The Ramsey Show - App - A Paid-Off Home Sets You Free! (Hour 3)

Episode Date: January 4, 2021

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show. For debt is dumb, cash is king, and the paid off home mortgage has taken the place of the BMW as the status symbol of choice. My co-host today on the air, Chris Hogan, Ramsey personality, number one bestselling author of the book Everyday Millionaires and the book Retire Inspired. Both number ones. We're taking your calls at 888-825-5225. That's 888-825-5225. My mind wandered off, Chris.

It wandered off because I was thinking you got two bestsellers, and I think we're to have another one here with rachel cruz's new book know yourself know your money it launches tomorrow yep and uh so today's the last day you can pre-order it and get the deal that's right and inside of that deal not only do you get all the extras of rachel the audio book the e-book uh but you get something really cool you're going to get a lot of quizzes and access to information to help you. But the thing that I think is awesome is you're going to have an opportunity to meet with a financial coach. That's like working with your own

personal trainer on the financial side, which is amazing. You get a chance to ask the questions you've always wondered about your specific situation. It's just a unique opportunity. That's all free. It's all free. If you buy the book today. And so get the book.

Like, don't wait, because it's all going away come tomorrow. So this is the last chance. So here's the thing. Know yourself, know your money. We know that personal finance is 80% behavior, and this deals with the behavior. It's only 20% head knowledge.

The problem with your money is not the math. The problem with my money is not the math. It's the guy in my mirror. And so what motivates the guy or the gal in your mirror? What is it that messes you up? What is it that holds you back? What is it that keeps you stuck? What is it that makes you afraid? What is it that makes you brave and effective? And when you know yourself in regards to how you look at money why you'd why do i do that with money you ask yourself when you and you get those questions answered with know

yourself know your money it puts you in a position to control and change the behaviors to to and to understand the behaviors of your spouse yeah and this is why she thinks that way she grew up in a house like that yep and rachel goes through every bit of that this book is heavily researched it is very well done know yourself know your money at davramsey.com or anywhere great books are sold and it's part of our new year celebration that starts today happy new year by the way yes and so the new year celebration involves you having a complete reset you've got to reset what you're doing. You have to rethink.

You really do. You need a do-over. And you've got to recommit. And so some of you have fallen off the wagon or you said, you know what, I made a couple decisions I wish I could have changed. Listen, 2020 is now behind us. 2021 is here. No more wishing and hoping for that year to be done. It's the New Year's here. Now what are you going

to do? Tuesday night you're going to be watching the new Reset event. It's going to be Chris Hogan, Dave Ramsey, Rachel Cruz, and Craig Groeschel, Pastor Craig. Now we're going to be over at Oklahoma City at their church doing the event as a live stream. It's

100% free. And you can just watch it. All you've got to do is text the word RESET to 33789. And I was just, as a matter of fact, I just got an email from Pastor Craig at the commercial break. And we've been friends a long time. We're back and forth kind of joking about it, picking on each other. But I'm looking forward to seeing him and vice versa. And we're going to get to spend some time together and then also get to hear his incredible talk on discipline.

Rachel will be talking about Know Yourself, Know Your Money. And Chris and I are going to walk you through the plan for your reset. How do you end up being the third pick? The guy in the brick house, not the one that gets his house blown over by the big bad wolf. And last year, the big bad wolf was prowling around. Yes, he was. And it was all over the place. And so I'm excited i'm very

pumped uh this is the first time for the new year that dave rachel and i will be on stage and the fact that you get a chance to watch it for free is awesome so again get your little phone out text the word reset to 33789 make it happen by rsvp in your spot how do you know they have a little phone they might have a big phone well i'll I was just saying little. Little phone. It's little to me. I got big hands. What was the movie Zoolander? They had the tiny little phones. You remember that?

That was hilarious. Yeah. So Oklahoma City, if you're in that area and you want to come to the Reset event that night, there are a few seats. Obviously, it's spaced and very limited, but they're $20 is all, and they're available at DaveRamsey.com slash events. We do want a live studio audience there for the stream. The stream's going to have probably about 100,000 folks watching it, and it's completely free.

Text the word RESET to 33789 to get registered. And these are things you need to do to get your new year started off right. Steven is with us in San Jose. Hi, Steven. Welcome to the Dave Ramsey Show. Hey, guys. Thanks for taking my Ramsey Show. Hey, guys. Thanks for taking my call. Sure.

How can we help? So I am looking to purchase my first real estate property or my rental, sorry, excuse me, rental property. And unfortunately, where I live, it's very expensive to purchase that. So I was wondering if you guys had any advice or experience or maybe just things to look out for when purchasing out of state. Well, you do have a legitimate barrier because you live in one of the most expensive markets in America. Yeah.

I mean, the Silicon Valley is unbelievable price-wise, and it's not exactly a rental market. So I don't know how far you've got to go away. Here's the problem. The further away from you it is that the property is, the harder it is to manage. And I've had a lot of friends and customers over the years that have had really, really bad experiences, long-distance landlording, to the point that I don't own any property that's not, for rental purposes, that's not within a few miles of me. And so yours might be more than a few miles from you,

but I don't want you to have something that's an airplane ride away. That's a good way to have a tenant change their Harley oil in your living room. And you're just really tough to manage. i can get a management company well nobody nobody cuts your grass like you do nobody manages your property like you do and so there are good management companies there are bad ones without a doubt uh but you know you're going to watch it closer even if you had a management company you're going to watch it closer if it's in town or near town, near to you. So I would beg you to not buy long distance and instead buy as close as possible, something in driving distance. Well, and that says a lot, Dave, is considering how much property you own, that it's something that you would steer clear of.

I mean, that's enough said. You know, you've got a man that owns a lot of real estate, has been in the real estate market for almost all of his life, and he's not going to buy. So, you know, you want to be smart about that. If you're out there and you're new in the game, new into investing, you want to do smart moves that put you in the right spot. Well, when the kids started college at University of Tennessee in Knoxville, we bought a condo over there so we could stay there on the weekends

and see them and go to football games and that kind of stuff. And it sat empty a lot of the year and that kind of thing. They graduated from college, and we tended to go in and out for the football game rather than stay over. And so the thing was not being used even two nights a year. Right. And I looked up and saw that about a year and a half ago, and I did something I almost never do.

I sold a piece of real estate because my choices were rent the thing 250 miles away, 200 miles away, or, and put up with the stuff that I'm talking about, or sell it. And I almost, once I buy a piece of real estate, I almost never sell it. Very unusual for me to sell property. I love real estate. I'm careful at when I buy it, and I keep it forever. And so I sold that condo because otherwise I'd have been renting a long distance and it just violates too many things in my life.

It makes my life too complicated and I don't want complicated. No. So there you go, people. It's some investment property experience 501. That's advanced level right there. This is the Dave Ramsey Show. Your number one wealth building tool is your income. For business owners, this comes as no surprise,

as you're used to putting in extra hours and watching your bottom line. That's why Christian Healthcare Ministries, or CHM, is a great option for those who are faith-focused and budget-conscious. CHM is not health insurance. Rather, it's a health cost-sharing program. It's not harder, but it is different. To learn if CHM is a fit for you or your business, visit chministries.org slash budget. Thank you for joining us, America. Chris Hogan, Ramsey Personality, is my co-host today. Michelle's with us in Madison, Wisconsin. Hi, Michelle. How can we help?

Hey, Dave. Hey, Chris. How are you guys today? Great. How can we help? Well, I'm going to try to sum this up pretty quickly. I've got a lot going on over here, first of all i have no debt um i was divorced last year uh we sold our house um we bought it in a session the recession so um we got it cheap sold at the top of the market kind of a good deal as as a bit of a deal as you can get a divorce, I guess. Yeah. So I have no debt. I drive a paid-off Subaru. No debt whatsoever. I'm happily renting right now.

I've got some cheap living going on at the moment. I have about $27,000 liquid savings, so plenty of emergency funds. I do have several businesses. I'm actually selling one of them this year. I have an interested buyer, so I'm not sure how that's going to go. And I do have half of my ex-husband's pension. My question for you is what I should be doing next. I am not, I don't earn a lot. I, I do have five income streams, um, which is a little unusual, I think, but, um, I'm able to be home with my kiddos who are doing virtual schooling. They're 15, 13, and 11. Um, my annual income is about 20,000. Uh, I get about500 a month in child support. So my question is, should I be saving for my next home,

or should I prioritize retirement and education for the kids that are quickly becoming adults? If I'm happily renting, is it important to buy another house, or should I be prioritizing my money elsewhere, or all three? It's just a matter of which order. It's a matter of which. Not all of them are things you're going to get around to. It's just a matter of the order of the attack. You're still healing from a divorce.

You're trying to get a career started again, which apparently you probably didn't have before. Oh, I did. I have several. I have several businesses, actually. They're just not. And you're doing a lot of work for $20,000. Yes, I am.

And so I think that's the biggest thing that's a glaring concern to me is your lack of income. Yeah. So, no, I wouldn't be worrying about buying a home right now. I'd be worrying about, not worrying, but my first order of business is if I'm going to invest in something, is to get your income up. And that can be a work-at-home thing. It could be that you invest some money in one of these ideas that is working and that you can expand.

And I might do that before I did. I'm not worried about buying a home immediately. If you buy a home in the next five years, you'll be okay. Yeah. And if you get the first kid in college in the next five years, you will have done a good job and so on. But you're going to have to have income in excess of what you've got to do either one of those things. Would you agree?

I do agree. Again, I'm selling one of my businesses this year. How much are you going to sell for? It's not making any money. Yeah, probably between somewhere around $10,000. Yeah, and that does not solve the issue at hand. I mean, you have a household of four on $20,000. Yeah. And that does not solve the issue. No. At hand. I mean, you have a household of four on $20,000 in Madison, Wisconsin.

Yes, I know. Yeah. So that's the glaring concern. I'm not saying you did something wrong. I'm just saying if there was an area to work on, it's not a lack of homeownership. Right. It's not a lack of retirement savings. Right.

It's the area we want to work on is do something, and it could be investing into one of these ideas. Again, if you're going to put money into something, that's what I would put it towards, and not much, but a little bit. And let's see if we could just, I mean, really, I mean, you could double your income, maybe $40,000. Yeah. And, Michelle, you've done a great job by not having debt.

You've put yourself in a great situation. Yeah. And Michelle, you've done a great job by not having debt. You've put yourself in a great situation. And so that's the thing I'm looking at, because again, the income is going to allow you to be able to save up for a house or save up for college and do the things you're looking for. So again, trying to thin the herd a little bit of the businesses and figure out which one's a hobby versus which one's a business business because businesses make money. Hobbies are fun. And so just be honest with yourself and start to assess that and let go of some of those things so now you can focus on the main things and really be able to grow your income. I'm going to guess and say out of the 20,000, 15,000 comes from one of them.

And the others are semi-hobbies. Probably. They're a distraction, and they probably are fun, and she likes them. But the one that's making money, she needs to lean in on, I think. Wait a minute. You said it's fun, and they enjoy it, but it's a distraction. Yeah, meaning she's not making money on it. It's a hobby.

Yeah. No, no. And that's real. I'm just guessing. but it's a distraction yeah meaning you should not make any money no hobby yeah no no yeah and that's that's real i'm just guessing yeah that's the way my i'm a little bit add myself and that's the way my mind works i can get i can get caught up in 73 things at once and i have to purposefully go oh no we're gonna get the idea down to one or two down because i can get just i can get i can thin out my resources so thin right time, emotion, spirit, money. All the things. Everything else is gone.

And so, hang on. I'm going to give you a copy of Christy Wright's book, Business Boutique, Equipping Women to Make Money Doing What They Love. Now, I'm not saying having fun is a bad thing. I'm just saying if you're not making money doing it and you're using fun as an excuse to do it and calling it a business, that's a hobby. Yeah. All right. Edwin is with us. Edwin's in New York City.

Hi, Edwin. How can we help? Hi. How are you? Thank you so much for taking my call. Sure. What's up? All right.

So my wife and I, we are on a Baby Step 3B. We're saving up for a house. And we were debating also to save up for a car as well. So we had some extra saving on the side for it, but we decided not to do it. And my in-laws, I guess they knew that we wanted to get another car because I already have one. And my in-laws bought my wife a car for her birthday. So we were very grateful and generous for the gift and everything. But we found out that they actually had to finance the car in order to get it to us.

So we weren't really too comfortable with that, but we wanted to call to see what can we do next. So obviously they did not put the car in your name, or they financed it with a personal note? Yeah, the car's under their name. The insurance, registration, everything's under their name. Nothing's on our name. Yeah. And they still have to pay it off.

And the other thing is it's a brand-new car, too. So it's not like an old car. It's a brand-new car. Oh, my Lord. Yeah, so we don't want to – we have the money to – we don't know what the remaining balance is, but we could assume how much it is and we have the money to pay it, but then to them it feels like we're taking away from their gift to us.

Yeah, well, this is not a gift, this is a curse. They're just confused. They're broke people trying to do a nice thing the wrong way and edward if you do this you're taking money out of the home down payment fund correct well the thing is that we we so we had the money aside for the car and also for the home okay but since we since we decided that you know what we're not going to get a car right now right we kind of just grouped everything together so the only difference is going to be, I don't know, a difference of like seven months in completing the Baby Step 3D. So it's not that big of a deal for us, but I don't know how to take it.

You've got serious family issues. Right. Because normal people don't do this. This is toxic. Mm-hmm. Because normal people don't do this. This is toxic. Normal people communicate adult to adult and say, we'd love to give you a car, but it's going to take us a little while to pay it off and talk about it. Instead of showing up and going, surprise, we're going to give you a pony. She's not eight years old.

She's a grown woman. This is toxic, weird crap. Yeah, they've tried to tell us that, hey, look, we want to get you a car. What kind of car do you guys want? And we told them, like, hey, look, you know, we want a wave. We don't want a car right now. We're good how we are right now. But I guess they just felt like it was, I don't know, like they knew best kind of thing.

Yeah, they were demanding. They decided they were going to tell you all what you're going to do. So how does your wife feel about this? She's a little mixed about it. She doesn't want to hurt their feelings, but she knows it's a bad deal. Right. Exactly. Well, I think the two of you have to

decide what you're going to do. If this happened at my house, your wife it's her parents. She's going to have to handle it. I mean, you can sit there for support, but she's going to have to do the talking. Mom and Dad, we love you, and this was an attempt to do something really nice, but it was a negative attempt. And we don't want the car. We will not accept the car.

And you should take the car back, and you should sell it. And get it out of your life. And then you guys go on with your life, and don't do this again. Please. Have better communication with us than this. This is not how we live our lives. This is the Dave Ramsey Personality, is my co-host today here on the air. We're answering your questions about your life and your money.

Open phones at 888-825-5225. Maria is with us in Tampa, Florida. Hi, Maria. Welcome to the Dave Ramsey Show. Hi, Dave. Hi, Chris. Happy New Year. How are you guys? Happy New Year to you. We're great. How can we help? All right. So before I start, I want to say I feel very honored to be on the show just because I've been listening to you since I was a little girl. So I turn to you for advice. So I took on student debt to get through college. I'm the first in my family.

So I feel proud that I was able to accomplish that. And this year with the pandemic that hit, it was a bit of a blessing and a curse. But with the stimulus and everything, payments and interest got paused for some time. And now with the new bill that got passed, everything's going to start, payments will resume in interest. In the meantime, I saved up the money to pay off the loan completely, and I wanted to get your advice on should I pay it off or should I maybe wait, just to see kind of what happens. Are you working? Yes.

What do you make? I make six figures, a little over $100,000. And your hold? $26,000. Um, I make six figures, a little over 100K. And you're how old? 26. Way to go. Good job. Thank you. What do you do?

I'm a technology consultant in analytics. Excellent. Okay, so how much is the student loan debt? It is $21,000. And how much do you have in savings? I have about $25,000-ish. And that's the money that I saved up for the loan. And I kept it on hand just in case, because it was a very odd time last year. And then I'm working towards baby step number three. That's what the remainder of the money is for.

And your income is stable right now, right, Maria? Yeah. Okay. So guess what it's time to do? You have been diligent. You've been intentional. You've saved this money up to attack this debt. It's time to write that check.

It's time for you to not only become the first to go to college, but the first one to have it paid for. And that's where you write that check. It would be a shame to get that diploma repoed. Yeah. Yeah, Maria, I to get that diploma repoed. Yeah. Maria, I'm going to tell you something. I'm going to give you some coffee or Red Bull or something. I need you to get happy. I need you to get excited, young lady.

Because not only are you working in your career and making a good living, but you also have a common sense. The stuff that Dave's been teaching to be able to save up, to be able to set yourself free from the student loan. This is a big deal. Write a check today. This is a big deal. Get online and hit submit.

Yes. Are you going to do it? Yes, I am. So once I hit submit, I'm officially debt paid. I love it. That's where you want to be. Way to go, young lady. That's where we're headed.

That's awesome. It's not the way I would have done it. No, no. But we got there. That's where you want to be. Way to go, young lady. That's where we're headed. That's awesome. It's not the way I would have done it. No, no. But we got there. That's right. And she is making six figures. You know what she's doing, Dave? She's resetting.

There you go. She's getting a reset. And how many of you out there have done some stuff that you go, boy, I wish I could back up and redo this thing or fix it? Guess what? You've got an opportunity with your money to be able to reset by making new decisions, having a real plan that works, and then committing to stick into it. Yeah.

That's all you have to do. That's it. So, I mean, if you didn't get there the perfect path, you still got there. That's right. And hit reset. That's right. And now let's go forward the shortest path. On the right path.

That's exactly right. Yeah. Wherever you are forward the shortest path. On the right path. That's exactly right. Yeah. Wherever you are in the journey, we can do that with you. And Ramsey Plus has got a free offering right now for a free trial, and it's all about reset. So decide on a total money reset for this year. If you commit to working hard in the first 90 days, we will show you exactly step-by-step what to do for that first 90 days. And you will go, wow, for the first time ever, I got control of my money.

Because you will either manage money or the lack of it will manage you. You don't have a choice. You have got to turn it. You've got to step into these lifelong habits and change them and make this money behave. It has to behave. And only you can do that. So Ram ramsey plus our step-by-step plan we've got a 90-day thing right now going and you can get in there for a free trial and get started you'll see how it all works and make sure that it's for you it doesn't cost a thing just step

in there go to davramsey.com slash reset and chris is exactly right reset reset reset reset matt is with us in Orlando. Hi, Matt. How are you? I'm fine. Thank you for taking my call. Sure. What's up?

We've been listening to you all for about three years. Prior to that, though, we incorporated into our portfolio some whole life insurance policies. I'm sorry. One policy has reached paid up policies. I'm sorry. One policy has breached paid-up status. Oh, no. And the other one is nearing paid-up status. It has two more premium payments to go. And I was wondering if you have some advice on what I should do with these at this point in time,

or should I just leave them as is? Well, I'd cash them in if you've got the proper amount of term insurance in place. It's not a place to invest money, and basically that's the status that it is. Let me just tell you, the idea that you can pay off a life insurance policy is an impossibility statistically. The only thing you can do, and they call it paid up, but the only thing you've done there is you've overpaid and prepaid so much that you've covered all the actuarial costs of your death, the statistical probability of your death,

the cost of insuring you is all covered now because you've given them so much freaking money so far in advance that it covers your whole entire life now. And it's now baked down into a cash value that you lose when you die. And all you'll get is the, well, you won't get anything. You'll be dead. But the only thing your beneficiary will get is the face value of the policy. And honestly, probably the lost investment dollars on the cash value would have bought your term insurance more than you got in a whole life right now.

I'm betting, and I don't even know the math on yours. Almost every one of them I've seen that if we took your cash value and invested it at 10%, it would pay for term in perpetuation, and that's what paid up means. It means you're just prepaid and overpaid. So if you're healthy and can get term insurance or have the proper amount of term insurance in place i wouldn't have this in my portfolio it's the weakest part of your portfolio personally if i woke up in your shoes is how i answer these questions what would i do knowing what i do no i'd cancel it as fast as i possibly could it It is crap. And in your case, it is double, triple crap.

Because you double, triple paid. Yeah, no, that's exactly right. And again, if you don't have term in place, get term in place before you cash out anything. And as far as the whole life side. So get over there, go to DaveRamsey.com. You can click on Xander and we can help you get term in place. That's gracious. Probably worth a short teaching segment on that then.

So there's two kinds of life insurance, term and whole life. That's right. Term you get, whole life you don't. That's how to remember them. But term is pure insurance. All it covers is if you die, you get money. Right. And if you don't die, you don't get money.

Right. It's like homeowner's insurance. The only way you get money from your homeowner's so your car insurance is you have a wreck or your house burns that's right the the event has to occur it's pure insurance and so it's a statistical average of your death so the older you are the more expensive it is and that's how term that's how all insurance is based it's the statistical average of the event it's a probability and statistics equation and it's called an actuarial table in any type of insurance. But in term, you're buying the insurance plus profit plus commission.

And the insurance company wants to pay a commission, and they want to make a profit. And so that's all that's in there. It's just pure or virtually pure. Whole life is when they charge you 20 times more on average. Literally, that's not an exaggeration. $5 of term, $100 of whole life premium to buy the same amount of coverage. That other $95 buys you a savings program inside your policy called a cash value buildup that has a poor rate of return. And when you die, they keep your money.

This is why we tell you not to do it this is why everyone tells you not to do it in the financial world except people that sell whole life they're the only ones that think whole life is just dandy it's crap it's the payday lender of the middle class i hope i wasn't unclear this is the dave ramsey show Dave Ramsey Show. Our scripture of the day, Isaiah 43, 18 and 19. Remember not the former things, nor consider the things of old. Behold, I am doing a new thing. Now it springs forth. Do you not perceive it?

I will make a way in the wilderness and rivers in the desert. Vern McClellan says, What the new year brings to you will depend a great deal on what you bring to the new year. Definitely. Rashonda is with us in Tucson, Arizona. Hi, Rashonda. Welcome to the Dave Ramsey Show. Hi, Dave. Thanks for taking my call. Sure. What's up? So, I recently got some advice from my financial advisor that contradicts your advice

hello are you there something happened roshanda are you there okay all we heard was your financial advisor conflicted with our advice and so yeah that would just make them wrong. Wrong. Okay. And we're okay with that. Sorry. We'll put you on hold so we can get you back up there. St. George, Utah. Terry's with us.

Hi, Terry. How are you? I'm well, Terry. I'm well, Dave. I'm a little nervous. Sorry. It's okay. Thank you for taking my call.

Sure. I've gotten myself into a mess, and I get it, so you don't even have to yell. I'm not going to yell at you. No, I know. I listen to you. I'm not going to yell at you. No, I know. I listen to you. I know beans and rice and all of that. Here's quickly, and I can give you as much detail, but bottom line is I just got a new job,

but I was without a job for two years while I was finishing my terminal degree. So now I'm a certified nurse midwife. I was a labor and delivery nurse, and they shut down the hospital in my area. So I just kept doing my schooling. So now I'm a certified nurse midwife. I was a labor and delivery nurse and they shut down the hospital in my area. So I just kept doing my schooling. So now I'm done, but I lived off student loans and credit cards. So I've got $44,000 in credit card debt, $105,000 in student loans, but I do own a home. But now I need to move because I got a new job, which is going to pay me $89,400 a year. Wonderful. That's the best news so far.

And I've got, right? What's the house going to sell for? It's going to sell, it's going to give me at least $200,000 in equity. I also have a little rental property part of it. So I haven't put it on the market yet. So I'm bottom line at least $200,000. It could go as much as $230,000 in equity. But I now have to move closer because my new job is three hours away.

Great. Sell it. Pay off your debt. What's wrong with this plan? Done. Oh, not a problem, except that I need to have something to move into. So I was thinking about if I pay off my credit card, am I, I mean, I need to have. Terry.

My job is. Terry. Yeah. Rent. I'm here. Ah. Be debt free. Start fresh.

Yep. You made a mess. You have an opportunity to clean it up in one fell swoop. And you're going to have some money left over. I mean, I only got $150 out of $230. You got $80 to put down on something if you wanted to buy something. Pay off all your debt. Don't monkey around with this.

Okay. And shut down around with this. Okay. And shut down the credit cards, Terry. Shut down the credit cards. Already done that? Be done. I might have done it silly soon. I signed up with Green Path Financial Wellness, and I shut them down, the credit cards.

But if I pay it off, then it'll all be done. Yeah, you can't hand off the responsibility of the mess you created. So those management programs and all of that that promise they'll handle it for you, tell them thanks but no thanks. Sell your house and pay off all your debt. You're going to pay it off and be done. And matter of fact, don't even try to go buy. Go somewhere and rent for three months.

Now, the biggest fear I have of this whole thing is that next time you feel a little bit scared or desperate, because that's what happened here, you won't hesitate to go back in debt because you'll be debt-free, and this time you won't have a house to sell. So you have to raise your right hand and swear, never again am I going to use a stupid credit card. Never again am I going to say, oh, I was forced to buy a car because my car broke, so I got car payments now. Never again, oh, I had to go on vacation. Oh, my mother was ill, so I had to buy an airline ticket and I had no money.

You can never say this crap ever again. You can never rationalize your way back into debt because you get a clean slate here. You got to take it and change your ways permanently. You have a 90 000 income you're a rock star you're going to be in a place to go win don't go stupid's right around every corner hogan says waiting it's waiting i've got my right arm my right arm is to the square and i promise because i hate this okay i hate this well then be a hundred percent free of it put 80 000 down on something after you rent for six months in the new neighborhood

so you know the city well before you buy. And go pile you up some money. Make some money. Make some money. Have no payments. And I want you to get into Ramsey Plus. I'm going to give it to you for a year. And I want you to go through Financial Peace University.

And I want you to get into the Every Dollar Budgeting app. And I want you to change the way you've viewed money emotionally because money's been telling you what to do your whole life, and now you're about to tell it what to do, okay? You got it. How do I get into the financial piece? We're into Ramsey Plus. We're going to give it to you, and we'll put you on hold, and Kelly's going to pick up. We've got you taken to that.

And, Terry, I also want you to dive over and watch us on the Reset event on January 12th. There you go. Yes. Roshanda is in Tucson. Roshanda's short on time now. Let's try again. How can we help? I got some advice from a financial advisor that contradicts your advice.

So I wanted to get your opinion. Well, my opinion would be they would be wrong. Why would I change my opinion? Right. So my husband and I wanted to pay off our house really quickly because our interest rate is super low. It's only 2.75%. And our financial advisor said that it would be better to make that money plus some with a 19% gain on our investments. Yep.

Did you say a 19% gain? That's what we got this year. We know that's not the average. Yeah, they might have this year, but he didn't say. He didn't project that for you, I hope, because he'd go to jail. No, no. Okay, so here's the thing. Chris Hogan is sitting next to me.

He did a book called Everyday Millionaires. We studied 10,000 millionaires. You know how many of them said they became millionaires by the strategy that your investment advisor told you? Zero. Zero. Oddly enough, they did two main financial things that made them their first one to five million you know what they were chris first of all first and foremost they invested in 401ks 403bs roth iras and iras the second thing they did roshanda is they paid off their homes

in right at 10 years now these were 10 000 millionaires not a financial advisor not one of them became a millionaire by not paying off their home and using the money to invest and making the spread not one of them isn't that interesting it is so it's not like my opinion versus his. It's like all the data says he's wrong. And the reason is that a paid-off home sets you free in so many ways, emotionally, spiritually, mathematically, everything else, to be able to go on and live your life in a way that you can invest. When you have a paid-off home and you have $100,000 less in your investments and a pandemic hits, you don't have the same feeling as you do when all that money is in investments and your home is not paid off

and a pandemic hits. Oh, and the market goes down and you're scared to death watching the news at night. I wasn't scared watching the news at night. I was sad for some people that were scared, but I wasn't scared watching the news at night. I was sad for some people that were scared, but I wasn't scared. Was that because I'm stuck up or arrogant? No. It's because I don't have any debt, and I got a pile of money. It's a pretty simple equation.

It really is. One your financial advisor should adopt. Yeah. And, Rashonda, here's the deal. You know the fact. You know the reality. What you do when you bump into stupid is you just smile at it and there's a phrase we say here in the south bless your heart but what you do is you continue to move on your path yeah and you move on

from this financial advisor to one that's not trying to make money he didn't make any commission when you pay off your house i mean that's just it's Yeah. So, I mean, I understand, but you're leaving out risk. And when you put risk in the mathematical formula, it does away with the perceived returns. That's right. And the investment world is not, a lot of the folks haven't figured that out in that world. And it's just wrong. And, again, the data of people who actually built wealth backs up what we're saying. But you can do whichever you want to.

It's all good. Hey, thanks for the call. Open phones. That puts us out of the Dave Ramsey Show and the books. Thanks to James and to Kelly in the booth. I am Dave Ramsey. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace,

and that's to walk daily with the Prince of Peace, Christ Jesus. Hey, it's Kelly, associate producer and phone screener for The Dave Ramsey Show. with the Prince of Peace, Christ Jesus.