The Ramsey Show - App - Address the Issues Underneath Your Money Problems (Hour 1)

Episode Date: October 14, 2020

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumped, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. Rachel Cruz, Ramsey personality, number one best-selling author, and my daughter is my co-host today here on the air. Open phones at 888-825-5225. That's 888-825-5225. Dave's in Fort Worth, Texas.

Hi, Dave. How are you? Mr. Ramsey, I'm doing fine. Thank you for asking, sir. Your time's valuable, so is mine, so I'll make it quick. Okay. Um, I, me and my wife just found out we inherited $315,000. Woo.

It does. Yeah. It doubles every 10 years. And of course, like every, every other normal, I guess, silly American, we have debt, bad debt. Um, uh, we have, we have debt, bad debt. We owe $150,000 on our house. We have $8,000 in a credit card debt and some student loans. Basically, it totals out to being almost $200,000.

So that would leave about $150,000 or so in the account. But the thing is, we want to use that for retirement because we can get more out of that than we can my retirement at work. So I was wondering if you would endorse the idea of instead of paying off the house, of course, we're paying off all the other debt. That's silly not to pay that off. But instead of paying off the house, put 50 000 down on the house and refinance it to a lower rate and then we just slowly pay that off whenever uh and it gets paid off when it gets paid off yeah how old are you guys uh i'm 33 my wife is 26 how long you've been married five beautiful years and we had the only way only way we're leaving each other is through death sir okay i wasn't wasn't questioning that trying to figure out where you are okay

yes i know i'm just very very excited now so uh who passed away who left you the money uh it was her uh grandma and her dad had her her grand her granddad was really good with money, and they left it to her, which, of course, me marrying her, she signed it over into both of our names. Okay. And now we're here. Okay. So, number one, let's back up a second.

All right. Yes, sir. An investment doubles. There's a little nuance in mathematics called the rule of 72s. And if you divide the rate of return from your investment into the number 72, it tells you how often it doubles. So if you say, I got 10% on my money, your money would double every 7.2 years. So if you're telling me it's doubling every 10 years, that means every 10 years, then that tells me it's invested at 7%. Okay, that makes sense. That's what that tells me. So number one, it's not doing really great in an investment there. In good growth stock mutual

funds, you should make considerably more than that if you invested it the way we taught you. But so the question is not what I would endorse. The question is, what causes you guys at 50 to be in the best financial condition, to have the most possible money? Which of these strategies? And that's the way we look at it, right? Yeah. I mean, it's the math of setting you guys up well in the future. So what I would do if I woke up in your shoes is I would pay everything off, and I would use the fact that you have no payments to become an aggressive investor then. And so I would max out all my retirement accounts, 401Ks, Roth IRAs, anything I can do.

Do some other investing. I would increase my generosity uh the downside the problem with that idea is you you and your wife have handled money horribly yes sir and if you keep doing that after you pay off everything you're going to wake up at 50 back in debt yes sir if you keep doing that after you pay off everything you're going to wake up at 50 back in debt yes if you keep making the same stupid butt decisions now i used to make stupid butt decisions that's how i can recognize them because i got a phd in stupid and so phd and dumb right so i i know what it feels like so the problem is you have to change your behaviors as a part of this advice or the advice is wrong if you're going to continue to handle money like you're going to continue to

handle it i would recommend staying in debt that way you won't get further in debt you know but if you'll do it right and take those old house payments and old payments that you don't have anymore and use them to grow, then you're going to be fine. And that's what I would tell you to do. Yeah. And I think that will make granny smile, grandpa smile from heaven and say, hey, these kids are out of debt and they are on a budget and they're never they raise their right hand and put a brand in there, take a tattoo, whatever you want to call it, where I say I never, never, never, never will dishonor my grandmother, grandfather's memory by going into debt again because I misbehaved. Yeah, because there's a process that you are refined. When you go through baby step two and you've made decisions that you and your family are in debt,

you work the progress and the program to get out of it. There's sacrifice involved. And through that sacrifice, majority of people at the end of it are like, oh, never again. I've made it through. I've trudged through this problem and I'm done. I'm never looking back. And for you guys, you guys were handed a gift, Dave, and that's not a bad thing. I don't think that that's wrong at all. And that's a blessing. But exactly to your point, the refining that people had through that process of baby step two, you guys are skipping that. And again, not bad, but recognizing and understanding that, that yes, those habits that you guys have had have to break.

You have to change the way you're viewing money and you, you and your wife sitting down together and doing that. And then it just on the more tactical side of it, you guys are young. And so the whole idea of the retirement, you're gonna have plenty of time, plenty of time, plenty of money for retirement. Yeah. What I would just prescribe to you and make you worth $10 million. That's right. That's right. So paying everything off, there's this, this level of like, Oh, you get, you get a redo. Not everyone gets like the, get out of free jail card and you did. And so use it properly, get rid of everything or all the debt. And then you guys together continue to work the plan and then that money that was left it will grow and you guys will continue to contribute more yeah so i if i were in

your shoes that's what i would do but i would be so afraid of myself because of what we're talking about if i were in your shoes i might even like write out you know type it out on your computer print it out a contract with myself and both of you sign it that because we did this in order to honor the memory that this inheritance comes from we are we are pledging to always do a budget we are pledging to always live on less than we make we are pledging to always be uh generous we are pledging to never, under any circumstances, for any reason, ever borrow money again. And write it out. And both of you sign it. And then if you ever get like, you know, I got to buy, we need a better car.

And you start whining and you start getting, then you get that piece of paper back out and you go, uh-uh. No. No. Because if you don't do that, so let's do this. I'm going to give you a gift to go with the inheritance. It's a year's subscription to Ramsey Plus. The two of you go through Financial Peace University. The two of you get on your every dollar budget and wait 60 days to do anything with this money. Just park it to the side, pretend like you don't have it and do this stuff for 60 days, and you can give yourself the confidence that you are going to change instead of this just, I promise I'll do it to myself thing. I would want to know that I wasn't going to screw this up if I were you. This is The Dave Ramsey Show. You know, so many people have such a negative attitude about life insurance when it's actually one of the most caring and giving things that you can do.

Still, 7 out of 10 families either have no life insurance or they don't have enough. I don't get it. Look around. People die. At all ages. I know it's sad, but that's reality. What's worse is when they leave their family unprotected, creating even more hardship. Yet somehow we find reasons not to get it done.

It can't be the price. Term insurance is just plain cheap. Now, that's why I talk about Zander Insurance so much. Not because they're just an advertiser, but because they offer a crucial service that helps you and me. Call them at 800-356-4282 or check out their rates at zander.com. Listen, in the end, you need to get past the unpleasant images and just make sure your family's protected. Be responsible and feel good about what you've accomplished. Go to zander.com or call 800-356-selling author is my co-host today here on the air author of the new book coming out in january know yourself, know your money. Discover why you handle money the way you do and what to do about it.

What we have figured out is that Socrates was right. Know thyself. The unexamined life is not worth living. And for 30 years, we've been telling people that personal finance is 80% behavior, 20% head knowledge. And we've taught you all the head knowledge during that time. And occasionally we deal with some of the behavior things and make sure that you're adjusting your behaviors or transforming.

But Rachel decided to get under the hood and say, all right, what does it take to really understand who you are? Because if you do, then you can say, I need to be the best version of that. That's exactly right. So walking through, you know, understanding not just who you do, then you can say, I need to be the best version of that. That's exactly right. So walking through, you know, understanding not just who you are, but it really is. It's your upbringing, how your childhood classroom, if you will, influenced how and why you handle money the way you do today. Your money tendencies, your money fears, your money dreams. Even the amount of grace that you give when money mistakes happen.

It affects your relationships. I mean, the whole part of who you are, understanding that, and that allows you also to have the empathy for others in your life if you're married. So hopefully this book reveals things. You're like, oh, that's why my spouse does the things he does or she does. And you really can understand the person because when you understand you more, you can become a healthier version of that, which helps you create better money habits and win with money faster. Yeah, and I think we started scratching the surface years ago. We said, okay, some of you are nerds, some of you are free spirits, and usually there's one of each in a marriage.

So you want to be a healthy version of a nerd, which is the detail administrative thing, but not the overbearing control freak. You want to be a healthy version of the free spirit, which is a person who enjoys life but does it in a mature way where you don't destroy the entire family's finances. And so we started scratching the surface with that years ago, but you've gotten down into scarcity and abundance and safety versus status and quality versus quantity, which is one I had not really thought of. That's an interesting one. Well, let's go through them.

Here's your quiz. Because in the book, the way I wrote it out was that there's there's a scale basically so you kind of put yourself on the scale okay between the two so saver versus spender where are you on the scale me yep i'll spend her yep which i think is probably surprising for some people everyone just assumes and me too they're like oh you love you teach about money so you love to save and i'm like i don't love to save winston is a saver and sharon's a saver naturally now i'm a good saver because i've learned that it is the shortest method to spend more and to be more generous yep i can't

give money away if i'm broke and i'm like you too i'm i lean way more on the spender and again extremes on both on all these scales can be unhealthy. So again, the moderation is key, but you lean one way or the other. Okay. Scarcity versus abundance. Abundance. Me too. Are we going to be the same person? Safety versus status. And what this is, is meaning why do you want to win with money? For some people, it's completely out of safety. I don't want to have to worry about it. It's there. I'm okay. Some people want it in order to live a fun life, to go on vacation. So status isn't bad. I feel like some people read this.

Status is not bad. There's an unhealthy version of it. But it's so that I can enjoy life, go on vacation, maybe drive a fun car. Like I want to use it for things in my life versus it just being there that I'm okay. So that would often be the safety would be the saver and the status would be the spender wouldn't sometimes always i mean i think it could be opposite are you more safety oh definitely status definitely me too okay quality oh versus quantity quality okay i'm quantity oh i would rather have like 20

pairs of earrings so are $10. So you get like sucked into the Costco 22 pounds of peanut butter thing. Yes, I love, yes. I like having more stuff versus like one nice pair of shoes. I'd rather have 10 that are like, yeah. Okay. Yep, that I have to replace. But you like quality.

You'll research and buy the best of the best. Even if it's just one thing, you just have the one. i've got a pair of cowboy boots that i have had since college but they are top line i mean i've resold them three times yeah but they're they're not only are they broken in and they're perfect but obviously they had the ability to last 30 some odd years that's pretty good so they were quality boots and you know so that's fine and i'd rather wear them than new ones because i don't want to break them in. When you spend money, is it more on experiences or things? I do both.

I don't know. I'm probably in the middle on that one. Okay. You're an experienced girl. Oh, yeah, all the way. No question. Give me a nice dinner out. Give me a vacation.

Go to the zoo with the kids. Like, I want to go do stuff yeah versus having like a thing yeah your mom's is on things yeah no she does both though because she's like i need a vacation of you whatever y'all can do both yeah all right we all can't do both all right no but this was a good one for i'll say for me and winston because for the first probably two or three years of our marriage even when we did our budget and all this this, I just valued our out to eat category. I was like, I love going out to eat. And he always, if we went, especially at the beginning of marriage, it's like, I'll just get a water.

And I'm like, just drink, have a drink. Like, it's fine. Like, and he's like, no, no, no, it's so expensive. Like, no, it's fine. It's fine. And I'm like, oh my goodness. But I enjoy that whole experience where he, again, would buy something. And I'm like, why did you buy that?

Like, like it made no sense. Yeah. But finally, when we had the communication around it and i pinpointed it i was like oh that your value around where you spend your money on that's what it is yeah okay plans giving versus spontaneous giving well this is a brain versus a natural my natural brain versus heart yeah my natural response is spontaneous. Yep. And yet the vast majority of our giving is very planned. We even plan our spontaneity. I mean, so we have categories in the Ramsey Family Foundation that's just money that's just sitting there.

So if something comes up, we can, you know, a single mom needs some help with something that, you know, pops up. We had a we had an opportunity through the legal system to help a family that was messed up beyond belief the other day. And we, you know, we had the money. So we planned to be able to be. So I don't know. But personally, just walking up and giving somebody some, you know, I'll leave a large tip that for me. So it's spontaneous, spontaneous, spontaneous. And I guess it is for you. Spontaneous giving.

Yeah. Mine's spontaneous too. I'll hear of some amazing organization. And I'm like, we will gift you. We will gift you for the rest of our lives. Because I'm like, yes. I just want to help. And it's amazing.

Until I see someone else. Yeah. That's it. I know, right? Yeah. So those are the seven money tendencies as part of the book. And breaking down the good, the bad, the ugly of each one, some roadblocks that could be ahead for you depending on where you lean on the scale. But having those in the back of your mind helps you understand this is why I do some of the things I do with money.

What we have known at Ramsey and what you've really clarified and put a lot of work around is that the biggest obstacle between where you are today and becoming wealthy is not opportunity. It's not your income. It's you controlling you and you understanding you helps you control you so that you can win. The problem with my money is the person in my mirror. We've said that for years. And what you're doing here is to say say okay if i'm gonna be a nerd i need to be a healthy nerd uh that way i don't kill my free spirit that i'm married to you know and run them into the dirt and use turn dave ramsey's name into a cuss word and all those kinds of things and so know yourself know your money we're throwing in over 150 dollars worth of free stuff when you pre-order right now including for a short time longer, not very much longer,

a free financial coaching call if you preorder the book with a Ramsey Preferred Financial Coach. $150 worth of free stuff, including the audio book that she's in the process of reading this week, literally, the e-book, and of course we will ship you the book as well. You can get it all at DaveRamsey.com, or you can call the Ramsey Concierge Team at 888-22-PIECE, 888-227-3223. It's very workable for you.

So the thing is that if you're not careful, you end up with your money problems aren't really problems. They're the symptoms. The real problems are under the surface. And if you whack on a money problem, it'll pop up somewhere else. It's like whack-a-mole. You won't be able to get until you get down under it and you say, okay, that's what's going on. We're not communicating about this.

This is why we can't get our budget done. That's right. This is why we're always screwing up our savings account. That's exactly right. Yeah, your money problems are usually masquerading as life huge problems underneath the surface. So you go and say, okay, it's not that my spouse can't get on board. It's because, oh, wow, we have some marriage issues here. We're not trusting each other.

We're not communicating. There's lots of other stuff. When you can get under that surface. Know yourself. Know your money. Some acknowledgement. This is the of Ramsey Solutions on the debt-free stage, Scott and Erica are with us. Hey, guys, how are you?

Hi, Dave. How are you? Great. Welcome. So good to have you. Where do you all live? We're from outside of Grand Rapids, Michigan. Oh, fun.

Welcome to Nashville. All the way down here to do a debt-free scream. Yeah. How much have you paid off? A little over $63,000. Good for you. How long did that take? 12 months. All right. And your range of income during that time? Around $46,000 to a little over $200,000. Whoa! What in the world? Okay, so what kind of debt was the $63,000?

Credit cards and student loans. Okay. So what happened 12 months ago and what the flip happened to your income? Well, Scott and I started dating in early 2018. And by about date four, he mentioned this guy named Dave Ramsey. And I was like, oh boy. A real romantic guy, aren't you, Scott? You have to listen to something when you're going to a date. Yeah. So kind of throughout the year, we talked a little bit about finances. Finances have always been kind of a sore subject for me personally, just having a lot of debt, working 60 plus hours a week and feeling like I'm not getting anywhere.

And just the same old, same old that you hear everyone say. Towards the end of 2018, Scottott paid off his house uh he did 98 000 in one year and i was like okay this is weird no one at 32 has a house they paid for this is marriage material yeah yeah so this guy's a keeper yeah so much so he gave me total money makeover for christmas and i was like oh goody oh thank you and the hits they just keep on coming yeah yeah so it was um 2019 uh that i finally got serious you came to our church in february of 19 for smart money yeah um and so i was like okay i know everything that's going on i had read the book book. I had to, it was a Christmas present. Um, so I was like, okay, we'll start. And so that was February of 2019. Um, at the time we were already living together and we knew marriage was on the table for us. Um, he proposed in June of

19. Um, and then, uh, kind of, you know, just doing my thing. I sold stuff that I didn't need. Um, I just used a budget cause whoever uses those before. Um, and just, you know, I saw money that I thought, you know, I, where's this money going? And I actually saw it go somewhere and it was, you know, relief to pay off a, you know, $1,800 student loan that I thought I would have forever kind of thing. Cause it was $1,800. That's a lot of money. So, and then Scott had a really wild idea end of 2019. Yes. My idea was that if we got married sooner rather than our planned wedding date, that we could combine our incomes and really knock the debt out.

Yeah. So we actually got married officially December of last year, but we had our official wedding ceremony with all our friends and family this past Saturday. Oh, wow. So we're actually on our honeymoon officially. Oh, that's cool. So yeah, so we knocked it out. And on February 29th, I pushed send and paid off the last debt and then COVID hit and we couldn't be any happier. Wow. What the timing? That's what I was thinking. I was like, Oh my gosh, yeah. I can do it all in December. Yeah, exactly. That's amazing. Yeah. Well, well done. Thank you. How's it feel? Um, I mean, it's exhilarating. I mean, I had the one credit card I had was $17,000 that I had had since I was, uh, 2000 since 2009. And I was like, this is it. And you know,

it was a credit card that I used to cover other people's expenses. And I thought, I'll never get that money. We're breaking up. I'll never get that money back. It is what it is. And I'll just, you know, but then at the same time, I'd say, okay, I'm not going to use it for anything. But then it was, well, I need to go get gas here or, you know, McDonald's is a quick dinner kind of thing. So I would just, you know, pay a little off and then I'd put more back on kind of thing.

So, but it feels liberating to be. So you guys are in your early 30s now? Yeah, I'm 32. And I'm 34. Okay. And that puts you at Baby Step 7 then? Yes. Automatically.

Yeah, automatically. Ding, ding. Yeah. What's the house worth? About $250 right now with all the renovations we've been doing. I love you guys. Speaking of which, when you're in Baby Step 7 and you start a kitchen remodel and you find rotten floor joists and a cistern with water underneath the kitchen that you didn't know was there. Oh, that's handy.

It's kind of handy not to have to wonder where the money for that added expense is coming from. 100-year-old house. Of course, there's going to be some surprises. Yeah. And they're never cheap surprises. It's never like, oh, look, we don't have to spend that. No, it never happens that way. But you got the money.

You don't have any payments. No. We own everything from the shirt I'm wearing to the house that we live in. What do your shirts say? I can't quite see it from here. Our shirts say we might look like odd ducks, but actually we're weird gazelles. Baby step seven. Yeah.

Yeah, I have a little felt letter board in our kitchen right by the door, and it says that too. I love it. It gets the conversation started. I'll bet it does. With anyone that comes in our home. People say, what? Wait a minute, you have your house paid for? What?

You are weird. Yeah. Yeah. Yeah. And Scott had a really fun unique uh idea for our wedding exit song that we played on saturday that got the convo started yeah it was baker street so we had lots of people who came up saying is this dave ramsey we're like yeah by the way we're going there so that's fun here's your complimentary

tone when you make over on the way out the door yeah that's fun. Here's your complimentary tilling money makeover on the way out the door. Yeah, that's right. That's right. Your parting gift for the receptionist. Your bachelorette gift. So you guys,

I mean, your story, you had kind of two separate lanes. You were going for a while and then once the marriage hit, obviously you combined it and it was gone. So Erica, for you on that journey

when you were doing it on your own without his income coming in before you were married, what was the hardest thing for you during that time when you were doing it on your own without his income coming in before you were married? What was the hardest thing for you during that time? Um, you know, everyone says budgeting was so hard and you know, that you need to do that. But I think it was just learning that money is not evil. You know, it's a tool that God gave us and it's a tool that I need to use responsibly. And I hadn't been using it responsibly.ibly. But I also feared it more than I should have and that it was money that I worked really hard for, you know, doing 60 hour weeks and, you know, feeling like I didn't get anywhere because, you know, I got to shift money here, shift money there.

And hopefully I can make it work. And, oh, well, I got nothing to do X, Y or Z thing. But just money is not evil. It's just how you use God's tool. That really taught me. And I was a little nervous too because I sold my car. But it was a $4,500 car that it was just a car that I had financed when I was 19 with my family and spent all of college.

That was the only thing I worked for was rent and paying my car. And I was like, Oh, I don't want to give this up. But, you know, Scott said, it'll be money that, you know, it'll help, um, you know, go to that credit card. That was just a plague on my life. And you never again chase bank ever. Yeah. You had like past anchors with you, that credit card you'd had forever, that car. I mean, there was like a lot of symbolism and kind of like the redemption of your story. I mean, you're cutting all that off to start this whole new life and, uh, the way you view money. And so I love that, that your heart and your mind behind it even shifted so much. Yeah. That's awesome. Yeah. Powerful. Who were your biggest cheerleaders? Um, Scott for sure was my biggest cheerleader. Um, but I would honestly say the Ramsey,

the Ramsey Facebook sepers Facebook group is, was really just, you know, I didn't want to have one more thing in my life that screamed Dave Ramsey on, you know, everything I look at, but that really became, um, a group that, you know, I enjoyed reading questions, being able to answer questions as I went along in my journey and joining Rachel's Facebook group and everybody else and just listening to all the podcasts. But it really was just this community that you and your team have built with everybody. Yeah, very cool. Very cool. Well, that's why they're there.

You need a positive peer group instead of one teaching you to spin like you're in Congress or something. Yeah, it can feel isolating, right? If you're on a journey and no one around you is doing it. I mean, it's obviously you have your man next to you doing it. But like, but yeah, having that group, that community is a huge wave of support for sure. Yeah. Well, we got a copy of Chris Hogan's book for you.

Every Day Millionaires. That's definitely the next chapter in your story, Weird Gazelles. Well done. Very, very very well done i'm proud of you guys thank you you're heroes you took control of your life very well done both of you excellent excellent job all right scott and erica grand rapids michigan 63 000 paid off by the way he paid off his house before that then they get married it's a long story but you heard it 12 months making 46 now making000 as a couple. Count it down.

Let's hear a debt-free scream. Ready? Three, two, one. We're debt-free! Yeah! Woo-hoo-hoo-hoo! Well, that's how it's done. I love it.

This is The Dave Ramsey Show. Well, that's how it's done. Love it. This is The Dave Ramsey personality, Rachel Cruz, number one best-selling author, and my daughter joins me today as my co-host here on the air. This is the Dave Ramsey Show. Sarah is with us in Concord, New Hampshire. Hi, Sarah, how are you? Hi, good, how are you? Better than I deserve. What's up? I guess, so my husband and I are in baby step six, and I'm trying to just figure out establishing some kind of balance moving forward with paying off our house. We recently refinanced from a 16 to an eight-year mortgage.

And I'm wondering about, though, so our emergency fund is like $25,000, and I think it's probably a little overkill. Both of our jobs are super stable. And we had somebody suggest to us pulling out some of that money to top off a Roth IRA account. And I think that you're probably going to say it's a bonehead idea. But I guess I'm just wondering about doing something like that. I mean, we're saving $4,000 a month pretty much, so we could probably just cash flow that for the next few months. Okay, what is maybe step four?

Save for – I don't have a memorized door in front of me. That's okay, Donna. 15% to your retirement. There you go. We're doing 15%. We're doing more than that. Okay, you're not supposed to be. We don't have to.

Stop, you're not supposed to be. You're supposed to be doing 15%. And the rest of it would go to the mortgage. Our house, yeah. And so if you also say I'm going to adjust my emergency fund down because I think it's too beefed up, then you would just throw it at the mortgage. Okay. That makes sense.

And you need to make your adjustments on your retirement accounts down to 15%. Let's get the mortgage paid off. Okay. Sarah, what's the pressure of the Roth? Is that you feeling that? Is that a financial advisor? It's a financial advisor. We have like

$400,000 in our retirement savings right now. So I think we're doing, like I'm 31 and he's 35. I think we're doing pretty well. I think you're doing pretty well. So what's happening Sarah, I think, is you're getting conflicting advice, so it's confusing to you. You're going to a financial advisor, and they're saying, no, no, no, no matter what, you max out the Roth.

You max out the Roth. Well, yeah, if that's 15% of your income, you do. But we just talked about this, Dave, before the show even on an Instagram Live about why 15%? Because a financial advisor is going to say you know max out that roth but the financial advisor is going to tell you some of them are going to tell you never pay off your house but yeah but all the data all the data on the millionaires that we studied which are actual millionaires not at financial advisors shows that they the shortest distance between where you are and becoming a millionaire meaning building wealth is to get the house paid off. Meanwhile, putting some money into the nest egg. So if your 400 doubles every

seven years, okay, and we have, we got four times or five times, it's going to double. So the first time, if you don't add anything to it, the first time it doubles is 800. The next time it doubles is 1.6. The next time it doubles is3.2. So that tells me you're going to be worth just on that $400 somewhere at your age, somewhere in the neighborhood of $10 million. Wow. So I don't know why you need to worry about maxing out your Roth today when the primary goal should be knocking out the debt. You may need a new financial advisor because this financial advisor doesn't make a commission when you pay off your mortgage, but he makes a commission when he sells you a Roth IRA.

So, and when we refinanced our house, or we're in the process of that, I guess I should say, our credit union is actually doing it for only 150 bucks to refinance from a 15 to an 8-year. And the interest rate is pretty low. It's 2.25. Yeah, good. That doesn't mean we want to keep it. Right, exactly. We have a mean dog, but he's small.

It doesn't mean I want to keep it. I mean, get rid of it. Get rid of it as soon as we can. Yeah, because we could probably pay it off in much fewer years than six years or eight years. We could do it in four or five years if we wanted. And then you're done. And then you go and you max out everything, Roth, anything you've got available to you, because that's baby step seven at that point.

So you guys are doing awesome. I just hear your voice. You really are. You're killing it. And you're questioning. I can hear you questioning because you're confused. And you're like, okay, I'm getting this advice. But Dave's saying that. You really are. You're killing it. And you're questioning. I can hear you questioning because you're confused. And you're like, okay, I'm getting this advice. But Dave's saying that.

So it is. So just the clear path, and that's the why, too. Hopefully this call answered that question for you. Can I ask one more question? Sure. At this stage of, at this point where we're kind of, we're paying off our house and we're not like gazelle intense anymore in terms of you're not supposed you're not supposed to be yeah right how do we balance having fun and cash flowing like toys or like trips or

experiences or things that we want to do and rewarding ourselves for being successful to the point that we're at but also maintain like moving forward and paying off our house. Yeah. We go from gazelle intensity just to simple intentionality. And intentionality says after I do my 15% towards my retirement, no more. And then I look and I say, all right, there's only three things I can do with money at this point. Pass that. And that's pay off my mortgage, give money away, and enjoy money.

And all three need to be in your budget. Enjoying can be a purchase of a toy. Enjoying can be going on a trip. Both are enjoying, but those are lifestyle choices. A nicer car is not a necessity. It's a cool thing, and you should do it. But it's a toy, as you said. And so both of those are just lifestyle. And so what you just do is you look at your budget and say, you know, we've got this number of dollars. How many of those dollars are

we going to put to us? How many others and the house? Yeah. So Sarah, yeah. So I would say that you and your husband need to decide, okay, our, goal, right, the finish line is paying off that house. Like that's the last big thing. How quickly do we want to do it? And you guys need to agree together. We could do this in four. If you do the math, yeah, we could. Or we could do it in five.

We could do it in whatever it is. Yeah, we could do it in five and go on more trips. That's right. Back it out and you guys decide. And then whatever money is left that's not going towards the house is what you guys can use that percentage of it to enjoy and to give and then i would still recommend upping a little bit of your giving during this process and that was a great call out but having the end in mind and then backing out because when it's like there's that ambiguity of like yeah we want to pay off our house soon but i don't know it feel when it gets in the numbers and the budget i totally get

how it gets foggy and you're like i don't know if this is okay or not well is it okay with your goal like that's what you guys need that that's't know if this is okay or not. Well, is it okay with your goal? Like, that's what you guys need. That's your answer. Yeah. I mean, I would not suggest that you have no fun and no lifestyle increase and pay off a mortgage in four years. I would rather you pay it off in six years and have some of each. So, you know, if that's the number, or maybe you paid off in three years with no fun and

four is a little bit of fun and, you know, just run some numbers. That's right. And you guys decide. Actually run some numbers out and go okay yes that feels like too much fun i'd rather i'd rather do the other one you know like scott that was on the debt-free stage paid off his house and i could just assume scott's not here on the microphone but i would think scott's like you know what i'll sacrifice fun for two years to get my house paid off you could just tell that was him right like and he did it and that's great so it's your choice but you and your husband 98 000 in one year that's right so you and your husband together need to agree with that goal is if it's short lots of sacrifice agree if it's like hey we're

going to extend another year or two agree on that but that's the key put actual numbers to it so it's real simple take your balance on your mortgage and divide it by six balance on your mortgage divided by five balance on your mortgage divided by four those are your numbers and then you say how much and here's how much i've got to work with divided by 12 with each how much it's used it's used up i've got this much disposable income after my 15 going into retirement no more need to back that back down and you say all right that gives us x for toys y for toys z for toys based on the four the five or the six and then it'll be right there in front of you it'll go that one i feel good

about that one and you'll probably both agree to it instantly but you're right the ambiguity where you don't have if you put numbers in front of you on it the numbers will talk to you and they'll tell you because you are you know right now you've kind of got well i don't know about the feeling and i just feel like i should do this and it's hard for me to transfer from gazelle intensity to simple intentionality and um i don't you know but you put the numbers down you go oh well that's the one that's it that's the one and you go i can buy a car i can buy a nice car for that i i can we go on a nice trip for that and and still pay off the house in that number of years you know and that so it'll be right there nice trip for that and still pay off the house in that number of years,

you know, and so it'll be right there in front of you, and it's not going to end up being, don't pay the house off early at all, and it's not going to end up being on the other end where you have no fun. You don't want to do either one of those, and so I'd rather you get it done, because it sounds like you've got a substantial income, rather go and get it done, but let's just lay it out. When the numbers will say, oh, that's the one. Oh, and by the way, when you get a raise, all of it goes to the house after that.

Because you've already set your lifestyle budget. Not upping it with the, yeah, that's a good point too. With an income increase. Exactly. That puts this hour of the Dave Ramsey Show in the books. Have a friend or family member that needs a daily dose of Ramsey advice in their life? Let them know about the Ramsey Call of the Day podcast. It's a quick hit of advice about life and money in under 10 minutes. Check out the Ramsey Call of the Day podcast wherever you listen to podcasts.