The Ramsey Show - App - Budgeting Doesn't Have to Suck

Episode Date: April 5, 2022

George Kamel discusses: Why budgeting doesn't have to suck (if you do it right), Saving for college, The best way to get a mortgage, Paying down your student loans. Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6

🎵 Live from the headquarters of Ramsey Solutions, this is The Ramsey Show, where America hangs out to have a conversation about your life and your money. I'm Ramsey Personality, George Camel, host of The Fine Print, host of the Entree Leadership Podcast, and today, America, host of the Ramsey Show. That's right. I am flying solo. Once again, everyone has ditched me. I don't know where they are. If you see them, please make sure they're okay. Send them our way. We'd love to have them. But it is my pleasure to take your calls today.

If you've got a question about money or something that touches money, which is pretty much everything in life, let's have a conversation about it. The number to call is 888-825-5225. That's 888-825-5225. If you're really nice, Jenna will patch you through and you can talk with me and America can hear our conversation. If something's worrying you, keeping you up at night, you want to know how to get out of debt, you want me to talk you off the ledge of a bad decision, I am happy to do all of those things. Mark has decided to join us. He's kicking off this hour. He is in Detroit, Michigan. Mark, welcome to The Ramsey Show. Hey, how are you? Doing great. How can I help today? Good. I'm calling with a question regarding education for our kids.

We are lucky enough to have be debt free. And as of a couple of weeks ago, actually, we became millionaires. Whoa. Incredible, man. I know. Yeah. Pretty good stuff. How old are you?

So I'm 41 and my wife is 40 and my kids kids are 6, 7, and 9. Wow. Have you been following our plan for a long time? So we found your plan kind of halfway through things. Like, I basically just listened to my wife, and so that's kind of what got us on the right path. But she was all about being debt-free. So when we got married, we kind of just tackled our debts, very similar to what you guys said, just smallest to largest. all about being debt free. So when we got married, we kind of just, uh, tackled our debts very similar to what you guys said, just smallest to largest. And I think in the first five years of

our marriage, we paid off our house. And then from there on out, it was just a totally different world. Um, and, and the feeling that we had was just amazing. And now that, uh, we've done a couple of real estate deals in the last year, and that's kind of where our money came from, was making the right moves in the last year during the rise in real estate. So now the question is that we don't know what to do with the money that we have as far as saving for our kids' education. And that's kind of why I'm calling today, kind of get your input on it. Okay, so you haven't started investing at all for college no we have uh that's why i said we didn't do exactly your steps because we found you guys kind of like sort of halfway through everything um after we were already debt free but we have zero for college but we have six hundred and fifty thousand000 cash and our house is fully paid for.

The kids are going to be all right. I hope so. So that's some good news. And then I've got a pension for when I retire, and then we've saved some other things in Roth and other things like that. But as far as what we've saved for the education, it's been basically zero. So that's why we're trying to figure out, like, what do we do? What sort of saving plans do we invest in?

Awesome. So what is your household income? After taxes, $113,000 annually. Okay. I was wanting to make sure because the ESA, Education Savings Account, has an income limit, but the ESA and the 529 plans are going to be your best bets for saving for college and allowing that money to grow for you tax-free. Okay. So I would be opening at least an ESA. You can fund $2,000 per child per year, and the 529 plan has much higher contribution limits, but there are some limitations there tax-wise. So I would work with a SmartVestor Pro to get those opened up. You can get connected

with one at ramseysolutions.com. But you said the ages of the kids was what? Six, seven, and our oldest is about to turn nine. So six, seven, eight right now, but six, seven, nine. Awesome. So we're looking at 10 to 12 years of investing for their futures. And whatever amount you don't have in those college funds, it sounds like you can use some cash to help cover them so they're not going to school with any debt. Right. Yeah, that's what we're trying to figure out because we met with a financial advisor yesterday, and they were talking about not putting too much into it because you don't want to be penalized. Like, say, they get a scholarship and now you're being penalized for not using that money. Well, you can deduct that money if you get a scholarship for $20,000.

You'll be able to deduct that from the 529 without penalty. Okay. So you're going to be okay there. So I wouldn't not invest in these funds because of the unknowns of, well, what if they get a scholarship and what if and what if? I would save that money and you can pass that thing down through the family, grandkids. They can use it for all kinds of expenses as long as they're qualified expenses, including things that aren't tuition.

You know, we're talking books, random school expenses, housing, that kind of stuff. Sure. So you got 10 to 12 years to save up and with your income and no debt, I mean, you guys could easily at least max out the ESAs every year for 10 years, right? Sure, yeah. And beyond that, you can get a 529 plan in any state, and some of the plans are better than others, and that's why I say work with a SmartVestor Pro. They live in this stuff.

They breathe it day in and day out, and they can match you and go, hey, even though you're in Detroit, Mark, we're going to put you in the Utah 529 plan because it has some great investment options and great features. Oh, okay. So we're not limited to necessarily Michigan's ESA. We can go to any state because there are different versions. Well, with the 529 plan. With the 529 plan, yeah, they're all state-specific. And so it's all going to, either way, the ESA or 529, you're going to use after-tax dollars. You're going to invest that. It's going to grow tax-free and you can take it out tax-free for qualified expenses. Okay. Thank you. Man, way to go. I mean, I'm just encouraged to hear from a guy like you,

40 years old, a millionaire because of some wise decisions. You're giving credit to your wife. And that tells me you're a good man right there. Credit. Oh, we try. You know where the credit is due. Well, good for you, man. Thank you so much for the call. We appreciate that. Good stuff there from Mark. I'm encouraged to kick off the show with a call like that with a couple who's done the hard work. They've invested wisely. They got rid of the debt. They paid off the mortgage. They're millionaires. And I didn't hear anything about a trust fund. Nothing was given to them. They just made some wise financial decisions over a long period of time. Well, folks, I'm excited because we are about to be heading on the road starting

next month. And I want you to imagine this, the energy of a jam-packed arena filled with people ready to experience what it means to live life to the fullest. Picture all of your favorite speakers together on stage, empowering you with tools and principles that will create unstoppable momentum in your life. What I'm talking about is Smart Conference. That's right. Smart Conference is back, baby. It's been three years since we've done one of these events. And we are so pumped to get back on the road. We're going to Dallas this fall. That's right. Dallas, Texas. We're headed your way Saturday, October 22nd. The headlining speakers this year include myself, Dave Ramsey, Rachel Cruz, Dr. John Deloney, Ken Coleman, Christina Ellis, and more.

We've got special guests Craig Rochelle and Amy Rochelle from Life Church. They're going to be talking about marriage. You don't want to miss that. In just one day, you're going to get all the practical advice you need from leading experts on money, personal growth, leadership, mental health, day, you're going to get all the practical advice you need from leading experts on money, personal growth, leadership, mental health, career, you name it. And this is not a pep talk, folks. You won't just learn. You're going to have a good time too. And we know how to have a good time. So join us. Tickets start at just 39 bucks. Guys, that price for a full day

event, that's amazing. So get your tickets now before they sell out. Just go to ramseysolutions.com slash events to learn more. We'd love to see you on the road this year with real people on real stages and real places. Let's go. ramseysolutions.com slash events. More of The Ramsey Show coming up. No matter what time of year it is, focusing on your family's financial plan is always a smart move. I get questions all the time about where to start and what to do first. One of the most crucial and affordable first steps to take is to protect your family and get term life insurance.

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It's not that expensive, it's not complicated, and you need to do it now. Welcome back, America. You are listening to The Ramsey Show. I'm Ramsey personality, George Camel, host of the Fine Print Podcast and Entree Leadership Podcast, both of which you can find on the Ramsey Network or wherever you listen to podcasts. Who doesn't love a good podcast? I know I do. I host like three of them. So there we go. Open phones this hour, 888-825-5225 is the number to call.

Let's talk about your life and your money right here in front of America and all of the listeners. Zachary has decided to join us. He's in Orlando. Zachary, welcome to the show. Hey, thank you. How are you doing today? Great. How can I help? Yeah, so just kind of a question about, you know, how I should go about buying my first home. So I have about $65,000. I have no debt. You know, I own my car outright, everything like that. So I'm kind of wondering, do you think it would be more beneficial to go ahead and start, you know, uh, get the house now deal with the mortgage and the interest, um, or save up a

little longer until I can go ahead and try to buy the house outright. I'm not trying to get too much of an expensive house. Um, and I'm right now paying about paying about $7,200 annually in rent. Okay. What's your household income? I bring home about $33,000. You bring home $33,000 a year? So we're talking $2,750 is your monthly take-home pay. Does that sound right? Yeah, that sounds about right. Okay. Well, our rule around mortgages, the only kind of debt we don't get mad at you for is a 15-year fixed rate mortgage. So I love the idea of you saving up to pay cash if you can do this pretty quickly.

But if this is going to be six years from now and we don't know what the housing market is going to do, I don't mind you getting into a house if you do it the right way. And the right way looks like a 15-year fixed rate mortgage with a healthy down payment. I love 20% or more because it helps you avoid PMI, private mortgage insurance, which is just money that protects the lender, not you. And on top of that, I want the payment to be no more than a quarter of your take-home pay. So you just told me your take-home pay is $27.50, right? So let's divide that by four.

We're looking at a $687 mortgage would make me feel really good about you getting into this house. Right? Yeah. So then we back that out. So what are the home prices in your area that you're looking at? So that's the thing. If I'm going to get a house in my range, it's not going to be in my area, unfortunately.

But I'm looking at around like $120,000 to $150,000 maybe for the first home. Okay. And you can find those in your area? In the outer areas, yeah. A little bit further out, but I can, yeah. What are you doing for work? Does proximity matter? Customer service for insurance. Okay. So if you're okay living further out, are you going to have a commute? No, I actually work remotely. Oh, okay. See, that's what I was angling at because that makes it easier

because it doesn't really matter where you live at that point. You're not having to drive 45 minutes. So you have $65,000 saved. Is that all the savings you have? Does that include your emergency fund? Yeah, that would include an emergency fund, yeah. Okay, so let's put aside, let's split this money up

because I don't want all of it lumped in together. One is your emergency fund, yeah. Okay. So let's put aside, let's split this money up because I don't want all of it lumped in together. One is your emergency fund and another account is going to be your down payment fund. Right. So what does three to six months of expenses look like for you if you add that up? Three to six months of expenses would be around $3,500. That's three months of expenses is $3,500? Yeah, I'm only paying $600 in rent, all included. That includes, you know, plus my car insurance and food and stuff like that. It all adds up to a little over $1,000 a month. Right. That's great. Okay, well, let's call it $5,000. I like to aim towards $10,000 just so you can cover all of your deductibles and all out-of-pocket maximums that you might have when it comes to emergencies. So let's just call it 10 to be safe,

all right? That leaves you with $55,000 in savings. And if you put $55,000 down on a house, that's $120,000, that would leave you with about a $736 mortgage payment. So you're pretty close already. Right. And so I would continue saving for a little bit longer. If you can get, let's say, get that up to $65 with just your down payment fund, that puts you right at about the number that I'm real comfortable with. Okay. How quickly could you save up another $10,000? I could probably do that in another four or five months. Love that. And so we're talking, you could be in the house four or five months. Love that. And so we're talking you could be in the house four or five months from now. Right, right.

Yeah, that's perfect. Yeah, so I was just wondering, you know, the interest versus paying rent, but at the end of the day, you know, as long as the interest rates don't go too high, it pretty much washes it out, so you might as well be getting in the house, I guess. Yeah, I mean, I'm okay with you getting in that house, and you're going to pay that thing off pretty quickly, right? Right, yeah. You're going to have about a $65,000 mortgage.

Yeah, right, yeah. Trying to get that paid off as soon as possible. And your income will hopefully go up in the next few years in the insurance world. Yeah. And so instead of having lifestyle creep where you start to spend every single raise you get, let's just keep living on what we're making. And every single raise we get, every bonus, keep living on what we're making. And every single raise we get, every bonus, all the overtime,

a second job, whatever you want to do, we're going to throw that thing at the mortgage and have this thing paid off. Instead of 15 years, what if you could pay it off in four years? Right, that's the goal, yeah. And now you have a paid-for home, you've got no payments to anyone in the world,

and you're making how much? What's your gross income? 33, you know000 after taxes. After taxes, $33,000. Man, you're going to be in a real good spot. And what that tells me is it's not about income. You don't make $100,000. Right.

And yet you can have financial peace. That's a good feeling. Yeah, once that house. Yeah, exactly. How old are you? I feel like once that house is paid off, I'm 28. 28 years old. Man, I'm so proud of you, dude.

For the fact that you're calling in, having this kind of conversation, wanting to do it the right way, and not going, well, the bank was going to give me a $500,000 loan, so I guess I can afford a $500,000 house. Oh, heck no. That's what most people do. Right. So I'm proud of you, man.

Thank you so much for the call. Wishing you the best in the home buying process. I know it's a crazy time out there, so don't make any poor decisions, but it sounds like you've got a great head on your shoulders. Appreciate that. All right, we're going to move on to Harrisonburg, Virginia. Luke joins us there. Luke, welcome to the show.

Hey, man. How's it going? Great. How can I help today? So I started a new job about two months ago, and finally got all the paperwork taken care of enough that I'm ready to roll over my 401 from the previous job. Okay. It's just a traditional 401k account, but I'm trying to decide, you know, what the advantages are if I

ought to roll it into like my own personal account or into the new job and whether I should transfer it to like a Roth or just keep it as traditional. Some great questions you're asking. How old are you? 31. 31. And with this new job, do you know what investment options they have for retirement? Yeah, so there's both traditional and Roth, and they use a lot of Fidelity accounts, just like your typical 2050, 2055 retirement funds. There's a couple of stock options. What's your financial picture look like? Are you out of debt? Do you have an emergency fund? So the only debt I have is my mortgage. Okay.

No car payments or anything. No credit card debt. No. And then I've got about like 75K in a brokerage account. Oh, okay. Just sitting there. Yeah. Cool.

Well, here's what I would do if I'm in your shoes. I'm going to do a direct rollover from your old jobs, traditional 401k, and I'm going to do a direct rollover to a traditional IRA. Yeah. That way you have no tax implications right now. And I would not convert it over to Roth,

which is going to create a tax burden until you have a paid-for house. Because right now, that is your next goal, is getting that house paid off. Yeah, definitely. I agree with that. That's where our budget's really tight for getting the house paid off. Are you investing 15%? No, so I'm at 8% right now.

And then I set it to increase 1% per year until it reaches 15. So you have no debt but the mortgage, but you don't have enough margin to be investing 15%. What's going on there? Well, last year, the previous employer that I was at, I got moved around and ended up taking a couple pay cuts after buying our house. Okay. And it ends up where just our budget is right at our monthly expenses. Wow. Well, I'm going to try to get that income up so we can get you investing 15%.

And I would start investing in the Roth 401k option at your new job. But leave the old, the old one, roll it over, direct rollover, traditional 401k to a traditional IRA and just leave it there. Let's park it there and let's start investing in the new job in the Roth 401k option. Love that. Get that income back up so that you're not drowning, man. You got to get the margin in your life, especially with no debt payments. You can do this. This is The Ramsey Show. welcome back to the ramsey show i'm george camel flying solo today give me a call triple eight eight two five five two two five we'll talk about your life and your money. So I'm a millennial, as many of you know. Maybe you can tell by my voice. I don't know. Do I have a millennial voice? James is nodding yes.

Got that NPR nasally tone. There you go. So here's the deal. As a millennial, I keep up with the trends. I'm on social media. I'm on Instagram reels, checking those out. And of course, you got to see what's happening over on TikTok. And listen, I'm a hardworking guy. I'm just out here trying to help people get on a budget, get out of debt, save for the future. And flying in the face of all of my hard work, there's some people out there, some gurus that can't grow facial hair that are out here telling you how to manage your money and better yet, how to not manage your money. And one of those videos popped up on my feed, and it made my blood boil.

And it's all about how stupid budgeting is. You guys want to watch it with me? The live audience is nodding yes. I'll take that as a go. Let's watch this video. Here are the three reasons why budgeting sucks. Reason number one, it almost always puts you in a bad mindset, right? You have this negative feeling towards money.

Reason number two is because it's like a diet, right? We go on a diet, we tell ourselves we're not going to eat certain things. Budgeting, we tell ourselves we're not going to buy certain things or we restrict ourselves. And reason number three is because we all have limited willpower, right? Just like a diet, you tell yourself you're not going to eat that cookie. Eventually, you break down and you eat that cookie. Budgeting, we tell ourselves we're not going to buy those shoes or whatever it might be. Eventually, we end up breaking down and buying that thing, and then we just feel bad about ourselves.

Oh, man. That actually, he's hilarious. He should try stand-up comedy instead of being a financial advisor. Okay, so let's break this down. Budgeting sucks because it puts you in a bad mindset. Okay, all right, so the alternative here, let's just play this logic out. If we're saying never do a budget because it puts you in a bad mindset, instead, let's just spend every dollar we make and more and never worry about it. What a great mindset to have, right? Until the payments show up and you're wondering where your money went and you can't afford your four walls.

How's that for a bad mindset? Yeah. Okay, the next one was budgeting is like a diet and diets are bad. Okay, well, let's look at how people lose weight. I'm not a scientist. I'm not claiming to be, but it's all about caloric deficit. So if you burn more calories than you take in, you will lose weight. If you live on less than you make, you can build wealth.

And so budgeting is a necessary part of that, just like watching your food intake. So the last one was willpower. He said humans have terrible willpower, so budgeting sucks. Okay, he is right on that one. We have terrible willpower. He said it sets you up for failure too. Oh, it sets you up for failure. Thank you, James. It sets you up for failure because we have limited willpower as humans. And therefore we should just out earn our stupidity, keep spending and spending, never make

a plan, never pay attention, never look at the mirror, bury our head in the sand. Oh wait, that's what America has done. Okay. I'm seeing what's happening now. That is why 78% of people live paycheck to paycheck because they've all decided to be like this guy and just go, budgeting sucks. Let's not do that. Let me hit you with the real on what a budget does. A budget is telling your money where to go instead of wondering where it went.

A budget is permission to spend. That's all it is. So a budget is actually the most freedom you can have with money because you know exactly what's happening on paper every single month. And when you make a budget to go on a thousand dollar vacation and you stick to that budget, you come home with just good memories, sweet times, maybe a tan if you're lucky. I can't get one. But when you do it without a budget, you come back with credit card debt. And you wonder how long you're going to be paying for this vacation that happened three months ago. And you're stressed out because you know that bill's going to come due. And that's where most of America's at. They've got

the credit card payments. They've got the car loans. They have student loan payments. And I get it. Budgeting is tough to do. It's tough to stick to. It requires discipline. And so, yes, if you think discipline is stupid, then I really question how you're doing in every single other area of your life. Do you show up to work on time? Do you work hard? Do you communicate with your spouse? Do you read books? What other areas are you just going, well, head in the sand, who cares? Willpower is hard. Diets are stupid. Puts me in a bad mindset. Anytime you make me work out or eat healthy, goodness gracious. But this is what people on the internet are seeing, and they're hitting the like button, and they're commenting, and they're saying, oh my gosh, yes, Dave Ramsey is the worst. He doesn't want me to have nice things. No, Dave wants you to have nice things. He doesn't want

nice things to have you. That's the difference. He wants you to buy all the things that you want to buy. But when you do it with other people's money, you put yourself in a really, really poor, risky financial situation. So that's my take on budgets. And if you listen to this guy, you're going to agree. Budgeters don't have fun. You have to be really good at math. Only people who struggle need a budget. Only people who are out of debt need a budget. Budgeting takes too much time. Budgets are too rigid. Too rigid. Guess what? You control the budget. The budget doesn't control you. All we're saying is list out your expenses, list out your income. Let's make sure that we have enough income to cover the expenses.

It's that simple. Okay, my little baby rant is over. I can't handle it, guys. How many more of these TikToks are you going to send us? It's too much. I'm getting messages every single day from viewers like you going, oh my gosh, please respond to this. And there's only so much time in the day to respond to stupidity. That's the truth. And so keep sending them because it's entertaining for me. But I can't guarantee you it'll make the show. Appreciate that. All right, let's go to the phones where hopefully Ben doesn't frustrate me. Hey, Ben, are you a good guy?

He's in Charlotte, North Carolina. Welcome to the show, man. How are you doing? Pretty good. How about you? Great. What's your question? Hey,. Welcome to the show, man. How are you doing? Pretty good. How about you? Great. What's your question? Hey, so I'm getting married this June.

Awesome. Yeah, thank you. And I don't have any student loans, but she does. We're both still in college. And I was just wondering, when is it okay for me to start paying off those student loans? And would you advise me to do it start before graduation or wait until you both graduate? Okay, great question. Speak a little bit louder and clearer into your phone for me as we continue here. Okay, I'm sorry. So you're getting married in June. She's got student loan

debt. You don't. You're both in college still. Yes, sir. How much longer are we talking? Are we graduating soon? We both graduate with our undergrad next spring. Okay, so we still have a year to go. 2023. Yes, sir. So is she going to incur more debt to finish school, or is it over? Is she taking out all the loans she needs? It just depends on how much grant money and other scholarship money we can get. Okay.

I ask that because right now your plan is to invest in yourselves as you graduate college. So we don't need to be focused on debt payoff quite yet. What I want you to do is stop the damage and stop the bleeding. And so I would stack up as much cash as possible and make sure that we can cash flow the rest of our college experiences. Okay. And cash flow the wedding and get our life together. Once we graduate, it's game on. We are attacking this debt with a vengeance. But until we know 1000% sure that we are going to graduate without taking on more debt, I wouldn't start paying it off quite yet. Okay. So how close is she? Do you think she can cash flow this depending on the grant money? I think we should be able to cash flow most of it.

And I got a lot of scholarship money, so I'm going to try to see if I can also help transfer that money over to her. Wow. I've never heard of that. Transferring a scholarship to another person? I've heard of it working in some instances. I just got to make sure it'd be okay in this specific scenario as well. Okay. Well, good luck with that, man. But either way, I'm investing in y'all right now.

We're going to pay off this debt as soon as we graduate, but we have to make sure we don't go into more debt. And if you need to be scared silly, go watch the Borrowed Future documentary. I'm also going to give you an early wedding gift. Hang on. Jenna's going to pick up. I'm going to gift you Ramsey Plus, one-year subscription. It includes EveryDollarPlus, our premium budgeting tool that connects to your bank account.

It includes all of the videos in Financial Peace University and many, many other resources, tools, courses. I want you both to sit through that as a premarital counseling. It's my gift to you guys. Watch the videos together. Do the budget together. And as soon as you're married, combine accounts and let's attack this debt with a vengeance. Get it out of our lives forever

and move on with a beautiful, long-lasting, healthy, financially peaceful marriage. That's what I want for you, Ben. Hang on the line. Jenna's going to pick up and gift you that Ramsey Plus subscription. Thanks so much for the call.

This is The Ramsey Show. I'm George Camel, Ramsey personality, host of The Fine Print and Entree Leadership Podcast. Season one of The Fine Print is out right now where I help you uncover all of the hidden truths that are keeping you broke. We did 11 episodes and we covered the gamut. We covered a wide spectrum of financial issues from student loans to bankruptcy to buy now, pay later to credit card rewards to credit scores.

Turns out there's no shortage of financial traps out there. And there's a very small sliver of things that you can do, common sense things to set yourself up for wealth. You can avoid all those distractions and the traps and stay focused on the most simplest way to build wealth. You will be unbelievably successful, unbelievably wealthy. Get out of debt, stay out of debt, invest consistently, pay off your house. It's that simple. It's the baby steps. It's worked for millions of people and it can work for you. Open phones this hour, 888-825-5225. Give me a call and we will talk about your life and your money. That's 888-825-5225.

Phone lines are open and they are waiting for you. Lisa joins us now in Orlando, Florida. Lisa, welcome to the show. Hey, George. How are you? Great. How can I help today? Well, I feel like I need a lot of help. So, embarrassed to say I'm 47, but I know nothing about money. That is so embarrassing. Oh, my gosh. You're 47? I'm 47, and I feel like I'm 80.

Lisa. I'm very stressed about money. It's okay. It's not too late for you. I hope not. I found you guys probably about two years ago. Raised four kids, helped them with a few grandkids here and there.

And I got custody of my mom and she's 85. Okay. So with what I'm able to bring home after insurance and everything, it's about 4,100 a month, about 50 grand a year. So in my savings, I have 40,000. I, I have less 46 to pay on my house and I have a 401k that has, well, $20,000, but if I take it out, I would get around $15,000. Don't take it out. Why are you even contemplating that? Well, the house is almost paid, so I thought maybe if I took that out, then I could maybe pay it off within a year, year and a half.

No, no, you're robbing Peter to pay Paul over here. Okay. Don't take out the 401k loan. You can do this, Lisa. You got 46k left in the mortgage and you have $40,000 saved. You're doing great. What makes you think you're in such a terrible financial position? Well, it's scary because I don't know anything about finances whatsoever, about Roth 401s. I don't know how to put away for savings right now because what I make is kind of what's going out monthly based on the mortgage, insurances. How much is the mortgage?

The mortgage I pay $1,200 a month. It's actually $836, but I pay extra. Oh, well, this is very reasonable. That's below 25% of your take-home pay. Yes, sir. Okay. So where are you saying that you don't have enough margin? You're paying all your bills. Are you investing currently? No, I'm not.

My mom's medications are kind of pricey. And like I said, I help out the grown kids. I help finance a car for my son, which is only $9,000 left. What do you mean you helped him finance it? You co-signed? I co-signed. So how much debt do you have total outside of the mortgage? That's it, $9,000. I paid off my student loan, the last payment I made last month, for $3,000.

Okay. Well, that car loan scares me because that's in your name. That's your debt. Right. That payment's only $136 a month. Okay. So how can I help today? Well, I've been listening and like with the housing insurance market, you know, they're threatening to take away our housing insurance and the prices have almost tripled and then i was listening to the program where it said that if something happened to your home they wouldn't pay out what it costs to build your home um and i called the insurance company to talk about that and they're telling me that there's a clause that says that they have to replace it at cost.

So who's threatening to take your insurance away? There are insurance companies here in Florida that have gone under and out of business. So we're only left with a couple choices. When's the last time you shopped around for home insurance? I'm currently in the process of shopping. Okay. I would shop with someone who's not captive. And so our friends at Zander Insurance, this is what they do all day long. That's who I have my own personal home insurance through. And they're going to shop all of the companies across the nation, and they're only going to choose the best companies. Okay. So I would jump on a ramseysolutions.com and click on Trusted Pros and get connected with Xander to help you shop for home insurance.

And they're going to find highly rated companies that aren't about to go under, that aren't about to rip the rug out from under you. But outside of that, what else is going on that's freaking you out? Just getting older and not having anything paid for retirement. Well, we can work on that for sure. You have $20,000 in retirement. That's it, right? That's it. What do you do for work?

I'm a nurse. Awesome. So you've got some good investing options at work? Just the 401. Okay. That's all you need. In our research of millionaires, we studied over 10,000. That was the most likely path to be a millionaire, their company 401K.

So I want to encourage you, you don't have to get fancy. You don't have to keep up with the latest trends in cryptocurrency and NFTs to build wealth. And you've got, what, another, let's say, 20 years of your working life ahead of you before you retire? Hopefully, yeah. Okay. So over the course of 20 years, if you invest 15% of your income, and once you have that house paid off, we can invest even more. And once we have this car loan out of our life, we can invest even more. Then with all the catch-up contributions you can make past 50, you're

going to be okay. If you invest consistently into that 401k, into some good growth stock mutual funds, you don't have to know all the ins and outs to build wealth. That is the beautiful part of our plan. You just have to consistently do the actions. We can teach you along the way. So what I'm going to do, have you been through Financial Peace before?

Financial Peace University? I have not. Okay. This changed the game for me. I just check out the books and read them at the library. That's great. You can get Total Money Makeover from the library there. I'm happy to send you a copy as well. And I'll also gift you one year of Ramsey Plus.

And what I want you to do is, oh, absolutely. I think once you read Total Money Makeover and you watch all nine lessons of Financial Peace University, Dave and our team, we're going to walk you through exactly what you need to know and really all you need to know in order to build wealth. And again, you don't have to be a financial expert. You just have to be willing to do the actions. And we have teams in place. You know, we have SmartVestor Pros. Those are our investing professionals in your area in Orlando that can help you do things the Ramsey way.

You can get in touch with one at RamseySolutions.com. And they'll help you understand what you're investing in. They don't just tell you what to invest in. They want you to understand it and you can make an educated decision. So I want to encourage you, Lisa. Number one, it's not too late. You're 47. You're not 87.

You're only halfway there. And so let's just start making some good decisions. You already have. You've got a ton of money saved up. Let's call that the emergency fund. You could knock out this car loan today if you wanted to. You could fully fund an IRA if you wanted to. You've got lots of options here.

And your income is going to continue to go up, isn't it? I don't think so. I'm kind of maxed out in this position. I took this position because I can work in the evenings and I can still take care of my mom. Because of mom. Because the figures are very expensive, yeah. Well, I'm sorry that you've got that burden on you. I know you love your mom, I can tell, but it's a lot for you right now.

I feel that in your voice and what you've described, taking on not only the physical burden of taking care of her, but the financial burden, too, of covering medications and grandkids and all kinds of things. Yeah, believe it or not, she's number 11 that I'm taking care of in my family. Wow. Lisa, you're a warrior. I know, I know. But we're going to get you there. Hang on the line. Jen is going to pick up. We're going to gift you Ramsey Plus, one're a warrior. I know, I know. But we're going to get you there.

Hang on the line. Jen is going to pick up. We're going to gift you Ramsey Plus, one year of that. Plug into it. We're going to send you a copy of the Total Money Makeover and get you going in good shape here in no time. Thank you so much for the call, Lisa. That puts this hour of the Ramsey Show in the books.

We'll be back with you before you know it. Hey, it's John Deloney, co-host of The Ramsey Show. Did you know over 18 million people listen to The Ramsey Show every week? A lot of those people listen on one of our 600-plus radio stations across the country. To find a station near you, go to RamseySolutions.com slash show.