The Ramsey Show - App - Building Wealth Happens One Baby Step at a Time

Episode Date: January 28, 2025

Welcome to the Ramsey Show, where we help you win in your life. We're going to help you win in your money, win in your profession, and win in your relationships. The phone number to jump in today so we can coach you up is 888-825-5225. Alongside the incomparable, the doctor is in sign is hanging above my head, Dr. John Deloney. What's up? My pal and seatmate, if you will. And I'm Ken Coleman.

And so we are here for you today. So no money personalities, but we know the basics. And so we are here for you today. So no money personalities, but we know the basics and we're going to help you out. We're going to get behind some of this stuff. So excited to have you with us. Corey's going to start us off, John, in Detroit, Michigan. Corey, how can we help today? Thank you for taking my call. You bet. What's going on? My wife and I are kind of trying to think in the future and we know that our wealth is going to be significant, and we're just trying to figure out when do we start to give. Yes.

Tell us about this wealth. We know we're going to be wealthy. Give us a picture of what's going on and when it happens. We're currently at around $900,000, and my wife and I are teachers, so we have a pension as well. It's about $320,000 in Roths. We have $210,000 in our 457s. We currently max out our Roths, our 457s, every year.

And then we have two additional properties besides our single residence. And those are paid for? Yes. So what's your net worth? $900? Around $900. Okay. So what is the question? I love how John answered. He's absolutely right. So what is the specific giving strategy or question marks you have around this? What are you pondering? So we live comfortably as we are and as we're saving, and our kids' colleges are taken care of, and our goals are set. And we know we'll achieve our goals. The question is, when do we stop building our wealth, and when do we start giving it away?

What if it's both and? Exploring that part. It's both and. Do you all not give at all right now? At this moment, no. Okay. What has inspired the question about giving? We sat down and we've paid off our properties.

We are, I mean, we're saving 35% of our income and we still are comfortable. So we're realizing that we have an excess. Yeah, but back to John's question. Is there a specific cause, something that has spurred this on where you want to give, you're wondering about it? We're maxed out. We have a child that's going to be leaving daycare going into kindergarten. That's when we kind of really sat down and what do we do with this additional money? So we're trying just to figure out, do we continue investing? Do we keep building wealth? Or at what point do we start to share? You do both. My honest answer would be you start to share years ago.

Because I think generosity is a position. It's a stance you take on the world. When you look at giving as a number, we'll start doing X when we get there what most people find is their life continues to grow their needs and their expenses grow with them and that number just that the finish line keeps moving and moving and moving so giving is a way of being it's it's a it's a way of going through the world saying I got struck by lightning in that I married well. My jobs have been stable. I've worked out.

I was left an inheritance. I worked really hard. I owned a small porta potty company. And then all of a sudden, some guy bought 40,000 acres next to us. And now I'm a million, like whatever the posture is, or I'm a person of faith and everything, every single breath that takes a blessing. And so I'm a pass through. I'm going to let this thing, I'm going to let so much of this go back to those who need um whatever your position is every single um psychological study

every single faith community throughout all of human history has wired into it um generosity giving being a pass-through and so for the sake of your soul not like in a like in a go to church or you go to hell that's what i'm talking about but for the sake of your soul, not like in a go to church or you go to hell, that's what I'm talking about. But for the sake of your spirit, of your soul, your marriage, your kids, yeah, start giving today. Find causes that matter to you. Find moments that matter to you. Find people that you see that we can be a blessing towards and begin to practice it. And Ken, I tell people, practice this in little ways, meaning wait until you see at a restaurant, when you see a waitress who's working five different sections

because people didn't show up on their shift, and she's exhausted, and your food's a little bit late, and tip her 100% of the tab. And write her a note that says, we saw how hard you're working, we're grateful for you. Do that, and then just watch her when she opens it up. Do small things like that. And then find somebody at your kid's kindergarten who can't afford the tuition and tell the headmaster, hey, we'd like to pick up somebody's tuition.

Just let us know. Or be more strategic about it once you think about it. But it's just a posture. Yeah. Corey, did I hear you say you guys are investing 35%? Yeah. Yeah. You know, look, here's what Dave has taught for years. Corey, did I hear you say you guys are investing 35%? Yes. Yeah. You know, look, here's what Dave has taught for years, and of course we sing that chorus as well.

What we teach is in the Baby Steps. Are you familiar with the Baby Steps? I'm assuming you are. Yes, we went through them and paid everything off. Exactly. So you get to do whatever you want, but we've prescribed for 15%. And you guys are in great shape. So you could say, we're going to go back to that and we're going to invest 15%

and we're not going to stop. Okay. That's the, when John and I said, yes, and that's that. Now, if you want to do more than that, you can, but that's the rule of thumb and you're in great shape. So at which point you now go, okay, if I'm going to invest 15% or 35%, then whatever's left over, how much of my income am I going to set aside for continuous giving? So John's right. You can give where you are. However you're moving throughout the day, you find opportunities to give. But for strategic giving, then I would put a budget number on it. And so let's say you said we're going to do, for sake of discussion,

let's say you're going to go back to investing 15%, and that's the continuing build. But then you go, okay, we're going to take that $35 we've been investing, we're only going to invest $15, and we're going to take 20% of our income. And that is now our giving fund. And to John's point, if you feel generous and you want to leave a $500 tip, that comes out of that number, if you want to invest in a nonprofit, a mission organization, your church,

some type of charity, I would find a cause that's near and dear to both you and your wife and something that has a story attached to it that connects to you all's story. I think that's a great way to do it. But you get to decide. But I would just start immediately doing it. And you've got the margin. And so now if you're investing 15% and you are giving 20% or whatever ratio you want to do there, I would start right away. Okay. Well, just kind of tap onto that. would you give smaller or would you invest and then give later in larger amounts again we're not genie in a bottle so i'm not going to answer that i like john's answer you get to decide cory there's no i'm not turning to page five in the in the in the

ramsey manual right now to answer that question because that is so individual to you. We're not being coy. It's a posture. You do what you want to do. But my only advice on that is, John, and you weigh in on this, if I was in your position, Corey, I would be giving a substantial chunk consistently to something that I deeply connected to absolutely i would leave it at that you get to fill in what deeply connected to looks like yes and i think what you need to do cory is get out of the spreadsheet and into life and so yes there's going to be a library someday that wants an extra gargoyle that your nine9 million could pay for. You're right. But you want something special? Go tip your waiter $100 at a Waffle House,

and he'll chase you out into the parking lot and hug you because you just took care of his kid's light bill. Right? You just put food on their table for a month. I love that your brain went to a special customized gargoyle. There's a lot to unpack there on the commercial break. It tells me so much that I love about you. Hey, we have something special coming back. Big news.

King and Hellman. We'll tell you. Can't wait. We'll be right back. Hey guys, I'm Jade Warshaw and I want to talk to you for a quick second about student loan refinancing. If your payment and your interest rate are burying you

and you feel like you can't dig out, refinancing your student loan debt might make sense. That's because a lower rate could free up more money in your budget and a shorter term could help you pay down your debt faster. So reach out to the student loan refinancing experts today at laurelroad.com slash Ramsey. There you'll find helpful resources like a student loan rate table, a refinancing calculator, and other tools. Plus, you can get an initial rate in just a few minutes. Laurel Road offers low competitive rates

starting under 5%, and you can get your interest rate even lower if you sign up for auto pay. But if your situation is more complex, sign up for a pay. But if your situation is more complex, sign up for a free 30-minute consultation with one of their student loan refinancing experts to get your tough questions answered. Listen, not everybody should refinance their student loan,

so make sure you run the numbers. But for some people, it is the right move. Learn more at laurelroad.com slash Ramsey to find out more about their student loan refinancing. That's laurelroad.com slash Ramsey to find out more about their student loan refinancing. That's laurelroad.com slash Ramsey. Laurel Road is a brand of Key Bank National Association. All credit products are subject to credit approval. Welcome back, America.

Thrilled to have you with us here on the Ramsey Show alongside Dr. John Deloney. I'm Ken Coleman, and we're here for you. The phone number, by the way, to jump in is 888-825-5225. That's 888-825-5225. All right, Ken, I've got to jump in. You're jumping in. I have been waiting for weeks and weeks and weeks to be able to talk about this publicly, man. This is amazing.

This is a huge day for Ken Coleman, for your family for this company and this incredible new show called front row seat that you're premiering this week so thank you tell us the genesis of this thing tell us how it's been going yeah um and i'm so jealous of everything from the from the it does look cool the team's the talent the the videos, all of this. The set design, everything's rad. Tell us all about it. So if you're old enough to know the show Inside the Actor's Studio. Legend.

If you remember that, we're a famed movie television producer, professor. James Lipton would interview the best of the best of actors, directors, producers, and he would do it in front of a classroom in a theater, but a true classroom, and then the students themselves would get a chance to jump in and ask questions. That's the concept of front row seat. That's why we call it front row seat, because we will be doing this in front of a live audience surrounding a very small, intimate audience surrounding me and the guest. And then we'll do virtual audiences. And so where you can sit in almost on a group Zoom with somebody that you would never get the opportunity to talk to, but you don't just

listen and learn. You actually get to ask questions. That's why we call it Front Row Seat. And we're focused on three things. We want people to get better personally. Think of all the areas of your personal life. You think about your relational life. It's where you're focused on three things. We want people to get better personally. Think of all the areas of your personal life. You think about your relational life. It's where you're focused on helping people. You think of your physical life, your mental and emotional life. We bring whatever version we have to work. And so we want people to get better. So bringing in people that are experts in all of those areas, deep dive, how can we get better so that we can go to work and we have the best opportunity to do our best work and move up, whatever move up looks like. And then ultimately, as you move up in America, you get thrown into leadership positions that you're largely not

trained for. So some leadership 101 stuff. So you're thinking about personal growth topics, growth development topics at work, and then Leadership 101 stuff from some of the best voices in the world. Our debut episode out today, former governor, first female governor of South Carolina, Nikki Haley. Yeah. Now, if you're on the Trump side of things, you're going to have to get over it because it's not a political interview. Well, it's a great interview. This is a leadership interview. Yeah.

And I'm going to be sitting with people that are left, right, middle, don't even want to talk about it, because this conversation is designed to make us think, to make us feel, and to make us do. And that's what we're doing with the show, and I'm really excited. That's my roots, by the way. Yeah. That's what I'm saying.

You've been interviewing people, athletes, presidents. You, you've been interviewing people who are extraordinary in what they do forever. Like for way before you were. Yeah. And I've had the opportunity to do a lot of coaching here on the Ken Coleman show,

but this is a natural evolution of what I've always wanted to do. And I think that, you know, I always tell people do what your heart tells you to do. Follow your heart, Dave, and the leadership. This is a show that I've wanted to do for a very long time. And so we're doing it. And it's designed to, again, bring in a large audience.

If you listen to this show for money issues, you're going to love this show. And so the audience themselves brings in a representation. That live audience represents the people listening and watching. So I would say this, and we'll move on to the calls. You can get it on YouTube, podcast app, the Ramsey Network app. All you've got to search is front row seat, Ken Coleman, and it'll come up, and it's live now. And I will say this, this interview with Nikki Haley,

a deep dive on her past as a child, an immigrant who dealt with bullying because of her race, a woman who broke a barrier and then stood up for one of the biggest issues that divides us racially. I mean, this is a woman of great substance. Whether you like her or not, I think you'll learn something from this interview. That's all I'd say on well and my favorite here's what i think sets this whole show apart and i can't wait to see this thing just hit the ground running dude is i don't know how many times we listen to podcasts and someone's doing an interview and i think yeah but hold on but what about and i want to inject myself in that conversation or at least ask the next question or that felt like a softball and you have a live audience you have real people in there that get to do that and that i don't know that

that show exists anywhere right my favorite part is allowing people to get a chance to speak up and ask a question that's their question so i love it i love it there it is front row seat now available from ramsey solutions uh you can get it wherever you get your podcast and on youtube all right to the phones we go. Sarah is joining us in Charlotte, North Carolina. Sarah, how can we help today? Hi, thanks for taking my call. You bet.

What's going on? So my question is, how much should I be contributing to my kids by 29? You know, I know there's no magic number of what, you know, what college is going to cost for them, but is there a point of, you know, you get a hundred thousand dollars in there, should you be putting it in a high yield savings account instead, just in case? Sure. How old are they and have you done any investing so far? So there's six and three. Okay. And my six-year-old, we have $15,000 sitting in his account at this point.

Good. And my three-year-old, $6,700. Good. So if you were just to look, if you get on RamseySolutions.com after this call and pull up our investment calculator, punch those numbers in. And it would be a real fun exercise for you to see, okay, add 18 based on those two amounts and put in a modest return, nothing crazy. Then you're going to see where that number is going to add up to. But I think, John, I like her question. You know, there's no magic answer, but you get to about $100,000.

I'm curious, if I were you and I'm thinking what education may or may not look like 15 years from now. You can know this, Sarah, that with AI, college will look different for your kids than it did for us. I think $100,000 is pretty good. Just know that, yeah. What are your thoughts on that number? And I will also add our mortgage. I've calculated out that once our kids

are out of daycare, that we're going to increase our mortgage payments and I should have it paid off the year my oldest goes to college. Sure. So there's an awesome and then a, let me just check you on it, okay? That will be the year also that one of your parents calls and says, we need to move in with you. So I know in your head probably I want to get to a place where I can just cash flow all of this, and I like that idea. I like that sentiment. And also just be prepared for life to happen along the way

too, right? Yeah. I would really do the investment calculator, Sarah. I really would so that you can actually see how these numbers play out. Because again, if you could make the case to put $150 to $200 away per kid, that's real right now. That won't cover a lot of schools for four years. We know that. If you put $200 away, you'll be fine 200 you're easy okay you're fine uh but i i just believe that it's a tough thing to discuss john because you and i both we talk about this all the time higher ed is going to look dramatically different would you agree with that 1000 okay let me ask you this actually we've never talked about this yeah if that's true i don't see how it gets more expensive i see it getting less expensive the only way it gets if you see a and again this is what

what higher ed people talk like me and my colleagues have talked about for years behind closed doors like just having those we call them sad lunches, right? If you saw a dramatic number of colleges close, which I don't think is wild speculation. Oh, no, I think it's going to happen. Then it will make the remaining colleges very, very exclusive and thus very, very expensive. Interesting. Right?

And I think the marquee will be on a shared shared experience it will be the cultural aspect um as much if not more so than the information if i've got a personal bot who can just coach me along the way and see that's where i think i you know what i'm that's a fun discussion for another time the human element will be can i associate and talk to and hang out with other people my age and older can i have multiple leaders? I think there will be a premium level, just like there's really fancy restaurants now. That's exactly right. But I do think we're seeing the cost of tuition, student loans.

I think COVID started the tide. I do think we're going to see decentralized higher ed. And thus, I think it's going to be a lot less expensive. That would be my prediction. I could be wrong. I agree with you. I still think they'll be your premium place. There's always going to be a Ritz Carlton.

That's right. That's right. But Airbnbs didn't exist. That's exactly right. All right, quick break. He's Dr. John Deloney. I'm Ken Coleman. You're listening to The Ramsey Show. What does the future hold for business?

Ask nine experts and you'll get ten different answers. Economic growth or a recession. Business taxes will go up or down. AI will help us work or it will replace us all. But there's no such thing as a crystal ball. That's why more than 40,000 businesses have future-proofed themselves with NetSuite by Oracle, the number one cloud enterprise resource planning system. Ramsey Solutions uses NetSuite, and you should too.

Whether your company's earning millions or even hundreds of millions, NetSuite helps you respond to immediate challenges and seize your biggest opportunities. With one unified business management suite, there's only one source of truth for the visibility and control you need to make quick decisions. NetSuite's real-time insights and forecasting help you see into the future with actionable data. And when you're closing the books in days, not weeks, you can spend less time looking backward and more time focusing on what's next. And speaking of what's next, download the CFO's Guide to AI and Machine Learning at netsuite.com slash Ramsey. It's free at netsuite.com slash Ramsey. Welcome back to the Ramsey show. Thrilled to have you with us.

888-825-5225 is the number to jump in. I'm Ken Coleman. Dr. John Deloney is joining me today. Jack is with us now in Cleveland, Ohio. Jack, how can we help? Hey guys, how are you? We're having a blast. What's going on with you? Okay, so I just need some advice. My ex, I have a kid with my ex, and my kid is getting older, and big expenses are starting to come up, and I don't know how to tell my ex. We're pretty good co-parenting.

We just talk about things a lot. But I think there's an expectation with money, and I don't think I can meet their expectation with money. So I have, it's like a finance question, and it's really morale. You know, like my kid needs braces or wants braces. It's not medically necessary. And that's $6,000. She wants to split it with three grand a piece. I just don't have it.

Is that something I am just obligated to pay anyway and just figure it out? No. Or am I allowed to say no? And then there's a car that's being brought up right now, and there's some big expenses coming up, and she wants to split everything. And I don't know how I can really do that. Well, it's pretty common that people get sideways at this age and some parents like you um are just steeped in reality this is how much money i have like even if i wanted to

buy you six thousand dollar braces which i i do i want you i want you to have the things that you think are going to make you feel beautiful i want you to have the things that you think are going to make you feel beautiful. I want you to have that. And I don't have those dollars. And then there's other parents who, as the kid gets older, they want to use money and stuff as a proxy for the world that they thought they would have been able to give them had there not been a divorce. I want you to have this fancy car. I want you to have these fancy clothes and this fancy, whatever. I want to say yes to everything that you want. What's your relationship with, with step-mom? Y'all communicate well, y'all co-parent well? It was really, really rocky in the early years. And we, we've worked on it really well. And I think that we're,

I mean, at one point we've even had a couple of beers together, so I think we've gotten pretty okay. Um, but I just, you know, I just, you know, my kid is, you know, 15 going on 16 and she's so getting so expensive now with bigger ticket items. It's not just clothes anymore. So here's what you have to do. You have to sit down with your ex-wife and say, Hey, could we meet? And i'm glad that y'all are acting like adults oh it's awesome i love it when adults act like adults it's so good so rare so high five to you um and just say hey here's my financial situation here's where we are i it would it would be honoring to you that you're she doesn't say i want to buy this but your dad's too cheap to because at the end of the day that doesn't hurt you as much as it hurts that kid. And so if y'all could come to some sort of

agreement on those kinds of things, and maybe you can't, and you'll remember, oh, this is why we got divorced in the first place. Hopefully she could say, well, in my new world, I've got 5,000 bucks. If you could do 1,000, I'm going to tell the kid that we're splitting this together. And y'all work out the money behind closed doors, like adults, whatever you can put in there. But you have a financial reality that you want to stick to, and hopefully you all can sit down and have an adult conversation and come to some consensus here. We're not getting her a Lexus.

That's never possible. I can come up over the next year with $3,500 that I could contribute to a Camry. Right? And if you wanted to have a new Camry. I do have a follow-up question. Okay, go ahead. So we're kind of going down that path right now, and I think you're going to say no.

I'm assuming you're going to say no, but. Don't take out any loans. Please don't. Okay. Yes. Well, that's exactly kind of where she wants to go. It's not necessarily a loan. It's an IOU to her.

God, no! Don't borrow money, but if you have to choose between a bank and your ex-wife, good God, at least there's laws regulating a bank. Yeah, I mean, Jack, I'm sitting there listening to you and John talk. You already knew the answer to the question that you asked. I think you're, and again, no judgment here. I'm seriously putting myself in your shoes. I would be a mess internally if I were in your shoes right now, because I would be afraid that my ex isn't going to like what is the reality and she's going to say something or do something. And then my kid is going to think that I don't love him as much. I would be sick to my stomach.

Just being honest, John. Yeah. Heck yeah. Jack, I think that's what you're dealing with. All right. So, so now that's what we need to address because when you started this call, you already knew what's reasonable and what's right. And what is real. I can't afford it, right? You can't. But what's also real, John, is that Jack can be manipulated into, and I could too. All of us. Overloving our 16-year-old daughters?

Yes. Into credit cards and all the other things to just get through this. And you know what? I'd rather deal with the financial pain than the emotional pain of disappointing my kid i think that's where he sits am i right jack yeah that's that's right that's what i'm okay so i think we gotta get her out you're 16 year old out and just said i just paint you a picture of how the world works here's how much money i got and your mom loves you and she wants to buy you this and i love you and i want to buy you this and here's how much money I got and your mom loves you and she wants to buy you this and I love you

and I want to buy you this and here's what reality is I that's what I agree I agree that's the tack Jack you got to go directly to your daughter she's 16 I agree and I know leather seats feel like it's more love it's really not right like um what would happen if you had that conversation? I don't know. I used to make a lot more money, and I spoiled my kid a lot, and her family used to just hand it over money. What did you do? The child support. What did you do, Jack, and how much did you make versus how much you make now?

I was just a supervisor. I just worked a lot of hours, and I didn't really have a good relationship with my kid. And I made about $90,000, and now I just work at the local lumber yard. I just order lumber, and I make about $40,000. I actually have a separate phone call I'm going to have to call you on, Ken, about a different job.

Well, that's why I bring that up. Just to be home more. I think there's two things. I get that. But I think there's two things. And, again, I'm – and, John, you weigh in on this. But, Jack, I'm going to talk to you as if I was in your situation. And I think that, number one, I agree with Doc here that

you're sitting down with your daughter and you're explaining reality. And you give her a lot of why. Here's why I've cut back. If you want to go to that, I got a different thought on that one, but you can explain all that. Explain, I don't want to go into debt. Here's why. Explain all of that. Be really honest, really humble really humble not defensive but explain the situation whether or not she gets it in the form of agrees with it or not doesn't matter does not matter but i think you got to go one-to-one with the daughter and do your best to and i don't want to say this the right i don't want to mean controlling but the narrative needs to be between you and your daughter that's the first thing I do.

The second thing I do, interestingly enough that you said, I used to make $90,000, now I make $40,000. I think for this season, you've got three more years with this kiddo, right? Yep. I'd be working a little bit more, and I would be doing what I could to cash flow. I'll come up with three grand for braces. I'll tell you what I'll commit to. Whatever she earns towards her car, I'll match it.

Up to five grand or whatever number. Now we've got girls skin in the game, moms skin in the game, your skin in the game. I think for this season I'd be pulling some more hours and leveraging my past experience to meet this situation in the

middle. No debt, no manipulation and pressure from daughter or ex-wife. However, I can bring more to the table and out of a good gesture, I'm going to do that. I think I would try to do that. John, is that unhealthy? A hundred percent. Because here's what gift you're going to give her, a gift that's infinitely more valuable than braces, Jack. If you sit down and have this conversation with her and say, I know you really want braces. I know right now you don't as much have to have them medically as your teeth make you feel less than and you don't smile.

There's actually some research about smiling and teeth, okay? But I'm going to go take a second job here, and I'm going to bust my butt, and I'm going to knock this out for you. And here's my expectation. You're going to put some skin in the game, like Ken said, when it comes to grades or comes to working or whatever. But you showing her that extra hours and that extra work. And I took a second job driving for Amazon when she was at mom's house and you're exhausted and you put that cash on the table. She will understand the value of a

dollar infinitely more than you just throwing money at a problem or just saying no to a problem. So I like that, Ken. But all of this starts with real, honest conversations. Jack, you're a good man. And I'm going to tell you, I think you're a good dad. So believe that, act that way, hold the line. I'm not doing anything that hurts you financially. This is the Ramsey Show. Hey, you guys, I'm not a fan of the big banks, and you probably already know which ones I mean, but I do like credit unions because they're non-profit organizations that focus on their members, and I'm proud to endorse Fairwinds Credit Union because they share the Ramsey mission of helping people get out of debt and live generously. In fact, they design products to help keep you from going into debt in the first place. Fairwinds has been in business for over 75 years, and they serve hundreds of thousands of members worldwide. You can feel secure because

your deposits are federally insured by the NCUA up to $250,000. It's easy to join and Fairwinds partners with more than 5,000 credit union locations around the country, so you can bank in person wherever you live. But if you prefer the online experience, you can log on to Fairwinds and do anything you could do at a physical location. So go to fairwinds.org slash Ramsey to learn more. And while you're there, look at the combined checking and savings account bundle they created just for Ramsey fans to help you take control of your finances. That's Fairwinds, F-A-I-R-W-I-N-D-S dot org The Ramsey Show.

Alongside Dr. John Deloney, I'm Ken Coleman. So excited that you're with us, 888-825-5225. Our Ramsey Network app question is from Darren. He writes in, my wife and I are 50, debt-free, and have a net worth of close to $5 million. I retired last year and it's allowed me to lean in to many fun hobbies. That said, I feel guilty that I'm not working, even though we don't need the money. I'm embarrassed when people ask what I do for a living. Did I retire too early or should I just ignore societal norms and enjoy the fruits of a lifetime of hard

work? I'm going to go yes and yes, John. Correct. A little bit controversial maybe. And what I mean by yes is did he retire too early? Yes. Absolutely. And should he ignore societal norms and enjoy the fruits? Yes. Yes. Now I'll explain the first part of that. I'll get the second half because I like this question. Yeah. I don't think retirement is good for us. No, I'm sorry the first part of that. I'll get the second half because I like this question. Yeah. I don't think retirement is good for us. No, I'm sorry. Let me go back. I know it's not good for us, and that's not my opinion.

That is based on— All the data. You know about all the data. You and I are both data nerds, and the data says it's just not good for us physically, mentally, spiritually, the whole nine yards. If retirement means going home and doing nothing which is what he's he's doing fun hobbies which is great i would say that um and this is my goal um and by the way this is a very unpopular opinion i was on graham stefan's uh show and they asked me about retirement and uh i said it's overrated and i'm not going to ever retire. I have no interest personally either. I will slow down. Yes. I will diversify, but I will be doing something that looks, sounds, smells suspiciously like

work until God takes me home. Yeah. And that's because, A, I believe it's what's best for us. Now, again, downshifting. So all I would say here is, Darren, hey, man, keep doing the hobbies, but find something. Even if, by the way, here's what's interesting. I would say, John, that volunteerism is in the category of not retiring.

In other words, he may not have to collect a check, but let's say he's going in and let's say he used to run a sawmill, random thing that came to my head. If he just goes in, he starts consulting with a couple young guys that are in the wood business or whatever, and he tells them what he knows, and he does it one day a week. It's about purpose and providing value. That's the idea.

That's it. So one can volunteer. And by the way, volunteers work. So that's my little spiel, and i'll leave it at that let you jump in on the second part of that i just i a hundred percent agree i am also one i've got one of my closest friends in the world is counting down the minutes just counting down the minutes um and so i i'm with you when it comes to work i have a buddy who has a giant um ranch that he he messes with it you would say it was a hobby but he

provides a great place when somebody needs wants to go for a hunt and bring their kid out for the first you know hunt he is he manages this thing so that people have a welcome place to come he's not retired he is not retired he works really hard i love that um he doesn't draw a paycheck right and so um i think i also want to get done to this societal norm thing. If you have 50 years old or financially independent and you're still quote unquote embarrassed when people ask you what you do, stop, stop.

The reason people work their lives, they become financially independent so that they don't have to care what people think. And so for some reason you are still attaching your self-worth and your quote-unquote feelings to other people's perceptions and opinions of you stop yeah because you know the irony john i think most people would love to be where that dude is yes 50 yes i'm 50 that'd be amazing i think i'm young exactly i know i'm delusional but but but i still go i mean now again i wouldn't stop today right uh but you'd go to fewer meetings yo sure but i'd still come be on the on the show sure sure yeah that's a good point yeah i don't

neither one of us like meetings yeah but uh but i don't think there is i think that i think the societal norm is that everybody wants to be where he's at. He's in the one half of 1% of all people who do walk at 50. Right. Or maybe smaller percentage than that. So what is, what do you think? And again, I'm putting you on the spot, but real quick, we'll get to a call. But I would love to know, 30 seconds, on what do you think is the source of that feeling he gives us in the last sentence that he thinks people are going dude

you're 15 you're not working well i think it goes back to something i heard um an ai pontificator talking about more than a work crisis more than an economic crisis we are going to have a massive especially in the united states a massive social unrest when it comes to an identity shift because in the west our identities are based on what do you do and how hard do you work at it that's if you don't answer those questions appropriately you are seen as less than culturally and so we don't have a psychology for what if a robot just does it right and what if the job that you had as an attorney making the 700 an hour goes away because a chat gbt will do it for 35 cents right and so we don't have a psychology for that so i think it comes down to just breathing or the cultural air which is if you don't have an answer

to the question what do you do my god what if you could answer that i love my life i hang out with my family i am currently working on woodworking projects but i'm also starting a radio building thing and i play in a punk band on the weekends at 50 like that should be a great answer i'm creative i solve problems for people etc but anyway um i think i want to be free from other people's allowing other people to speak into my value or quote unquote embarrassment because of how i answer that kind of question yes and amen and by the way last one enjoying the fruits of a lifetime of hard work is not in opposition to doing hard things

and showing up at a scheduled time so enjoying the fruits of a lifetime of hard work doesn't mean you stop doing hard work. I think hard work is good for you. And every single nutritional, physical, psychological thing would say keep doing hard things. So maybe you don't do it with a mean boss or something like that or shareholders, but keep doing hard things while you're enjoying the fruits of your labor. Yeah, I love it. Let's see if we can get Will in here in Phoenix, Arizona.

Will, how can we help? Hi, guys. Thanks for taking my call. You bet. We got about two and a half minutes, and I'm sorry to do that to you, but see if you can get us your quick question and see if we can help. All right. I hope you guys can hear me. My wife and I are in Baby Step 7. our home is worth 400,000. Of course it's paid off. And, um, my question is, um, I'm 61 and potentially in four years, like to possibly retire, not entirely like you guys were just talking about, but from corporate America anyway. And, um, the home that we sell for 400 now,

which I'm assuming will go up, and the home we want to buy in the same area is possibly about $100,000 more. Currently have about $700,000 plus in retirement savings and liquid combined and want to know if you guys think it's okay to spend $100,000 of the retirement to buy a $500,000 house instead of the $400,000 we're in now. I wouldn't take the money out of my retirement to do that. I'd work a little bit longer and pay it off quick. And again, you could still retire from corporate world and I think you can still accomplish what I'm suggesting. Why would you move up in house? Most people retire and then they decide we're gonna we're gonna sell the big house that we raise the family i'll tell you why we're gonna tell him downshift

tell him why i know well believe it or not i don't want to my wife doesn't want to go upstairs when she gets older she's like she's putting something on herself that hasn't happened yet. She thinks she can't get up the stairs of the two-story and wants to go to a one-story. I knew it, Will. I feel you, dog. I saw it coming like a freight train. I knew it was the wife. Hey, the house I just bought has one of those rad chair lifts in it.

I'm coming over tonight. I told her about that. I'm coming over tonight. She still wants a house. Yeah. Well, fair enough enough fair enough i single story so if that's going to be the case john i really don't want him pulling out of the retirement fund i want that money staying will and and again you have the income and the experience to uh to to if you got to do a mortgage on 100 grand that's such a small amount and pay it off quick if you can't convince the wife yeah well one thing i

didn't throw in is that between now and those four or so years we will probably reinvest another hundred or so between now and then so oh i wouldn't do that at 8 50 i wouldn't oh you're talking about invest in your retirement account well the whole question is about a house, but the retirement savings, which is $750,000, will probably be about $850,000 by that time. I know, but I still... If you were at that million mark or more, I'd feel a little bit more comfortable about it, but... I wouldn't. Yeah, I wouldn't pull $100,000 out when you only have $750,000. I'd tell her she's got to work a little bit longer. Yeah, I wouldn't have that conversation either. I agree.

Just a joke, Will. You're on your own, pal. This is The Ramsey Show, where we help you win with your money, win in your profession, and win in your relationships. Alongside Dr. John Deloney, I'm Ken Coleman. The phone number to jump in today is 888-825-5225. 888-825-5225. Let's get it started with Zach in Lexington, Kentucky.

Zach, how can we help today? I'm trying to figure out how to budget my money to get out of debt. Okay. Tell us a little bit more. What's the debt? Car payments, house, and a lot of small debts, a couple credit cards, and a student loan. All right. Let's list them out for us. So go smallest to largest. The biggest debt down to the smallest. Start with the biggest debt.

$150,000 for my house. Okay. We'll leave the house out right now because we want to work on that other debt. So keep going. $12,000 for my truck, $3,000 for my wife's car, about $2,000 on a student loan, and then two different credit cards are $1,700 and $1,600. Okay. And what is your combined income? Do you have two incomes or one? Two, me and my wife. So what's your combined income?

Roughly $60,000. Okay. All right. What's the truck worth right now if you were to sell it, private sale, not to a dealer? What's the truck worth? Roughly $25 to sell it, private sale, not to a dealer? What's the truck worth? Roughly $25,000. Okay, that's great news. Okay, and how much is the $3,000 car?

How much is that worth? About $6,000. Okay. All right, so that's everything you got, correct? That's everything. Do you have any cash outside of your checking account at all? What kind of cash do you have? None.

I just sold a four-wheeler to a four-tire for both of our vehicles because we live paycheck to paycheck. All right. So you guys are struggling just to make it to the end of the month? Yeah, majorly. All right. So what is your question today? Are you struggling with budgeting, or is it a bigger issue where you guys aren't on the same page about money?

I'd like to see more income, but what do you think is the big cause of this? Is it a lack of budgeting, or is it you guys are on two different pages? One's trying, the other's spending like crazy. Give us a little bit more. I think it's a lack of budgeting because, I mean, we buy our groceries, we eat most of our meals at home, we eat about one meal out a week, you know, it's kind of like a date. It's just, we live, you know, our bills take most of our paychecks. We don't really have much income week by week, and it's just, I feel suffocated. And I got a baby

on the way that's due in about three weeks, and I don't know how I'm going to afford child care. All right, let's figure this out. So what is your income, and what do you do? And then tell us your wife's income and what she does. My income is like, I want to say $32 to $35. I don't know exactly. I make about $17 an hour.

What do you do? I am a water plant operator. Okay, great. What does your wife do? She works for the courthouse, and she makes about $15.50. Okay. All right. What is the mortgage?

You don't have a very big mortgage. What's your mortgage payment? It's almost $1,200. Okay. Well, that is a huge chunk of your take-home. It's a massive chunk, and we don't even owe that much. I think it's because we're so young. No, that doesn't have anything.

What's your interest rate on that? Do you know? It's all interest rate. I think it's almost 8%. Good. That's the issue. Call my friends at Churchill Mortgage right when you get off this call and see about a refinance in that house.

Yeah, I agree. What's your truck payment? It's $330. Okay, I'm going to start there. And the reason I'm going to start there is because that's a $300 a month raise, which is a massive deal for you. And you've got equity in that. And I would sell it. If you can sell that for 25, you owe 12, that's going to leave you 13. I would go buy a

$5,000 truck because I can find them all day long online and have done it before. And then I'm going to take that 8,000 and I'm going to knock out your wife's car payment. I still got $5,000 left over. I'm taking out the $2,000 student loan. What do I got left? I'm trying to run this in my head. Then I'm putting the rest of it in a savings account. It's going to be in my emergency fund

because I'm about to have a little baby in my house. I agree. I also got the two credit cards, which is $1,300 for both. No, I got that. Those are gone then. But I think he can get rid of it all. If I did the math right, I think you pay your entire debt off with the proceeds from the truck. Brother.

You're free. That's massive. What is your car payment on the wife's car? $180. Okay, so that's $480. All right, and we should start going down the list. Yeah, you just got a $6,000 a year raise if you do this. Massive.

$500 a month. Now, I want to say one other thing. You, my friend, your wife's pregnant, so I'll let her off the hook, although I'd like to see her pick up some hours, pick up 15 to 20 hours a week at Walmart working evenings while the baby's in the oven. But you definitely need to be picking up another 20 to 30 hours a week to actually get this emergency fund built up because you can be debt-free and start

stacking in the emergency fund really quickly. But this is all effort. I'm going to sell my truck, pay off all the debt, stick the rest in savings, and my wife and I are going to work like we got no tomorrow in order to stack up five, six, seven grand. All this is doable. Am I right, John? All this is doable. But hey, listen, you're on it. You said the baby comes in three weeks? Oh, three weeks. Yes. Okay. And your wife works hourly, right? So if she is at home for two or three weeks on maternity leave or six weeks. We just took a huge hit. You lose half your income, right? She has paid maternity leave or six weeks we just took a huge hit you lose half your income right uh she has paid maternity leave for six weeks oh outstanding right high five those people in lexington listen listen my man we live in a world adam excuse me zach that would tell you well you

take off time no you're not you don't have you can't afford it you can't afford to take time off with your wife you got to got to be working crazy hours. And so you go get a second job, sell everything. If you sell this truck, you are debt-free. $500 a month raise right there. And let's also call Churchill, like you said. Let's call Churchill and get this house, see if we can't get the house refinanced. That's number two.

And number three, brother, you're on the horn to get another job. I think with someone who works in a water treatment plan who works as hard as you do on a day-in-day-out you should expect to make 50 to 60 grand yeah okay well my biggest my biggest issue is i'm unlicensed but i'm supposed to be licensed in april and that should be a little bit of a pay raise. And then I've been picking up odd jobs like crazy and working 16-hour shifts about four days a week. Good. But let's go get the best hourly rate we can right now. I don't care what it is. And let's don't get a certification for a little bitty raise. Yeah, I agree with that.

Let's go get a certification or change fields so that in two years, you're doubling your salary. I'd like to see you be looking at the trades, Zach. I really would. I want you to get through baby and get a nice emergency fund, but I'd like you to start thinking about the trades. You're talking about a plumber, electrician, that down the road, if that's something that you're interested in. I don't want to push you into that, but the type of work you do,

I think it would be a nice transition, And we're talking about a much better situation when it relates to hourly rate plus benefits, plus a nice ladder forward. But listen, Zach, we just gave you, I mean, this is easy compared to calls that we get. Selling that truck changes your life. It also signals to your wife and that new baby, I'm the husband and I'll do anything for my family. By the way, honey, I sold the truck and I picked up a second job for the next six months so I can get us ahead financially. You guys will be fine. You got a small mortgage. Let's see if we can get you a better rate on that. But just doing what we said is selling the truck is going to make the margin there. Go get it, brother. Get after it, my man. There's no sitting around waiting anymore.

You got to move. This is The Ramsey Show. There's a time in your life and at the baby steps for renting, but you don't want to do it forever because when you rent, you're still paying for a mortgage, just somebody else's. Plus, rent means instability in your budget because it always goes up, never down. So when you're ready to buy, make sure you work with a mortgage partner you can rely on. Churchill Mortgage. Churchill is Ramsey trusted to help you make the move from renting to home ownership wisely. Churchill understands that when you buy a home the Ramsey way,

your mortgage payment will be a consistent, manageable part of your monthly budget. Plus, when your home is paid off, that was your largest expense. Now it's extra money in your pocket and an asset towards turning you into a baby steps millionaire. So get started on the American dream of home ownership today at churchhillmortgage.com. That's churchillmortgage.com. This is a paid advertisement. NMLS ID 1591. NMLSconsumeraccess.org. Equal housing lender. 1749 Mallory Lane, Suite 100. Brentwood, Tennessee 37027. Welcome back to The Ramsey Show. Alongside Dr. John Deloney, I'm Ken Coleman. Glad you are with us today. 888-825-5225 is the phone number we'd love to hear from you. Let's go to Orlando, Florida, where Adam is joining us.

Adam, how can we help today? Hello, and thank you for taking my call. You bet. What's going on? Well, I'm expecting to get married in the next year and a half. And the person I'm expecting to get married to comes from a lot of money. Uh-oh. And as someone that's in school and I'm expecting to have a stable career,

I'm a little nervous because I don't think I can match that lifestyle that she's exposed to. You can't. You can't. Let it ride, dude. Her father's an entrepreneur, and he makes a lot of money. And I know that that type of wealth that she comes from is only available for an entrepreneur or businessman or has her own thing going on. And honestly, I'm not too confident that I could match that.

You can't. I thought we just covered this. You can't. I thought we just covered that. You can't. And John said let it go. How do you think any of the men marrying Dave Ramsey's daughters felt? You don't. And you know what? Both of those men, I know them.

They're friends of mine. They're confident. They're smart. And they do good work. But they ain't ever going to have 750 million dollars that's right and yeah those daughters don't love them any less is the issue you uh which we would understand that you got to get over that but i understand you feeling that or is it her is she is she putting pressure on you i mean what's what's the reason for this call

what what can we help you with well i don't know her too well is the issue. It's sort of an arranged marriage type of situation. Okay, hold up. Now we're digging in. Hold on. So are you actually engaged? Because you started off the call saying, I'm going to get married in about a year and a half. Is there a ring? Well, there's not a ring. Are there animals going back and forth with the arrangements? Like 150 goats? Are you with many goats? What are we doing here? What are we doing? Well, she's from Morocco, as Fred mentioned. My cousin married her sister, actually.

And this is actually, we went to the wedding and things of that nature. And the way it works is she asked her dad and her dad came to me and her dad said are you married and i said no i'm not i'm actually 19 years old i'm not married and we kind of hit it off from there well who hit it off you and the dad or you and this girl me and the dad i've really talked i've talked to her that's what i thought i thought i heard you say me and pops hit it off and and I think I might marry his daughter. I don't know if you know this, but she is a key component of this marriage that y'all are setting up.

Not really. Not with this deal. Is it really an arranged marriage? Yes, sir. Not this. My mom and dad, or mainly my mom, I actually have seven siblings, and my mom tried to get each of us arranged, and I'm the last one.

And she always wanted, she always talked about all this, and when she came in contact with her parents, like done deal, they didn't like the word arranged. We used the word insisted. I don't know if that's what it is. I think that's probably the better word. I think that's what it is. I think that's actually the right word. Let me that's what it is. I think that's actually the right word.

Let me ask you this. Where are you at on this deal? Do you want to do this? I don't care how cool Pops is or not. Well, I mean, she's pretty. She's really pretty. No, bro, you're not answering my question, and I think I know the answer. Do you want to marry this girl or not?

I think I do. No, you don't. No, you don't even know her. You want to please your mom is what I think I do. No, you don't. No, you don't even know her. You want to please your mom is what you want to do. You want to make your mom happy because she insists that you marry this wealthy Moroccan girl. Well, for me, honestly, I understand that. Yeah, good. I talked to her here and there.

Like, nothing crazy, nothing like. Bro, I'm not marrying somebody that I talk to here and there. That's an acquaintance. What are you doing? Why'd you call us? I believe I will marry this girl. In all honesty, I saw it set up. So, basically, it's end stone.

Okay, in all honesty, why did you call us? It doesn't matter that you called us. Because John and I want to help you, but we've already told you how we feel. Yes, sir. So I don't know if I mentioned that. Well, I set up for a stable career later on down the road. And again, I don't know how to – I can't match this lifestyle. Really, I don't know her. Hold on. Listen match this lifestyle. I really, I don't know her.

But hold on. Listen, Adam. I feel like we're on a hamster wheel. Yeah, none of the things you're saying matter. It doesn't matter that you don't, hold on. It doesn't matter that you don't talk to her regularly. It doesn't matter that you haven't been on dates. It doesn't matter that you haven't kissed her yet.

It doesn't matter. None of that matters because you said this thing's arranged. So if it's arranged and you as a grown man in the united states of america are going to get in that boat and say all right mom you're going to direct the rest of my life then bro it doesn't matter what you make it doesn't matter any of that stuff because you got in the arranged boat and you took off down down the river what do you care let that be if you want to be a grown-up and decide i I love you, I want to create a life with you, us two as two individual adults creating one, not letting my mom and your dad drive our future,

if you want to do that, then yes, I get there being feelings like, man, I didn't make as much money as your dad. You're going to have a different lifestyle. We may have a Honda lifestyle when you're used to a Lexus lifestyle lifestyle that's all well and good but that's not your situation right now dude so just get if you that's what the choice you're making get in the boat prop your feet up and put your hands behind your head and then just ride on down down the river down to the ocean man yeah yes sir does that make sense it makes sense it sense. So you called us saying, guys, I don't know what to do. I don't think I can provide for her.

It doesn't matter. She chose you and Pops chose you, it sounds like, or the two of them got together and said, this is my guy, and you're just going to go along with it. So, therefore, it doesn't matter if she's disappointed. It's got to be the greatest get-out-of-jail-husband card of all time. And, Adam, for what it's worth. It's absurd.

How old are you, man? 19. I tell 19-year-olds to get off their parents' cell phone plan, much less their marriage arrangement plans. So, knock your lights out, man. You're an uncharted water for me. I would tell pops to get you a good job. That's what I would do.

What are you worried about? Why are we even going to school? I mean, this guy's wealthy and he selected you. The whole thing is foreign to me, Adam, and we're having a little bit of fun with it because, quite frankly, it's so absurd, I can only laugh with it. And what is absurd is I'm not insulting other,

I probably already have but we'll get over it the absurdity is your attitude towards it i i'm not going to judge another culture and arrange marriages i don't get it but this doesn't feel like a cultural practice this feels like an overbearing mom yeah you can say that what culture what culture you come from are you are you an american family oh i was born in America, raised in America, but my father is from Yemen and we're Muslim. They're Moroccan, so there's obviously some differences. This is a generational thing for your parents.

This is a very normal thing for them to arrange or insist. Yeah, my parents weren't arranged. My dad's parents were arranged and their parents are arranged yeah it's what i'm getting at so i don't understand it but i'm not i'm not knocking the tradition because i don't understand it and i want to be very clear our large audience on that what i'm saying absurd is your response to this because i feel like you got an option to go deuces i'm out or i kind of think i'm gonna do it and yet you called us to go what do i do and i i just i'm pleading with you and i mean this i hope you remember my

voice multiple times tonight before you go to bed please don't do this john am i right you can hear it all over him yes he feels like he has to do that's the thing adam if this is a like the i've actually looked at the data on the traditional cultural arranged practices. It's remarkable. It's robust. But there's entire family systems around these new married couples and families and all that. So I'm with you, Ken. Not knocking it at all.

This doesn't sound like that. It sounds like a mom that wants to make sure her boys marry somebody who's going to have a lot of wealth. Right? And good on mom. She got you there. Well, she got you. Yeah. You, though, Adam, aren't in.

And if you're not into the cultural practice, if you're not on board with the family practice, you're not on board with this woman that you are going to. At some point, they close the door and it's just y'all two. This is awful, but I'm going to be real. Okay. If I was in Adam's situation and the father approached me and we're hanging out and we're bros,

and he goes, hey, by the way, my daughter over there, that's my fourth one, would you like to marry her? She thinks you're cute. I'd go, let's talk terms. I would be like, hey. Can I get an offer sheet? I need to run to the bathroom real quick, and I would go to Washington, D.C.,

and I would never be seen again. That's true. But, I mean, if we're going to do all this, let's go, all right, what's the job? Do we got a slush fund? This is wackadoodle. I don't know how else to process that. Oh, Adam. He needs to fall in love with somebody quick.

Hey, let us know. Send us a wedding invite. Me and Kim may show up. Rachel, do you ever get these sketchy text messages that are like, hey, you need to update your address and verify so we can get you the package you didn't order? Yes, I have, George. Sketchy and never trust them. And that's why we recommend Delete.me. They help with that. Yeah, they do. Delete.me actually goes in and removes your information

from data broker websites, and it is an incredible service that everyone needs. And there's a lot of shady companies out there that solely exist to sell your personal data to bad guys. And that means your info, like your email address, your home address, your kids' names, your name, everything is just out there for scammers and spammers to find. That's right. And then once they remove your information, then they're going to send you a detailed report telling you where they found your information, when they removed it, how many hours they've saved you. I mean, it is incredible. So detailed and it's beautiful. I love these reports. So far, get this, they've reviewed 27,000 listings on my behalf, removed me from 240 data broker sites and saved me 77 hours of time. It's incredible.

Absolutely amazing. And Winston and I now get fewer texts, weird emails, spam calls, all of it. I love it. So you got to be sure to check them out. Ramsey fans get 20% off their annual plans. Just go to joindelete.me.com slash Ramsey. That comes out to less than nine bucks a month. Super affordable. It's amazing. So again, that's joindelete.me.com slash Ramsey. Make sure to check it out, you guys. Welcome back to the Ramsey Show. Thrilled to have you with us. I'm Ken Coleman. Dr. John Deloney joins me. And the phone number for you to jump in is 888-825-5225. That's 888-825-5225. Okay, folks, a little bit of a mild roller coaster going on in real estate right now. That's just the reality. A lot of experts are saying we're

going to stay in this interest rate range for most of this year. Who knows? They don't know. We don't know. But the reality is, is for years we've said marry the home, date the rate. And so whether you're buying a home or selling a home, this is a massive, massive decision and transaction. And it's why you need the tools and resources to get you prepared. And so that's why we have the Ramsey Real Estate Home Base. Fabulous location for you. You're going to see calculators, start to finish guides, how-tos, a podcast, books, and even a video course, all giving you actionable steps so that you can navigate the buying and selling process without any massive errors, and it's painless. RamseySolutions.com slash real estate, RamseySolutions.com slash real estate, or you can

click the link in the show notes if you're listening on YouTube and podcasts. And I want to point out, when we tell you about all these things, and if you miss it because we know you're listening to us and watching us while you got other things going on, the show notes, the show notes, the show notes, all of the links, things we talk about are in the show notes of the podcast app that you're listening to us and watching us while you've got other things going on. The show notes, the show notes, the show notes, all of the links, things we talk about, are in the show notes of the podcast app that you're listening to and on YouTube. All right? And RamseySolutions.com, you can usually find it. All right, let's go back to the phones.

Vanessa is joining us now in Phoenix, Arizona. Vanessa, how can we help? Hi, thanks for taking my call. You bet. So I just had a quick question. Me and my husband and my brother-in-law and sister-in-law, when we first got married and started having kids, we bought a piece of land and built two houses on it in the city, which is kind of a unique property. Then we refinanced. We bought a house separately. they bought their house separately. We long-term rental those two homes and then we turned into Airbnbs about five years ago.

My question is this, I'm wanting to sell my Airbnbs and to pay off my house I live in now and then build an Airbnb on the back of my property. The problem is, is everybody tells me this is going to be the biggest mistake of our life because I can't buy into real estate like I did 20 years ago. I am going to have to pay capital gains because I already own the land that I'm going to build an Airbnb off of. And obviously you have to pay capital gains if I pay my house off. So I'm just wondering, is selling my rentals to pay off my house and build another residual income a bad idea or not? No, of course not.

You know that, don't you? I do, but something about, because people are saying the interest rate that I own, I owe $238,000 on my home, and I'm at an interest rate of $2.99. I owe $166,000 on my rentals at an interest rate of 2.99. I owe 166 on my rentals at an interest rate of about 4.25. So they're saying, you know, lumber's going to go up. How do you know you can build an Airbnb on the back? God bless them. They don't know as much about real estate as you do. True or false? Well, I don't feel like I know a lot and so i never mind okay bad tack let's go this okay let's go by the numbers can we do the numbers okay all right yeah let's say i want you to give me these numbers super simple you sell both rentals okay how much money do you

walk with cash well so that's another problem because, to find a comp in our area with two houses on one piece of land is very difficult. So when we do the numbers in our head, like to pay, you know, the mortgage off to pay capital gains, like I think I need at least minimum, I need to walk away, me and my husband personally with 500,000. Okay, I didn't ask that, and I want you to keep this simple, because I'm trying to help you, but you're confusing me in your answer. You sounded like a congressman on a Sunday morning show there. So, direct question. Stay with me. I'm trying to help you, okay? Okay. First of all, you need to get a great real estate pro, okay? It's somebody who can give you real comps. Real numbers. Real comps. But I want you to be modest, okay?

You own two homes. What do you think you walk away with on a modest sale price of both rentals? Give me a modest ballpark figure. You've thought through this, haven't you? Yes. Okay, then give me the number. I would say $500. All right, you're going to walk away with $500.

And your current home that you live in that you want to pay off is how much? How much do you owe on it? $238,000. Okay, so you're going to have $500 minus $238,000 is what? $272,000 left? Yes. Am I doing my math right? I'm doing it quick.

I was a history guy. Polysci, not math. So $272,000. That's after we paid our house off. Now, what is it going to cost you to build this property, this next Airbnb property on your actual house now that you have a paid for home as your main living? What's it going to cost to do that? My husband believes being very generous, about $200,000. So if I'm hearing you right, and I'm going to round down, we got $30,000 cash left over. We have no debt at all on any properties. My home that I'm living in is paid off. And I've got an actual rental property that is going to spit off cash in perpetuity that it's paid for.

Yes. Versus being $238,000 in debt on your main home, and how much in debt on each of the rental homes? Together, they're $166,000. Okay. So what do you like better? When I just ask you those numbers, what future do you like better? When I just ask you those numbers, what future do you like better? I want my home paid off and to have residual incoming money with that paid off as well. Great, so I'm going to hand you over to my friend who's really smart with emotions and mental stuff.

And John, now that I've just pulled out what she would prefer to do, which interestingly enough lines up with what we would tell her to do. Right. What about these people in her life that know so much about lumber? I guess, I'm trying to think of the right way to ask this question. He's stumped. No, there he goes. It's this, Vanessa.

What do you do for a living? So I clean our Airbnbs and manage them. Okay. And my husband works for UPS. What is your take-home salary every year? Combined? This last year, it was about $115,000. $115,000.

Yes, sir. How, somewhere along the way, did you get the understanding that that you're dumb who told you that well not that i'm dumb but account like you have such a great interest rate on your home why would you pay that off and i'm like well because then my husband can work but he can be basically retired you You have no car payments. You have no credit cards. It's a really smart answer. Okay. So somebody is trying to tell you that you're able to see into a future that most people who are obsessed with their stupid spreadsheets and Instagram can't. And that is this. What is life on the other side of not owing anybody anything? Or to say it another way, what is life on the other side of freedom?

And our culture is so stupid and obsessed with short inch-by-inch gains that they don't look at the long picture, the long game. It's so true, John. You already have. It's the same reason companies hire a bunch of people to goose the Q1 numbers and then fire them all Q4, not realizing that at some point people just quit working for you because you're terrible people. But they're so obsessed with the little notch here and the little notch there and the little notch here. So in the same way, you've already projected a future where your husband laughs every morning.

So true. Where you have a cup of coffee on those rare cold Phoenix mornings in your paid-off house that nobody can ever take away from you, and y'all just can go for a walk together. Hey, Vanessa and John, do you both remember the classic Miller Lite ads where it was like, when we grew up, it was like, great taste. And then the other half of the bar would yell, it's less filling. And it was a debate. Here's what's going on, Vanessa. Here's what I'm hearing.

You're saying, my life is better. And they're going, better interest rate. Yes. And it's this goofy, weird, what? It's a dumb thing. You're going, my life is better. And they're yelling, but you got a better interest rate. It's the

goofiest thing I've ever heard. People are like, well, you're just giving capital gains away, but then when I do the math, I'm like, but I'm going to pay more in interest over the next 25 years to my mom than I did in Kyle. Vanessa, you're not dumb. Good answer, Vanessa.

Ken and I, in your seat, would both do the exact same thing that you're talking about. And I'll pay the 3% difference on my APR that I'm losing for my new property. I'll pay that difference in a peace tax every day. You got it right, Vanessa. Do your plan, not theirs. This is The Ramsey Show. people that call in and their spouse has passed away suddenly and they don't have life insurance. When you have to think through how am I going to pay my bills in the middle of next week, in the middle of all that grief, like it's just, it is, it's terrible. And so life insurance is the one thing, especially as a mom with three little kids that I'm like so big on for people

to get because it's inexpensive. Zander is the place that Winston and I actually get all of our life insurance. And it doesn't cost much because Zander shops among a gazillion different companies. It doesn't cost much. You just have to admit that someday you're not going to be here. You got to say it out loud and you got to say, I'm going to say I love you to my family by taking care of them and taking the time to put this stuff in place. The cost of stinking pizza. To get a free quote, call 800-356-4282. That's 800-356-4282 or go to zander.com. Welcome back to the Ramsey Show. I'm Ken Coleman.

Dr. John Deloney joins me this hour. We are thrilled to have you with us. 888-825-5225. That's the number to jump in. Today's question of the day is brought to you by WhyRefi. Now, we don't recommend refinancing on everything, but for distressed private student loans, there is Y Refi. We trust Y Refi because they can help you with a low fixed interest rate that you can't get anywhere else to help you stick to your budget

and get out of debt. Learn more at YRefi.com slash Ramsey. That's the letter Y, R-E-F-Y.com slash Ramsey. It may not be available in all states. Oh, I started pre-reading this question, Ken, and it's already giving me gas. All right, today's question comes from Allison in Georgia. Yeah, you're going to want to scoot over a few feet here.

Okay. My husband and I started building our dream home last year. We took out a HELOC to fund the down payment and start the building process. We struggled financially for the last few months due to low profits at my husband's business. No way, things weren't going to always just continue to go up and up and up and up forever. So he took out several more loans to help with the cash flow. These ended up strangling us, so we used most of the HELOC to keep the business afloat,

along with using personal credit cards to make business purchases. The business now owes us over $300,000. And y'all owe the banks and the credit card companies, I'm assuming. Our house is almost complete, but closing on it is in jeopardy due to all of this debt. How do I come to terms with the fact that my dream house is probably gone? How do I deal with the embarrassment and the shame? And how do I feel safe in my home when everything is falling apart? A lot of questions for you there, Doc. Well, I mean.

A lot of emotional questions. I mean, I would just say on the dream home is I would, if you can get out of it, get out of it. Yeah. And then start to dig out of the situation from the business. Because this is a lot of stress right now. There's a marriage issues. There's the, by the way, she's putting all this on her husband. She doesn't say here that either she was complicit in this,

like she participated in, well, I guess I'll just put this on. Or she needs to deal with some serious financial infidelity issues in her home where her husband came and said, by the way, I just lost the house. And there are times when that happens. He basically gambled it away, yeah. I think when it comes to dealing with when dreams are gone or when you have to grieve what you wanted to be, man, it just takes time. You've got to write some things down.

I recommend people go through some sort of, for lack of better words, a funeral, some sort of ceremony that says this was and it's not going to be anymore. Embarrassment and shame. It's just kind of part of it. If you participated in trying to rob Peter to pay Paul and you ended up gambling away all of your losses, gambling away your home, then yeah, there's some embarrassment. There's some shame. I recommend dealing with those head on.

Walk straight into them. When somebody asks, you say, me and my husband made some dumb business decisions. We ended up having to pick between the business and the home and we chose the business. And you run straight through it and you'll find that the embarrassment and the shame lose their power over you when you say them out loud and you head directly into them. And then how do I feel safe in my home when everything's falling apart? sounds like a marriage question ken and that's when you and your husband get away for half of a morning and go to breakfast at a cheap diner and say right we got to rebuild what like the our ability to trust one another that's right forget the business forget the house forget all i agree and to your point the only thing i'd say on that is if she doesn't feel safe financially, which this circumstance would absolutely do that to anybody, then what you've got to do is I'm going to take shame, whatever shame there is.

And it shouldn't be, but I understand that's a natural emotion. Of course there is. But I'm going to go ahead and take shame over feeling unsafe, meaning I'm going to get out of these problems. Oh, heck yeah. I'm going to go back away slowly. I'm going to go get myself a job and get myself of these problems. I'm going to go back away slowly. I'm going to go get myself a job and get myself a checking account. I'm going to do what we need to do so that I feel like that my financial world isn't crumbling. And then once I get there, that's going to do wonders for

dealing with the shame. That's right. That's right. But it's really hard to deal with all that at the same time. That's exactly right. And it's easy for me to say on this side, but it's just a house. So if their marriage is intact and they made some strategic gambles by taking out a HELOC to fund down payments and putting everything on credit cards and we triple stamp a double stamp and it all came down, everything's not falling apart. But if your husband's lying to you and now you've lost your house and you may have lost your marriage, it can feel like everything's falling apart. You need to get somebody to talk to and say these things out loud and you know what just i

want to throw this out there john i know you're gonna agree with it but i it just popped in my head we need to say that if we are very wise and intentional in who we choose to be our friends those are the people you need to go talk to about not need you have to instead of shame just you can you can enter with shame but real friends will go hey don't worry about it oh i i'll bring the nachos you bring the beers we're gonna sit and talk they're not gonna leave you no they're gonna actually make you feel good and dare i say safe yeah and they'll weep with you they'll laugh with you a good friend will poke at you and gotta have they'll say, how can we move forward together? I'm going to tell you, and I mean that with everything in my being,

Stacey and I have always been intentional, but I'm telling you, we've got friends like that around us right now that I'm just telling you. It's everything. You just have to have the people that no matter what's going on, you can snot in front of them and cry an ugly cry or be weak or doubtful or insecure or whatever. And they just come around you and they lift you. And it is so important.

So I just saw, I heard that and I was like, you know what? I get the shame feeling, but take that shame, take it to real friends and watch shame disappear. That's exactly right. It's really good. All right, let's go to Valerie in San Antonio, Texas. Valerie, how can we help? Hello. I was just wondering, when I'm looking at baby steps four, five, and six, are you supposed

to, you know, max out number four first before you move to five, before you pay more towards the house, or I know you're supposed to do them all together, but I just don't know how much of each. Yeah, that's a good question. I love a good Ramsey rule follower, Valerie. Yeah, so basically what that means is like once you get out of Baby Step 3, okay, and you've got that three to six emergency fund, three to six months. Then you begin to take the budget. We reorder the budget, right? And so we take 15% of take home and we invest that. And that is for retirement. And so you begin to make that happen. Now, now you start working the rest of the budget, right? And so now we go, okay, we're going to put some, we're going to put what we can away for baby step five, right? And so you may have enough

income where you can do all at the same time, but you may not have enough income to be able to do that. And so you may be in four and five for a while. Does that make sense? Yes. So you suggest putting all 15% before you do five and six, right? Yeah, because it's not about before, it just becomes the thing. It's now, this is the next thing we do. It's like budgeting, right? So once we get through baby step three, the automatic is every time we get a paycheck, we're putting our money away for retirement. So it's just in perpetuity. Does that make sense? Yes, it does. Thank you so much. Yeah, that's a really good call actually you know because we have a lot

of people that join us all the time john and so do you want to talk about the momentum behind that and and why dave over the years developed that so it it feels and there are times where you can do four five and six all at the same time sure but that's a function of margin right it's exactly or sometimes like um i was really close to paying off a house so i paused in quote i guess technically four or five i paused putting money in retirement because it was like six months away and i could escalate i'm just going to hammer it but so there is some four five and six flexibility but the cornerstone principle is if you got kids there's going to be some educational expense at some point that you don't want them to have to choose between no education or debt, right? You are going to have life after work at some point or

life after an ability to go in and be given a paycheck and you have to prepare for that. So you start saving for retirement. Dave's found 15% over the long haul is a good amount of money that's going to give you a good lifestyle in the end of it. And then, yeah, dude, try to work towards a world where you don't owe anybody anything, including your mortgage, man. But yeah, I think that the hard part for me, for a hard part for most people is toggling out of the, which is baby step one, two, and three, getting out of debt and getting an emergency fund and then settling into living a life, right? Like, what do you want life to look like for you? And I think that's a hard part for everybody. It really is. And we say, we use this phrase a lot and it can sound cliche and I don't

want it to be cliche today, but we talk about we're moving now out of baby step three and we've been super, super intense. And now we want to downshift, if you will, to intentionality. And it's easier. So from intensity to intentionality. It's always easier to blame Dave for all your decisions. Four, five, and six is where you guys sit down and say, what kind of life do we want to build for ourselves? And what's that going to look like? And you've got to own some of the

consequences there. That's right. Good stuff. A good hour. Dr. John Jaloney, I want to thank James Childs and our amazing crew behind the glass to keep us on the air. And you, America, for listening. This is The Ramsey Show. Welcome to The Ramsey Show, America. This is where we coach you to win with your money, to win in your profession, and to win with your relationships.

Alongside Dr. John Deloney, I'm Ken Coleman. The phone number to jump in is 888-825-5225, 888-825-5225. Let's get started with Cody, who's joining us in Dallas, Texas. Cody, how can we help today? Hey, y'all. Thank you for taking my call. I have, between my wife and I, we just got married this year, in May, or last year rather, and unfortunately we lost our job two to three times within the last year and a half. Oh, man. And we didn't get utilized credit.

Oh, no. What happened? We do have a fight. Just either I was a police officer for a local agency and things changed and they let me go, and then I transferred into the medical field, and that changed and they let me go. And then I worked and transferred into the medical field and that one didn't work out either. We're both pretty stable now. She got a new job in a different field too, because she's got some medical disabilities. So we've got somewhat of stable income and hopefully it doesn't change what is your combined income right now

we roughly i make about 47 right now and she makes about 37 and is that about what you guys were making before oh no we were making well over between the two of us especially in law enforcement i was making over 115 120 a year combined okay hold on i i spent a lot of my time with police officers especially in texas did something happen did you let go do you get fired yes they let me go but it was it was an honorable situation i didn't get in trouble and then you know why haven't you been able to pick up another or do you just want to get out of law enforcement completely because every single colleague i talked to is saying man we can't find people that want to do this job it's there's there is some history but it's not permanently disqualifying for me it's just

certain areas um up in far north te. Agencies talk to each other. Okay. But that little thing in your history is $60,000 a year worth it to you to not explore? No, I'm still actively seeking. I just haven't gotten through with an agency to move forward. Okay. Full-time. So you guys went.

I do reserve. So you went from 125 combined to 74 combined. Do I have that right? Yes. And in between, we've been as low as zero and, you know, 40,000 with just a single income. All right. So we got a decent picture. What's the challenge today?

How can we help? Debt with vehicles is anywhere between $160,000 to $180,000. We don't have a mortgage because I still do security in an apartment, so thankfully I get discounted rent. So what is the debt picture? Give me the list this out because we got $160,000 to $180,000. We don't even know the number. That makes me a little concerned uh and it doesn't involve a house correct so i we have three vehicles all of which can't get sold because there's negative equity i played that game for

a few years unfortunately um so 55 in one vehicle 30 or 42 in a lease and then a motorcycle that's sitting at about $16,000. What's the $55,000 car worth? About... Last time I checked, it was roughly $35,000 to $38,000. Okay, so if you sold it... If you sold it today and went down to a credit union and got the difference and wrote a check for it, now you owe $25,000 instead of $55,000. Unfortunately, we've got so many things that have transferred over to collections I can't get approved by a credit union.

We're kind of at the spot of is bankruptcy kind of a no realistic options no okay you what else is in this debt because i'm only seeing cars i got 55 42 and 16 now what's the rest of the debt student loans uh roughly read at at about 30. And then the rest has been lots of credit card debt. We used overused credit to pay bills and insurance. And you're renting right now? Correct. Yes. My monthly apartment rent is like 275. So I'm not worried about our living situation. So here's the thing. I don't think you're going to do what we're going to say. Okay.

And here's why I think that there is a particular kind of person that calls into the show and everything that has happened to them is just an is. And it's just a, it's a, it's a fact there's a period and there's nothing anybody can do about it and we just right and then there's sometimes people call in and the woman who's stuck in my head was a teacher who is a hundred to thousand something dollars in debt as in new york city when they locked down new york and she figured out a way to work four jobs and she paid it all

off like in 18 months something nuts and she's like i wouldn't do anything else they wouldn't let us do anything else and so she delivered food and then she taught on zoom and then she she tutored on zoom then she delivered midnight meals or whatever and so here's the thing ken and i'll both tell you you save up enough money to to get rid of these cars and you go work four jobs and five jobs. The idea that we just had zero paycheck, that should never be a thing because you're going to go to McDonald's. You're going to go to a Walmart and throw boxes.

You're going to go mow lawns. I'm going to go knock on doors. There's not going to be a day I go by where me and my wife have zero. Do you get what I'm saying? It's that kind of fervor. And if your wife works the best she can with her medical challenges and you get what i'm saying it's that kind of fervor and if your wife works the best she can with her medical challenges and you say i'm gonna not just stop and make 40 grand i'm gonna work 40 grand and i'm gonna drive uber in the morning and at night so i'm gonna go throw

boxes until midnight i'm gonna start over tomorrow and do it again you're gonna wake up in 18 months exhausted but you're gonna be in a very different position than this something happened with the police force. My dream got taken from me. These departments are all talking, and so they're boxing me out. Stop being a victim of that story. Go somewhere else. I mean, you're renting right now.

Move. Yeah, I would sell everything I owned. Move to Abilene, Texas. They'll hire you. Move to Lubbock. They'll hire you. Move to somewhere where it's cheaper. You get what I'm saying?

You're going to have to go buck wild on this thing. And you still got to sell the truck. And the reason you sell the truck is to lessen your debt load. Right. I mean, you don't want to hold on to it. Holding on to this makes zero sense. You can ride the motorcycle, right? So sell her car.

Figure out a way. She rides with somebody. I mean, you guys have got to find a way. And selling these vehicles is at least a big chunk that you can take out of this, which feels like an insurmountable mountain. This is why you called us and said, hey, guys, can you guys give me the blessing on the bankruptcy? I just want to kind of start over.

And I don't think that solves anything for you because there's some behavior changes that you guys have got to make you agree you guys just kind of made some really bad decisions and kept compounding them oh absolutely and i don't say that to judge you no but we've all been there are you done yeah is this it for you yeah we we i'm tired there's no murder i was gonna say you laughed is there anything funny about your situation right now cody is it funny no stop laughing yeah let's get after it hang on the line we're gonna hook you up with financial peace university and i'm gonna hook you up with every dollar budget the premium version for a year and that way we'll put a little bit of jet fuel in your tank but i'm telling you what man If we give this stuff to you for free, these are tools that people spend money on.

If we give them to you for free, y'all have to use them. And you, my brother, have to stop being a victim in the story and get after it. Starting today. We'll be right back. We'll be right back. Welcome back to The Ramsey Show alongside Dr. John Deloney. I'm Ken Coleman. 888-825-5225 is the phone number.

888-825-5225. That music, that bump music sounds like old In the Heat of the Night. Dude, suddenly you say that. Here's what I thought. I thought, this is when Magnum P.I. is sneaking into a house to find a clue I felt it was Magnum P.I. mystery, I felt the same vibe

Very interesting, good bump there I'm going to grow a mustache You should, actually It's not a good look, man I think you could pull it off, you're already the oddball kind of different kind of psychologist. I think James would look good with a mustache. You know what I'd like to see with you?

I'd like to see a mustache, and I'd like to see a Tommy Bahama shirt with a wife beater under it. I'm going to make that happen. I think you could pull that off. I think your fans would love it. I really do. Fairly certainly wouldn't. If I take off these dark shirts,'m blindingly pale yeah like it'll burn your

you're in short sleeve shirts all the time the tommy bahamas no shorter all right i'll let you think about it all right with the stash only stash no stash no shirt i'm gonna start stash today all right mason is joining us in louisville kentucky no stash no shirt that sounds like a like a like a sign in a restaurant it's like a bad country song uh let's go to mason who's joining us in Louisville, Kentucky. No stash, no shirt. That sounds like a sign in a restaurant. That's like a bad country song. Let's go to Mason who's joining us in Louisville, Kentucky. Mason, how can we help? Hey, guys.

Thank you for taking my call. What's up? My question is my wife and I are following Baby Steps 4, 5, and 6 currently, and we just had our first child in September of 24. So we got no debt except for the mortgage. That's just under $100,000. And I'm currently working in IT, making $64,000 a year. And I just had a job interview that would put me at a raise of $69,000 a year. And my question is, my father always taught me to stay loyal to one company,

but my peers say switching jobs in IT about every two years is the best way to gain a significant raise. I'm wondering if it's wrong or, you know, cheating to change companies for a better salary. Yeah. Is it immoral for you to take this job if you were to take it? No. Is it illegal? No. Have you signed a contract that you would be violating if you took this job? No. Then your dad, while a very good man, comes from a very different generation, and they had a very scarcity mindset about work, and your peers, they've changed the game. It started with the millennials, and now Gen Z's come along,

and in the tech world, it is absolutely possible to be changing jobs every two years and move up the ladder. And I think as long as you're moving up, and these are great opportunities, it doesn't make you look flighty at all. It makes you look talented. And I don't think there's anything wrong. I love your ethic and I love the heart by which the question comes. But unless I'm missing something, John, this is a great opportunity and you can go do good work for a company and uh and and and leave well but you don't owe them loyalty other than doing what you're expected to do for the paycheck that they give you that that would be loyalty but if a great opportunity comes along and they can't match

it and it makes your life better go period right am. Right. Am I missing anything, John? No. In fact, I think that loyalty ideal, sometimes with a company, ends up challenging your loyalty to your spouse and your kids. And so I don't want to ever get into a loyalty game where I've got a pit potentially x versus i don't want i don't want to live that world and so i think loyalty loyalty to me is about integrity right loyalty doesn't mean i don't know i'm loyal to my friends to a fault but i'm not going to do something that's going to violate my core values you know what i'm saying right that's a very good point you can be loyal to your friends but if uh going with your your best best buddies of all time on a trip

that is at the detriment of something in your family that's not loyal that's dumb right you know and and so uh here's another thing you could you could grow up your whole life in one locale super loyal friends. We said we were going to Texas forever, you know, like Friday night. You get an opportunity to go to Washington State, that changes your life. Hey, pals, you guys can come visit me. We've got these things called airplanes. That's exactly right.

So, Mason, I love your spirit, but this is such a simple question. Can I ask a bigger question here, Mason? Yes, sir. Do you hate working where you work now? I don't hate it. It's just boring, and the job opportunity now is something I believe in more. Okay. Love it. Because I was going to ask you, that's a lot of life change for five grand.

But you just sold me. And here's the other thing. You know what what john makes a very good point mason so does this set you up on a better ladder in other words you see an opportunity to climb at the other companies yes yeah a much higher opportunity that's the key to john's point you start amortizing that after taxes, five grand is not that much. Yeah, it's a couple hundred bucks a month. This is more about your future than the present of changing my salary. Okay. Okay.

All right. And all you do is you go in and you tell the truth. Facts are your friends. You don't owe a big swan song explanation. You go in and say, I'm so grateful for the time you gave us. And it's been an honor to work with you. I have accepted a position at x y and z and i'm grateful for you yep don't look back leave like you would want to be left and you'll be fine

let's go to uh tampa florida and rome is there rome how can we help thank you for taking my call today sure what's going on? So, background around me, I just started the Dave Ramsey thing, going headfirst already, clearing debt. I did the Every Dollar Budget app. Once I did the Every Dollar Budget app, I see that I can save a lot of money. So, now I got me and my girlfriend, hopefully wife-to-be soon, sooner than later. Make it happen, almost most definitely later this this year engagement next year wedding 100 so i get out of debt completely by january of 2026

and then after that i start baby step three but my main concern is i'm a ups driver here in tampa all things are very expensive in my area. It seems to be that there's nothing that you can find for $200,000 or $250,000 that's even remotely decent. So that's my main concern, and I'm trying to see for the future, me and my wife, our first home, we're going to do 15-year fixed-rate mortgages, just like how you guys say. It's really hard for me to visualize

anything other than i i just don't want it to be a burden not a blessing like you guys say yeah so it's not a visualization problem this is a math problem man right yeah i have to be patient yeah be patient or you have to expand your search or consider moving into another city it's just it's the reality that millions and millions and millions of people are facing my biggest thing is that because ups is a seniority-based company, and I've already put in seven years, if I leave to another building, I lose all my seniority. So that means bottom pay, bottom placement, everything.

And I hit top pay next year, so I'll be around that $120,000, $125,000 mark. Great. Then if that's where you want to be long-term, or at least in the near term, a little bit longer there for all those reasons, then we're going to be patient. We're going to rent. It's not a sin for a married couple to rent.

Yeah. You're going to be giving up one thing you want for one thing you don't want. Yeah. But I'll also tell you this. Oh, definitely. I'm hearing more and more and more people who gave up 10, 20, 30 years with railroads,

with driving companies for this so-called seniority thing, and they're looking back with some deep, profound, painful regrets that they let somebody else tell them how they were going to live their own life. My thing is I don't want to get a 30-year mortgage because at the end of the day, you're just going to be paying for it. So that's fine. Then don't. So roll.

Then don't. We wait. Yes, be patient. We wait. And you might buy a house in five years or seven years instead of next year. So that's fine. Then don't. So Rome, we wait. Yes, be patient. We wait. And you might buy a house in five years or seven years instead of next year. That's all good. You're not throwing money away. Yeah.

Listen, you're not throwing money away if you rent in order to give yourself freedom in the future. That's exactly right. Freedom from too much house, right? Very, very smart. Yes. All right, my man. So if you want to keep this job, making this much money in this town cool, then you have a math problem and so that means

those two choices are gonna mean, Ken, that we're delaying house purchase for three to five years. It's just everything is a choice and everything has a trade-off to it. That's right. It just is, man. Absolutely right. If you want to buy a house right now, then it's gonna be a smaller house. That's fine. That's great. And somewhere along the way, they told us we could have everything all at the same time, and they lied to us, Ken. It's true. You can't.

It sucks. But that's how it goes. All right. We're going to try to lift it up a little bit on the next call. Quick break. Dr. John Deloney, Ken Coleman, with you on The Ramsey Show. Welcome back to The Ramsey Show. Alongside Dr. John Delaney, I'm Ken Coleman. Thrilled that you're with us.

888-825-5225 is the phone number to jump in. 888-825-5225. The Ramsey, let's see, here we go. Oh, I wanted to tell you about the EveryDollar app. This is the best way to make the most of your money. We've been talking about this a lot. We drop it in the show all the time, talking to people on the phone, and we go, look, you need to use EveryDollar.

Why? Because at that point, they have no idea where their money's coming, going, all of that, and getting control of your money starts with knowing where it is and how it's being moved around. So plan, spend, and track expenses save for what matters most to you, all in an easy-to-use app. It's every dollar.

Download it for free in the App Store or Google Play. That's the App Store or Google Play, or you can get the link in the show notes. That's every dollar. All right, let's go to AJ in New York City. AJ, how can we help? Hey, Ken. Hey, Dr. John. Thank you very much for taking my call.

Sure. I have an interesting predicament. Essentially, I'm definitely going to be buying a business here probably within the next year. And I'm 21. This is all very new to me. And I'm just looking forward to see what's going to be the best way of acquiring either a business loan or through an independent financial company. I mean, what would be the best way of acquiring either a business loan or through an independent financial company. I mean, what would be the best way? What kind of business? It's an automotive repair shop. How much is the cost? I'm assuming right around a quarter million.

How did you come to that number? I mean, that's just going off of a lot of other sales that were in my area, and also I'm very close. No, no, no. I've been working alongside them. I mean, that's just going off of a lot of other sales that were in my area. And also, I'm very close. No, no, no. I've been working alongside them. So you need to base that on a revenue projection. So you're talking at the lowest price should be one times revenue, somewhere in that range. So you need to see those books.

It's called net present value. And there's actually somebody you can hire that will help you project out. That's where we come up with the value. It's not like a house where we look at comps. We want to look at real books and go, okay, when all the expenses are paid last year, what was the net profit? That's what we want to be looking at. And what am I buying? Am I buying all the lifts and all the tools and all the air compressors, or am I just buying the name on the wall? How much business have we had the last five years? How good a team do we have? All that stuff you're buying. No, absolutely. And it would be absolutely everything. And that is going off of the books

for the past five years. The company typically does about two and a half million in revenue a year. And it ranges from eight to 17% of profit at the end of the day. And have you been in this industry? I've been working alongside the current owner for about a year and a half now. And before that, I've always been in the automotive industry, whether working or managing. So when you called us, did you think there was a good shot? We were going to say, this is a good move, man. Go ahead and take out a loan for $250,000.

I mean, that's really what I'm having a hard time valuing, you know? Please don't. What do you mean? What's your hard time? What are you wrestling with? I mean, I know that, you know, obviously it can be between $150,000 to $375,000 a year. And, I mean, that would be steady income that eventually I mean, I know that, you know, obviously it can be between $150,000 to $375,000 a year. And, I mean, that would be steady income that eventually I would like to, you know, co-branch and have somebody else run it for me, essentially, so I can focus more on my passion.

Which is what? Building custom cars at home, which is what I've been doing on the side for a long time. What do you make right now working for this guy? About $93 a year. Yeah. I mean, is he looking to sell this to anybody else? Is this one of those deals where he likes you, you guys have been talking, kicking rocks around a little bit on this, and this kind of came up?

Or is he going, I'm out, I'm done, and before I put it out there for everybody else, do you want it? What's the scenario by which this came to you? Um, I mean, when I started there a year and a half ago, I was originally talking about doing that because he's, he's getting up there in age and he's wanted to ever since. Um, I mean, you know, every day that I'm working with him, he brings it up once or twice, you know, about how he will only sell it to me and how obviously he's going to give me a good price for it. Sure. So here's the only way this thing can work, brother. And, and here's the thing. You're passionate. You're clearly skilled at what you do. He's paying you a good, a good wage. So he

trusts you. Um, he likes you. That's awesome. I remember being 21 and having mentors tell me that they valued me and it, it was, it felt amazing. Right. And so I don't want you to take that excitement and that good feeling and him saying he's proud of you and then you go do something that A, will jeopardize that relationship, which is to take out a loan and then pit your relationship with him

against this, bring a bank into your relationship essentially. The other thing is you might overpay for something so it would be wise for you to get a third party you're not going to do that i know that but it would be not integrous of me not to say you need to get a professional in here just to make sure they're double checking and they look at you and go hey dude i know you love this man the car he's about to sell you has rust all the way through it okay but you're not going to do that so here's the only way i would tell you to the way you could pay this out is if you

and him agree to a three-year or five-year deal at x dollar amount and you pay him a percentage of net profits period that way it's not technically a loan he's still got skin in the game and he is still getting paid so if the if the if the profits crater for a year then um he doesn't get paid but if you guys run this thing up and it crushes two years you're done with him you get what i'm saying that that to me aj that's the only way the only way but i'm going to push on you a little bit here how much money do you make or could you make on your side hustle of the custom cars and doing that stuff, the restorations? I mean, realistically, I could probably, you know, pull six digits of about $100,000 a year. That's what I'm saying.

But, I mean, you wouldn't make that right away. You're just kind of tiptoeing in it right now. Like, what are you making right now? I mean, right now I make my current salary. Uh, no, I know that obviously make 90 at the shop. I'm saying, do you make any money right now in this side hustle where you're restoring cars? Um, I would say on average, probably 20 to 25,000 a year. Okay. I'm going to tell you what I would consider if I were you, I would consider not buying this company, even though John's giving you a legitimate plan. But unless you're super fired up that I want to be in this, and I really believe this is an absolute win, and it really sets me up for the future, I really want, you said your passion is to work on cars, and you just also said you could make six figures eventually doing that. And I absolutely know that because I know that world.

Okay. Maybe, just maybe, I say, no thanks. I'm going to keep making 90 here. I'm grateful for the offer. Grateful for the offer. But I don't really want to run this business long term. I actually want to run my own car shop, restoration, custom shop. And so I want to work here, and then I want to go home there and I want to see if I can go from 20 to 25,000 in 2025 to 50,000 in 2025. And in 2026,

I want to crack six figures for the first time. And so now all told, I'm making close to 200 grand and I slowly get to a place where I can walk away from the mechanic shop and do the thing I want to do that's what I would push you to do because here's what you're buying in addition to a car you're buying employees I mean you're at employees sick days hey my wife's sick I need to not come into work anymore you're buying the hey you're one of your guys didn't torque the lug nuts on this front tire. I've got a nickel for every time I heard that. I'm suing you. Yeah, Ken hears that all the time.

I'm just kidding. So you're buying also headaches and all that kind of stuff. So please don't go to a bank and take out a loan just to make this older man happy. It's awesome that he's a good mentor. That's fantastic. What do you want? What future do you want? Let's just say,

let's say you do John's strategy and John's right. It's absolutely the only way we would ever say that. Let's say you do that and you crush it. Do you want that future or do you want the future of you're crushing it in your restoration business? I mean, I obviously would be more apt to the restoration business in the end, long goal. I mean, I obviously would be more apt to the restoration business in the end, long goal. I mean, however, working there for as long as I have and just going through, I mean, it really does mean something to me to be more of a moral-filled auto shop, you know. And that's certainly a kind of precedence that I like to push and I like to be a part of. But I also, you know, like building cool stuff. Okay, so it's not our call. We answer the question on no to the loan, but the profit share

and you pay him that way. And get it in writing, no handshakes. Or just so you know, no thanks. I think I know what you're going to do. Just don't get overextended because that dream's going to keep pulling at you. I promise you. Yes. And here's the last thing. You're going to have to get in writing. I'm going to say that again because there's a chance he drops dead of a heart attack three years into your handshake deal, and now you've got to mess with his

estate. Get everything in writing even if he's a close friend. Great stuff there. Good call. Alright. Quick break. We'll be right back. This is The Ramsey Show. Welcome back to The Ramsey Show. Our scripture of the day is Proverbs 13, 20. Walk with the wise and become wise, for a companion of fools suffers harm. Our quote today from leadership and management guru Ken Blanchard.

None of us is as smart as all of us. Interesting. Is that whole true? Because isn't there a... I was getting ready to say, like, I actually, I thought, I love Ken. Had the opportunity to interview Ken years ago. But mob mentality is a thing. That's debatable. Yeah.

That quote. None of us is as smart as all of us. I'm going, there needs to be context around that. There you go if all of us is congress 435 members i think it's debatable to your point if it's a mob right or if it's my family they all want to go to chick-fil-a again again yeah and i think i'm right um we can make this personal you you've been known to frequent a mosh pit, even in your mature age that you are now. Yes.

Is that smart? It's not smart. It's fun. It's not smart. Yeah. But it's a blast. I'll bet. It's good for the soul, man.

Yeah, when I see that, I get a little terrified. My next time, you're coming with me. Not happening. You're coming. No, because I once made the mistake of getting on an inner tube with you as Dave Ramsey, who's already crazy behind the wheel of a boat, was trying to kill us. And you're climbing over top of me, all elbows and bones. That was the last time.

I was terrified for my life, James. It was the last time I heard the words, hey, man, knock it off. That's true. I haven't heard that since I was a little kid. Because I could see one bad wave, and your elbow goes into my ear all the way down to my stomach. That's fair. But it was fun. That was fun.

That's one of the funnest I was ever. That was a good time. Hey, man, knock it off! That's true, dude. Great memory. That's right. I just remembered, like, hey, no one's told me that since I was a little kid. I was not in my window of tolerance at that point.

Ben is joining us. It's very unsafe what we window of tolerance at that point. Ben is joining us. It's very unsafe what we were doing. That's right. Ben is joining us in Jacksonville, Florida. Ben, how can we help today? Thanks for taking my call. Yeah, what's up? Looking for a little advice on a scenario,

a situation we've got going on at the moment. So my wife and I, we are on baby step four, five, and six. And we were hoping on paying off our house this year, coming up over in October, November timeframe. Just last week, my wife actually got laid off from work. Oh, man. Sorry about that. Yeah.

So the question is, we have the funds to pay off our house and savings, separate from our six-month emergency fund that we have the funds to pay off our house and savings separate from our six-month emergency fund that we have as well. Should we go ahead and take that money to pay off our mortgage and be 100% debt-free, or should we keep that money in the savings just in case for any kind of other expenses that may come up until she's able to actually find another guy. I would do that.

I would just sit tight. Don't let it be an excuse, though, to not pay it off. But had she not lost her job, how soon were you going to pay it off? We were just going to, over the year, just start throwing money at it. But you got the whole sum. You got the whole sum right now sitting in the bank. Why would you take your time paying it off? She was in the mindset of wanting to keep that money for security,

and then we had a discussion the other day and started talking about how the money that's in the bank is just really a transference of debt between what's in our account and what we owe on the actual mortgage. We're in the process of trying to talk her through it. Very good. Great perspective. But to answer your initial question, yeah, I would wait until she gets back to work. What does she do for a living? Is she a nurse or is it more of an abstract opportunity she's going to have to find? She is actually a UX designer. Oh, well, you know, it's really interesting about tech jobs right now. I don't know if she started looking into this already in your area. What has she seen? She has. It's actually a very tight industry right now at the moment. It has her field. It has. It has contracted across the country.

I don't think it's going to stay that way but i just think that we saw companies we saw the overall job market tighten over the last quarter with companies not hiring as much um i don't think it's going to stay that way but it but it's definitely that way right now so for those reasons i mean i would wonder if she could at least while she's looking for full-time work, could she get some contract work, some freelance work? We discussed that. At the moment, she's at home with our two-year-old. So we're trying in the middle of trying to get some family to watch her while she's trying to see what is actually out there to be able to find work. Okay. Well, here's the bottom line. You guys are clearly a responsible couple. Anybody who's got, how much money, by the way, would pay the house off?

$55,000. Yeah. I mean, you guys are smart. So what do you make, dude? So I'm self-employed. After net, I'd probably be around anywhere between 70 to 80 how consistent is that uh it's pretty consistent um it doesn't really fluctuate much it depends on on whether i'm out doing more trees or not as well so i've got two different industries that i'm in at the moment so here's another a third opportunity and here's like just a rule of thumb for me whenever i feel boxed in and me and my wife have feel like we have an either or i always do the experiment on for myself a thought experiment of what would a random third option be because i hear it in your voice y'all had a plan to get this house paid off and she already feels bad that she got laid off she feels bad that the markets

are tight right now there's shame there's all. What if you sat down and said, hey, for the next six weeks, the next three months, I'm going to work this many extra jobs, and at the end of February, March 1, we're going to pay this house off. I'm going to make an extra $20,000. So we're going to meet in the middle here. And what that's going to show her is I've got skin in the game. I love you. I'm all in. You take a minute. You recalibrate. We've got kids in the game i love you i'm all in you take a

minute you recalibrate you got we got kids at home i know you're picking up the slack there i'm gonna hit the streets because i want to get this house paid off i know we we had this goal life threw us a curveball um i'm gonna hit it and then we're gonna go from there does that make sense that's just a random third option there too um but dude ken i like the idea of just exhaling and sitting tight for a second. I agree. Very responsible couple. No, they're not going to do anything silly. And by the way, this is another example for new people coming in all the time of why saving money, this is money above and beyond their six-month emergency fund. And so really nice to have this security when

your wife loses her job. And she's in a good industry. It will rebound. Let's go to Halifax, Canada next. And Rebecca joins us a good industry. It will rebound. Let's go to Halifax, Canada next, and Rebecca joins us. Rebecca, how can we help? Hi there. Thanks so much for the call. I'm wondering, would you sell non-retirement investments to pay off debt and complete baby step two? Tell us what you got real quick. We got about two minutes, so give us what you've got in non-retirement funds? So we have about $33,000 in stock that are currently down 45%, and we have approximately $15,000 in precious metals. And then what's your debt left in Baby Step 2? $42,181.

What's your tax hit if you sell those, the 34 and the 15? What's your net if you were to sell? That's a great question. Okay. So they're actually, the stocks are in a tax-free savings account. I'm not sure what our tax hit would be. And our household income annually is less than $100,000. Okay.

Well, I would want to know, you said you have $42,000 left in Baby Step 2? That's right. Okay. And what is that? Is that comprised of one debt or multiple? It's multiple. So it is line of credits and student loan. So there's three open line of credits right now, $4,700, $20,000, $10,000,

and then I have $7,470 left in student loan. Yeah. So as a general rule, I'm selling stocks and metals to get out of debt. Because we believe in mutual funds and that investing strategy. And so if I can get out of this and not take a beating on a tax thing and clear my debt, I'm doing it. And here's why. Single stocks sometimes go down 42%. Yeah, right.

And you just get hit in the mouth, right? Where theoretically a mutual fund's going to have other stocks that are not going down 40 john real quick talk about the psychology though if they wipe it all which we're saying to do let's talk about that that she's not a lot of pain getting rid of this yes it's going to hurt because there's there's going to be that that false security that um you don't even have gold buried in the backyard you you're holding an email from somebody saying we've got your gold scattered across many countries in their backyards, and somehow that's supposed to make you feel better.

Ken, I might give it a week to see if it rebounds some, just because the market went silly yesterday, but on the whole, just as a general principle, yes, I'm selling single stocks, I'm selling unprecious metals to get out of debt. Thanks for the call, Rebecca. Thanks to Dr. John Deloney, James Childs, and our fearless crew. And you, America. This is The Ramsey Show.