The Ramsey Show - App - Can We Afford To Buy a House? (Hour 2)

Episode Date: January 9, 2024

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. George Campbell, Ramsey Personality, is my co-host today. Thank you for joining us. Open phones at 888-825-5225. Starting this hour off is going to be Jenny in Columbus, Ohio. Hi, Jenny. Welcome to the Ramsey Show. Hi, thanks for having me. Sure. How can we help? My husband and I are on baby step two, and we are all in. I've got a second job.

He's working overtime. We're selling everything but our kid. We're all in. Good. However, we are looking at anywhere, depending on what option we pick at the dentist, we're looking at anywhere from $10,000 to $50,000 worth of work needed on my husband's teeth. I don't know how to do that without taking on more debt. What's your household income?

$170,000. Well, I do. You save up $10,000. Well, okay, so the $10,000 gets us 10 years, they said, and then he'd probably have to have the work done again. Do you still think that's the best option, or should we try to do the $50,000 option, which is a fix for the rest of his life? B or C, none of the above. I want you to go talk to two other dentists okay i'm calling bs okay unless your husband has some kind of disease

50 000 is out of control i am not a medical professional it's for dental implants i know but it's not okay then it's not 50 grand. Let's go shopping. Let's go shopping. Okay. Okay. Okay. Because the thing, I don't know beans about being a dentist, okay?

But what I do know from having sat in this chair for 30 years is that I've had a lot of people bring me dramatic numbers like you just did and I send them back to the marketplace and they there's a lot of other ways to do this and turns out and a lot of uh different pricing structures and so forth for some reason when it comes to medical or dental or things like this we we don't shop like we if you were buying a car and someone said you could buy a $50,000 car or a $10,000 car, you would say, okay, tell me about it. And then I'm going to keep looking at cars. I'm going to keep shopping. And then I'm going to have a lot of things to compare with, not just two of these options. So, but for some reason, all of us, you included, just accept,

well, it's 50,000 bucks. It didn't said so. Doc said it's this. And no, there's a vast array of pricing structures in that world. So I want to go shopping. And then, yes, I'll put, let's pretend you can fix this for $10,000 or $15,000 or $20,000 even, okay, for implants, okay? Okay. Something more permanent. And then you don't have to cheap out, but you also don't have to go bananas, okay? So then the answer to your question is how do you pull that off? You make $170,000, you just slow your debt snowball and pile up $20,000

depending on the urgency, the amount of pain he's in or whatever it is you're facing is how fast you do it. If it's me and I'm hurting, we're going to do it fast because I'm a complete wuss. You want it over with quickly. I don't do pain. I'm a wuss. Sharon has the pain tolerance of a Navy SEAL.

I get a hangnail, and I'm in the floor crying like a four-year-old. So, no, I mean, so I'm going to go. I'm going to write some checks and get out of pain is what I'm going to do. But anyway, so just depending on the urgency of the situation. And if what she's saying is true, let's say 10,000 buys are 10 years, well, 10 years from now, you're going to be in a very different place financially. In two years, it might be debt-free, and you could do whatever you want. I don't know if I want to rip my teeth for 10 years.

But anyway. I'm confused. I didn't know it was like an HVAC. Like, well, this thing will keep it running for the next 10 years. I don't know what they're doing to his mouth there. It's a very strange diagnosis. I can tell you this. There's the cost.

It's $400,000 to become a dentist now. And then buying into a practice would be another half a million or so. And so there's a whole business side of dentistry that allows them to sell a vast array of products i've fallen for it every time i go in there they have a new technology they've purchased that can now do this new thing and it's for fifty dollars a tooth we can do this for you otherwise it'll be 300 later on if you get the cavity and i'm like i don't it's so stressful that's called practice management that's sometimes they're in sales which is medical talk for sales okay so um i i'm not accusing this dentist of malpractice management that's sometimes they're in sales which is medical talk for sales okay so um i i'm not accusing this dentist of malpractice i'm just saying he's willing to

sell implants are the most willing to sell old jenny a bentley that's all i'm saying i'm seeing on google dave one to one to five thousand dollars per implanted tooth is what the going rate is so if he's talking many many teeth could be 50 grand it could be okay depending all right google we know google's right always right i go to web md for all of my health needs yeah yeah if you go to web md you're dying you have three days to live that's it you got three days to live everything is three days to live or it's a minor head cold three days to live and a thousand dollars a tooth yeah three days to live i seriously shop at jenny that's what i would do and then if and $1,000 a tooth. Yeah, three days to live. Seriously, shop it, Jenny. That's what I would do.

And then if you need $20,000, slow down your – you got $170,000 coming in. Slow down your debt snowball enough at the speed of the urgency to come up with the $20,000. If you're going to wait 10 months, it'll be $2,000 a month. We're going to do it over 10 months. If we need to do it right now, we're going to have to stop everything and do it over two or three months, right? And so however quick you can build up the 20K. But it is going to impact and slow down your debt snowball speed because this is something you have to deal with.

Your husband's dental health does matter, and we're not blowing that off. Hey, thanks for the call. Open phones at 888-825-5225 thank you for joining us america we appreciate you being here and uh i mean this is how it's done boys and girls we you know it's um man george your brand new book coming out next week, Tuesday, January 16th, called Breaking Free from Broke, The Ultimate Guide to More Money and Less Stress. You can see right there on the cover, there's a millennial holding up the wall. That's all you need to know.

So if millennials can hold up walls, then they can do anything, right? I had to flex my muscles there. That's it. I've got an interesting question about this, Dave. People keep asking, well, how is this different from the total money makeover? And it's been an interesting question because I believe it's very different. The first two-thirds of this book are really unpacking probably the most in-depth we've ever done on the toxic money culture, all of the different types of debt with research from these last few years.

I mean, if you want some in-depth stuff on any of the financial things moving around out there, this book's got it in there. And Total Money Makeover has none of that. Total Money Makeover is the baby steps. It's how to do it. How to do the baby steps. Yeah, this book has a little. I cover the baby steps and I go, cat's out of the bag, but we're going to have to unpack why to do the baby steps. What's underneath this all?

The research in this and the snark in this is incredible. But let me tell you, living on a lesson you make, living on a budget, being generous, getting out of debt, saving money, is going to be in every Ramsey book in one form or another. Nothing new under the sun, says Ecclesiastes. We didn't change that for Jade or George or Rachel. It's going to be there. So every Ramsey money book anyway, it's not going to be in John Deloney's book, but even part of it's in John Deloney's book.

Yeah. So be sure to pre-order. January 15th is your last day to get $100 in bonus items at ramsesolutions.com. Thank you to so many of you who have already done that. I hope this book helps you take the right next step with your finances this year. George Campbell Ramsey Personality is my co-host. Thank you for joining us, America. We're glad you're here. Open phones at 888-825-5225. Our question of the day is brought to you by Neighborly, your hub for home services. No more scrolling through pages of internet results.

Neighborly is the one place you'll find a variety of home service professionals that you can rely on to do the job right, or Neighborly will make it right. That's the Neighborly Done Right promise. Learn more at neighborly.com slash Ramsey. Today's question comes from Sherry in Vermont. Hello, Mr. Ramsey. Can you please explain why the most common form of income mentioned is gross income, not net income when discussing budgets and personal finances? I find it confusing because in my mind, the deducted taxes don't count. You can't spend what you owe the government. So if you include that, it makes it seem like you have more discretionary income than you actually do.

Thank you for the clarification. Well, it depends on what we're talking about. The problem is, honestly, Sherry, too many people don't know. I'm going to say this delicately. They don't know what the flip their own money is. I mean, so here's the thing. If you make $60,000 a year, that's $5,000 a month gross before taxes. But if I ask you what your net is and you say $2,500, which is $30,000 a year,

then I've got to go try to figure out, because you apparently don't know whether you have taken out 401k out of that health insurance out of that, whether you have your car payment deducted out of that, and it's going to your credit union. That's not real net, but it is what you're coming home with because you had all this other crap taken out of your check. And so a lot of people don't really understand that net, what you get your take home pay because people have other various things taken out is not germane. I can tell what's going on with your gross, but I can't. And I know about what your taxes are based on your gross, but, uh, and then I can do

the calculations while we're sitting here to help you move towards getting out of debt. But I'm well aware if you make $60,000 a year, $5,000 a month, that you're not getting home with after federal income tax withholding $5,000. I know that, but I also know that you should be getting home with a lot more than some of you are. Some of you have too much taken out of your check. Your deductions are wrong. Some of you have other things that aren't taxes coming out of your check, like I just mentioned. And so when I say take, when someone gives me take-home pay,

I really don't know what they're talking about because it could mean so many different things. But I can back into it from gross and know where you stand. So that's why I use that figure. But it's not because I don't realize there's taxes taken out. It's because I do realize there's a bunch of other crap taken out of other people's checks. And sometimes they're so confused by that because you really can talk to somebody that has a $5,000 gross and they're getting home with half of that.

Or if they have a regular income, they can be very confused based on what's going to come in that month. What's your take-home pay? So the, hey, what did you make last year? If you're self-employed, you know, you don't have a take-home pay. You know, unless you set yourself up on a salary and you've done withholding, then did you do your withholding correctly? Because way too many people get a tax refund, which means you have too much coming out of your check for taxes. It doesn't mean

Santa Claus lives in Washington, D.C. And so if you have too much coming out of your check, and then I use your take-home pay number to try to help you with your finances, then I've participated in your stupid mistake, you know? And so that's why we do that, because the only reliable number to back into things is your gross. And yes, obviously, Sherry, we do realize it comes out. Taxes do come out. And we use some round numbers, too, when we're just on a five-minute phone call. We're not digging in to the exact mathematics. But your brain is pretty good.

And the lady a few minutes ago, $170,000, is her gross. And I know she's not getting home with $170,000. But I also know that with $170,000 gross, she could come up with 15 or 20 000 bucks for her husband's teeth i mean i can they're taking home eight or nine they could probably live rocket surgery to do that basic math right there and so uh but i don't have to actually go well let's see her tax withholding and i don't have to you don't have to do all that she's out of 170 minus income taxes minus food she can still find 20 to fix her husband's teeth i mean that's just it doesn't take them you know sixth grader to do that so um hypothetically but that's why that's why i know you can't spend what you owe the government i'm well aware of that they they take so much from me

that it i can't breathe aiden is with us in tampa florida hi aiden welcome to the Ramsey show hi how you doing better than I deserve what's up great um I'm 22 I just got married in October congratulations thank you thank you yeah we make around 115,000 dollars right now we both contribute 10 percent to our IRA for work we're debt free and our question is around housing we have enough for about a 10% down payment on the house we want to buy. And our question is, should we go ahead and do that and pay the PMI, or should we wait a couple of years and just save up 20%? Well, I doubt it'd take you a couple of years. You'd probably do it by a year from now, couldn't you? Yeah, I think so. I think the math I was looking at, it'd be about a year and a half. Okay. All right.

So you'll be a whole 24 years old when you buy your first house. That's the goal. Yeah, that wouldn't be bad. I like that. No. I mean, it's okay to do it the other way, but the PMI is so stinking expensive, man. I mean, it's $75 a month per $100,000. So it's $225 if you do a $300,000 house.

What does this house cost? Aiden, what's this house going to cost? Yeah, about a $300,000 is what we're thinking. My wife works for a home builder, so you get a good deal. So you got $30,000 and you want $60,000. So the question is, how quickly can we save up another $30,000, making $150,000? You really ought to be able to do that in a year, dude.

You have other debt. Yeah, that's what we're thinking. You said you had no other debt, right? No debt at all. Oh, good. Yeah, I think I'm going to sit down, do the budget, and tighten up and say, hey, we're not going to buy that thing, and we're not going to buy that thing, and we're going to save for a house.

And that's what I would do if I were you guys. And you're investing 10%. You're in Baby Step 3B, and so if you so choose and you wanted to do this in six months, you could pause investing or bring it down to a match or something like that in order to speed this up. Yeah. I think you'll be, and if you're building a house,

the two, you're not going to be closing on it when you break ground. That's exactly what happens. You could break ground next spring, one year, and still have time to get the money together to have the 20% down. So I just don't want to give them PMI. Private mortgage insurance, folks, if you don't know, is foreclosure insurance. It pays the mortgage company in the event they have to foreclose on you and they lose

money. That's what PMI is. It's private mortgage insurance. It protects the lenders, not you. It protects the lenders. It's not life insurance. It's not insurance. You are buying someone else an insurance policy.

It's a risky borrower fee. That's $75 a month per $100,000. If you're buying a $300,000 house, it's $225 a month. On top of your interest that you're throwing away. It definitely hurts but i was in the same spot as aiden dave we bought our first townhome was three hundred thousand dollars it was a new construction build and every delay i was happy because it was more time we could save up and so we were able to put down well over 20 because of that and it allowed us to pay it off even sooner did did you you didn't purposefully cause any delays did you no that's just a construction business dave i learned i learned i had to i had to manage the project myself i had to show up there and be like that towel bar is not

even centered on the wall i'm not a construction expert but i feel like it should be centered wow and so a lot of things need that really happened didn't it yeah it's real life that's what that real you really did do a towel bar thing, didn't you? Yep. You had too much passion about that. So much passion about the towel bar. But you know, you've been in Nashville a long time. The amount of construction that's gone up in the last five years even is wild.

And these builders, you know, they're moving as fast as they can, but they run into delays and subcontractors are moving around and going to the next guy who will pay them a dollar more. And so it can be tough. Now things have slowed down, which is great. You get a little more attention on these builds. Yeah, probably keep the towel bar centered now.

Keep the towel bar centered. That's all I ask. I'm OCD. It's got to stay symmetrical. It's a big deal. But new builds, as you know, Dave, they can be a blessing and they can be a curse. And so we were happy to have it, but getting there was a journey. The amount of blue tape on the walls, Dave.

Every little joke and cranny. You blue taped them too? I blue taped the heck out of those walls. Oh, man. You're that guy. Yeah. Okay. They didn't like me.

They were ready for me to be done. Yeah. Got to get rid of OCD George. It's the biggest purchase of my life, Dave. I wanted it done right. OCD George. He's the towel rack guy, the blue tape guy. I've complained more at Chick-fil-A to get the order right, let alone my house.

Oh, you've complained at Chick-fil-A? It's happened. Are you going to heaven? They're not always perfect. They're not always angels, Dave. This is The Ramsey Show. George Campbell Ramsey Personality is my co-host today. Sarah is with us in Seattle.

Hi, Sarah. Welcome to The Ramsey Show. Hey, Dave and George. Thanks for taking my call. How are you? Better than we deserve. What's up? Well, my husband and I are pretty young. We're 24. Over the last three years, we've paid off all of our debt. You know, college and a car, we've paid for our wedding in cash. But since we started working, we've actually tripled our income. So now it's about $400,000 a year. Good Lord. What do you guys do? We work in tech.

In what? In tech. Okay. They work in tech in Seattle. so I can guess where that might be. Okay, well, good for you. Way to go. Congratulations. You know, thank you so much. And that kind of leads to my question.

You know, as the baby steps lay out, we're moving on to the next phase of wealth building. We've maxed out our 401ks, our HSA, contributing to an IRA, some mutual funds. We don't have a desire to buy a house soon, but maybe we'll just save up for a down payment to be able to do that down the line if we choose. But since neither of us grew up with this kind of wealth or anywhere close to it, all of it kind of feels excessive almost. So how do you guys think about what a reasonable amount is to be saving versus spending? We don't want to be excessive savers and missing out on generosity and enjoying the now, but also we don't want to be excessive spenders.

So since it's new territory, I was curious if you could share your insight on that. There's a lot of wisdom there. Well done. Very well done. Oh, thank you. Well, the experience that most people have, and I've had it as well, is that as your income increases and it goes places you've never been before, it takes your emotions a while to catch up, which kind of causes you to ask this question.

Yeah. Okay. It's like, you know, give an extreme example. I mean, I own Ramsey Solutions. Our gross revenues here are about 300 million a year and i've got a thousand team members we spend more on coffee than i used to make you know it's kind of it's kind of emotionally mind-blowing you know what i'm talking about and so yeah um it's uh it's hard to get your head around.

So how do you go? It almost feels immoral or unethical unless you really start to put some help to it to help with the emotions. So one of the things I've discovered, and when I'm working, for instance, with a pro athlete, I'll use this, is we just always say, Sharon and I work off of percentages. We say this percent of our income, if I get a check in from a publisher, total money makeover check comes in, which is usually a pretty nice check each year, and that check comes in. A percentage goes to investing, a certain percentage, that preset. A preset goes to additional purchases and enjoyment. A preset amount goes to additional generosity, additional investing.

Now, 50% of it's gone before we start because 40% goes to taxes and 10% to tithe because we're evangelical Christians. Okay, so that leaves me the other 50% to split up among fun, investing, and additional generosity. And so we just put a percentage on that. And so that's what you can do. You can just say, so for instance here, you're in baby step four, and you're saving towards a house, so I would put 15% of my income towards retirement, right? And you ought to be doing that anyway that's a standard baby step move and uh then i'm going to put x percent for

enjoyment and then you kind of like have to spend that on enjoyment even if it feels weird yeah because when you were thinking about it not in terms of a purchase you wanted to make but you were just thinking about it in the in general of a purchase you wanted to make, but you were just thinking about it in general terms, and you said, okay, we're going to spend 10% of this money on us, as an example. I just pulled that number out, okay? So that's $40,000 of just increased lifestyle. And that would be leaving 90% for everything else, taxes and generosity and investing and everything else. So that would be, you know, we can't really say that would be crazy.

But yet then when you get ready to spend $40,000 on something, oh, my gosh, what in the world? It feels so weird. But it helps you to do that because, oh, I've done my generosity. I've done my investing. And these are amounts I came up are percentages I came up with. Because your income could go to $600,000, then what are you going to do? I wouldn't use an amount. I would use a percentage.

That's really helpful. I think that's exactly my word, not worry. I mean, what a blessed problem to have. But, you know, we're 24, so presumably this isn't going to be the peak of our income. And so thinking about it as percentages is so helpful. I hadn't thought about that before. Yeah, it'll keep you from underdoing an area or overdoing an area. Yeah.

Because you thought about it, and you thought about it in ratios when your head was calm, not when you were. Because if you wait until you're looking at an opportunity to support a thing with generosity, a ministry or something, you're emotionally involved then. And so, you know, I want to help that thing. I want to help those people with that situation, these hungry kids or whatever it is right by then by then you're already you're already deep into it and then you start going well you know i don't know if this is right or not and i may be going too much and you could do too much you could get all caught up in the you know the beautiful little children that need some food and you could just give away you know you go crazy and so that's that really helps to lay out ratios.

Yeah. Well, I think of it as that kind of tire and you don't want a flat tire. If you're only saving and you're not enjoying it, you call into the show and you're just clenched fists. And, you know, some people can be very, very generous, but I've had a hard time finding people who went broke being generous. So that's a great one to flex. And the spending side, people call in and say, Dave, I've been following you for 30 years. I can't stomach spending money. And Dave's like, go force yourself to do something fun. And so if you look at it through those three buckets, it becomes easier.

You can save spend. I mean, the first time you spend X, Y, Z that you've never spent. Makes you want to throw up. On something, you go, what in the world have I lost my mind? Even if you're a spender, you stop and question, you know, am I out of control here? I bought a car that cost that? Oh, my gosh. I used to buy houses for that.

You know what I mean? It's like, golly. And so, yeah, it is emotional. But, you know, the good news is the first time I gave away $10,000, I thought, man, I'm rich. I mean, only rich people give away $10,000. I thought this is a big deal. And now $10,000. I mean, it's like.

And then you kept upping it every year. Yeah. The other year you gave away a million dollars in a day, and that was a big goal for you. Yeah. Just fun. To get there. But it wasn't. I mean, I couldn't even.

I thought I was so cool in one sense i gave away ten thousand dollars you know and then and then i was like oh wow you know uh but then you get satiated to it and what will keep you from going out of control is to have some boundaries and those those ratios are good boundaries it's kind of the opposite of lifestyle creep when you're not living on less than you make this is is someone following the plan going, how do I increase the right way? Mike's in Washington, D.C. Hey, Mike, welcome to the Ramsey Show. Hey, Dave, how are you? Better than I deserve. What's up, man? Not too much. I have a question. So my employer offers a 401k, and I just finished up my first year of work, maxed out my contributions to it, found out we have the ability to make Roth contributions.

Great. So I switched from 12% pre-tax to 12% Roth. Awesome. And so now that I'm contributing, making Roth contributions, I lose that deduction that I was getting for making pre-tax contributions. Correct. And other than an IRA, a traditional IRA, I'm curious what other avenues there are to kind of make up for losing that deduction. Okay. Let's reframe that because you traded a pre-tax tax deduction, making the entire account taxable when you get ready to take it out.

So if you have a million dollars in your 401k at retirement, 100% of it's taxed if it's a pre-tax 401k. You traded that for tax-free. You didn't lose the tax deduction. You traded a small tax deduction for a huge tax-free. You didn't lose the tax deduction. You traded a small tax deduction for a huge tax-free gain. So that's a good trade. I'll make that trade every day. I hate taxes, but not bad enough to just do something stupid like avoid a Roth. No, you did the right thing with the Roth. There are no big deductions out there. This idea that the rich people have all

the deductions is a bunch of crap. Unless you run a business or you've got something you can depreciate, you don't have big deductions out there. And don't go do a traditional just to get a tax deduction. George Campbell Ramsey Personality is my co-host. Heidi is in Bowling Green, Ohio. Hi, Heidi. How are you? Hi, Dave.

I'm doing well. How are you? Better than I deserve. Bowling Green, Ohio, hometown of Scott Hamilton. It is. It is. Yeah. And the National Tractor Poles and, yeah.

And I believe Dave, there was an old runner back in the day, Dave Waddell. You probably don't know that name, but yeah, that was a long time ago. Anyway, how can I help? Okay. Okay, so my question is, first I want to say thank you so much for taking my call, and you are an answer to a bold prayer that I just said yesterday. And I'm so grateful to get through. Um, but my question is we, my husband and I, um, we've been blessed with four kids that we've raised. We have our,

our baby is a senior in high school. And now, um, my husband and I are trying to buckle down and figure out how to ride this next season and to the best we can financially to, you know, hit retirement in a good note. We have our home that we live in, and we also have a five-acre piece of property that has four rentals on it, four rental homes. It also has a large barn, but we've had a hard time renting the barn out for anything. But we have, through this process of raising the kids and selling a business that we had for years,

my husband went back to school, and they called him Grandpa Daddy, but he graduated first in his class so he was he was a good grandpa daddy student he um but we have we took out two helocs um we have a heloc on our home and a heloc on the rental for what um so what yeah what'd you buy with that money? We just covered expenses while he was in school because my... Oh, so he wasn't working? No. Oh, crap.

He worked a little bit... And you weren't working. Y'all didn't have any money to eat, and so you borrowed money to eat. Well, I was working, but my income was not going to fill the gap of his not working. So how long did he not work, and how much money did you guys rack up? Well, he did not work for about a year. and in that time we had we went from I guess over the course of a few years we went from a really large income. How much do you owe on these two HELOCs that's what I'm asking? On the HELOC on the first one we owe 29.5. What about on the other one? The other one is $39,500. Okay.

So you borrowed $70,000 on the year that he didn't work. And what is his degree in? He is now a substation electrician. Okay. And what is his income now well he's still climbing each year um because he's he's been at his job for three years now but currently um he works he is working a lot of overtime but he makes about um 110 okay what do you make? And I'm currently home. Okay, so you have $110,000 income.

You have $70,000 in HELOCs from this mess. Any other debt? Well, we have $140,000 income because we get rental income from the five acres. So another $30,000 in rental income? Do you have any other debt other than any sea locks we have um no we we drive crappy cars and you're how old we 52 okay so how quick are you going to clean up 70 000 making 140 i i hope i would love to do it in two years. I think you should. But I would also, my other proposal thought is, do we sell the five acres with the rentals? Because over the next 10 years,

from what I'm calculating, if it makes a profit of $21 000 i don't know if um i don't know if it's worth hanging on to or just trying to sell it or what would it bring everything i think it would bring i think it would bring at least my husband thinks 450 you've got a half a million dollars sitting in the middle of your coffee table, and you don't own this farm. Would you go buy it? No. Then sell it. Okay.

If you wouldn't buy it again, you shouldn't keep it. But do you think it's possible to get out from under the HELOCs? Because then that would be paid for total. It's possible. If you make $140,000, surely to God you can pay off $70,000 in two years. It's only $35,000 a year out of $140,000. You've got to struggle through on $105,000 minus taxes. Right.

I think you can do that for sure, and or you can sell the other property i don't think you're required to sell the other property but it doesn't sound to me like you guys are you're not enjoying it's a headache yeah it's like you know if you didn't own it would you go buy it no was an instant answer you didn't even think about it so obviously it's not i mean if you if you wouldn't buy it again folks that means you need to sell it whatever it is other than your spouse i mean and you said you only got one more kid the house if the baby is a senior in high If you wouldn't buy it again, folks, that means you need to sell it, whatever it is, other than your spouse. I mean – And you said you only got one more kid in the house.

The baby is a senior in high school. So it might be time you go back to work and help speed this process up so you can retire with dignity. You said that was your goal. Yeah. But if you sold that and you cleared the HELOCs and then you just start stacking cash towards retirement, you're going to be just fine. You're going to be okay. It's just a matter of which way is the way you want to go at it. Twenty years from today, do you want to own that farm?

And if you ask me that about several of the properties that we own, the answer is yes. I very seldom sell a piece of real estate. But occasionally I look at it and I go, God, I wouldn't buy that buy that i didn't own it that means you got to get rid of it that means it's time to move to something else and i've got a couple of those um uh i have moved a couple of pieces of real estate over the years but 90 of the stuff we buy we keep forever uh that's our goal so but you know it's okay to move it there's nothing wrong with it. Good question. Thank you for joining us. Canada's on the line.

Dale is calling. Hi, Dale. Welcome to the Ramsey Show. How can we help? Hey, guys. I'm just wondering, I hear you guys talk all the time about if you own vehicles with large payments on them to sell them and downgrade to smaller vehicles. But I guess my question is, if I've got vehicles with negative equity, how do I do that? You have to cover the negative equity with a new loan or savings.

Okay. How much negative equity do you have, Dale? We have two vehicles and a travel trailer that we don't use anymore. So we're deciding that because we're not using it, we might as well get rid of it. Yeah, so the trailer, let's just take the trailer. What is it worth? It's worth about $30. And what do you owe on it?

$47. Okay. So would you rather have $47 in debt or $17 in debt? I'd rather have $17, but I just wasn't sure if have 17 but i just wasn't sure yeah if that's the best way to do it or if there's some other options there's not another option you got to cover this you got to cover the negative in order to give a clear title to the buyer and so that's the problem with being stuck upside down in these things so you could go to you know your local credit union and see if they'll give you where the place that holds the loan and say listen i'm underwater on

this thing this you got bad collateral here because this thing's only worth $30,000. I owe $47,000. I'm looking for a $17,000 loan to cover the difference and get rid of this thing. Yeah, let me sign a note for the difference. And if it's a local credit union, they might do that for you. Yeah. You know, if it's Trevor Trailer Finance Incorporated, they're not going to. Yeah.

You know, because you're not running trouble. You're going to have to go to the local credit union and borrow 17 to get out but i'd rather you be 17 000 in debt than 47 that'll speed this especially on a trailer that's sitting in the yard that you don't use and wish you hadn't bought so there you go or you come up with the difference if you got it in savings or you can come up with it quickly by the way travel trailers are not evil but if you're out there sitting there thinking today that you're going to go buy a $50,000 one. Oh, gosh. And a $50,000 truck to pull.

You need to know that it's going to be worth $30,000 in about 45 minutes. And so don't finance it, for sure. You know, be ready to take the hit. That's how this world works. This is The Ramsey Show. Thank you. I'll see you next time.