The Ramsey Show - App - DAVE RANT: If You're Broke, You DON'T Deserve a Vacation! (Hour 2)

Episode Date: November 13, 2020

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. My co-host on the air today, Rachel Cruz,

Ramsey personality and number one best bestselling author, also my daughter. Open phones at 888-825-5225. Jake is with us in Michigan to start off this hour. Hey, Jake, how can we help you? Hey, Dave and Rachel, thanks for taking my call today. Sure, what's up? Hey, I just had a quick question for you. A few years ago, I made some dumb butt mistakes with credit cards.

And about a year ago, this was before I found you guys and your team, I had signed up with a debt relief company where they consolidated all my debt, and I pay them now, and then they have been settling some of the accounts. But the issue I'm having now is my, my brother introduced me to you and your team and he's been all over me about the getting ahold of these people because they're telling me that they're going to have the debt paid off in five years. And it seems like I might be able to do it a little bit quicker. I just don't know how to leave or how to, I guess, figure out.

I guess I'm just afraid to leave it in case I can't pay it off quicker. Yeah. Well, let's understand that they're not paying the debt right now. Right. You know that. You didn't consolidate your debt. You just quit paying it. Right.

That's all you've done. And they're collecting a check from you, and then every so often as they pile up some of those checks, they use that money to settle one of these debts that have gone bad because you're in default on all of them. Right. You've completely trashed your credit. Pretty much, yeah.

Yeah, that's what this did. So how many different accounts and what's the total um i i want to say that there was about um 12 accounts in total that i enrolled into the program um and the total amount of debt was around sixty thousand dollars what is it now uh well they've settled about um i want to say five of the accounts and so i'm about 45 they've settled about 15 000 of it okay so you owe about 45 000 on seven accounts right okay and what's your household income uh my income is about 55 a. All right. So why in the world would you take five years to pay off $45,000? Yeah, you know, that's what I think about every day now since I started listening to you.

I would be debt-free in two years. Yeah. Not five. Or sooner. Especially since you're settling this the outstanding balance is 45 and if you settle for less because they're in default then that of course shortens up the time frame so yeah i'm taking this taking control of the situation back whatever money you paid them in fees you've lost but um you know if you've got any balance over there with them if they've

got any money in your quote savings account, have them send that back to you and send you all the detail they can on everything and cancel the service. And then you're just going to have seven different arguments until you get seven different deaths settled. Okay. All right. They can sue you today. Right. And just because you pull it out from under this doesn't make them more likely or less likely to sue you. So then you just make a list of the smallest one, and you call them and say, you know, we owe you $7,000, and we can offer you $3,000 in cash.

That's what I got saved up. If you don't want that, I'm calling the next one on the list, which do you want to do it or not and you get it in writing and um you never give them electronic access to your checking account and you settle them one at a time and work your way down through it this is why we call the debt settlement people and the real debt consolidation loans debt con consolidation loans because you're paying people to do something the work that you can really do and with consolidation, it's so hard because it feels like, again, back to that math thing, but it's just true. It's like, okay, wow, this makes sense. It feels like, okay, it's just one big debt versus all these other debts.

And again, the psychological aspect of it, people fall into so, so quickly, and they get sold this bill of goods. Well, it feels easier, but it's really harder because it's not as efficient and takes longer. Right. And it's not really debt consolidation. It's really debt settlement. And what they do, the very first thing they do is they trash your credit by putting all your accounts into default. And they keep the first several payments into their pocket as their fee before you start

building up any money over there to settle the accounts with. And so you could have just stopped paying your credit cards by yourself if you were going to use this plan. It wouldn't have been the plan I would have used, but you can do that. Now, a real debt consolidation loan is where you get a new loan and the balances are rolled into that new loan. And so now you do have literally one loan instead of 12 and that is that's consolidation when you consolidate something it's a bringing together it's not a i moved it over there and didn't pay it and so folks when people are saying with these debt settlement companies you see them on the cable tv all the time when they're saying, you know, this is debt consolidation.

It's a lie. It's not debt consolidation. You're not consolidating anything. Consolidating the very definition of the word means to put together. And so don't do that. Don't do that. Open phones at 888-825-5225. Thank you for joining us, America.

Andrew is next, and he's in Colorado. Hi, Andrew. How are you? Doing well. Dave, Rachel, thanks for having me on. Sure. What's up? So I have a question about Baby Step 4.

Right now I'm a teacher and 29 years old, and I've been with my district for about five years. And we have a pension program. And in addition to that pension program, I have a 403B that I'm going to be rolling over to a Roth as soon as possible. So the pension automatically takes out about 8.75% of my paycheck. So I add on top of that another 7% into my additional, uh, 403B. Now I recently got an email saying that the pension percentage is going to go up to about 10%. And then I think in the future up to 12, some research on Colorado and it looks like Colorado is in the top five underfunded states with my pension.

So with everything going on with COVID and things like that, I'm trying to consider, okay, now that I'm going to be rolling over things into my Roth, should I increase that percentage? Because right now I'm doing 7% and should I be worried? And how much should I put in in addition to that pension in case things kind of take a turn? I don't know what happens with that. Yeah, the problem is the pension goes sideways. You get nothing, and you haven't saved anything over on the other side. That's what you're considering. So you're exactly right.

You need to beef up your investing that you control into your Roth IRA and into anything else where you have control of the investments. You are still the owner of the investments. You're not the owner on a pension. And, you know, how long have you been at this job? Five years. And these increases in pension withholding are mandatory? I think so, just with the current state of the pension program and everything.

Wow, that would make me reconsider a job. If they're taking 12% of my pay and putting it into something that's weak and might fall apart, and they're increasing that, that would make me reconsider my job. This is The Dave Ramsey Show. You know, I hate to see people waste money, but that's exactly what happens when you buy an identity theft plan that guarantees, quote, you won't become a victim. Well, the reality is you can't prevent identity theft. All these credit monitoring and preventative plans with their fine print guarantees are just a bunch of hype. Our personal information is everywhere, and you can't control who gets access to it.

Why do you think there's so many data breaches? Thieves steal your personal information and use it for medical ID theft, Social Security, IRS fraud, and even criminal activity. None of this shows up on your credit report, which makes these plans a waste of money. You need a plan that protects you against all types of ID theft and takes over all the work if you become a victim, since that is the real nightmare. That's why I only recommend Zander's plan, and I have for years. I have it on my family and all my team members. It's the only plan worth buying.

Go to Zander.com or call them at 800-356-4282. Our question of the day comes from Blinds.com. They have a 100% satisfaction guarantee. It means even if you mismeasure, you pick the wrong color, they'll remake your blinds for free. You get free samples, free shipping, and with the new promos they run every month, you'll save even more. Use the promo code RAMSY to get the best deal. Today's question comes from Jordan in California. She visits DaveRamsay.com to ask, I am wondering what the better option is when on baby step two or three,

buying something cheap and that's going to need to be replaced quickly or making room in the budget for a higher quality item that will last a long time. In baby step two? Two or three. You wouldn't be buying anything. That's what I was thinking. But if you're like... None of the above.

If your car, though, has to be replaced, like it dies on you and you're like, okay, I need a new car. You go cheap, cheap, cheap, making sure it's reliable and you're not having to go to the mechanic every other day. Yeah, that's like $3,000 cheap. Yeah, you are making sure it's reliable and you're not having to go to the mechanic every other day. Yeah, that's like $3,000 cheap. Yeah, you are. Not like $30,000 cheap. Right.

Well, some people get confused about what that means. That's fair. All relative. All relative. Yeah. You get a freaking hoopty when you're in baby step two or three, and you don't upgrade anything. You only do emergency spending. It's the only spending you do because it's an emergency to get out of debt.

You are in gazelle intensity mode. That's exactly right. So here's the thing. You can wander into debt. Most people do. It's normal in our culture to be in debt. Everyone teaches you to be in debt. All the people that want you to buy crap from them tell you to be in debt.

Everybody is talking about being in debt, and everybody's broke. The only people that talk about getting out of debt are those people that are wealthy. And that's how they got wealthy. I mean, you talk to wealthy people, this is what you're going to find out. And so what is required here, you are going against the entire set of cultural influences, not only in your life, but in all of our lives. And so the idea to get out of debt and stay out of debt requires tremendous emotional energy. You've got to, and you can't just kind of go, well, I can't think, do I buy something cheaper?

No, you have to get fired up and wired up. I mean, because you're going against everybody. Everybody's going to think you're crazy, except wealthy people. I mean, and so you have to exert this extreme amount of energy to break through all these barriers in your psyche. That's right. Well, you said earlier you can wander your way in like most people do, but you can't wander your way out.

Like there has to be a level of intensity. There has to be a level of like you're going against the grain and it's going to feel uncomfortable. Change is hard. It's not always fun. But as you start making that progress and you start saying things like, oh yeah, yeah, I got no, we're not buying anything like nothing. All our extra money is going towards this debt. Not only do you get out of debt faster and you advance in so many ways financially and

emotionally, spiritually, all of that because you just have no payments. You don't owe anyone anything. But on top of that, something changes within you. That level of sacrifice really does. It's this iron sharpening iron and the process of it all refines you. And I think what ends up happening is you start to realize, okay, all this stuff that probably put me in debt in the first place. wow, it really doesn't matter. Like when I sacrifice stuff and I start selling things off, like suddenly even your value system starts to change in our culture, in your life that goes against the culture.

The point of gazelle intensity is gazelle is running from a cheetah for his life. You have to run for your life you cannot just act like this is an academic intellectual exercise you're carving new grooves in your brain and the only way you do that is with when people look at you and go, you're so extreme. Then you're right on track because those are stupid, broke people that are saying that. I don't think I could do what you're doing. That's your dadgum right. You couldn't because I'm a winner and you're a loser.

I mean, these things have to go through your head. If broke people are making fun of your financial plan, you're right on track. But if they're not making fun of you, you're not doing it right because you need to go to scorched earth because you're setting your whole psyche your relationships to stuff your relationship with your spouse everything's in a whole new zone and and you're basically taking an emotional bulldozer and digging a new ditch in your life. And this is not like, I just think I'll have a little ditch here. No, you're digging a hole.

You're getting out of this mess. You're changing. And you cannot half-butt do this stuff. And so you can't go on vacation when you're in baby step two. That's freaking lame-o. You can't be going out to eat when you're in baby step two. That's freaking lame-o. You can't be going out to eat when you're in baby step two. That's freaking lame-o. You're getting out of debt like your hair is on fire, like your children's lives depend on it because they do.

You're changing your family tree. And you don't do that without this thing happening inside of you. And that's when people change their lives, when they finally say, I've had it. The level of intensity is so, so crucial in the process. Yeah, and it's going to lead you to deeper sacrifice. And that frees up the math. Goofing around with the intensity will lead you to watered-down, wussified levels of sacrifice, which screws up the math, and you stay in debt longer,

and you have a higher probability of never making it out because you run out of steam before you get to the end. And possibly going back in. Yeah, and you just give up, and you go, I'm going to go be normal. Screw it. Screw it. I'm going to be broke like everybody else and look like I'm not. And I'm just going to go buy crap I can't afford,

money that I don't have to impress people I don't even like. And I'm going to go back to those old ways. And you just got to, you know, you have to reach a point that you go, no, no. And so picking on Jordan a little bit, the point is when you're in that mindset, you don't even ask the question that you asked Jordan. It wouldn't have even come up unless it's an emergency expenditure, like a car went kaput like you talked about rachel yep yep you don't ask a question of what level of vacation

can i go on you don't deserve a vacation you're freaking broken in debt don't tell me you're entitled to squat you're not when i was broke and rachel's a baby and the electricity gets cut off i can't come in and go you know i work so hard i think we need to go on a vacation no we need to turn the dadgum lights back on we have a baby in the house you can't you know your whining is unbelievable and you it happens inside of all of our heads it happened with us i mean we you know we've been fighting against bankruptcy for two and a half years we hit bottom we're bankrupt we got zero it would have been real easy to justify well we've been through this horrible time and we just really need to rest and you know you can't do that what an option because we've freaking been

on the street and i wonder what the the level of even from 30 years ago to now, 35 years ago to now, the amount of comfort we have in our lives today from the accessibility of just information, getting what we want when we want it, you know, Amazon, anything can be at your doorstep even that day. Like there's a level of comfort we live. Oh, we're spoiled rotten. Yep. You can pick up a little square thing and touch buttons and stuff shows up on your doorstep to be uncomfortable right now in life is very scary and uncomfortable but you have to be uncomfortable in this process if you continue to just be comfortable you're not

going to get the progress but that comfortability is is sweeps all of us it's and it's in all of us we're we're spoiled rotten. We really are. I mean, when you can pick up that little square thing and touch three buttons, the stuff shows up on your front porch. And you can touch three buttons and get the answer to one button and get the answer to almost any question. You can't even have a good argument anymore, you know, because the answer is right there.

You know, and so, you know, when's early voting in? Well, it's right there. You just Google it. I mean, we were laughing the other day, Anthony and I, like all the questions people ask us here on the radio, they don't need to right there. You just Google it. I mean, we were laughing the other day, Anthony and I, like all the questions people ask us here on the radio, they don't need to ask. They could just Google it. You know, and so, but, you know,

if it's the dirty little secret of the Dave Ramsey show, there's nothing here that you didn't already know. Or you could just watch one of our nine million hours of YouTube, right, for free. So, you know, that kind of stuff. And the dirty little secret is that it's all right there. We're spoiled rotten, though. Yeah.

And it makes us feel like we're entitled to pleasure. We're entitled to luxury. Yep, that's it. And we are not. When you're broke, you're not entitled. Your brain may say it's entitled, but your brain's being a baby child. This is The Dave Ramsey personality, bestselling author, is my co-host on the air today. Open phones at 888-825-5225.

Roxanne is in Tampa. Hey, Roxanne, how are you? Hey, guys, thanks for taking my call. I am about a month into Ramsey Plus. I'm loving it. Good. And I have called today because I also, as you advised me to do, I got rid of my very expensive car and I bought a $6,000 beautiful car. Nice. Good for you. So, and it's paid off, which I love. So my next question though, is I have a lot of student loans

and I'm a public educator so i have the public service loan forgiveness which is a program where if you pay for 10 years you get the rest of your loans forgiven no you don't it was a scam have you not have you not read the articles? 95,000 people have applied for it after their 10 years of service. 18 people have had their loans forgiven. Everyone else was denied. Oh, wow. No, they didn't do it. They scammed you.

So there are some loan forgiveness programs that are real. That one has not worked out. And I would not wait 10 years and hope that the government keeps its word because they haven't okay i would just get the loans so that was my question my question was do i wait wait it out or do i put it into my debt snowball so that snowball and get rid of it how much debt have you got it's about two hundred thousand dollars oh man oh my goodness what what grade do you teach um i'm in a k-8 school i'm an assistant principal oh okay okay good and are you single or married single and what do you what's your what's your income? My income is about $63,000.

How long have you been an assistant principal? For about 12 years. Okay. It's going to take you a while. I hope it doesn't take you 10 years. But that is a small shovel in a big hole and so you may you may be starting a tutoring business on the side to get some income coming in and try to double your income over a period of time here so that you can attack this at a faster rate but the um your return on investment

200 000 invested to get a 63 000 job was horrible. It was a horrible return for you. I'm sorry for that. I'm glad that you're there, and I'm glad you're an assistant principal, and I'm glad that people like you are serving. I'm very sorry that you're that far in debt to get into that, to get that kind of an income. I mean, so my goodness. Yeah, it's going to take you a little while, kiddo, but I would not be waiting on the government to do it. Um, I'm going to just start chipping away at it and figuring out what I can do to get my income up and attack it as fast as you can. That's distressing. Well, it's so hard when these, I mean, you get these numbers like that and sadly they're,

they're more common than not these days. I mean, like that upwards of six figures, people, it's the reality. And so that it just takes, it's going to take a lot. I mean, people spend $250,000 and then they're an MD, like in 150, 200 a year. And it's just, oh, oh, oh, oh. So if guys, if you guys have not listened to the eight-episode series called Borrowed Future, the podcast that the Ramsey Networks did, you guys need to go listen to it. And so you understand how bad the student loan program is.

You've, you know, we the people, it has destroyed people's lives, and we the people are doing this to ourselves, and you and I are guaranteeing these loans because we're taxpayers, and so, and we're putting people like her in bondage, allowing her to do that to herself. And, oh, I'm so sorry. What a horrible, I'm so sad. But, yeah, and this is why the student loan program has to be stopped. It's not working. It has to be stopped.

It's out of control. It's an epic failure. And so it's just, I mean, she's going to be scratching and clawing for a while. That's just heartbreaking. All right, Yolanda is with us in San Diego. Hey, Yolanda, how are you? I'm fine. I'm very nervous, but thank you for taking my call. Sure, how can we help?

This is an estate-related question. Just some background. I'm in Baby Step 2, and I've been going really hard at my debt. But prior to me joining your program and my brother, actually, before he passed away a year ago, had always, every time I saw him while he was ill, was telling me about this land, acres of land that we had in Louisiana. And he was like, you can't let this land go to waste. You have to take care of this land, he had learned that my grandfather's land had oil being drilled on it, of which oil royalties could be collected. It's also classified as timberland, and I think it looks like it's over 40 acres.

And so he passed away, and it has been put heavy on my heart to go ahead and delve into this situation. So I've done some research. I found out that the land is in my grandfather's name, who passed away back in 1982. And since then, my father passed away in 2011. And then my brother, like I said, he passed away in 2019. Are you the only survivable heir, or were there cousins and nephews and nieces? So from my research, I do have one surviving brother. My other two brothers passed away.

They also had children. And my grandfather only had two sons, my dad and I guess my uncle. I had no relations with them. And so right now what I did, since I really did not know how to handle this, I reached out to an estate attorney in Louisiana who says that I need to have a land succession performed or done, and he's going to charge me $3,500, and I think there's like $400 of court fees. Do you have any idea what the land is worth? That's the thing. I have no idea what the land is worth? That's the thing. I have no idea what the land is worth. It might not be worth $3,500. Well, they are drilling oil on this land. Who's getting the royalty checks? Well, that's what I asked the attorney. So the attorney says that in the state of Louisiana, that if the oil royalty checks are uncollected over a 10-year period, that money goes to the state.

That would be true in most states. And so I believe that no one has ever collected any of the oil royalties for this land. There may not be any, though. But if they're drilling oil, there wouldn't wouldn't they might be and they might not be i this this sounds like swampland in florida to me i just i just i don't i don't think you i i think this is a pipe dream kiddo i'm not spending 3 500 bucks on an attorney until i get a lot more information i want to know what the royalty checks are where they've been going i want the line of succession how many brothers and sisters cousins uncles aunts and people are going to be splitting into this money you could easily spend thirty five hundred dollars and get

a net when you're done of a thousand bucks after the property is sold because that oil that's out there they're pumping natural gas out of there and they're not getting any dead gum oil at all i mean this is all this is all rumor and legend. This is so funny. I'm the opposite. I'm like, did you hit a jackpot? How do you not know that there's just tons of oil in all these royalties? If it was a big pile of money,

somebody would have already been jacked up about it. It wouldn't have been going to the state. Her brother was trying to tell her. Her brother would have been all over there camping out on the place. Get in there and dig around if you want, kid. I'm so opposite. Don't drop a bunch of money on this until you get some more information.

This is the Dave Ramsey Personality, Rachel Cruz, number one best-selling author, and my daughter joins me today as my co-host here on the air. This is the Dave Ramsey Show. Sarah is with us in Concord, New Hampshire. Hi, Sarah, how are you? Hi, good, how are you? Better than I deserve. What's up? I guess my husband and I are in baby step six.

And I'm trying to just figure out establishing some kind of balance moving forward with paying off our house. We recently refinanced from a 16 to an eight-year mortgage. And we, I'm wondering about, though, so our emergency fund is like $25,000 and I think it's probably a little overkill both of our jobs are super stable um and we had somebody suggest to us pulling out some of that money to top off a Roth IRA account and I think that you're probably going to say it's a bonehead idea um but I guess I'm just wondering about doing something like that. I mean, we're saving $4,000 a month pretty much, so we could probably just cash flow that for the next few months.

Okay, what is maybe step four? Save for – I don't have a memorized word in front of me. That's okay, Donna. 15% to your retirement. There you go. We're doing 15%. We're doing more than that. Okay, you're not supposed to be. Stop. You're not supposed to be. You're supposed to be doing 15%. And the rest of it would go to

the mortgage. Our house. Yeah. And so if you also say I'm going to adjust my emergency fund down because I think it's too beefed up, then you would just throw it at the mortgage. Okay. That makes sense. And you need to make your adjustments on your retirement accounts down to 15%. Let's get the mortgage paid off. Okay.

Sarah, what's the pressure of the Roth? Is that you feeling that? Is that a financial advisor? It's a financial advisor. Yeah, a financial advisor. I mean, we have like $400,000 in our retirement savings right now. So I think we're doing, like, I'm 31 and he's 35. Like, I think we're doing pretty well.

Yeah. I think you're doing pretty well. So you're getting, so what's happening, Sarah, I think, is you're getting conflicting advice, so it's confusing to you. You're going to a financial advisor and they're saying, no, no, no, no matter what, you max out the Roth, you max out the Roth. Well, yeah, if that's 15% of your income, you do. But you only, we just talked about this, Dave, before the show even on an Instagram Live about why 15%? Because a financial advisor is going to say, you know, max out that Roth. But maybe step four.

The financial advisor is going to tell you, some of them are going to tell you never pay off your house. But all the data on the millionaires that we studied, which are actual millionaires, not financial advisors, shows that the shortest distance between where you are and becoming a millionaire, meaning building wealth, is to get the house paid off, meanwhile putting some money into the nest egg. So if your 400 doubles every seven years, okay, and we have four times or five times it's going to double. So the first time, if you don't add anything to it, the first time it doubles is 800. The next time it doubles is 1.6. The next time it doubles is 3.2.

So that tells me you're going to be worth, just on that 400, somewhere at your age, somewhere in the neighborhood of $10 million. Wow. just on that $400,000 somewhere at your age, somewhere in the neighborhood of $10 million. Whoa. So I don't know why you need to worry about maxing out your Roth today when the primary goal should be knocking out the debt. You may need a new financial advisor because this financial advisor doesn't make a commission when you pay off your mortgage, but he makes a commission when he sells you a Roth IRA.

Mm-hmm. You pay off your mortgage, but he makes a commission when he sells you a Roth IRA. So when we refinanced our house, or we're in the process of that, I guess I should say, our credit union is actually doing it for only $150 to refinance from a 15 to an 8-year. And the interest rate is pretty low. It's 2.25. Yeah, good. That doesn't mean we want to keep it. Right, exactly. I mean, we have a mean dog, but he's small.

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

because that's baby step seven at that point. You guys are doing awesome. You really are. You're killing it. And you're questioning. I can hear you questioning because you're confused. And you're like, okay, I'm getting this advice. But Dave's saying that.

So it is. So just the clear path, and that's the why, too. Hopefully this call answered that question for you one more question just like at this stage of at this point where we're kind of we're paying off our house and we're not like gazelle intense anymore in terms of you're not supposed to you're not supposed to be other dad yeah right how do we balance having fun and cash flowing like toys or like trips or experiences or things that we want to do and rewarding ourselves for being successful to the point that we're at, but also maintain like moving forward and paying off our house?

Yeah, we go from gazelle intensity just to simple intentionality. And intentionality says after I do my 15% towards my retirement, no more. And then I look and I say, all right, there's only three things I can do with money at this point. Pass that. And that's pay off my mortgage, give money away, and enjoy money. And all three need to be in your budget. Enjoying can be a purchase of a toy. give money away, and enjoy money. And all three need to be in your budget. Enjoying can be a purchase of a toy.

Enjoying can be going on a trip. Both are enjoying, but those are lifestyle choices. A nicer car is not a necessity. It's a cool thing, and you should do it. But it's a toy, as you said. And so both of those are just lifestyle. And so what you just do is you look at your budget and say you know we've got this number of dollars how many of those dollars are we going to put to us how many others and the house yeah so sarah yeah so i would say that you and your

husband need to decide okay our our end goal right the finish line is paying off that house like that's the last big thing how quickly do we want to do it? And you guys need to agree together. We want to, we could do this in four. If you do the math. Yeah, we could. Or we could do it in five. We could do it in whatever it is. Yeah, we could do it in five and go on more trips.

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

gets foggy. And you're like, I don't know if this is okay or not. Well, is it okay with your goal? Like, that's what you guys need. That's your answer. Yeah. I mean, I would not suggest that you have no fun and no lifestyle increase and pay off the mortgage in four years i would rather you paid off in six years and have some of each so that you know if that's the number or maybe you paid off in three years with no fun and four is a little bit of fun and you know just run some numbers that's right and you guys just actually run some numbers out and go okay yes that feels like too much fun i'd rather i'd rather do the other one you know like scott that was on the debt-free stage paid off his house and i could

just assume scott's not here on the microphone but i would think scott's like you know what i'll sacrifice fun for two years to get my house paid off you could just tell that was him right like and he did it and that's great so it's your choice but you and your husband 98 000 in one year that's right so you and your husband together need to agree with that goal is if it's short lots of sacrifice agree if it's like hey we're going and your husband together need to agree what that goal is. If it's short, lots of sacrifice, agree. If it's like, hey, we're going to extend another year or two, agree on that. But that's the key. Put actual numbers to it.

So it's real simple. Take your balance on your mortgage and divide it by six. Balance on your mortgage, divide it by five. Balance on your mortgage, divide it by four. Those are your numbers. And then you say, how much? And here's how much I've got to work with. Divided by 12 with each.

How much a month do we pay? It's used up. I've got this much disposable income after my 15% going into retirement. No more. Need to back that back down. And you say, all right, that gives us X for toys, Y for toys, Z for toys, based on the four, the five, or the six. And then it'll be right there in front of you, and you'll one i feel good about that one and you'll probably both agree to it instantly

but you're right the ambiguity where you don't have if you put numbers in front of you on it the numbers will talk to you and they'll tell you because you are you know right now you've kind of got well i don't know about the feeling and i just feel like i should do this and it's hard for me to transfer from gazelle intensity to simple intentionality and um i don't know about the feeling, and I feel like I should do this. And it's hard for me to transfer from gazelle intensity to simple intentionality. And I don't, you know, but you put the numbers down, you go, oh, well, that's the one. That's it. That's the one. And you go, I can buy a car.

I can buy a nice car for that. I can go on a nice trip for that and still pay off the house in that number of years, you know. And so it'll be right there in front of you, and it's not going to end up being don't pay the house off early at all, and it's not going to end up being on the other end where you have no fun. You don't want to do either one of those. And so I'd rather you get it done. It does sound like you've got a substantial income. I'd rather go and get it done, but let's just lay it out.

When the numbers will say, oh, that's the one. Oh, and by the way, when you get a raise, all of it goes to the house after that. Because you've already set your lifestyle budget. Not upping it with the, yeah, that's a good point, too, with an income increase. Exactly. That puts this hour of The Dave Ramsey advice in their life? Let them know about the Ramsey Call of the Day podcast. It's a quick hit of advice about life and money

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