The Ramsey Show - App - Do I Have Enough To Retire On? (Hour 1)

Episode Date: October 24, 2022

Dave Ramsey & George Kamel discuss: Knowing when you have enough to retire on, How to divvy up life insurance. Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Live from the headquarters of Ramsey Solutions, broadcasting from the pods of Moving and Storage Studio, it's the 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. We help people build wealth, do work that they love, and create actual amazing relationships. I'm Dave Ramsey, your host. You jump in, Chris. Chris, what's your name? George Camel. Ramsey personality is my co-host. We don't even have

a Chris that is a Ramsey personality. So he's my co-host today. Call me anything but stupid, Dave. Yeah, I'm not going to call you stupid. You're not on that list. Open phones today as we talk about your life and your money, 888-825-5225. Huge day here at Ramsey. You know something's different if I'm wearing a hoodie. And I'm matching. And we have matching hoodies. We're a boy band.

Oh, God help us. Oh, that's awful. Well, the reason we're wearing hoodies is we are celebrating the launch today of the Ramsey Gazelle debit card. We have been working on this literally for two years, and millions of dollars has gone into it so far, and today is the official public launch. We are very, very excited about this. It is something we have dreamed about and thought about for a very long time. Why do we have a Gazelle debit card? Well, from the day the debit cards came out, I told you to get one.

I have not carried a credit card in three decades. I carry two debit cards. You've heard the story. I have four pieces of plastic in my pocket. My debit card on my business, my debit card on my personal account, my driver's license, and my handgun carry permit. That's the entire thing in my wallet except green faces of dead presidents, and they're in there too. But we carry debit cards here. We use debit cards. We do not use credit cards at Ramsey. We teach people to not use credit cards, to have plastic surgery and chop up your credit cards.

And we teach you that the debit card has the same fraud protections as a credit card. And we teach you, you will not overspend when you're using a debit card, because if you don't have money in your account, you will bounce freaking checks. So you use a debit card because you're a responsible human being. We teach you all of these things. We have carried, I have carried a debit card since you're a responsible human being. We teach you all of these things. I have carried a debit card since the day they came out. I've always had a Visa debit card or a MasterCard debit card.

The particular bank we deal with now is a MasterCard company. So my personal accounts are with my personal banker, our MasterCards. And the Gazelle card, the bank that we're running it through, is a MasterCard debit card, and it's a world debit card. It is an absolutely fabulous graphic. It looks amazing. I mean, it's amazing. I've never seen, actually, like a cool-looking debit card. Really?

I mean, the team accomplished that. Or credit card. It was a low bar. Yeah, it was fairly easy to beat the competition on that. But this one, no fees, no fees, no gotchas. We're not going to run commercials of pretty people like freaking SoFi and try to make you think we love you and then screw you, which is what they do. We love you, and then we don't screw you. Go figure.

We don't take advantage of you. We're not going to send you a bunch of ads for a bunch of home equity loans. We're not going to sell your name to other people and go, oh, you can sell these people debt. You can sell these people debt. See, that's what debit cards are for most banks. They're loss leaders that they use to get people on the hook. It's the gateway drug, Dave. It's the gateway drug.

It's how they get you in. It's the opener. Well, this isn't a gateway drug. It's the beginning and the end. I love it. It's right there. It is a complete debit card process fully online fully fdic insured fully fraud protected just like any good mastercard debit card is

and it is a gazelle card but the best part about it of all is when you use it people are going to go wow what is that what are you doing and you go man i'm gazelle intense i'm getting out of debt i'm i'm wise with my money i'm not spending like I'm in Congress. You are signaling other people that you are a financial freaking adult. And an unintentional effect is that when you go to swipe, you kind of think you see the gazelle on there, and it reminds you of, I want to do this the Ramsey way. He's not a little wimpy gazelle.

He's got attitude. I mean, look at him. I'm not messing with him. He's a dude, man. I mean, he's got attitude. I mean, he's got, look at him. He's got right there on my shirt. I'm not messing with him. He's a dude, man. I mean, he's got style. We talked about putting a little red eye in there, so he looked like a devil, but he looked like a devil beast, so we didn't do that. But, man, this guy, he's not, this is not a gazelle that's scared. No.

This is a gazelle that's getting her done. It's intense. You know, and so good stuff. Good stuff. So the gazelle debit card is out there. There are already thousands of people using it because we've run it through beta tests and everything else. And to make sure everything's working before we go public today, George and I have done, what, 10 interviews this morning on television stations around the nation, including Fox and Friends this morning, announcing this launch. We've been up since 4 a.m. doing this stuff.

I need coffee. But, man, I'm telling you, this thing, this is an incredible product. It makes a statement about who you are. We're not going to get you with fees. It's got all the same protections. And you ought to try it out. Oh, absolutely. And if you're an EveryDollar user, seamless integration with EveryDollar

because we own both experiences there. And so there's some really cool features that the team is continuously going to be working on to make this better and better. Like it's really, really fast how fast you're charged when you run the card, how fast it shows up in your EveryDollar app, really fast. One of the best features. Since we're the people, like you said, we got both of these digital things going on and we have digital geniuses in this building.

You and i are not one of those don't put us we have them here and we know that they do stuff we're not sure what stuff they do but the stuff they did allowed those two things to talk every dollar and the gazelle card and can you be clear dave we are we are not a bank we are not becoming a bank no partnering with we're not gonna get you into that or this this begins and ends here it's a process for spending and saving the ramsey way and it and for you stupid butt people on social media you stupid butt trolls dave ramsey's master card dave ramsey's got a master card debit card in his pocket for 25 years so shut the flip up okay you stupid You stupid butt people. It's not inconsistent.

I didn't sell out. There's nothing different here. And I've always told you use debit cards. And a lot of debit cards have cash back, like at a, not cash back, savings. You can go in, like, if you use it at, this one was what, Starbucks is one of the ones, or whoever. I don't even know what these are. It's a huge long list of companies that when you use it there, you'll get a discount. And that's through our partner at NetSpend. that spend is the bank behind this the banking process behind this and they already had all that set up

so you get the savings on that stuff but we're not trying to get you to spend money to save on your stupid coffee that's not the idea the whole idea is to do the all the stuff we've been teaching you all along we didn't change a thing we're just giving you a better way to do it so and if you don't like that troll your butt off because you're an idiot okay that just goes but there's that's what trolls are they're idiots in general anyway so just keep it up people just keep it up yeah master card and i'm gonna keep calling you idiots too i'm beginning to think almost anybody on social media is but i'm not ready to go quite that far because i still checked instagram well you're on there too dave so well i

know they put me on there but i'm not on there and i'm certainly let me tell you how many times i have commented negatively on someone on social media other than twitter on someone else's thing other than on twitter now i've gone back at people on twitter you used to have i used to have these twitter fights in the old days that That was a lot of fun. Back when Twitter was cool, Twitter's completely devolved now. It's devolved into a sewage pit. But the number of times I've gone on someone else's Instagram

account and posted negatively, precisely zero. The number of times I've posted a negative book review on anyone's book ever, precisely zero. I've told people in private, don't read it. It's trash. But I'm not going to go out there.

I don't have time to do that. I have a thing called a life. We're launching products out here, folks. That's it. We're helping people with stuff like the new Gazelle debit card. A good reason to wear stylish hoodies. Cool hoodies. RamseySolutions.com slash Gazelle.

Stylish hoodies. Got Gazelle on the sleeve. Rocking it. Man. Not something I would have designed, but something I get to wear wear makes me look 25 yearsica george camel ramsey personality Thank you for joining us, America. George Campbell, Ramsey Personality, is my co-host today. Open phones at 888-825-5225. We just returned from Dallas. All the Ramsey Personalities and Pastor Craig and Amy Groeschel were speaking all day long at the SMART Conference in Dallas.

I think it was our best SMART Conference ever, George. You did a great job on stage. Oh, thank you. Funny, fun, entertaining, informative, and inspiring. All the stuff you did a great job on stage. Oh, thank you. Funny, fun, entertaining, informative, and inspiring. All the stuff you needed to be. Well done. I appreciate that. All the personalities had amazing talks across so many areas. I mean, from career to mental health, relationships to money. I mean, people left in tears. They were laughing. They were crying. And I hope there's a lot of lives transformed. Absolutely. Good stuff. Open phones at 888-825-5225. Betsy is with us in Asheville, North Carolina.

Hi, Betsy. Welcome to The Ramsey Show. Hey, thanks so much for taking my call, and I'm absolutely going to get a Gazelle card. Well, thank you. Woo-woo-woo! I love it. How can we help today?

You've changed my life, but I think it might be too late for me. And I needed to kind of tell you that I've been more fortunate than a lot of people. I've blown through many thousands of dollars. I've had big chunks of money from various things, inheritances, whatever. And basically, I am 66 years old. I sold my business four years ago for $200,000 and I sold a house. I'm now renting very cheaply. And, um, I have, uh, about $200,000 still, and I'm living on six to $700 dollars a month because I live very cheaply but I wanted to give you the numbers and have you laugh at me and say no you're not going to make it

because my core values are freedom and independence and it petrifies me to think that I won't have financial you know stability and I'm unable to work because of a neurological condition where I can't be upright very often. So should I just give you the numbers? Yeah, that's fine. Sure. Okay. I invested a hundred thousand dollars a year ago in a local commercial lender. They do alternative lender lending to people that don't go through traditional banks. And that's a, that's a guaranteed 8% a year. So that $100,000 has turned into $108,000.

I put $45,000 into Vanguard last year when I first found you guys, and it's down to $38,000. Of course, I'm not selling it, but that hurts. It's basically a wash on what I made from the other investment. I have my IRAs are about $17,000 and my cash is about $19,000. So somewhere between, I don't know the add up of that, but I go through my expenses in my budget every month and I say, okay, $600 a month divided by our hundred, let's see,

$18,000 divided by $600 a month. Oh good. I can live 24 more months on that before I have to tap into my investments. But am I, am I just, um, living a pipe dream? Am I going to be a, if I can really stick to a budget. Are you not collecting social security? Oh, that I don't even include that because that actually pays my rent. It's a wash. I get a thousand dollars, I pay a thousand dollars.

So basically I spend $600 out of my savings a month, six to seven out of savings. I see. Okay. And my social security will be going up of course course, but, you know, not that much. And you're making $8,000 on one investment and the other investment because the market's down is down right now. Yes. Okay. And tell me again what you put in Vanguard again. I put $45,000 in. I put $15,000 in the, what's the one that you have a minimum of $15,000, like the Shiller? Yeah. I forgot some word for it.

It's in that, and $30,000. So you only have $150,000? I thought you told me you had $200,000. No, I have almost $200,000. I have $108,000 plus the original $45,000. Right. Let's just call it that. Yeah.

And then in my savings, I've got got 19 oh i see and in my ira yeah for your emergency fund yeah and my iras i've got 1700 i mean 17 000 and i'm trying to see if i can live on six to seven hundred dollars a month and stretch it out till i'm like, I'm 66. So, I mean, I don't want to get married. Did you say 5'6 or 6'6? 6'6. What? I'm 66. 66.

That's what I heard the first time. Okay. Yeah, I'll be 67 next month. Okay. All right. Well, yes, you're going to make it. And no, it's not a pipe dream. And no, it's not all come to an end.

It's the worst possible year to have this conversation with Vanguard going the wrong direction, which is an unusual thing. I don't know exactly what you put that in. But if you're just in a good growth stock mutual fund, it would be down this year. The market's down. And most years it's up. It's an unusually bad economy that we're in. And a lot of reasons for that, but that's not the purpose of this call so um right and i'm hoping by next year we see a turnaround yeah because i'm i'm going to go early vote this afternoon just to make sure we do but um

but anyway the uh uh But anyway, the – well, I'm – Can I just insert one more thing? Sure. I come from a family of such spenders that it is – it's really hit me this month that I've still been spending too much. And so now I'm locked down. $600 a month is too much? No, I spent $2,000 in September. Oh, so you're not sticking to your budget.

I am now, but no. Okay. Well, I mean, whatever budget you set, you have to put that into your projections, and then if you don't stick to it, you screw up your projections. Right. So that's the third variable that you've added now and yeah i will say you gotta do that or you whatever i mean because i don't care if you make 50 000 a month and you spend 60 000 you still got a pipe dream right definitely so um that's the thing so i would

tell you this i want you to sit down with smart vestor pro and uh stir this portfolio a little and see if we can't make it do a little better over the long haul. I don't know that it would do better on the short haul if you had done what I told you to do, like with the money. If you'd done that two years ago, you might be worse off right now than you are right now because the market's down, and I'm 62, and I'm 100% invested in invested in the market i mean in terms of i hadn't pulled anything out but um but but in a little different situation so i think sitting down with smart investor pro sticking to your budget you got you know then lay your projections out but i think

overall you probably can do better than either one of these investments but not a ton. And then the third thing I would tell you is this. I had a perfectly normal conversation here with you for three or four minutes, five minutes. So there is some things you can do. Even if it's just a few hours a day or a week? Even if it's just finding something online that you sell stuff on eBay, whatever it is you're able to do with the limitations that you have with the medical process you're facing, I'm still going to find something I can do. Because here's the thing.

If you add $1,000 a month to this by working five hours a week doing something online or on the phone or something, you change this number you change this situation dramatically a thousand dollars a month changes your whole math picture with the numbers you're giving me because they're so small and so i'm going to think about what you can do within the limitations i'm not trying to say you you've been lazy or something you're certainly not that but you're very articulate very quick very very intelligent on the phone. So that means there's things you can do. Yeah. And if this year you were able to live off 8,000, you know, maybe with compound interest next year, we shoot for 9,000 and then 10,000. And over the next 10 years, as the money continues to grow and you continue to

live on a budget, we can make this work. But right now it might be tight for this year. Yeah. Yeah. But overall, is there hope? There's hope because you're breathing, and there's hope because you're paying attention. It's not too late. And if you pay attention and you keep breathing, then you're there. So I met this lady the other day that's 100 years old. 100 years old. Sitting in a rocking chair on her porch. She's a neighbor to a farm I own.

And I said, so what's your secret? How do you live to be 100? She said, don't stop breathing. That is a 100-year-old lady humor right there. And 62-year-old guy humor, too. I cracked up, man. I laughed all the way home. This is The Ramsey Show. Thank you. George Campbell Ramsey personality is my co-host today.

We are wearing matching gazelle hoodies, celebrating the launch of the new gazelle debit card brought to you by Ramsey. It is a MasterCard debit card. Check it out at RamseySolutions.com slash Gazelle. In the lobby of Ramsey Solutions is quite a few folks, a couple hundred looks like, and two of them are on the debt-free stage, which can only mean one thing. Debt-free. James and Kat are joining us for their debt-free scream. Welcome guys. Good to have you. Hey Dave. Thanks for having us. Absolutely. Where do you guys live? We live in Luverne, Alabama just south of Montgomery.

Oh cool. Welcome to Nashville. All right. How much debt have you guys paid off? We have paid off $80,000 in 21 months. Good for you. And your range of income during that time? We ranged from $85,000 starting out. We went up to about $150,000 and we're back down to about $125,000. Cool. What do you guys do for a living? I'm a hyperbaric safety director. I also work part-time with the volunteer fire department in my local

area. And I'm an ER nurse. So who worked their butt off? Because somebody doubled your income. That would be me. That would be the ER nurse. Unlimited hours these days, right? Yes, sir. Continues to be a nursing shortage. Always will be. Yeah, I think there will be. You're right. And COVID mandates and crap makes it even worse because people bailed out. Yeah. Wow. Good for you guys. Way to go. What kind of debt was your $80,000? Dave, it was all normal. It had a truck, tractor, lawnmower. We had some student loans that we had to pay off as well as some credit cards. Okay. So it sounded like a lot of it was you.

A truck, a tractor, a lawnmower. That doesn't sound like she's the problem. I'm not. That was 100% mine. Unless she's collecting tractors. I mean, you never know these days. That's true. The student loans are all mine oh okay well that balances it out all right was that the big one please tell me it wasn't the lawnmower no the lawnmower was about 5500 um yeah definitely the student loans were the worst i love it very cool how long y'all been married uh almost three years okay so what happened a year into marriage and you said okay in the next two years we're cleaning up this dadgum mess we're going to get

gazelle intense uh we uh we we decided to have a child it was a little bit of a surprise i have a 19 year old and an 18 year old so we kind of started all the way back over and i made a lot of sacrifices when they were young because of poor financial decisions. So I decided I didn't want to do that with the new child. So we kind of listened to Dave Ramsey. I'd heard about it multiple times, but I'd never met anyone who had actually stuck to the plan and was actually successful. And then, you know, we talked about it. And at first, I was not 100% on board, of course. I'm very much one of those instant gratification kind of people.

But I didn't want to make the sacrifices. I wanted to spend time with the new child and not have to miss out on all the school events and stuff like that. So we sat down and made a budget, and we stuck to it. And it was not easy. No, it's not easy. It was not. Was it worth it? Yes, 100% worth it. What did you sell? We did not sell anything. Good. Believe it or not, it was not was it worth it yes 100 what did you sell we did not sell anything

good believe it or not we didn't sell anything you just buckled down on the old lifestyle yes and kicked in the hours absolutely work like no one else so later you can work like no one exactly hebrews 12 11 that's what we wanted to do so that's what we did i did want to try to sell my truck uh it hurt but nobody really wanted to give me what it was worth. So I said, well, let's just go ahead and pay this thing off and I'll have it for a while. There you go. That's incredible. So what was the biggest sacrifice you guys had to make along the way? Spending time together. We had the child and we decided that we were not going to pay anywhere from $400 to $600 a month for daycare. Instead, we could throw that money onto debt and maybe accelerate paying off the debt faster.

So we actually work opposite schedules of each other. And we have for the last almost three years now. Whoa. He works Monday through Friday, and I work weekend nights. Wow. So this is our first family vacation all together as all five of us together. So this kind of means a lot to us. education yeah all together as all five of us together so uh and now you can change that though now you can set set things up in a more normal rhythm because that was your reason for doing it

that's the biggest reason to get to get the family in balance that baby's a great fresh start to go let's do things differently with this one well i'd heard about you know your principles back in 2014 or 16 i believe and i tried to jump on it i was a single man at the time. And I don't know if I just wasn't paying attention or just didn't want to do it, but it just didn't stick. So when I found out that I had a child on the way, I said, well, I don't like where we're at financially. I know babies are expensive. Diapers are expensive. So, you know, we need to, we need to fix it. So I said, well, the only thing I had heard of that worked was Dave Ramsey. So I went back, and I started reading up on it, started kind of buying into it.

And then I went to her, and she was a little hesitant at first. So I said, I'll tell you what. If you stick with me, if we do this together like we're supposed to, then at the end, we'll go on a week-long family vacation together. And she said, okay okay i'm in now so here we are you bribed her i did i did right bribing works i'll go with bribing bribing's good so we came up friday night uh we stayed here in nashville or actually here in franklin and today after we leave here we're going to head to gatlinburg we're going to stay in the cabin until next month wonderful and perfect timing with the leaves changing over

there. Yes, sir. Yeah. Way to go guys. Very cool. Very cool. I'm proud of you guys. Thank you. Thank you. How's it feel? It feels great. It's a very, it's like a heavy weights lifted off your shoulders whenever you get done. I mean, you still have to stick to a budget. Otherwise you'll find yourself going right back into debt. But it's a very good sense of relief. For example, when we got up here, we had an issue with our truck and actually had to put it in the shop. Of course. But it wasn't really that stressful because we have an emergency fund that is set aside specifically for instances like this.

So we enjoyed our few days while the truck's in the shop. We had an extra car up here with us because the kids are going back today. So we didn't really stress about it too much. We enjoyed our time together. And then today we went and picked up the truck. It wasn't that big of a deal because we stuck to the plan and we had an emergency fund set to the side. That's incredible. And now you're building for the future instead of paying for the past. It changes your posture.

An emergency fund turns a crisis into an inconvenience just like we said in fpu go figure that's exactly what i told her to you know you just yawn and go okay cars in the shop whatever yeah yeah we'll just go get another one instead of freaking out way to go you guys you guys are incredible done very well done so proud of you good stuff what do you tell people the key to getting out of debt is commitment foritment. Commitment, for sure. I'd like to say that owning your situation probably is the biggest thing for me because I was the one that went out and got the loan on the truck. You know, I was the one that decided to get the lawnmower. I was the one that decided to do these things to get ourselves into debt. You know, it wasn't

my friend down the road. It wasn't my parents. It wasn't my best friend so i decided hey it's time to pull the bootstraps up do what i have to do to provide for my family and that's what we did if i'm the problem i'm also the solution yes sir yeah well done very very well done and you know what happened the difference in when you tried it before or your friends tried it before and this time was you had a big why you had a a big enough reason. You've got to have a big why. And if you've got a big enough why, you can do almost anything. So well done, you guys. Excellent job.

All right, let's bring the kiddos up. I want to introduce all of them. In the meantime, I'm going to let you know we've got the Live and Give Bundle. It is called a one-year membership to Financial Peace University. The Every Dollar Book, or the Baby Steps Millionaire's Book. There's not an Every Dollar Book. And the Total Money Makeover Book. So two books and a one-year membership.

You can use those yourself, give them away or whatever. It all comes in a nice, tidy box we'll send home with you. So way to go. So the kids' names and ages? This is Gabriel. He's 19. This is Katie. She's 19. This is Katie. She's 18.

And Quint, he is two. All right. Way to go, Quint. All right. I love it. I love it. Hey, Dave, real quick, one thing. I wanted to point out that both of our children here, well, our older children, are going

through school debt-free. Yeah. Awesome. Very good. Okay. Lots of lessons learned here. Family tree has changed forever. Definitely has.

Already. Well done, you guys. All right. James and Kat, Quint, Gabriel, and Katie, Montgomery, Alabama area, $80,000 paid off in 21 months, making 85 to 150 to 125. Count it down. Let's hear a debt-free scream. Ready?

Three, two, one. We a debt-free scream. Ready? Three, two, one. We're debt-free! Yeah! Woo-hoo-hoo-hoo! This is how it's done, ladies and gentlemen. Life happens, gives you a little wake-up call, and you go, I'm going to answer the phone. The best part of life is you can just decide to change. I think that's cool.

Powerful. Powerful. We are still free. At this moment in America, you're still free to decide. This is The Ramsey Show. The George Camel, Ramsey personality, is my co-host today. We're wearing the matching Gazelle hoodies because today is the launch of the Gazelle debit card by Ramsey. Completely free, no fees of any kind. You're going to love this.

And we're not going to try to sell you a bunch of debt because we're not SoFi. We're not NerdWallet. We're not going to try to sell you a bunch of crap. We're just is what we is. It's a debit card. That's all it is and it's got all the fraud protections that mastercard debit card has it's got all the same features be sure and check it out at ramsey solutions.com slash gazelle chad is with us chad is in

i probably messed that up i'm see i'm i'm uh rusty from being on the air here chad's in minneapolis hey chad how are you very good how are you better than i deserve what's up so uh quick backstory uh divorced in 2018 um kind of found your program paid off 60 grand worth of debt uh over a course of two years uh last year met a new woman, and we were married here a couple weeks ago. Congratulations. Thank you. So my question is, so my annual income is right around $150,000. I've got life insurance of about $1.6 million,, 1.7 million. Um, and just looking to, if for some, for, for anything,

if anything happened to me, I know for a fact that my wife, my ex-wife would go out of her way because she's difficult. And that's kind of her nature is to ensure that there's no relationship between my current wife and my four children that I share with my ex-wife. So I want to make sure that I'm kind of taking care of my kids, but also taking care of my current wife if something would happen to me. I know I can break that out, but under no circumstance would I put the life insurance for the kids in my ex-wife's name, but in a trust, but, you know, is there a good split? You know, is that a 50-50, a 60-40, you know? Yeah, it's just difficult, isn't it?

I'm sorry. Sorry you're going through this. How old are your babies? 15 to 7. Okay. What I would do is just split off the two issues. And how much does it take to make sure your kids are okay if you left that money in a trust managed by someone you could trust,

thus the name trust, for the good of your children? Okay. And set that amount in life insurance in that. And then what does your current wife need if something happens to you and set that amount of insurance in her name? If that happens to total up to be the amount of insurance you have now, then you have your percentages when you back into them, right? Right.

And if you need more, then you can just get more. You're right. I know that my current wife, she would drastically, she would want to, I mean, she would want to move. She would want to reduce her lifestyle. That's not the point. The point is you answer the question, what do you want, what kind of situation do you want to leave her in? And you create that number. And, you know, I just used, I always just use 10%.

It's a very easy number. Okay. You can use 8%, whatever. And so if you want to leave her with $80,000 a year, you need to leave her a million dollars. If you want to leave her half that, then half that, you know, same with the kiddos. Okay. And, and then you determine on the trust for the kids. Obviously you decide who's going to be the trustee, who's going to manage this money. And I'm going to pay out the equivalent of child support monthly. It'll be one

of the terms of the trust, maybe a little more. I'm also going to make that trust money at the behest of the trustee available for a portion of a first car for any major medical problems and for college. And then when they reach a certain age, their portion will be released to them. And you can decide that age. Graduating college is not unusual. 25 is not unusual and those kinds of things. But in no case does the ex have any control over the flow of money

except the amount that's coming to her monthly in the form of child support replacement. Right. Okay. Would a trust have to be formed prior to my death? No, you need to go have an estate plan done, a will done, and as a part of that, there's a family trust that can be developed that only activates in the event of your death. Right.

Okay, and then you name that trust the Chad Trust, and then you make a percentage of your life insurance beneficiary to the chad trust and you got us who's going to be the trustee dude right but but the the question would be on you know i have to list out the beneficiary yeah you can just put a if you got a million six you can put a percentage to the trust and a percentage to your ex. But the trust wouldn't be formed until after my death. Exactly, but it doesn't have to be. You still name the trust, and the trust is formed only if you die.

Now, here's what's probably going to happen. It's what happened to me anyway. I did all of that. My kids grew up. That trust was never made. It never was used because I didn't i didn't die before while they were minors and so as an age limit on it yeah as the last one hit 21 i did away with that portion of my will and changed all my beneficiaries to be sharing because once they're 21 you on your own baby so So you don't need life insurance from daddy.

So, you know, it changed it all, right? Because they don't rely on your income anymore. Exactly. They're not dependent on me. I'm no longer responsible for buying their shoes. They are. And so, thank God, considering some of the shoes Rachel buys. I thought it was going to be Daniel.

But anyway, you know, all kidding aside. But you'll outlive this more than likely, right? Right. And it all becomes for nothing. And then you'll change the beneficiaries at that point. And by then, probably you're going to have built enough wealth, you may be even dropping all of this life insurance. You might have $2 million in your mutual funds,

and you're going to leave some of that in inheritance to them, some of that to your current wife, and that's all there is. There's no life insurance at all. And that trust that would have been formed upon your death for the care of your minor children never occurred because they grew up before you died. So for most people, we say, hey, a will is enough. At what point do you go, all right, you might need to look into developing a trust? A trust for minor children is necessary.

You know, Sharon and I had that if in case of both sharon and i dying that would have had to have occurred because we were married still we weren't exes right and so uh yeah you you know uh if either one of us died it didn't activate only if both of us died because i trusted her to manage the money for the kids but he can't give that to his crazy ex. Yeah, it's a complicated situation. So it changes the dynamic a little bit. But the last thing we want to do is fund crazy, right? With a million dollars.

Here's a million dollars crazy. That'll help you. That'll make you sane, right? Not! It just makes you crazier. But, yeah, that stuff. I'm glad he's thinking about this because most people don't even have a will. They're not even thinking about this stuff.

You're right. 78% of Americans die without a will, which is dumber than a rock. Okay? Because you leave everybody behind you that you said you loved in a mess. In your wake, just dealing with a relationship broken. Even if you've only got a car and $10,000 in your checking account, you need a will. Yeah, people think, well, I have to be a multi-millionaire to get a will in place you need a will you need to go to mama bear legal forms and get a will and you can these little trust these little family trust like

i'm talking about and you could put terms in there very easily like i just dictated i even dictated in mind back in the day that it went into the four types of mutual funds wow the trustee had to put it into those four types because i didn't want some judge going, oh, it has to be in CDs, certificates of depression. Because, I mean, what if you had your money in CDs with a 9.8% inflation rate and you're making 1% on your money? Not the legacy on the list. What kind of Bidenomics do you call that? That's bass-ackward right there.

You're running backwards. So you don't want to do that. So I want the kids plugged into something that's going to work there. So I had even the four types that had to be invested in that. And the income off of that was to create to do this. And the rest of the income was to continue to grow. And, you know, we just dictate it out. It really isn't that long.

You just kind of have to think about the different things that you want the thing to do. So you have to be intentional with it. Yeah. Just like every other area of your life. Look how that works. But I'll tell you what, here's what's very interesting. There's a high correlation between people that build wealth and people that pay attention to these types of things

that involve managing wealth. So there's a high probability Chad in Minneapolis is going to be a wealth builder. There's a high probability of that. Not only is he a dad that cares about taking care of his kids, not only is a husband that takes care of his current wife, but he's also thinking about the subjects of how I'm going to do that.

This guy's a stud. Love that. He's a stud. Well done, Chad. This is The Ramsey Show. Do you love a good day, Brandt? Want to see the latest Ramsey Show videos going viral? Check out your favorite moments from the Ramsey Show on YouTube.

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