The Ramsey Show - App - Don't Become a Landlord by Default! (Hour 2)

Episode Date: April 7, 2021

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, 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. I'm Dave Ramsey, your host, Christy Wright, Ramsey personality number one, best-selling author of the book, Business Boutique, and host of the Christy Wright Podcast, which is a big exploding movement, is my co-host today. As we answer your questions, the phone number is 888-825-5225. That's 888-825-5225. Ryan is with us to start off this hour in Waterbury, Connecticut.

Hey, Ryan, how are you? Good, Dave. How are you doing? Better than I deserve, sir. What's up? I'm 27 years old, and I'm on baby steps four and six. And I was wondering if it would be ridiculous or wise to stop making extra payments on my mortgage to save up and build a basketball court in my backyard. A basketball court in your backyard.

Like a real court, not just like a goal, like an actual court. Yeah, like a concrete slab. Oh, my. Like a full court or half court? I would do a half court. Half court. Yeah, half court. Okay.

What would it cost? Between three and six grand. And what do you make a year? Last year I made $65,000, but this year I'm looking to make closer to $85,000. What's your house worth? $228,000. Okay. And you just love basketball?

I'm just curious why. You just love basketball? You just want to play all the time? Yeah. Or is this just kind of like a ridiculous thing to do? Because I'm trying to be wise, you know, and build wealth, and I was planning on paying the house off within five to seven years. But other than that, I was just curious on, you know.

No, it's not ridiculous. I mean, people put tennis courts in their backyard. People put pools in their backyard. They do all kinds of things. Let's talk about it from a real estate perspective. No, it's not ridiculous, but let's talk through, is there a better way to do this than, and a worse way to do this? And the answer is, yeah, I think there is, probably from a real estate person's perspective. So I'm going to put that hat on for a minute.

Yeah. put that hat on for a minute um yeah i'm gonna build it if i if i'm doing this the for the least money possible number one because it's not going to add a dime of value to the house right so like if you spend six thousand dollars the house is not worth six thousand dollars more because of it as a matter of fact if you do it poorly the house might be less marketable because it's kind of got this weird thing in the backyard for somebody that doesn't play basketball. Right. That's what I was worried about down the line. I looked at a really nice vacation property the other day, like a super, super nice one.

I don't play tennis, and it had a fabulous tennis court in the backyard, and I kind of looked at that as a negative, not a positive. It's like a thing back there that I don't need or want. And, you know, it's like a problem, not an opportunity. So if you do it wrong, that's how you do it. So depending on how you're – I mean, I'm just thinking about properties that I've owned or lived in. Number one, growing up in Nashville, we had turnarounds that you went back out of the garage and you drive away, and most of the neighborhood kids, including when my kids were little,

we had a nice turnaround that was paved. In our case, it wasn't concrete, and we put a basketball goal on the house or put one on a pole on the edge of the turnaround, and it didn't really a cost anything extra to put the actual surface in there's a little bit of money to put a goal up uh but b it didn't weird people out that weren't basketball people when they came to buy the house they just went well i'll take the pole down right if i don't like what i don't want to back and so do you have like a turnaround you could do that with? I don't. But my other idea was to build a patio on the back of the house, you know, closer to the house.

And it would be a smaller patio, but also I could play basketball on it. And then that would be the same kind of a thing. That makes a lot more sense. And then the buyer can visualize, I'm just going to pull the goal out. Or you could even pull the goal out yourself before you put it on the market, and then you've just got a nice patio you built. Now we're not messing with the marketability of the house, okay, and that is less weird. The only other thing I can think of is, again, a driveway configuration matters here. you don't have a turnaround if you have a uh your driveway pulls up and you could simply extend the driveway back and put the pad there it gives additional parking spaces or maybe a slab to

put an extended or to put a an exterior garage on someday if it wasn't a basketball court that kind of thing so we've got again like like the patio thing it's got multiple uses right so i just want you thinking that way. Don't stick it back there and make it a problem for the buyer. How long are you planning to stay in this house out of curiosity? Well, I wanted to pay it off as soon as possible, and that looks about five to seven years. And then my plan was to either use it as a rental or resell it and move up in-house. Gotcha.

Okay. Okay. use it as a rental or you know resell it and move up in-house gotcha okay okay so yeah yeah i think you just use some of these ideas we're batting around here and try to make it a multi-use type of thing yeah where it's got possible other uses so it doesn't just look like a problem concrete slab in the backyard yeah you know like why is it there i wanted to grow tomatoes there you know and that you know that that's what. That's what, that stinking tennis court. I mean, again, I think it's wonderful if you play tennis, but I don't play tennis. Well, and even still.

Can I turn it into a shooting range? Yeah. The thing is the percentage of people that might buy your house that like basketball is small. And then the people that would want to play is even smaller than the people that would want that in their backyard is like tiny. Yeah. So you're talking about a very small percentage of people that someone would actually like that so the rest of

the people you're isolating so build it off build it in such a way that it can be something else yeah in addition to that and the least possible cost as well because you're not doing that and then and the more you move in that direction the less you are on the ridiculous side and the more you are on the wise side there you go you are on the wise side. There you go. Good question. Interesting. Chuck is in Kansas City. Hi, Chuck.

How are you? I'm doing good. Thanks, Dave. Good. I'm 57, and I just came into some money, and I was wanting to invest it for retirement. And one of the options I looked at was indexed annuities, and I was curious what you thought about that option.

It's okay. I wouldn't use it for an actual retirement account because an annuity grows tax-deferred, and a retirement account also grows tax-deferred. So it's kind of redundant in that sense, or tax-free if it's a Roth, and you're paying an extra fee for it to be in the annuity. So you just buy the index. You buy an index mutual fund inside of your Roth if you were going to do that. The other thing I want you to be aware of is I'm 60 and I don't use them because they've got extra fees. The commissions are much higher on them for the seller, the financial advisor that's selling them, than a simple mutual fund transaction.

And so instead, what I do with a lump sum like that is I invest it just in an index fund. I use an S&P 500 index fund. I just drop some money in there. And it grows without taxes, by and large, until you take it out. Because it's capital gains growth it is not dividend growth and they have what's called a low turnover ratio so study and learn a little bit about low turnover ratio mutual funds that would be my suggestion but the variable in the od as long as it's got good mutual funds in it is not horrible in your situation.

Hey, this is Christy Wright. I'm all about equipping women to make money doing what they love. And I know that running a business or even a side hustle can be overwhelming, but it doesn't have to be. With the right training and support, there's nothing you can't do. So whether you want to earn extra income for your family or you feel a call to help others with your business, I want to guide you every step of the way. That's why I'm so excited to tell you about the Business Boutique Academy. The Academy is my online training group for women who have a business or side hustle or who want to start one. And it's open for enrollment right now until April 22nd.

Now, we only open enrollment twice a year. So don't miss your opportunity to join and get the training, tools, and motivation that you need to turn your ideas into income. Join us today at christieright.com slash academy and become a part of the incredible community of women who are making money doing what they love. Again, that's christieright.com slash academy. Here at Ramsey Solutions, we want to transform so many lives that disruption spreads like wildfire across this country. If you haven't noticed, our culture has become toxic, and the only way to remove that toxicity is to displace it with clean, good, real ideas. Imagine a world where it's weird to have a student loan, that you get an education and

you pay for it. Imagine a world where the majority of people pay cash for their car. Imagine a world where the credit card is the cigarette of the financial world. Imagine a world where ladies are empowered and know exactly how to start and run their businesses the way Christy teaches. At Ramsey Solutions, we work on this level of disruption every day, and it's why we have just under 1,000 folks on our team right now. And they create digital products and services to help people transform their lives

with the goal of disrupting the toxic culture in America today. And if you want to join us on that crusade, we're currently on the hunt for software engineers with expertise in Ruby on Rails, Java, C Sharp, front-end technologies. If you're a UX designer, an SEO, content marketing specialist, digital creative, we'd love to talk with you. We've got about 300 jobs we need to fill this year to be able to do the different initiatives that we've got to help people in America today. If you want to talk about joining us, find out about all the available jobs by texting WORKTHATMATTERS to 33789.

Text WORKTHATMATTERS to 33789 to find out about our open opportunities. And you can, of course, also go to RamseySolutions.com and click on the right-hand tab that says We Are Hiring. Lucy is in California. Hi, Lucy. Welcome to the Ramsey Show. Hi, Dave. How are you?

Better than I deserve. How can Christy and I help? So I actually just started listening to you about a week and a half ago, and I started the cash envelope system and started budgeting because I am a horrible, horrible spender. So I want to change my habits. I do have a student loan for I pay about 95% interest. And my principal balance is about $5,000. I just, because I am sort of new to this budgeting and I'm trying to be debt-free,

I just want your advice on how to attack these loans that I have because I do have a six-month-old baby that I want to plan for for her future. Good for you. So you're a single mom? No, I have a boyfriend. Okay. All right. So you're a single mom.

Okay. Okay. And, I mean, you're not married, right? No, we're not married okay and uh what do you make a year 55 000 okay that's good news well congratulations on stepping up and saying hey this is an area of my life that's caused me pain and i want to fix it i'm proud of you yeah thank you very well done very cool stuff good for you. So having sat in this seat for almost 30 years now, here's what I think I heard you say in the background, behind the words. How old are you?

33. 33. Okay. And so you've kind of just lived your life and money happened to you. You never happened to it. And the baby comes and you went, oh, crap, I got to be a grown up. Yeah. Is that right?

Yes. Okay. Good for you. I'm so proud of you. Yeah. That's awesome. Thank you. Thank you so much.

And I can tell some of that because the the only way anybody takes out a title loan is they're desperate yeah you felt cornered at some point and out of money and scared because otherwise you wouldn't have signed up for 96 interest everyone knows including you that that that's not a winning proposition right yeah no so the great news about your story is is that once you once the switch flipped inside your brain in the last few months uh and you said no more i've had it i'm not living like this anymore you're going to change things fast so fast it's going to be amazing because you're so ready i don't have to talk you into stuff you're like over it and i mean is that right yes i am

okay completely well obviously then what we're going to do is we're going to get on a detailed type budget beans and rice rice and beans no life i don't want you going out to eat i don't want to hear about a vacation you have a mess girl and it's time to clean it up and we're going to do our whole life right now is clean up debt. Complete focused intensity. Like, ah! Okay? Okay.

All right? And the first thing we're going to do is we're going to get rid of this stupid butt title loan and get those people out of your life. And don't you ever go back on that property or call those people ever again the rest of your life. Okay, I won't. I won't ever. As a matter of fact, you can take your pinky out and wave it at them as you drive by every time from now on because i am never going to go in this place again they screw people right no they do for sure and i i know this because i am in the financial

industry myself but i yeah yeah well you had a brain lapse because you got desperate every time i get desperate right after that I get stupid. That's what happens to me. It happens to me, too. And I teach this stuff. So we're going to attack that thing. We're going to be on a detailed written budget. I'm going to put you into Ramsey Plus for one year.

It's our online access to everything. It's the Cadillac, the Bentley. All right? And it's going to put you into Financial Peace University, into the extended version of Every Dollar, the world's best budgeting app. I'm going to pay for all of it. It's going to be free for you. But you have to promise me you're going to get in there and do everything we tell you

to do. And one year from today, you're going to have a completely different life if you do that. Oh, my God, yes. I'm sorry. year from today you're going to have a completely different life if you do that oh my god yes i told you she was ready didn't i yeah yeah you're awesome i am so proud of you so you go through financial peace university you drag boyfriend in there by the ear and uh tell him he's going to watch it with you and we're going to start getting our act together and get our life together and get this stress off of you, okay? You're going to do this, Lucy, and when you do,

I want you to call us back, and you tell us your story, and you do your debt-free scream, okay? Oh, my God, yes. You're going to do this. We've been binge-watching on YouTube. I've been listening to your podcast, and he has a sprained ankle right now. So he was stuck with me in my room all day yesterday while I was working. And I said, I'm going to play this

because this is what I've been listening to while I work. And he's also been so motivated and he's like, wow, this puts you like in the right mind. Like, you know, and we want to buy a house and want to start a savings for our baby girl. So, I mean, I think he's better with his money than I am, but I'm so ready for this. Thank you guys so much. You don't even know how much I appreciate this. Well, we are honored to help you, kiddo. It's what we do, and you hang on. Kelly will pick up.

We'll get you signed up. And you call us back any time you need help while you're walking through this, and call us back when you score the touchdown and let us us know and we'll do your debt-free scream with you how fun that is so cool i love that her boyfriend was a captive audience and she's like your ankle is sprained i'm just going to play the dave ramsay show for you while you're stuck you can't leave hey that's going to be our new answer of how to get people break their ankle break their ankle hobble them hobble them and they can't how do i get my spouse on board you hit their ankle with a sledgehammer and then just press play that's great i love it that's awesome les brown the great motivator i was uh did an

event with him about i was walking through the hallway my picture with him back here the other day and i stopped and looked at it because he's such a good man. He lives over in L.A. He just says, you have to be hungry. You know, you have to be sick and tired of being sick and tired. And people change their lives when they say, I've had it.

I've had it. I've had it. And you know what? No amount of intellect offsets that. No amount of academic discussion of some freaking theory offsets that. You have to get this belly burning thing happening where you go, that's it. I'm not living like this anymore. This sucks. And when you change that, that's when it changes, doesn't it?

My favorite quote of yours, you can wander into debt. You cannot wander out. You've got to get mad. I love it. You've got to get fired up, man. And it's just a decision, and that's where Lucy is. She just decided, and then we stumbled across her path. How serendipitous.

Thank you. Christy Wright, Ramsey personality, is my co-host today as we talk to you about your life and your money in the lobby of Ramsey Solutions on the debt-free stage. Baby, they're here. Nick and Brody are with us, which can only mean one thing Solutions on the debt-free stage. Baby, they're here. Nick and Brody are with us, which can only mean one thing. They're debt-free. Hey, guys. Hi.

Hi, Christy. Hi, Dave. Hi. Where do you guys live? Nome, Alaska. Wow. Quite a trek. You win the furthest traveled for a debt-free Scream Award.

Oh, my gosh. Wow. Very cool. And any excuse to get down south, huh? Right. award oh my gosh wow very cool and any excuse to get down south huh right it was negative 30 with wind chill when we left which is unseasonably cold but wow can't breathe we're melting well i'm so glad you're here how much did you pay off 267 845 Wow. How long did that take? Well, it took nine and a half years. Okay.

And your range of income during that decade? We started off at $75,000, went up to $150,000, and then down to $124,000. Okay. What kind of debt was this? I'm guessing with that length of time and that amount of money, you might have paid off your house. We did. Wow! Looking at weird people! How old are you two weird people?

I was 35 when we paid it off. We paid it off three weeks before my 36th birthday. There you go. And I'm 39. Ding, ding. Well done, you guys. What do you do in Nome, Alaska? I'm a court administrator.

And I work for an airline. Okay. Very cool. Now, I've been to Anchorage. Where is Nome? I can't see it in my head. It's northwest of Anchorage, about 500 miles. Oh, just a wee bit.

You can only fly. North of Anchorage, Alaska. Where do you live? North of Anchorage, yes. Okay, that'll work. Wow. Okay. Yeah, well, you can only fly half the places, Alaska. Where do you live? North of Anchorage, yes. Okay, that'll work. Wow. Okay. Yeah, well, you can only fly half the places in Alaska.

I heard you have more airline, there are more people that have airline, air pilot's license than driver's license. Might be true. Just to know. Yeah, I've heard that. So, wow, man, very cool. So, what's this house worth? $220,000 was what we paid for it.

It's at least $260,000 now. Yeah, very good. And was the $268,000 all the mortgage or other things too? We had about $47,000 in consumer debt when we first started. Paid that all off. In about seven months. And then we lived life for a while. After paying off that debt, we moved.

We cash flowed that move. Bought a house. Bought a house. Sold a house. Sold a house. We saved for the down payment for this house. And then in 2015, we bought this house. And we really weren't focused on paying it off.

We were doing our budget every month, and we were throwing extra at the principal, but I don't think either of us... Nick brought home a thermometer for us to fill in every time we paid it off. We'd fill it in a little bit much more. A lot of people do that, but it takes on a new meaning in Nome, Alaska. Well, when Nick brought it it home it just felt overwhelming um it just was there was a lot of lines it didn't seem like we were making much progress on it and i think when it really kicked in was december of 2018 when we decided to throw a chunk of money at it, and we were at the halfway mark. Oh!

I can see the light! Like, oh, we can do this. Yeah. Before, we really became focused around three and a half years ago when our daughter was born, our oldest. And we were like, why are we just, you know, we're not really focused on the house. We're doing all these other things, buying gear. There's so much gear that you can buy for things in Alaska.

Outdoor gear. Packrafts and snow machines and four-wheeler. I mean, just you name it. And it's all expensive. It's not cheap. And so we'd been cash flowing those different things. And then when our daughter was born, we were like, at different times cheap and so we'd been cash flowing those different things and then when our daughter was born we were like um at different times before that we'd kind of look at each other

and be like are you ready to pay it off really focus and one of us would be like no look squirrel i want that thing over there let's do that thing then we'll do it yeah then we'll do it but once our daughter was born we really dug in and uh and we paid it off in February of this year. So how does it feel to be 35, 39 years old with a paid-for house? I don't know if it's really sunk in yet. We just paid it off in February. And so April 1st was our first budget meeting where we didn't have a mortgage payment for March or April. And so I think it's starting to sink in, but we're not, we haven't fully realized

it. It's a lot of money. Yeah. It's a lot of money. Wow. Good for you. I'm so proud of you. Thanks.

Very cool. Who are your biggest cheerleaders? Oh man, you know, we were pretty private about the journey. We've certainly talked to our friends about it and um the friends that we've talked to have all been like wow you guys are doing it that's awesome and but um our parents have been supportive my mom's taken financial peace university we've taught a couple financial um university courses thank you um so That keeps you on track. It really did.

When you start teaching it, you have to do it. Yeah. You could go to the class and sort of do it, but when you teach it, you have to do it. Yeah. It forced us to do an insurance double check. Oh, there you go. Yeah. We had some updating to do on all that, too. Yeah.

Very good. Very good. What do you tell people the secret to getting out of debt is? For me, with the house, it was really patience. Because we had been cash flowing things for a while. And having that large number and just breaking it down into small chunks and being able to just be patient and wait. Yeah. How do you eat an elephant a bite at a time? Yeah.

That thermometer, one line at a time. That's so interesting, too, because research shows that seeing progress is the most motivating thing. And once you guys got to the halfway mark, it gave you that extra push. So it's just so cool to see how those small things all added up to you guys sticking

with it. Well done. That's amazing. Yeah, you won't stick with it if you don't see the progress. And that's good. The incremental wins. That's so good Yeah, you won't stick with it if you don't see the progress. And that's good. The incremental wins. That's so good, you guys. Woo-hoo! You did it!

You are debt-free house and everything! Completely debt-free. You're so weird! I love it. And you brought the kiddos with you to do the debt-free scream. What are their names and ages? This is Lydia. She is three and a half years old. Sweet. And This is Lydia. She is three and a half years old. Sweet.

And this is Adrian. She turned one a week after we paid off the house. Wow. That's awesome. And we've got a pretty Lydia in our family, too. Oh, very nice. Not much older than that. Oh, yeah.

Very cool, you guys. Congratulations. We've got a copy of Rachel Cruz's book for you, her latest New York Times bestseller, Know Yourself, Know Your Money. Nick and Brody and Lydia and Adrian, 268,000 paid off in nine and a half years, 75 to 150 to 124. House and everything, they are weird. Count it down. Let's hear a debt-free scream.

Three, two, one. We're debt-free! Good job, you guys. This is how it's done. That's so cool. Wow. Gosh, her face. It was like just the joy.

It was just like you could feel it. Oh, my gosh. Well, what people don't realize is when you don't have that payment, it's a math thing for a while. It's kind of an emotional thing for a while. But when it's gone, it's a spiritual thing. Yeah. You feel something click in the spirit, you know, and you're like, I had no idea I was a slave, and now I'm not. Yeah.

The borrower is slave to the lender. There's something. Yeah, the freedom in that there's a release yeah like that breath of cold mountain air yeah you probably don't want to use cold air in their example with gnome alaska but yeah there's that sense of cleanliness going down into your lungs you know i mean there's this like i'm wow i'm in a whole different place yeah because you are yeah yeah you're set up to win and that's just the first step that's right you're living like no one else so that later you can live and give like no one else.

So you can put yourself in a position to win like you've never done before and completely change those baby's family tree. What a great young couple. Rock stars, man. That's awesome. That is so fun. This is The Ramsey Show. We'll see you next time. our question of the day comes from blinds.com find out for yourself why blinds.com is the number one online retailer of custom window coverings. 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. It's magic. You'll get the best deal. Today's question comes from Shelly in Ohio. I'm a 52-year-old woman with a B.A. in art and M.B.A. in management. I've been a stay-at-home mom for the last 10 years, but I'm ready to go back to work. I'd love to get into interior design. However, most jobs require design training, which I don't have. Our community college offers a two-year course and I can cash flow their program. Is this

something worth doing at my age? This is such an interesting question. And I think there's some different variables that I want to point out. First of all, at her age, I'm like, absolutely, you can do that if you want to, and you can of all, at her age, I'm like, absolutely, you can do that if you want to, and you can cash flow. But what's more interesting to me is, if you think you want to do it, I encourage people to do this a lot. How can you get some experience in that to make sure you want to do it before you go take the courses? Because even if you have to have some education and training in this to do a know a full uh interior design full-time job it doesn't mean you have to have that in order to get started or to intern or to shadow or to have some position where you could make sure this is what you want to do before you do it so i would encourage maybe

a baby step but as far as her age i'm like no you absolutely could do that people switch careers they have encore careers what's the example of the Colonel Sanders? He was 63 years old before he ever fried his first chicken. There's a lot of – Grandma Moses never painted a painting until she was 88 years old. She did 1,500 works of art before she died at 100. And so you're not done until you quit. Don't talk to me about your age. You're 52. I'm 60.

You're pissing me off. You're not done here. You're not done here. You're not done. But the thing on interior design, there's so many ways to get at that. And there are many, many, many world-class designers who never had a class on interior design. They just had an eye for it, a knack for it, and they developed it over time. They studied with and around other people, but they didn't necessarily go get a degree in interior design. There's a lot of them that do very, very well.

And you've got an MBA in business, so you know how to run the business part. So I'm with you. I think I would use that Ken Coleman proximity principle and let's find an interior designer in your area. And even if you did something really weird uh you're not making any money right now so why don't you just go work for them for free for 90 days and say i want to prove that i'm worth having me around uh and then work for them for a year and learn how they do what they do you're probably going to figure out that you can pick

fabric yeah without a two-year degree you're probably going to figure out that you can pick fabric yeah without a two-year degree that's probably going to figure out you can pick a paint color without a two-year degree and maybe maybe there's some for example maybe there's some program that a lot of interior designers use to mock up what a room would look like to present to a potential client you learn that on the job or you learn that in this uh company that you don't have to go get a degree to do anyway so even if there is some technical aspect that you want to know that would help you you might be able to just learn it there yeah almost in an apprentice type of a setting use that proximity principle yeah i'm with you i think i'd get my feet wet um i don't think

what you need is more education i think you need some confidence that's right you're looking for confidence and it's not found in education it's amazing how many people ask me such a similar question dave of well i need to go get another degree and another degree and another degree and what they're really looking for is permission. They're waiting for some piece of paper that's going to give them permission. I'm like, you don't need permission to go do this thing, to go try this thing, to go help people and learn the degree you think is going to be your gateway of permission. And more often than not, it's you actually doing the thing that makes you feel the confidence

you're looking for. You have a four-year degree in art. If you decide you're an interior designer, you just are one. You just decided. That's right. Just print you some business cards, baby. That's right. And then go pick some paint colors.

And will you get better over time? Yeah. Will you stumble around a little bit? Yeah. You don't know how to necessarily source the lines of furniture or the fabrics or the paintings or whatever is needed to decorate that home and make it look like Magazine City. But I think you probably know enough to start today. But if you want to build a little confidence, go work for somebody for a little bit.

And getting your feet wet will give you not only the confidence, but it will give you the skills. Dave, I think I took one class in college on speaking. And that's just because it was a part of my business management program. You know how I learned how to be a speaker? It's by speaking for the last 10 years. Yeah. And reviewing. of my business management program. You know how I learned how to be a speaker? It's by speaking for the last 10 years. And reviewing. And every time you did a talk, watching the video.

Watching it back and looking at surveys. Oh, that sucked. I don't want to do that again. Watching from other people. It's just brutal to watch yourself. Yes, it is. You know, you go back and review your own work. In any work, you'll find the errors more than anybody else will find them. And you'll correct, course correct, course correct, get better, get better, get better.

That's called experience. But you know how you become a writer? You write. That's right. You know how you become a speaker? You speak. You know how you become an interior designer? You do interior design.

That's right. And so there's not a license required. You don't need permission. You can just go. But if you need more confidence, then we've decorated, oh, I can't think, I can't count now, thoroughly decorated and or redecorated using five different decorators over the years or interior designers over the years. And some of them with big-time credentials, some of them without. But, you know, what we cared about, we didn't care a thing about their credentials. What we cared about was the work that they had done and were going to do.

Can you do a good job? And can I get there? And that's all I cared about. I didn't, you know, as a matter of fact, I kind of preferred they didn't have a long list of letters after their name from some school in France because that means they're going to charge me triple to pick to go I need a white wall well I already knew you needed a white wall you know I mean so don't you know I just I didn't you know there's less joy for me that way more joy for Sharon probably but less joy for me so uh and that's not to say you can't learn things from um in that field but but um but getting started is probably your best bet.

Yeah, that's good. It's a big deal. Melissa is in Boise, Idaho. Hi, Melissa. Welcome to the Ramsey Show. Thank you. Hi, Dave and Christy. Hi.

Hi. I moved from California to Idaho in 2017, and now I have a job I really love. But I kept my house in California, and I plan to retire in four years and maybe move back. But what I'm thinking now is should I keep the house for the whole four years, sell it, and then put it into an investment property, and then just pay cash for it and let it cash flow, and then I just rent and live around and travel around, or is it better to just have that as my primary residence?

Or would you recommend I just sell it now? I'd sell it now. Why is that? Because I wouldn't long-distance landlord for 20 seconds. It's a nightmare. And I own a bunch of rental property, and I don't recommend it. I just don't recommend it. And I don't know what California real estate is going to do.

It has done well in the past, obviously. It has also been, in my lifetime of 40 years, working lifetime of 40 years watching real estate, it has been the most volatile market overall, meaning it goes way up and then it market overall, meaning it goes way up and then it busts, and it goes way up and then it busts. And with the number of people leaving that state right now, I don't know what's going to happen to prices there.

I'm a little shocked, honestly, with the level of exodus from California that prices haven't already gotten soft there. But they haven't. They're white hot. They're white hot so no inventory yeah yeah no it's no inventory we're in the united states i mean uh so the covid even though even though you'd pay recapture right now because if i right now i'm using it as my primary and paying california taxes and i'm doing a roommate situation and gave them reduced rent and i think if if I wait until January to sell it, I won't have to pay $56,000 and recapture, or would you just take the money?

Well, if you wait until January and save $56,000, I'll wait until January. But I'm not going to keep it five years, and, you know, I wouldn't have kept it in the first place. And so I'm going to begin the process of divesting and saying, you know, I'm going to live in Idaho. My investments are going to be in Idaho. And when I leave Idaho, my investments will also leave Idaho. And that's what I would have you to do. It's almost never, I mean, so close to never that I can just say never, a good idea to become a landlord by default.

In other words, would you have gone and bought that house to use it as rental property while you lived in Idaho? Answer 1,000 times is no. I live in Idaho. I'm going to go to a house that looks like something I would live in in California for rental. No, you wouldn't do that. And so since you wouldn't do that, then keeping it is becoming a landlord by default.

And it seldom turns out to be a great decision. Seldom. Can you get out of be a great decision. Seldom. Can you get out of it and make some money? Yeah. If you can get $56,000 help on the recapture by January, fine. I'm good with that. But long-term, I'm not holding that puppy. Thank you for the call.

Christy, good show. Thanks so much. Thanks for having me. This is The Ramsey Show. Hey, it's Kelly, associate producer and phone screener for The Ramsey Show. If you would like to do your debt-free scream live on the show, make sure you visit theramseyshow.com and register. We would love for you to come to Nashville and tell Dave your story.