The Ramsey Show - App - Don't Get Rich...Build Wealth Instead! (Hour 1)

Episode Date: February 17, 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. Chris Hogan, Ramsey personality, number one best-selling author, is my co-host today. Our phone number is 888-825-5225. We are going to take a second, though, and pause on the phone calls and just pay honor to our friend Rush Limbaugh, who passed away this morning. There are very few people in this world that create an entire industry.

Elvis, you know, the king of rock and roll. Even the Beatles followed Elvis, you know. And Rush created talk radio as we know it. There were a few people doing it odds and ends here or there. But the first person to do of scale uh for sure and uh in the process of those number of decades becomes an american icon and and um uh very interesting guy i got to spend a little time with him a few times and um obviously i was a little bit starstruck.

And so whether you agreed with his politics or not, for God's sake, some of you out there have some class today. It's hard for some of you, but you ought to have a little class. I mean, if someone you completely disagree with and you hate their message passes away, and you can't – Mama used to say, if you can't say nothing nice, don't say nothing at all. That's right. That's a good plan for some of you just just shut up but um anyway uh um rush created an industry i mean he and some of the guys were working with him in the early days took am radio and it was on life support brought it back to life uh to the point that am radio stations which were you know prior to that almost didn't exist in the ratings books,

became the number one rated show or station in many, many cities. On AM talk, you know, AM talk radio did that. Wow. And it was him that blazed a trail. And you know he blazed a trail because there's so many people that came along after him that wanted to be him. That's right. There's so many Rush wannabes on the air, out there, or people that just stepped into the same space with their own thumbprint.

But some of them not very original, some of them very original, and a lot of them are friends. But here's what it takes to do what he did. You have to have an unbelievable intellect, which he did. His critical thinking skills are unbelievable. And his sense of humor. The one thing he does that so many don't do when he's discussing stuff is not only to make fun of himself, but made fun of himself, but he's just dadgum funny uh well i was and it's just um it's hard to think about past tense get my get my my grammar correct here but um

his ability to deliver that and his ability to deliver uh thought provoking things and for those of us that are consider ourselves conservatives, he put words to things we were already thinking and feeling. And it really wasn't like what he was saying was new. It's like me, you know, and you, Chris. We don't say anything new. Get out of debt. Your grandmother said that. That's right.

You know, it's nothing new, but we've just done it with a panache and in a way and with enough volume that it's touched millions of lives and certainly he did um and so iconic iconic guy uh behind the scenes uh an introvert i didn't know that yeah i'm not a not a um you you would think as loud and uh gregarious as he was on the air that he would be that way in a a cocktail party, and he would just as soon not be at a cocktail party, just as soon not be in a crowd. And a lot of the guys on the radio are that way, a lot of gals and stuff, even on TV. They don't mind the camera, they don't mind the microphone, but a crowded room is not something they want to do.

I'm unusual in that regard because I am actually an extrovert, but I'm louder in those situations than I am here. Just a little bit. Just a little bit. But he set the standard, and those are shoes that won't be filled. There will be a lot of attempts in the coming weeks for all of us in the business to try to figure out what to do now because it leaves a gaping hole in talk radio, obviously. But no one will. People will come along and do their own version of whatever they need to do i hope i hope they don't try to just do rush again because that'll be a mistake yeah it would be and because it's

impossible yeah well i can tell you i mean he's definitely an icon uh bombastic had no fear of giving you his opinion uh and like you said, critical thinking skills were unmatched, being able to look at both sides, but also tell you what he believed and his feeling. And so prayers go out to his family. Yeah, absolutely. And we've reached out to the team that's around him. We know all of those and around his family and so forth and all of that but um you know it is an interesting thing to stand back and look at a person whose uh life was so epic that they literally created an industry i mean henry

ford created the assembly line and thereby the automotive industry without a doubt i mean there are people say the car was invented before henry ford yeah but no one did it like he did it i mean there's a he took it to scale there were other people making cars uh in their basements and other things but you know the mass production line um the ability to uh you know create a factory to to make cars was and you know the ford model t's became the thing the standard everybody after that including Tesla, is still trying to catch up. You know, and so that's what happens. And when you come in and an entire genre, an entire industry is created around a person's skill, a person's ability, and so forth. That's iconic.

That's iconic. That's iconic. And we've certainly, the talk radio portions of the Ramsey Solutions business have certainly ridden on the coattails of that. Had I come out and said, I'm going to do a show on the radio and I'm going to take phone calls and I'm going to teach people how to get out of debt before there was, before the road had been paved by somebody like Rush, I would have been laughed out of the building. I was already laughed out of the building several times anyway, but I would have been really laughed out of the building. And, yeah, mammoth, mammoth impact, and really a quality, quality guy.

Again, I didn't agree with everything you said, but I don't agree with anything anybody says. I don't agree with everything Hogan says. I don't agree with anything anybody says. I don't agree with everything Hogan says. I don't know why you had to go there, but I respect it. I respect it. Yeah. But, you know, if you have critical thinking skills, you don't agree with it. There's no one you agree with 100%. No, you're right.

You're absolutely right. I don't even agree with Jesus 100%. That means I'm wrong, and I've got to learn something, right? But, so, you've got to learn something, right? So you've got to learn. But if you can't respect the accomplishments, the impact, and the quality of that, then you're missing something, whether you agreed with him or not, or whether you agreed with his politics or not. I can tell you this on behalf of the family. I would encourage you, if your life was impacted by Rush in any way, write a letter, send it to him, his family. It would blow them away to be able to read those stories and remember this man in their life.

Amen. Yeah. Well, rest in peace, my friend. Rest in peace. Chris Hogan is my co-host today this is the ramsey show If current times have shown us anything, it's that the least expected events can and will happen, and we have to deal with it. That's why everyone who has a family counting on them needs term life insurance. For over 20 years, the only company I've recommended is Zander Insurance. Not only because they search all of the top term life plans to find you the best rates, but over the years, they have constantly changed and updated their systems to make the whole process simpler and easier to get the protection needed. You can now apply with a completely touchless experience with everything being done either over the phone or the Internet.

They also have plans with super competitive rates that don't require an exam, allowing you to skip a step and get the coverage you need faster. Go to Zander.com or call 800-356-4282. Great rates and a simple process mean there's no excuse to not get this done, people. Chris Hogan, Ramsey personality, is my co-host today. Open phones at 888-825-5225. Alex is with us in Syracuse, New York. Hi, Alex. How are you?

Better than I deserve. Hello, Mr. Ramsey. How are you? Just the same, sir. How can we help? All right. Well, let me first just say sorry about your loss of Mr. Eshlembaugh. I know a lot of people looked up to him.

My question here is I'm a social studies teacher in Syracuse, New York. I'm 23 years old, and I'm kind of at the point where I don't know which questions that I should be asking. This particular question is about 403Bs, private pension plans. There's about four different companies that I can set up private pensions with. But I guess my question to you is, what questions should I be asking them when trying to decide which company to choose? Okay. What do you do, again? I'm a social studies teacher.

A social studies teacher. And so your school system has a 403B available, and there are four different companies that you can choose to fund your 403B. Is that what we're saying? Yes, sir. Okay. Who are they? So I have FOIA, Security, Aspire, and Equitable.

Okay. What you're looking for inside of these companies is what they're offering for you to put the 403B into. You're looking for mutual funds. Equitable is most likely life insurance products. Stay away from those. They're bad investments. Okay.

I don't know the other companies. Aspire Equitable, and what were the other two? Voya. Voya Financial. Okay. They probably have mutual funds offered. But you're looking not for an insurance, not for an annuity. You're looking for mutual funds and so ask them

ask each one of them do you offer mutual funds as an option and then if they do you're looking for four types of mutual funds yep you sure are and inside of those you're gonna you're gonna see they're they're kind of structured. And when we talk about being, Alex, excuse me, being diversified, you want to put money, we don't want all your eggs in one basket. And so you're going to look at, you're going to have growth, you're going to have aggressive growth, you're going to have growth in income, but you're also going to have available international. Now of those four types, that's what you want to be putting your money into as you're investing over the

long haul. And so what I would do is get that information on what they're offering you. Go sit down with one of our SmartVestor pros so they can start to help you understand what's available and which program is going to be the best fit for you in the long haul. But you are going to hire an investment professional to help you. You are the owner of this money. So you're not trying to find a guy or gal just to turn it over to. You're going to work alongside them for your future.

Awesome. Okay. At 23 years old, how are you at this point? Were you taught by your parents or are you self-taught? So taught by you and Mr. Ramsey,sey um really honestly but my mom has been a great support system also so definitely shout out to mom that is fantastic i'm just at this point where people are telling me things to do and i just have to pause and be like i because i don't know what i should be asking so that's where i'm here right now and i called the show before and mr ramsey's

helped me buy a car not too long ago. Oh, cool. Well, go to DaveRamsey.com. There's articles on there Dave has about questions to ask your investment professional. You'll find a wealth of information there, and you can go right from there with those questions and go sit down. But I can tell you, it can save you a lot of heartache and headache. A smart investor pro is going to be the person to guide you and to be able to help you understand what you're dealing with. You're very wise to be asking questions.

And the question of what questions to ask is a good question. Because the whole thing is do not put money in something you don't understand. Not because I said to, Hogan said to, or anybody else. Yeah. Or your friends, for God's sakes. Put money in something because you understand it. And what we suggest around here are the four types of mutual funds, growth, growth and income, aggressive growth, and international. And if you can find those with long track records inside those 403B companies

that are offering to fund your teacher retirement program, then that's where I would put it. But try to stay away from annuities and try to stay away from insurance, life insurance-type products. They're all substandard at best, completely suck at worst. All right, Frederick is with us. Frederick is in Texas. Hi, Frederick, how are you?

I'm doing very well, Mr. Ramsey and Mr. Hogan. Thanks for taking the call. Our pleasure. How can we help? So I just had a quick question on, I'm 22. I'm going to be graduating from school in about a year and a half, and I'll be graduating with about $35,000 in student debt. And so my question is right now, should I double down with my time on school

so that I can have the highest paying income I can have out of college? Or should I take out a second job or a side job right now to try to take advantage of the fact that there's a freeze on the interest rates for the student loans and tackle those? That's my question. Frederick, what year are you in school? I, so technically I'm a senior, but I'm going to be graduating in five years because I switched from neuroscience to finance. Five years from now? Oh, no, no, five years total.

So a year and a half from today. So I have three semesters total left. I feel better already. Yeah. Okay. Yeah. And do you have the money set aside to pay for the remaining of school you have left?

I do not. So it's all student loans. So it'll be all student loans all the way through. And then my dad has a good chunk of it in Parent Plus. And then he put some in my name. So I have 35 total when I graduate. Well, I'm going to tell you this, my friend. I love the spirit of you wanting to get that debt out of your life.

But first and foremost, as Dave will tell you, the best investment you can make is in you. And so I would want you to get money set aside to make sure you're not having to add any more student loan debt to this $35,000. Right? We're at that limit. And so once you have that in place and you're paying for your school moving forward, then I want you to turn your attention to attacking the debt. But I don't want you signing any more of those papers in the financial aid office. They're not your friend. So here's the thing.

There's no point in paying down your student loans while you're continuing to borrow. That's filling up the hole with one shovel and the other hand's digging it out at the same time you're just swapping dollars dude does that make sense no it makes sense yeah so let's your first goal is work your butt off and limit or alleviate the future need for more borrowing from today forward let's get out without any more borrowing that would be goal one paying down the student loans that are the currently, I wouldn't worry about until after graduation. But your main goal now is to add no more debt. And, yes, I would work and do that.

And I think I heard you say double down on school so I get a better job. There are very few jobs that pay you more for a 4.0 than for a 3.0. Like none. Okay? I've been interviewed for jobs and interviewed for all kinds of things, interviewed in the press and everything else over the last 40 years of my life, and I can tell you the number of times someone has asked my gpa when i was in school was zero how many times you're i know you got a master's in finance but no i've not been asked my gpa you got a master's in finance nobody asked you what that was but

when they were reading your best-selling book yeah yeah yeah but i mean we're not telling him to hold back no but this idea this potential no but this idea that if I'm going to work, my grades are going to suffer, usually they don't, number one. No, that's true. That's not a given. And then, number two, if you're working and your grades do suffer a little, it's not going to mean you don't get a job. No, that's true. And if you're being hired by people who the difference in a 3.5 and a 4.0 or a 3.0 and a 3.5 matters, that's not someplace you want to go to work anyway. These people are freaks.

You don't really want to work there. There's some strange individuals. Yeah, aliens. Yeah. One eye in the center there. Something off Star Wars. I mean, really. You don't want that.

Who does that? Yeah. Yeah. So, no. You get to work, dude. And don't want that. Who does that? Yeah. Yeah. So, no. You get to work, dude. And no more student loans. No more. Bust your butt and get your butt in class and no partying. Quit playing beer pong.

This is The Ramsey Solutions on the debt-free stage, Luke and Sarah are with us, which can only mean one thing. They're debt-free. Way to go, guys. Thank you. Where do you guys live? Columbus. Columbus, Ohio. Ohio.

Awesome. Well, welcome to Nashville. Thank you. And you leave Ohio and come to Nashville for our one snowstorm of the last five years. So this is our version of global warming. So welcome. Good to have you. And how much debt have you guys paid off?

Paid off $90,000 in two and a half years. Way to go. Excellent. And your range of income during that time? $60,000 to $75,000. Wow. Whoa. What kind of debt was the $90,000?

It was our house. You paid off your house? Yes. Yeah, we did. We're looking at weird people. Oh. You guys are cool. Well done.

Thank you. That's a big deal. All right, Sarah, was it your idea or was it Luke's? Who started this thing? Actually, it was me when I first brought it up to him. He was insulted. Oh, he was insulted. Well, I was kind of the nerd and kind of working through everything. I kind of

did all the finances. So when she brought it up to me, it was like, am I not doing a good enough job? Oh. So it took me a few days, but with God's help and kind of smacking me around, I mean, he let me know that it was more about she just wanted to know about the finances. Like, so that if something did happen to me, she could take care of things.

Okay. So what happened from that day forward? Well, we started the, we got into the class. Oh, you did? Went to financial peace. Yep. All right. We were introduced to that, and then we started working together.

And it was really big shock to me how much faster things started working once we were on the same page. Yes. Working together towards things instead of me just handling the stuff. Yes. Well, you're built like me in that you said, you know, you're the nerd. You like the numbers. And most of us that are wired that way, we have a tendency to think numbers are going to fix things. And it's not.

It's behaviors that fix things. Yes. And relationships that fix things. The numbers are the result. But it took me a long time to get there because I wanted to fix everything with the numbers. A spreadsheet is my life, you know. So, wow. Way to go, guys.

Excellent. So, what's this house worth? About $260,000. It's all yours. Wow. How old are you two weirdos? 37. I'm 38.

You have a paid-for house. Yeah. That is so wacky. Yes. I mean, you don't owe? 37. I'm 38. You have a paid-for house. Yeah. That is so wacky. Yes. I mean, you don't owe a dime. Nope. Nope. What was the size of the last check you sent in?

Do you remember? Probably 8,000, I think. 8,000. Yeah. That's fantastic. Like a bonus or something and just popped it, huh? Yep. I love it.

So well done. Thank you. So the biggest sacrifice for each of you, what's the biggest thing you gave up in this journey of paying off your house? Mine was I had a bunch of little toys and stuff down in my basement that I've saved up throughout my life. Like what? What was one or two of them?

They're like action figures or little miniatures. Oh, yeah. I sold all of them. All of them? All of them. What did the whole kit and caboodle bring? I have no idea. Oh, yeah, I sold all of them. All of them? All of them. What did the whole kit and caboodle bring? I have no idea. Oh, roughly.

At least 10,000. Okay. Wow. She had a real collection. Oh, you had a real collection. Yeah, it was a lot. I've got three down in my basement. That's not a collection.

You had some stuff. Okay. Yeah, it wasn't just that stuff. I mean, that was kind of everything that we sold. Yeah. It was around that. Okay. Sarah, what about you?

What was the biggest thing, biggest sacrifice? I would say I was working three jobs for a while, three part-time jobs. I'm down to, I would say, one and a half. So that was a little rough for a little while. My photography business really took off, so I was able to let one of the jobs go, and I cleaned our local church. And so it was rough during busy season, but we had a goal. We had a goal and we were both excited.

Sometimes telling people no, that they wanted to do something and ask us to come. We would say, no, we're trying to hold down here. We got a goal that we want to hit and we would just work even harder on it. Yeah. Who were your biggest cheerleaders? Probably our family and friends and our church. He actually leads the FPU group at our church now, and they've been on board with us ever since,

and they've been wonderful, and a lot of great family and friends that we have. There's nothing that gets you fired up like leading it, because then you have to do it. Yeah, that's right. I mean, it's not like you can kind of cheat have. There's nothing that gets you fired up like leading it because then you have to do it. Yeah, that's right. I mean, it's not like you can kind of cheat then. That's right. We saved our credit cards for our first class so we could cut them up on class.

Oh, wow. That's cool. Very cool. So to other people out there that are thinking it's not possible, right, at 37 and 38 years old, what would you tell them? If you stick to the plan and you keep working at it, it can be done. It's it's sacrifice. But to me, it was more of our kids are kind of young. So I wanted to do it when they were younger and I knew I could sacrifice for a couple of years. And then it was like, then we're done. We can move on and start doing things that we want to do.

And we never went without. I mean, we had everything we need. We had a lot of family time. We played board games, maybe less vacations or more go visit family for vacations. And so we never went without. Many people say you can't take your money with you, right? We can't take our money with us, but we can leave our kids with morals and values and lessons to pay off. And work ethic.

Yes. And other things. So well done, you guys. So proud of you. Thank you. Very neat. Thank you. Very neat.

Okay, now you're leading financial peace classes. You paid off your house. You're not even 40. People ask, how did you do that? What are the main ways that you tell somebody to get out of debt? Have an accountability partner for sure um we we don't keep anything back if i went to mcdonald's and we already spent over our budget i have to tell them if i wanted to buy that toy and i'd have to come to her and say hey is this a good idea and she'd say or say no no definitely not even though i really want six of those.

But hey, you went through the period of saying no. You know what you get to say now? Yes. Yeah. You said yes to your future. I'm very proud of you, too. Thank you. Live like no one else later.

You get to live and give like no one else. Absolutely. Amazing. All right. And you brought the kiddos. What are their names and ages? Grace is 10 and Logan is 7. Very good.

They're also big supporters. We had a thermometer that we all crossed off the next line every time we paid a little more off. So they've been great. All right, there we go. So they've learned it. Oh, they have. They know that their family tree has changed. Yes. Yeah, you guys are so impressive.

Thank you. What wonderful, wonderful people. All right, it's Luke and Sarah, Grace and Logan from Columbus, Ohio. $90,000 paid off in two and a half years. House and everything.

We're looking at weird people. We got a copy of Chris Hogan's book for you, Everyday Millionaires, without a doubt. That's the next chapter in your story. So count it down.

Let's hear a debt-free scream. All right, guys. You ready? Three, two, one. We're debt-free! Yeah! Oh, I'm going to tell you, Logan meant that. Logan meant that.

Yeah, he's there. He's made some sacrifices. He wanted everybody to hear that. That's that. He's there. He's made some sacrifices. He wanted everybody to hear that. That's fantastic. Wow. Great points they made. Talking about making sacrifices. Talking about accountability people. Being committed to the goal.

And being driven. Wanting it bad enough that you're willing to sacrifice for right now. And that's all part of it, Dave. I don't know what the numbers are because I don't know that we necessarily track it. But it would be interesting if we could go back and look over all the years. And we have about $50 million worth of debt-free screams a year on the air, on the air. But how many of them that have paid off their home

went from going to the class or Financial Peace University or reading Total Money Makeover to becoming a leader. There's something about when you go from baby step two and you're out of debt, and then you're going to go on with four, five, and six. You're going to knock the house out. The people take that next step. They go over and they become a coordinator. And I think it's a way to stay plugged in. I think so.

But it's also when you have something that impacts and changes your life you can't help but want to tell others and be able to guide them and so you know if you're out there and you're wanting to get plugged in you've got opportunities i'm telling you i don't care where you are in the plan if you're attacking debt or maybe you're on baby step one and you think i could help other people with this yeah we can we you can help people yeah just check out ramsey plus and talk to that team about being a coordinator for Financial Peace University. And the people going through Ramsey Plus, a lot of the coordinators are virtual now.

Yeah. Because a lot of the classes are virtual. And not all of them, but there's, you know, there's a percentage that are. And so. There really is. And I guess probably will be forever. Not because of COVID, but just because that's the way things are now. That's right.

But hear me again. You do not have to be debt free to be a coordinator you can start helping people today nor do you have to be perfect because that would also rule me out he gone he who me me oh yeah you too we gone we gone we gone we gone we We gone. We is gone. Chris Hogan, Ramsey Personality, is my co-host today. Thank you for joining us on The Ramsey Show. The phone number is 888-825-5225. Colby's in Sacramento. Hi, Colby.

How are you? I'm doing good. How are you doing, Mr. Ramsey? Better than I deserve. How can Chris and I help? Awesome. I have a quick question. Currently, I'm in my third year of college, graduating four.

So, we've got about a year and a half left. And currently, right now, I'm on Baby Step 1. I've already saved my $1,000 for my starter emergency fund. And currently, throughout life, I've worked hard at many jobs and have saved up to about $37,000 that are all in stocks and currently have a $15,000 car loan. And was just curious for Baby Step 2, it says pay off all debt. But right now, all of my stocks are making more than my monthly payment. Was just curious on what I should do and how do I set up myself for success in the future? Kobe, I want you to brace yourself, buddy,

because you said a key phrase. How do you set yourself up for the future? Which means you're going to have to let go of some things you've previously learned and some things you've previously thought, because what we're about to tell you is going to be a paradigm shift. It's going to be counter to anything you've heard, and it's going to feel weird, and your brain is going to try to resist it because it sounds so weird tell him dave

well when chris and the team here did a study on millionaires we studied 10 000 of them not a single one of the 10 000 millionaires that we said, I kept debt on my car and used that payment to put into single stocks, and that caused me to be wealthy. Not a single one used leveraged car loans to invest in stocks to become wealthy. Not one of the 10,000, which tells me that your plan sucks. That's what the data tells me. Okay? And so you've gotten lucky so far. So far the stocks have gone up, but they don't always go up,

and you're carrying this extra debt. How are you paying for school? I'm blessed. My parents are putting me through school. Great. Okay. The good news is you've got a great financial mind, and you have the ability to look at numbers, and that's going to bode well for you if it doesn't lead you into taking risks that you don't even realize you're taking.

So if I woke up in your shoes this morning, what would I do if I was your age, knowing what I know at 60 years old with a net worth of hundreds of millions of dollars. What I would tell you to do is what I would do if I woke up in your shoes. If you were my son or, dadgum, my grandson or whatever, I would tell you to pay off the car today, move your single stocks into mutual funds, and be the tortoise. Yes. Don't be the hare.

Yep. There it is. And I'm going to tell you, it's crazy, Colby, but if I could go back in time, I'd grab me by my hair. Ramsey, don't go there. I had hair back in the day. Way back in time. I had hair back in the day. But literally, in that mindset of getting away from a

car payment of staying away from this cryptocurrency phase uh because another phase is coming and it's a get rich quick scheme and uh dave taught me something 15 years ago don't get rich build wealth there's a difference in the mindset there's a difference in the approach and i'm going to tell you it feels better yeah you know there's no shortcut to any place that's worth going and very few people who get wealth quickly keep it it's very unusual uh so somebody hits the lotto the bankruptcy rate of people hit the lotto is fourfold the national average yeah um people who inherit money with no effort and have been taught no character or work ethic promptly lose it and uh now it doesn't mean that everyone does that they don't uh but i mean you can teach your kids and

they can the blessing the inheritance can be a blessing because they've got the character but anytime there's quick rich that it's uh the best way to get rich quick is don't get rich quick and so um that's where all of this this where where all these sayings come from true principles. And so that's what we tell you to do. Of course, you're a grown person. You're going to go do what you're going to do. But ask yourself what the 30-year-old version of you is going to think about the 20-something version of you when you look back. Did you have a fro?

When I was a baby, Dave. When you were a baby. I had a... Can you think about this? Listen, I had a TWA. What's that? It was a teeny weeny afro. Oh.

It was little. It was little. Mama Hogan did it to me. I wasn't old enough. I mean, like when you were a teenager. No, I didn't have a fro. How big was your hair when you were a teenager? No, no.

It was little. I just had a little bit. Because you're always wearing a football helmet. Well, yeah. You don't want to mash it down. I kept it low okay but story behind the first shaving of the head we said if we made it to the national championship game in college we were all going to shave our heads and i'll be doggone if we didn't make it and so that was the first time

a razor touched my head and i never went back never went back i'm like this is a little and then it wasn't optional. I like this. Yeah. That's just you. It is. It is. It just fits. I can't imagine that head with the fro on it.

That just would be more than, I mean, like the full size. No, I can't. You know, the big one. Yeah. You know, like a 1970s. You remember? I mean, that would be, that's a picture I need. No. I'll find one of the little ones.

Throwback Thursdays on whatever it is twitter or instagram i will reach out to mama hogan and i will get that posted on instagram follow me at chris hogan 360 you are going to see a small afro soon yeah there you go there it is small one small all right little low yeah all right jake jake's in tacoma washington hey jake what's up in your world hey good afternoon gentlemen first of all and as a fellow bald man i I have to say that you guys have great hair styles. Jake, you are the caller of the day. You are the caller of the day. Whatever you want, you can have it.

Yep, you can have whatever you want. I love it. Hey, so I got a question for you guys. The company that I work for, I'm in Baby Step 4. I was super happy to be through Baby Step 3 when COVID hit, for sure. But anyways, I'm on Baby Step 4, and the question that I have is, my company has a Roth 401k option that matches $0.25 per dollar with no max. Wow.

Should all 15% of my contribution go through my Roth 401k? Yes. Okay. I wasn't sure if any of that needed to be split up into the ira no you got you got a 25 rate of return if your mutual funds completely bomb perfect okay that's awesome yeah that's killer yeah i definitely want to do that are they matching you in company stock uh no it is uh they go into the traditional, of course. Yeah, and then, yeah. I think it's after five years you're completely invested, but I've been there for more than five.

So 100% matched every, well, not 100%. 100% of their portion of the contribution is just in the regular mutual funds. Jake, that's a super cool benefit. The next time you run into someone in leadership, you ought to tell them thank you. Give them a hug. It's highly unusual. It is. But he brought up something, Dave, even with the Roth 401k, the employer match version

of that, you do have to pay taxes on that. Okay, that's going in pre-tax. But your money that's going in in the Roth side of Uh, but your money that's going in, in the Roth side of that, in the Roth 401k is after tax. Uh, but what I'm growing tax free and it is growing tax free. So, uh, but that's a great opportunity for him. But traditionally this is a teachable moment for all you listeners out there. We don't factor in the employer match. Don't care what they're doing, how much we call it icing on the cake. You want to flex the muscle of you investing 15% of your income. Which he is. Yeah. And then we'll certainly

take the match. Your first priority is get all the match you can get. Your second priority is make sure you're in a Roth. He's got the benefit of being in both. He's in both. And your third priority would be then to do traditional or something if you can't fill it up. Can't fill up your 15% in match and in Roth. In his case, he's got all of the above, so very good. Now, later on, when you're in Baby Step 7, you can, once a year, if you're vested, roll that money out of the traditional over into the Roth and pay your taxes on it once a year, which is what I do on my personal one.

Once a year, I roll out the, at the end of the year, matter of fact, I just did it in January, rolled out the match portion where I match myself since I own the company, but this is dumber than crap. But anyway, I match myself, and I'm in Baby Step 7, obviously. And so I roll that out and pay taxes on that portion immediately and let it all grow Roth from that point forward. So smart. So smart.

I don't have any traditional left. I've rolled it all to Roth over the years. And each year, I do it again so that I never have any. It's all Roth. That's good stuff. That puts us out of the Ramsey Show. In the books, Chris Hogan. My co-host, James Childs, is our producer. Kelly Daniel is our associate producer. This is the Ramsey Show. In the books, Chris Hogan, my co-host, James Childs is our producer.

Kelly Daniel is our associate producer. This is the Ramsey Show. Have a friend or family member that needs a daily dose of 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 in under 10 minutes. Check out the Ramsey Call of the Day podcast wherever you listen to podcasts.