The Ramsey Show - App - Don’t Let Your Inner Drama Queen Control Your Investing! (Hour 1)

Episode Date: April 19, 2023

Dave Ramsey & Jade Warshaw answer your questions and discuss: "Should I buy a backup vehicle for my job?" "Taking out a HELOC to repair the roof", from the blog: HELOC: What Is a Home Equity Line of Credit? Getting out of debt while preparing for marriage, Borrowing against one property to buy another, "I make a lot of money but have no retirement" 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/3cEP4n6 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 moving and storage studios, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Jade Warshaw, Ramsey Personality, is my co-host today as we answer your questions about your life and your money. The phone number is 888-825-5225. Chris is in Spokane.

Hi, Chris. Welcome to The Ramsey Show. Hello. Thank you for taking my call. It is a privilege. Honor to speak to you, sir. How can we help? Well, first, I've learned a lot from you in the last couple years, more than I ever learned in a college degree, so thank you. But my dilemma right now is with my work and obtaining a backup vehicle. I am an independent contractor who drives a lot of miles.

The repairs are part of the deal, and my original means was taken away from me a few months ago, and so now I'm looking for a way to get a backup vehicle, a way to finance the repairs. And it's been wishy-washy. I used to be able to take it to the dealership. It has a third-party contractor where I could work on financing, give me a loaner. That's all gone now. So I'm back to square one.

If I go hit my car breakdown, how, how do I get on a vehicle? Save it up for it's difficult. I still got a couple of credit cards and they're under control, but I still need that resource back. So I don't know how to do that. What kind of delivery driving are you doing? Can I have some clarity on that? Yeah,

I've done the Uber, Lyft, DoorDash. I've got thousands of deliveries done under it. So is there anything wrong with your current vehicle or you just want this just in case? Just in case. I mean... So how much do you make? Well, about $5,000 a month. Okay. Well, in business, if you were running a business, which you are, you're an independent subcontractor, right? An independent contractor. So let's say you had a heating and air company and you had 10 trucks that were fixing people's heating and air.

One of the things we would teach you in business is to set aside a percentage of your profits for truck replacement. And then eventually you'd have enough to buy a truck and then you'd start the process again. And so every so many years you would roll a truck off of your fleet and roll a new one on, but you've been systematically saving a percentage of your profits. If you save 10% of your, of your 5,000, as an example that'd be $500, that'd be $6,000 a year. I mean, you could buy another $6,000 car once a year.

And that's all you need for a backup car. Yeah, I don't think, Chris, that you need two vehicles at one time. I think this is more about I'm saving up. I've got this money here to replace the vehicle you've got or upgrade when the time comes or fix the repairs as needed. But making $5,000 a month, I don't see why you need two vehicles, one sitting in the driveway and the other one that you're driving. If you did, it's a super inexpensive one.

It's just above hoopty level because you definitely don't need two $15,000 vehicles to drive Uber. That'd be dumb. Okay? Right. need you definitely definitely don't need two fifteen thousand dollar vehicles to drive uber that'd be dumb okay all right even if they're all paid for and it with with the income you're producing it doesn't justify that so uh but yeah i i would it's okay to put a hoopty a semi hoopty in the in the yard if you want or the driveway if you want to have as your backup uh and then you've got to have repairs in your line items because basically you are running the wheels off a car and so you're going to have increased repairs because the miles you're putting on it and you got increased fuel cost uh and you've got to run all of that in your in your uh basically the profit and loss statement of your business which is the revenue that comes in minus fuel, minus repairs, minus vehicle replacement. And those are the line items in your business's budget. And then the net of

that is taxable. And the net of that is what you really are taking home. You can't take 100% of it home because you'll constantly be in a lurch on repairs. You'll constantly be in a lurch on vehicle replacements. You've got to systematize this and just build you a process. And I don't care what it is. If the $500 I mentioned is enough, then that's fine. And you say, okay, we're going to set. You also need to be setting your tax money aside every month. That's a fact.

You know? So, you know, your quarterly estimates on taxes, which is about 25% of your profits. And so you need to set that aside, set aside vehicle replacement, you know, your quarterly estimates on taxes, which is about 25% of your profits. And so you need to set that aside, set aside vehicle replacement and set aside car repairs. And so you've got these little miniature savings accounts for replacement and for repairs, and then you can run the thing efficiently. That's how you handle the cash flow aspect of this. And then the other thing you need to ask yourself is what Jade's saying is, you know, how much do we really need to invest in this? Well, you know, and that's what I said. If he's really focused on the Uber side of things or the Lyft side of things, it might be more profitable for him to increase the value of the car that

he's driving because you can earn more based on the type of vehicle that you have. So I don't know. I mean, it may be worth him running those numbers out, but you know, maybe you drive the hoopty for like Instacart type stuff, but you're saving up to buy, you know, a certain level of vehicle so that you can make more on your Uber and Lyft stuff. He's got it. He's got to price that stuff out and see, see where the true money lies. The black SUV level. Yeah. Well, that's going to take him a minute at 5,000 a month, but you know, 500 a month yeah yeah either way however you did it exactly tammy's with us tammy's in jacksonville florida hi tammy how are you i'm good how are you better than we deserve what's up awesome well i'm i'm searching for some godly financial wisdom we are in a situation where we've lived debt-free

um you know we took Financial Peace University many years ago and really put it to work. We live in a small rural community and our pastors, so we have done the best we can with what we got. Well, our insurance company has canceled us because they're requiring us to get a new roof because our roof is about 23 years old. It's actually still in good condition.

We could replace the roof ourselves. Um, but the second insurance company just canceled us again and we only owe about $42,000 on our mortgage. We are trying to figure out, do we, do we try somehow to pay off the mortgage, whether it be through, um, a personal loan a personal loan, like we could drain our savings and pay off that with a little bit of a personal loan and not have to worry about a roof or go into debt to get the roof. How much do you have in savings?

We have about $23,000 in savings. Then we have a... So you have the money to fix. You have the money to put a roof on the house. We do. Do it. But the other dilemma is that there... Your house needs a roof.

Right, right. But we're being told by our broker that even with a new roof, they won't be able to find anybody to insure us. Why? Because we don't have a fire department near us. You had insurance before and there was no fire department near you. No, there was. They closed?

They just closed down. down yes they just closed down like i said we're in a very rural community and so we're very confused with what everybody's telling us you know i'm going to work this problem and i think you need to put a roof on your house and get get insurance and then work to get your house paid off um i'm with you on getting it paid off but you know you're not really you're just moving the loan to a personal loan if you did that it's not the end of the world so if you throw 20 at it and you go take a 20 000 personal loan now you're free but you still need a roof and you still need insurance after the smoke clears on that no pun intended this is the Ramsey Show.

Jade Warshaw, Ramsey personality, is my co-host today. Thank you for joining us, America. We're glad you're here. The phone number is 888-825-5225. Our question of the day is sponsored by Neighborly, your hub for home services. If you're moving, you have a long list of to-dos, but Neighborly has local pros like Housemaster, The Grounds Guys, Five Star Painting, and Junk King. To check items off that list, visit Neighborly.com today to schedule home service experts near you. All right. Today's question comes from Jesse in the Baby Steps Millionaire Group.

He says, I'm 61 years old. I'm hoping to retire soon, but watching my retirement savings go down day after day after day. The only part not going down is $180,000 sitting in the bank earning almost zero interest, but not completely eroding away with the stock market. What should I do?

I like this question. this question for many reasons. Number one, Jesse, you're forgetting that the money that's just sitting in the bank, it's not earning interest like it would in the stock market, but there is a little thing called inflation and that is affecting your savings that's just sitting there. So I'm just putting that out there. But let's talk about this retirement savings because you're telling me that it's quote completely eroding away and that's just not true that's just not true the stock market is down but it's not completely eroding away and it will come back up. We know that.

You can look at the track record and know that this is temporary. The stock market is cyclical. It goes down and it goes up. So, Jessie, one of the things you have to understand, and it helped me because I actually got into the research about 30 years ago on this, is that we all, especially when it comes to investing, but a lot of other things too, we all have a drama queen that lives in our brain that exaggerates everything. And oh God, you know, thing.

Okay. And the studies have told us now that it takes $3 of gain in an investment to emotionally offset $1 of loss. Our brain records negative things at a much greater rate, and it takes a lot of emotion to recover from that. And so what I'm saying is that that jade is exactly right your drama queen wrote this email okay completely eroding away oh bull look okay it's down maybe 10 but i mean so if you got a million dollars now it's worth 900 000 and next year it'll be worth a million three i mean i mean million one i mean whatever it's just so it's not completely eroding away so because jesse's here's another way of knowing

have you ever heard people say this i lost all my money in the stock market mathematically impossible it just didn't happen you didn't lose all your money in the stock market unless you put it all in one company and that company completely closed yeah and was worth zero if you put all your money in the stock market unless you put it all in one company and that company completely closed yeah and was worth zero if you put all your money in enron you lost all your money in the stock market certain cryptocurrencies yeah well that's not even the stock market right that's true you know but it would have but but you know but what people really mean is i lost a bunch of money i freaked out i went into hyper drama mode i pulled my money out at exactly the wrong time while it was down and then bitched about it for the next decade that's what we really mean when you say i lost all my money it's like you didn't lose all your

money stock market so in 2008 the market went from 13 000 down to 6 500 down it went in half and the number of people that will tell you they lost everything in the stock market in 2008 is amazing because they and they're all wrong you just didn't you if you had if you put it in at 13 and with 6500 you have the world's worst possible timing you pulled it out at the bottom and if you did that you lost the most you could have possibly lost in recent memory right in 100 years almost not 100 but 80 yeah 80 years okay and um and even in that event you only lost half your money that's right you put a hundred thousand in it went to 6,500 is worth 50 grand and by the way I put money in at 13 I didn't take it out at all and guess what the 6,500 is worth 50 grand and by the way I put money in at 13 I didn't take

it out at all and guess what the 6,500 is worth now it's a 38,000 down right and so you know five if you so if you had a million at the bottom you got five or six million now wow you just you got to look in the mirror and tell yourself the truth I got to tell this story my my son this is exactly what this reminds me of uh my son is five and I do his hair for him every morning because he's got curly hair and I have to spray it down with water and he hates that. And today I have to do that. Do you to just keep the shine going? Dave, a little drip of water drips from his hair, like onto a shirt. And he's like, look look at me i've got water all over me yeah yeah that's it and i'm like you have one drip of water on your shirt and i made him look i said look in

the mirror and say there's not water all over me there's water there's a drip of water on my shirt and he said he said it in the mirror and then i said and now now say spraying water on my hair is part of the process and sometimes water gets on my shirt. And he said it. And I think that's what this is. You got to know when you invest in the stock market, part of the process is it goes up and it goes down. And you're not completely eroding and getting, I'm completely drenched. You got to, it's drips.

All right. Like you got to look, sometimes you just got to tell yourself the truth. And just accept it for what it is. Facts and mathematics are your friends to tell your drama queen, and all of us have one. And so we have to do the facts to tell our drama queen to shut up. We're going to continue to invest. And no, I'm not got $180,000 sitting in the bank wondering why it's not going up, because I know it's not going up.

That ain't doing squat. He's tripping. He thinks that money's doing well. That's losing value too right i know it's not that ain't doing it's not doing squat he's he's tripping he thinks that money's doing well that's losing value too right now let's just every single down year in the stock market's history but one is followed by a record two-year rise wow so if you're out right now historically you're stupid that's what history that's not good hysterically historically ah there's a difference right there you need to use history not hysteria and that's the thing because jesse all of us do this the other one that goes with jesse's thing here that i run into and i run into this sometimes when we're doing a media appearance too is what

are retired people going to do the stock market is down how are they going to live well they weren't going to cash all their money out this year anyway right if you've got a half million dollars in your 401k you're not going to run over and cash it out this year unless you panic and you probably weren't planning to cash it out you're probably just going to live over and cash it out this year unless you panic and you probably weren't planning to cash it out you're probably just going to live off of the income that it creates and not even touch the principal well that's so let the principal ride the roller coaster and just let your income a reasonable income come off of it and retired people are just fine that way but broke people when they retire they don't have fun even in up markets that's true

that's true because you never had it to begin with now jesse you said that you're still working you haven't retired yet so keep investing now's a great time to buy get the 180 000 invested right now dude i don't time the market but i'm telling you every down market bear market that it holds out as long as this one has held out is followed by a two-year upturn that's good to know except one every single one of them what was the exception do you know no not off the top of my head i was looking at the charts the other day it might have been 08 well it might have taken it more than two years to recover it might have been i think there were two down years in a row there and that's what throws that number off if i remember right uh but i mean you go back and look where we've had because usually what happens to

around this is election cycle that's a very good so think about what the election cycle is by this time next year we are sick of presidential i know that's right people there by this time next year you're going to be so sick of politics because you're going to be right square in the middle of a booming presidential election and guess what that does to the stock market hello it gives it hope that's true and hope is all the stock market needs to go up and so just just hang on when when the leaves get green next spring you're gonna be okay you'll be okay you'll be okay america you'll be okay all these companies out there are not losing money they're all making money guess where stock stock price comes from? Profit and potential profit and projected and forecasted profit. And that's all still there. This is the Ramsey Show. Hey, let's do a little mental exercise. Look out 90 days from right now.

It's July. You got $1,000 sitting in the bank. Two of your credit card payments are gone. And you check out at the grocery store without having a panic attack. You know how that would feel? Like financial peace. Some of you have never had that in your entire life, but today's the day you can get control of your money.

Starts with a thing called Financial Peace University. It's our nine-week course that's helped millions of people beat debt, build wealth, and become outrageously generous. And we're going to teach you everything about how to handle money, step by step. And here's how fast things can change. The average Financial Peace University graduate has an $8,000 turnaround between savings and debt reduction in just 90 days. That means before summer break is over, you're going to feel completely different about your money

because you'll be completely different. Financial Peace University, start it right now at RamseySolutions.com slash FPU, RamseySolutions.com slash FPU. RamseySolutions.com slash FPU. Caleb's in Austin, Texas. Hey, Caleb, how are you? I'm doing well, Dave. How are you?

Better than we deserve. How can we help? I was calling because I'm getting ready to get married, and I have myself and my fiancee, we have about $200,000 in debt or close to it that we are trying to figure out what's the best avenue for us to kind of take that on. Good Lord, who's the doctor or lawyer? Neither of us, actually. I went to a private school to get my bachelor's degree.

In what? In business administration. Okay. And she got a degree in what? Communications. And the two of – it's just all student loan debt or what? It's not all student loan debt. About, I want to say, probably about 80 of not all student loan debt. I want to say probably about 80

of it is student loan. What's the rest? The rest is a car loan that I have. How much is that? I think I was still 47 on it.

And you just graduated from college? In 2020, yes. Okay. So what is your income? My income this last year, I grossed $117. Okay. What about her? $42 after taxes, I believe.

Do you see where the problem is, Caleb? I think so. That's what I was calling. Well, I'm going to give you a hint since you're still thinking. It's the cars. These cars are so expensive. Yes, you've got $80,000 in student loans, but the cars, you could really set yourselves free if you made some decisions with these cars. You have one that's $47,000.

What's the other one? The other one is... Her car. $30,000? No. Okay, you're right then. You're right. It's both of them.

Mm-hmm, mm-hmm. So give yourself a wedding present and sell both these pieces of crap that are trying to drive you into the bottom of the ocean, man. Good Lord. When are you supposed to get married? November of 2024. Yeah. You're going to drive away from the church in a hoopty, my man, if you're smart.

Is anybody paying for this? Is your family contributing to this wedding, or are you guys paying for it in cash? What's the plan? We are paying for it in cash, and I've been saving for that right now. I'm still missing $50,000. What's the other 50 grand? I'm not sure. So it's more like 180 between us.

Yeah, so it's like 180. I got 150 though. Is it from her side? I'm sorry? Yeah, the rest are in credit cards from her side i'm sorry yeah the rest are the rest are in credit cards from her side i believe okay yeah okay so here's the thing and i think that you know this but in case you don't i want to make it clear until you get married you guys are working on this separately so it's good that you've talked about it it's good that you both know what's going on and both of you looking over each other's plan because it's getting ready to be our plan come November. But, yeah, so here's what we're going to do. I want you two to go through Financial Peace University as our wedding gift to you, and we're going to pay for it, okay?

If I give it to you, will you use it as part of your pre-marriage counseling? I don't see any reason why not, absolutely. Okay. This is a nine-week class, nine-lesson class. You get in a small group that's going to guide you step by step by step on how to go from where you are now, which is a hot mess, okay, into, you know, really taking this actually a good income. You know, you've got $150,000, $160,000 household income once you're married you should be millionaires within just about seven or eight years if you'll follow what we're going to teach you but if you go do your stupid butt stuff that your friends are all doing you're going to keep these

cars because you're afraid of what somebody thinks or because you like the car and you like the car more than being wealthy someday that's what you're that's the trade you're making so both of these cars are insanity they were insanity when you bought them and you need to get rid of them and get cheap inexpensive cars and then lay into this student loan debt and uh if you do that you know you guys could clear this 18 months after marriage you could be debt free and if you're if you're debt free this 18 months after marriage. You could be debt-free. And if you're debt-free, if you don't have a payment in the world, and you're in your 20s making $160,000, you can become millionaires then.

Okay, you really can. And you can drive whatever you want later. But you went and bought a bunch of crap you couldn't afford, an expensive education that you overpaid for, and cars that you couldn't afford an expensive education that you overpaid for and cars that you couldn't afford and so you've been just buying anything you wanted because some idiot would loan you the money and it got you into a mess and uh so if i were you guys if if you were my i'm old you don't you know you're younger than my kids so uh but kids. But if you were my kids, I would sit down and I would love you so much that I would be very clear with you like I am right now. Because we love you and we want you to win.

And be smart about that wedding. Don't let that. Keep the wedding down. There's no correlation between the expense of the wedding and the success of the marriage. No piece of research between that. No piece of research between the size of the ring and the lasting of the marriage, except possibly an inverse relationship. But the oh, my gosh.

So, yeah, you guys have got some real serious changes in the way you view the world in order to, A, clean up this hot mess and B, become wealthy. But I can we can show you how to do it and i will do that as our gift to you because we care about you we want you to win but dude you got to change some stuff this is not gonna if you just sit keep doing what you're doing it's gonna get bad it's not it's you're gonna have a really tough young marriage it's gonna be very harsh i hope she's on board for this well i he called the crazy people on the radio he asked for it so there you go man hey hang on i'll still pick up and we'll

get you guys signed up so jade i was on uh neil cavuto on fox yesterday neil and i've been friends for 25 years or so and uh of course he always pokes at me, makes fun of me. I make fun of him. He's cheap. And he's not here to defend himself, but he is cheap. But he was like playing this clip that went viral. We had like 37 million impressions of this clip. And it was me doing what we just did just now. Yes. And he's like, you're so tough. And I'm like, dude, that is not tough.

I didn't raise my voice. I wasn't yelling at anybody. Nobody got cussed at. I mean, how is that tough? Where did you come from that is not tough i didn't raise my voice i wasn't yelling at anybody nobody got cussed at i mean how is that tough where did you come from that that's tough you i said neil you're pretty easily triggered what are you a snowflake but the uh you know i mean really that's not tough that's me telling you the truth because i love you yeah but dave people think that's tough because people think that they should be able to well everybody just goes along with people's stupid stuff yeah and if you love somebody and you go along with their stupid stuff, that's not an act of love. No.

That's an act of cowardice. Enabling. Yeah, it's enabling. And so if you want to be enabled, guys, don't call this show because we're not going to enable you. We love you. We're going to tell you like it is. We're going to listen. We've all done stupid stuff.

She had a half million dollars in debt. I went bankrupt in my 20s going to listen. We've all done stupid stuff. She had a half million dollars in debt. I went bankrupt in my 20s. I mean, we've all done stupid stuff here. Nobody's exempt from it, but we're not going to stay in it. No. That's the thing. And we're going to move in a direction that's positive for you. We want you to win.

But they do need to go watch that clip, though, if they haven't seen it. It's not that unique. Come on, Dave. It's not that unique. Come on Dave. It's what we do every day here on the show. I don't understand why it went viral. It's a great clip. Go watch it. This is The Ramsey Show.

Jade Warshaw, Ramsey Personality is my co-host today. If you are new to the show and based on our rankings and ratings we know that there are several million of you that are new to the show you can learn some of the lingo and figure out where you are and what we're talking about by clicking on the get started button at ramsey solutions.com it's completely free you know we'll work you, figure out where you are, show you are here, and show you what the next steps are and why and how we're teaching this,

and you'll learn stuff like baby steps and debt snowballs and that whole process. So, hey, thanks for being out there. We appreciate you. 888-825-5225. Emily is in Athens. Hey, Emily, welcome to the Ramsey Show. Hi, thank you. I hope you're doing well. So my question for today is I have a rental property that I owe $50,000 on it, and I want for my future just to have an extra income I want to know if it would be smart to get a

equity the equity out of that rental property to purchase either do a flip investment or just to get another property a rental property so I can have that reoccurring income for the future. I wouldn't do that, Emily. If I were you, I would. Do you have a primary residence? And if so, do you owe money on it? Yes, but the thought is that we pay off the rental property and in a couple of years move into it and sell the house that we are living in now because the house that we're in now um we purchased it because you know we have

a lot of kids and soon you know they'll be out so what do you owe on it on our house now that we live in we owe two hundred thousand okay but if you borrow on the? On our house now that we live in, we owe $200,000. Okay. But if you borrow on the rental, then you're going to move into a property that has a mortgage on it. It kind of defeats your idea. So what I'm in my head, like, I don't know if I'm explaining it correctly or not. No, you explained it you said i want to take out a home equity loan or an equity line of credit on the rental property to buy more

rental properties but i'm going to move in the rental property later because it's going to be paid for no it won't you took out a home equity loan on it and you your whole thing was you wanted security and all you're doing is taking on more debt i mean so here's the thing okay emily i used to buy and sell real estate for a living. I've owned over 2000 pieces of property in my life. I went bankrupt when I was 28 years old doing the crap you're talking about doing. Only I did it with like a hundred and a hundred plus properties while you're doing it with one.

So what I figured out from that is that the shortest distance between where you are and wealth and security is not more borrowed money. Borrowed money adds risk and stress to your life and the chance of failure to your life. Debt-free moves you the other way. And when you're debt-free, you don't have any payments. You have a cash flow that's unbelievably wonderful. So if I were you, I would work to get both of these current properties paid off. And then if I wanted to buy more rentals, I would work to get both of these current properties paid off, and then if I wanted to buy more rentals, I would save up and pay for them. That doesn't move as fast as your plan, but it also doesn't wreck the car, which your plan can do.

How much equity is in the rental? $348,000. You want to know, I'm going to just tell you what Jade Warshaw would do. I'd want my primary mortgage paid free and clear. When are you going to sell the current house? The one that I live in now? Yeah, you said you're going to sell it and move into the rental, remember? Well, that's in a couple of years.

No, not move. Well, yeah, in a couple of years. What's a couple of years? Five or one? Well, no. My kids are still, the oldest is 15 so i'm like i said you know once they get how much how old is the youngest two oh yeah this is not moving this is long long term i would this is what jade would do i would get rid of this rental take the equity and pay

off my home because you're going to be in there the next 10 years your kid is two yep and then when you get that house paid off if you want to buy some rentals or do some flips you do them well she's going to have extra money with cash she's still going to have money left over so maybe they're you know you're going to be there very so much faster you can get another rental absolutely cash absolutely that's what i would do that's so opposite of what we what you called about that you're not going to do it, but that is what you should do. It's a smart thing to do. That's absolutely what you should do. All right.

Let's go to Mary in Tampa. Hi, Mary. How are you? Hi. I'm fine. Thank you. Thank you for taking my call. Sure.

What's up? I find myself in a unique position. I am making more money than I've ever made in my life. Wonderful. How much money are you making? I'm making about $100,000 a year. Whoop, whoop. Yay. If you got any extra, send it to Dave's Cabo Fund. Dave, you don't need that money, Dave. And I'm going to be receiving a settlement in about 90 days for about $400,000. Wow. What happened? It was an accident.

Oh, are you okay? Yes, yes. But that's about all I can say on that right now. Okay, that's fine. I don't want you to get sued again or something. But yeah, wait a minute. Okay, wow. So how old are you?

I'm 56 years old, and I have zero save for retirement. Okay. But I've been following your advice and I've like lowered all my expenses. I've paid off all my credit card debt. I have six months in my, in my emergency. Um, but I'd like to, with this money, make sure I can secure my future. Yeah. Um, you got a house. I have a travel trailer and I own the RV lot. So my housing expense is like almost nothing right now. But I would like to get into maybe like a quadplex or a triplex and live in one of the units and have the other two units, you know, one maybe pay for it and the other one provide a little bit of an income stream.

Okay. And I don't have a vehicle right now. I'm a truck driver, so I'm in my truck all the time. And I'd like to get a personal vehicle. Yeah. So my advice that I need from you is, number one, what do I do with this money to make sure I don't blow it? Mm-hmm. And how should I be dealing with my income as far as my retirement?

Gotcha. Who does the collections for you on the trailer lot? How do you get paid? Oh, no, no, no. I live in a trailer right now. But you said you own one. I own the RV lot. Just the lot.

The little lot that your RV sits on. And I own the trailer lot. Just the lot. Or the little lot that your RV sits on. Right. And I own the trailer that I live in. Okay, so if you're on the road as a truck driver and you have a quadplex, how are you going to deal with renters? That's what I want to know. Well, I would have my son live with me in one of the units. How old is he? He's 31. Okay.

And he's capable of doing all this? Yes. He's actually been a handyman for an apartment community. He's not the handyman I'm worried about. He's collecting dead gum rent. Oh, my gosh. Well, I did real estate property management before I was a truck driver for like 15 years. So you know how to set it up and how to get it done.

Okay. I do. I would pay cash for set it up and how to get it done. Okay. I do. I would pay cash for a piece of real estate with the $400,000. Okay. You would. Yeah, and live in part of it and rent out part of it. I don't think your plan's bad, but I wouldn't go buy an $800,000 property. I'd buy a $400,000 property.

Now, would you save? Between $200,000 and $300,000. Would you want to save any of this? You have zero in retirement. Did you say that? That is correct. would you want to three would you want to save any of this you have zero in retirement did you say that that is correct do you want it right do you want to say she bought two you said two to three hundred thousand on the real estate didn't you correct and i'd like to put like a hundred thousand towards my retirement okay there you go there we go okay and buy a car yeah and buy a car yeah i like it you got a good plan i think you're right on track you're being very wise let

me tell you what you're doing and you didn't even know you were doing it that is so wise when people get a lump sum they tend to spend it like six times over in their head in other words they take 400 000 and they spend it like it's 1.6 million yeah okay and and instead of laying out a detailed game plan and you've got okay 200 is going to $200 is going to this, $100 is going to this, buying a car, and we're going to have a little more in the emergency fund, and this is what we're doing. Boom, boom, boom, boom. You've already spent it real time in real dollars on paper,

on purpose before you got the money. That is unbelievably wise. Well done, Mary. Thank you. You're going to be in great shape at retirement if you keep thinking like this. She did good. Everybody's into the quadplex. It's all over the Internet.

That's the thing. Well, I'm proud of Mary. It's a tic-tac real estate, people. It is. By the way, folks, single families are much better investments. Why? Yeah, why the quadplex? Single families are better because when you get ready to sell them, you know who your buyer is?

It's not another investor looking for a deal. It's Joe and Susie looking for a sweet little house. They're a retail buyer. Single families go up faster than quads do. This is The Ramsey Show. Hey, what's up guys it's jade look if you like what you heard in this episode and want to know more about getting started on the ramsey baby steps go to ramseysolutions.com and click the get started button we'll help you figure out the best next step for you based on your specific situation that's ramseysolutions.com and click get started