The Ramsey Show - App - Don't Listen to Your Broke Brother-in-Law (Hour 1)

Episode Date: August 9, 2018

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Live from the headquarters of Ramsey Solutions, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. Joining me this segment, our own Ramsey personality, number one best-selling author of the book Retire Inspired, and the voice of Retiring Wisely, Chris Hogan joins us. Hey, Chris. Hello, sir. Good to be with you. Welcome, man. It's good to have you back. So it's back to school time, folk.

And that means you're thinking about actually being a grown-up again after the summer. And you're actually going to concentrate on what to do. And, you know, one of the reasons, I think, Chris, that we've had so much success with the stuff we talk about here on the show and you and i have had with the books we write and so forth is we always give this real clear plan a real clear path and i like a one two three step thing you know do these three things you win do these don't do these three things you don't win i'm a real clean cut clear cut guy and so i think that's where the baby steps came from and it's become this thing where it's almost a second language for people that listen to us all the time. The baby step, baby step.

I'm a baby step three or I'm on baby step four or whatever. And as if everyone else knows what they're talking about. Right. That's right. It's a fantastic process, Dave. I mean, as you begin to look at it and you're right, people want to follow a recipe. They want to plan. They want clear steps that know where is this going to lead me and where is it's going to take me and the baby steps has done that for many many years

for millions of people and it's an incredible process but dave it only works if you work it that's exactly right it's a money-back guarantee too if you work it you won't want your money back plus you didn't pay anything for it so baby baby step one is $1,000 saved. Two is paying off all your debt except the house using the debt snowball with gazelle intensity. Three is saving three to six months of expenses in a fully funded emergency fund. Four, five, six are done simultaneously. Four is 15% of your income going into retirement and good mutual funds, good Roth IRAs.

Five is kids' college, and six is paying off your house early. When that's done, there's IRAs, fives, kids, college, and six is paying off your house early. When that's done, there's nothing left to do but go back, fully fund all your investing and build wealth and, you know, increase your generosity to outrageous levels. What happens, Chris, and it happens to all of us, even when you get that first $10,000 in your emergency fund, it happened to me and it happens to almost everyone. I want to start investing.

I want to skip over the get out of debt part and I want to start investing because we know we've seen those charts that shows that that compound interest is going to make us rich. We really want to start. And it's a big deal to get started, but it's a big deal to do it in order. It really is. I mean, it's one of those things where you don't want to, don't overthink this process. Don't try to make it overcomplicated.

Follow the recipe. Follow the plan. You can't do them out of order, folks. You just can't. You've got to begin to walk through it and look at it and see it. I know you're excited. I know you want to invest. But we've got to get that thief out of your life first so you can move forward.

And here's the thing. You and the team, our team here at Ramsey Solutions, have just completed the largest study of millionaires ever done. Over 10,000 millionaires. And one of the common themes we found among millionaires, not among your broke brother-in-law. We didn't survey your broke brother-in-law. We surveyed millionaires. Was this idea that getting out of debt was a precursor. It was a prerequisite.

Remember those classes you had to take so that you could take the other classes? Yes, yes. It was the prereq to building wealth. Well, it really is. And I'm so excited, you all. We surveyed over 10,000 millionaires to begin to find out what do they really do? What are the truths behind where they are? And Dave's right. Getting out of debt is one of those big, big keys.

But I want people to understand you've got the power to do extraordinary things. If you follow the process, you have to follow a plan that actually works. And Dave, I love for years, you've been talking about your broke brother-in-law or don't listen to this person or that person, follow someone that's done it and you've done it. And you've been showing people how to do it for many years. So I'm very excited to introduce my brand new book, Everyday Millionaires, How Ordinary People Built Extraordinary Wealth and How You Can Too. In my book, you're going to figure out the exact plan. You're going to understand the steps, and you're going to figure this out, that building wealth has nothing to do with your income level, and it has nothing to do with your background. It has to deal with the plan.

You see, millionaires live on less than they make, they avoid debt, they're disciplined, they're responsible, and they invest. So whether you're on Baby Step 1 or 4 or beyond, no matter what your money looks like today, you can become a millionaire. The American dream, Dave, is not dead. Now, I want people to know,

you can pre-order my brand new book for only $20 and get over $50 in free bonus items. Just go to DaveRamsey.com or ChrisHogan360.com, or you can give us a call at 888-22-PEACE. Drum roll, please. We've announced it, baby. It's on sale! Some of you, we've been teasing you so much, you didn't think we were ever going to sell the book. Well, we are.

It actually publishes and will come to you in january but if you pre-order it you get 50 in pre and free bonus items on top of that now here's the proper way to do it though don't miss this is something we've never done before with a book launch i'm so excited about this a brand new all-inclusive bundle now here's the deal it goes on sale right now for $129. And this is on top of that, you're going to get the $50 in free bonus items. You're going to get the millionaire Kickstarter giveaway. This includes Financial Peace University. So for the price of Financial Peace University, basically we're throwing in the $50 worth of items, and on top of that, you're getting the new book, Millionaire, Everyday Millionaire. So you don't want to miss this.

Now, what the Kickstarter thing is this. We're doing a giveaway on our website. $5,500 in cash. There's no purchase necessary. You don't have to buy anything to be registered. You can just go there and register for the $5,500. Oddly enough, that's the amount of your Roth IRA to get you kick-started and get you going. You can enter once a day for that.

So go sign up for the free money. But listen, the deal of deals is get the class, get the membership to Financial Peace University, and get the book together. It shows you how to get out of debt and then how to become an everyday millionaire. It's a one-two punch. It really is. And as you start to step back and look at this, this is the thing you've been looking for. This is what you need as you move forward and you want to get serious with your money.

I know you're working hard. I know you're doing what's necessary to take care of your family, but I want you to have a plan. I want you to work the plan that's been helping millions of families. So here's what you can do. Enter daily for your chance to win and purchase our brand new bundle at daveramsey.com or go to chrishogan360.com or give us a call today at 888-22-PEACE now you can walk the baby steps with perfect confidence knowing that it's going to take you into that millionaire status because you've read that the

millionaires did almost the exact same thing and it's going to show you that it can be done see so many people thought that this is just about getting out of debt but it's really about building wealth oh no it's not even about that it's really about outrageous generosity and outrageous generosity requires outrageous amounts of money and so you need outrageous amounts of money to be outrageously generous and so you need to be a millionaire multi-millionaire and put you in a position to help others and do things for your family that you never dreamed you would even get to do so you go through the whole client the whole membership the the nine lessons at financial peace university you get the million the everyday

millionaire book to go along with this which is all of the details from this study and it's all 129 you can get the book for 20 bucks if you want or you all of the details from this study, and it's all $129. You can get the book for $20 if you want, or you can get the bundle for $129. Just check it out at DaveRamsey.com, ChrisHogan360.com. Call Customer Care, 888-22-PEACE. It's here, folks. It's the Everyday Millionaires, How Ordinary People Built Extraordinary Wealth and How You Can Too.

Proud of you, Chris. Well done. Thank you, sir. This is big-time stuff. Big launch today, Chris. Well done. Thank you, sir. This is big time stuff. Big launch today, baby. It's here. It's here. Don't miss it. Okay, I need you to listen to this,

because one normal routine that everyone does can cause total chaos in your life. Folks, I'm talking about the simple act of using Wi-Fi. When you're on Wi-Fi anywhere in public or at home, you're at risk of hackers easily seeing every site you visit and search you're doing online. It doesn't matter if you're doing it on your cell phone or your laptop. I'm not telling you this to scare you. I don't operate in fear.

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Download Hotspot Shield today. Thank you for joining us, America. We're glad you are here. Our question of the day comes from Blinds.com. Their 100% satisfaction guarantee means that even if you mess up, if you mismeasure, you pick the wrong color, they will remake your window blinds free. Blinds.com, you get free samples, free shipping, and with new promos every month, you'll save even more. Use the promo code RAMSY to get the best possible deal.

Rules and restrictions apply. Check it out. Ramsey at Blinds.com. Amanda is in Tennessee. My bank is offering secured credit cards to help build credit. They require a security deposit, which is supposed to be returned. Is this a good idea?

No, it's not a good idea. Use a debit card. Debit card will do everything your credit card will do. It won't build your credit. Why do you want to build credit? So I'm going to borrow money so I can build my credit. Why? So I can borrow money.

Why? So I can build my credit. Why? So I can borrow money. Why? So I can build my credit. Why? So I can borrow money. Why? So I can build my credit. Why? Because I like banks so much I want to give them all of my wealth throughout my working lifetime. I want to work my whole life and pay all the money I earn while I'm working to banks. It's kind of what we've done, isn't it? We the people.

If you don't think that's true, look in the skyline of your city. What do you see? Who owns those buildings? Banks. And whole life life insurance companies. That's who built those towers. You built them.

Think about it. Carol is with us in San Bernardino, California. Hi, Carol. How are you? Hi, Dave. I'm good. I'm on Baby Step 7. Sure.

And I live in Southern California, and I'm wondering if I'm on Baby Step 7, and I live in Southern California, and I'm wondering if I should purchase earthquake insurance. Yes. Okay. Is that not an area that frequently gets earthquakes? It is, and I do have it, but I'm coming up for renewal, and I'm just wondering if I should continue it. So I will write the check and continue it.

Yeah, I mean, because here's the thing. If you were in an area where there was hardly ever an earthquake, once every 500 years or something, you wouldn't buy it. I don't have earthquake insurance. I live in Tennessee. Right. Okay, and we did have one earthquake one time, like the year 1900 or something. But, I mean, it's not something I'm going to worry about.

And I live on a huge, huge hill as well, and so I don't have flood insurance. It's not something I'm going to worry about. But if I lived in a flood zone or near a river, I would probably have flood insurance. And if I lived in an earthquake zone, I'd probably have earthquake insurance because it could destroy that nice paid-for home. Yes. And that would leave you devastated, would it not? Yes, it would.

Financially, I mean. Yeah. Yeah. So, yeah, that's why you would carry it there. Yes, if I lived in your situation, I would carry earthquake insurance. Thank you for the call. Dallas is with us in Salt Lake City, Utah. Hi, Dallas.

How are you? Doing very well. Honored to talk to you. Thank you. You too. So I got a quick question for you. I am looking to become a doctor, and on average, it's about $200,000 in student debt. And so I'm kind of curious, would it be worth it to take it out in student loans?

Because it's going to be quite a lengthy, quite a big sum of money to try and save in the meantime. Well, I don't teach people to borrow of money to try and save in the meantime. Well, I don't teach people to borrow money, as you probably have heard the rumor, and that includes going to med school or law school. I have met many, many, many doctors and lawyers who have completed med school and law school with no debt. It's very difficult to do. It's very hard to do, but so is paying back $200,000. And so the assumption is that you are going to graduate.

Not everybody does. And the assumption is you're going to pass your bars or pass your boards, whichever in your case of boards. Not everybody does. And the assumption is you're going to get a very high-paying job as a doctor, but not everybody does. And so this is a set of assumptions that gets people into all kinds of messes. And you won't believe the number of times I've talked to people who did not complete med school or who did complete it, didn't pass their boards,

who did complete it, passed their boards, and couldn't find a job making more than $80,000 or something, and they're sitting there with $250,000 in student loan debt, and all of a sudden their dream has turned into a nightmare. And so I'm going to find another way to do it. Now, is it easy? No. But med school is like every other type of higher education, and that is, number one, there's a vast spectrum of what they charge depending on where you go.

And so the averages you gave me are correct, but averages are created by highs and lows. And so if I'm broke and I don't have the money to go to med school, I'm going to go to a cheaper school, and they're harder to get into sometimes than the more expensive schools because they're cheaper. But where you go to school, with the exception of a few specialties uh specialty areas of practice uh where you go to school doesn't affect whether or not you're able to earn an income much um and so like i you know i i have two or three doctors in my life uh and i have no idea where any of them graduate from med school but i go to them because they

take care of me and because they're competent. And you can get that a lot of places. So, number one, school selection will help you avoid that. Number two, I would work really, really hard at being highly unusual and find hospital companies that you might agree to work for when you came out. I agree to work for HCA or I agree to work for XYZ or whoever when I come out for a couple of years. And they're going to, in turn, pay for med school in order to recruit you into an area

that maybe they couldn't have recruited you into, an area of medicine or an area of the country. Also, pharmacy, the farm side of the thing, meaning the drug companies, they love having, you know, future doctors loving them. So they have a few of them have pretty aggressive scholarship programs. And, you know, so that because they want to support the medical profession. And, of course, there's always the military will pay for 100 percent of it. If you can get into school, if you can get into school if you can get into officer school and so you know you've got to prove yourself in all of that but just this uh

general assumption of oh we're going to hundred thousand dollars in debt because i always make two hundred thousand as a doctor and i always graduate and i always pass my boards no no no things happen and then people have the debt regardless of whether something happened or not. Now, if you come out making $600,000 a year and you've got $200,000 in debt, that's probably going to work out for you. Your plan worked. But not all plans work, so that's why I avoid the debt. It's not a popular answer, I'll tell you that.

And you may or may not choose to do it, but that's what I would do if I were in your shoes. Hector's with us in Los Angeles. Hi, Hector. How are you? Good. Thanks. Thanks for taking my call, Dave. Sure.

What's up? My question is if I should sell my truck to get closer out of debt. How much do you owe? I owe $24,000 on my truck, and it's Kelly Blue booking for $18,000 right now. Gotcha. And what's your household income a year? About $100,000. Okay. And how much other debt have you got? We have one car and a 401k. How much? And that's equaling up to $11,000 on the car and $9,000 on the loan. Okay. So $20,000, $38,000 in debt, you make $100,000 a year. Yes.

Is that right? Yes. Okay. And $35,000 in debt? I'm sorry? I think it's $34,000 in debt. Oh, $34,000. No, it's $44,000.

Yeah, $44,000 in debt? Oh, $34,000. No, it's $44,000. Yeah, it was maybe $44,000. Yeah, $44,000. Oh, yeah, sorry. I picked up the $18,000 instead of the $24,000. I'm sorry. That's the value. But how fast can you pay off $44,000 making $100,000? Right now, we'll be out of debt for roughly four years.

Why? That's what we're making. We have high house payments. Well, that may be your problem. That's ridiculous. You ought to be able to pay off $44,000 in debt in two years making $100,000. People do a lot more than that. They do debt-free screams around here. If you can pay off all your debt in two years, which is what you should be doing, and you like the cars, I would keep the cars. They're not out of line.

The only thing that's out of line is all the debt on them. But I think you need to adjust your get-out-of-debt plan. Your house payment may be ridiculous. That may be what you have to sell. This is the Dave Ramsey Show. Are high health care costs getting you down? Are you confused trying to navigate your options? Do you wish you could find an affordable, biblical solution to your health care costs? Testament Principles, Christian Healthcare Ministries, or CHM, helps Christian families, churches, and ministries join together as the body of Christ to share their major healthcare

costs. Christian Healthcare Ministries is the original health cost-sharing ministry, a Better Business Bureau-accredited organization CHM members share to pay each other's medical bills. It's not insurance. It's Christians financially and spiritually supporting each other. It's what Christian Healthcare Ministries has done for over 35 years, and our members have shared over $2.5 billion in medical bills. To learn more, visit chministries.org. That's chministries.org. Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live Events. chministries.org. In the lobby of Ramsey Solutions, Craig and Corianne are with us. Hey, guys, how are you?

Hey, Dave. Wonderful. Glad to be here. Welcome, welcome. Where are you from? Algonquin, Illinois. Chicago area. Yes.

Chicago area. Very cool. Good. Good to have you. Thank you for having us. And here to do a debt-free screen. Yes, we are. How much you paid off?

So before we read your book or after? Your choice. We actually paid off $193 total in six years. Okay. After we read your book, four and a half years in, we paid off $49,000. So you paid off $49,000 in the last year and a half. About 17 months, yeah. Okay. wow.

And your range of income through that six years? Right around $150,000 to $188,000, back down to $150,000 this year. Okay, cool. What do you guys do for a living? Well, I am a seventh grade language arts teacher. Awesome. And I'm a sales manager for a technology reseller. Good, good for you guys. Very fun. So what kind of debt was the $193,000? It was a lot of stupid, Dave. A full list. Yeah, yeah. Yeah, so I came into the marriage with about $70,000 in student loan debt, along with a lot of their stupid that we had. And I think we had two car loans. Just credit cards from attorneys. Attorneys, yeah.

So we had a boatload of everything. We were normal. Yeah. And Craig didn't mention, you know, during all this time he does pay, or he did pay 32% child support during all that time. So we were able to do a lot, you know, even given the child support. Wow. Yeah. Okay. Amazing. Yeah. And so you guys got married six years ago. Is that what started the whole process? Yeah. Yeah. He just walked into the house one day and just looked at

me and said, how can we make this much money and not have anything to show for it? Wow. I was like, that's a really good question. I don't know. And there it began. And so we started listing out the debt, and then, oh, my gosh. So you started tearing into it. You made a lot of progress before you ran into us, you then.

Well, we actually ran into you. I was an outside business development manager for seven and a half years for the same company I'm with right now. And I'd catch your radio show, this guy, Dave, you know, every now and again. And I'd come home and I talked to her about it a little bit and I wouldn't hear you for a while. And then I'd pick my children up on Wednesdays and I'd come home and I'd look forward to trying to find you on the radio, which was, I can't remember, 1260 or something like that in Chicago, and I'd catch you every now and again. And then that's like she said, you know, we finally said we're done. We're done with credit cards.

We're done with student loans. Well, not student loans. We're done with credit card payments, everything. Yeah, everything. I'm sick and tired of being sick and tired. Sick and tired of being sick and tired. Done. Done.

When you say that, when you finally say, I've had it, that's when it happens, right? Yeah. I've had it. Yeah, I love it. Well done, you guys. Yeah, thank you. Very cool. So what do you tell people the key to getting out of debt is?

A lot of communication. I mean, we sit down every Friday night, and he sits down with his spreadsheet of all spreadsheets, and we just go through it. You know, what do we have to do? What do we have to do to make it? And it's just, yeah, it's a lot of communication, a lot of talking, and that budget is just, it's almost like the Bible at our house. It really is. It's your map. It is.

On how you're going to get from here to the beach. Yeah. Right. And we want to go to the beach. Oh, we do. Yeah. I love it we want to go to the beach. Oh, we do. I love it. Very cool. Good, guys.

Thank you. What about you, Craig? What do you say the key to getting out of debt is? I'd also piggyback on Corianne by saying the budget, absolutely. And having a why. Our why is to change our family tree. That's our big why is we want to be able to do things we want to be able to live like no other now so that later on we can live like no other you know and I take that into a lot of different avenues in my life with managing

as well as personally so and we want to start giving too we just taught our first FPU class oh wow not that long ago and we're going to continue on in the fall. And we're finally to that point where we want to give something. We can't always give a lot of money right now, but we can give our time. And that's what we're choosing to do together as a couple. Absolutely. To give back. So we're so glad we can do that.

Thank you for leading the class. We need them. Oh, thank you. We need them out there for sure. Very, very cool. And you brought the kiddos with you. We did. We brought a couple of them with us.

Yeah, we did. Two and four. Yeah. And the ages and names. So we brought, well, I'll list them all. We have AJ, 18. He's not here. Ashton is 15.

He's not here. And then we have Aiden, who's 13, going to be 14. And I think he said 31 days. He's counting down. And then we have Rylan, who is just over two and a half years. Oh, okay. All right. He's got a blue smile back here. All right. Very cool. He's counting down. And then we have Rylan, who is just over two and a half years. Oh, okay. All right. He's got a blue smile back here.

All right. Very cool. That's good. You ought to have. They're coming up behind you. They're going to join you. They are. Very cool.

Come here. Good deal. Can you say hi? We've got a copy of Chris Hogan's book for you, Retire Inspired. Awesome. That is the next chapter in your story. We want you to be millionaires. Yes.

And outrageously generous along the way, like you were just talking about. So very, very cool stuff. All right, it's Craig and Corianne, Rylan and Aiden from Chicago. $193,000 paid off in six years, making $150,000 to $188,000. Count it down. Let's hear a debt-free scream. Ready? Three, two, one.

We're dead free! Well done, you guys. Very well done. Love it, I love it, I love it. Robert is with us in Houston, Texas. Hey, Robert, how are you? I'm grateful, Dave. How are you? Better than I deserve. What's up? I've been listening to

you since about 2005. I actually met you at Tolliver Church when you were here a few years back. Yeah. I just wanted some Uncle Dave advice, that's all. Okay. I am debt-free, fully funded emergency fund. I've got two properties that are paid for, and I have two more additional properties within a self-directed IRA that are paid for also. I'm employed, and as of this week, I've got to check between $100,000 and $150,000 on a property that was sold, and that's my cut from it. So my question to you is, what should I do with that $150,000?

Your home paid for? Yes, sir. I'm debt-free on everything. Everything. Way to go, man. Very well done. What's your home worth? I'm paid $105,000. It's worth $190,000. Good. Very good. And what's your household income? $100,000.

Okay. Wow. Very good. Well, I invest in two things. I invest in real estate that I pay cash for, like you, and I invest in good growth stock mutual funds. And I never advise anyone to invest in anything that they don't understand and that they can't speak into. You learn about it and feel comfortable with it before you buy it, whatever it is.

I'm very comfortable with those two things, and I have also observed with the majority of wealthy people, even ultra-wealthy people, that their investments are usually fairly primitive. They don't feel the need to be fancy. They just do something that they know and that works, and they do it a lot. And, you know, with me, that's real estate and mutual funds, and it's worked for me. And so if I'm in your shoes, I'm going to go one of those two directions. But if you have something else that you just are dying to do with it,

then that's fine. Or if you're at a point that you want to enjoy this at some level, it doesn't all have to be reinvested. You can give some of it. You could travel with it. You could buy a toy with it if you wanted to, anywhere in there. You've obviously done a wonderful job with your money. Congratulations.

And so that gives you the ability to, you know, maybe invest part of it and play with part of it and give with part of it. I always look at the give, save, spend thing, and I always try to, not in every single check, but over the course of my income, over the course of a year, I always want to be giving more, saving more, and spending more. Not a lot more spending, but it doesn't take a lot. But I always want people to enjoy money. I want you to be investing for the future, and I always want you to be generous. And when you're doing those three things with money, you're never messing up. I mean, those are three good things as long as you're not running up dead in the process. And so that's how I look at it.

Again, I'm okay with being a little bit primitive. I'm pretty comfortable in my own skin on that. So, hey, thanks for calling in. We appreciate you listening. This is The Dave Ramsey Show. One question I get asked all the time is, do I need life insurance? Listen, the whole point of life insurance is to replace your income for someone who counts on you. So if you have a spouse or you have kids, yes, you need term life insurance. It's the only way to protect them until you're out of debt and have built up your wealth.

You're only digging a deeper hole if you waste money on cash value plans since it robs you of the ability to make real progress. And that's why I send you to Zander Insurance, and I have for 20 years. That's where I get all my insurance, and they only offer the plans I recommend. It is not expensive. It's not complicated. And Zander will be there as your guide every step of the way. Visit Zander.com or call 800-356-4282. You need to get

this taken care of. I can give you the advice and I can tell you where to go but it's really up to you to take that important step to get your family protected. That's Zander.com or 800-356-4282. Thanks for joining us, America.

Hey, clarification point. Because I went out to get my picture made and sign books and stuff at the break i want all you guys out there listening real careful if you want to do your debt free screen we want you to have that milestone so many of you work so hard to get to do that but we have like a backlog of these and you actually have to be like out of debt everything but the house or everything including the house and you have to to be like out of debt everything but the house or everything including the house and you have to not be using debt anymore i'm not going to honor your debt free scream if you're still stupid and using credit cards so don't even ask okay uh that'll save kelly the trouble i'll go ahead and punch you right now right so she didn't have to later

but so that's the thing and and so you got got to schedule it. You can't just, like, wander up here to our building and be disappointed because we do one an hour. And some of them are here live in the studio. Sometimes people call in to do them. But in either case, they need to be scheduled. And the way you do that is just go to DaveRamsey.com and go to the show page. And there's a place there to fill out for your debt-free screen. And you give us a little information. Kelly will get back to you. And we do answer when you fill that form out.

And so you need to fill that form out and we're going to answer and tell you, no, you can't do it because of this or yes. And here's the date and so forth. And sometimes we're able to arrange it if you've already got a trip planned or something like that, but not always. So, you know, it's not – I just don't want you to be disappointed because so many of you work so hard, and then I don't want you to just go, man, I'm here to do my debt-free screening. Like, no, you're not.

I don't want that for you. So please, please, please, please pre-schedule it, and we will get back to you. We always do. Kelly's really good about answering those emails and checking out everything and giving you a date or not. And if you've not heard from her, you're not on the schedule. It's pretty simple. Aaron is with us.

Aaron's in Lubbock, Texas. Hi, Aaron. How are you? I'm doing well, Dave. Thank you for taking my call. Sure. What's up? My wife and I, we have a piece of property that we've owned, us and the bank have owned for about three years now.

And we're finally getting ready to start building on it. We just had our last kid about six days ago. Congratulations. Thank you, sir. Thank you. But ready to start looking to the future and where we want to put the kids in school and all of that and so we own our primary residence we still making payments on it we owe about 60,000 on it it is worth about 150 to 155. We also, my business, I'm a contractor and my business owns a rental property that we are just about ready to put on the market, but we are considering whether we should sell it

or rent it. We own it free and clear. It's going to cash flow around 900 a month and valued at about $80 to $85 for sale. Okay. And income ranging between $80 to $120. This is going to be a better year. We'll be closer to the $120 mark. Good. So that's where I'm at. My question is, should we sell one, both, either?

Just kind of trying to figure out what we should do with that. I assume you're moving into another property. Are you going to build on this land? Is that what you're saying? Yes, sir. Yes, sir. Okay, and what will the property cost? What's the property?

Is there debt on that property? Yes, sir. There is. There's about $40,000 on the... Okay, and what will it? What's the property? Is there debt on that property? Yes, sir. There is. There's about $40,000 on the... Okay. And what will it cost to build the house? It's going to cost us, as I've got it planned now, subject to change about $250,000 to $300,000. Okay.

My cost being a contractor, you know, there's savings in there. Yeah. Well, I definitely would sell both properties. Okay. And I would put as much down as you can on this, and then let's get a plan to go ahead and get it paid off in the near future. Because if you're sitting there with that house completely paid for as opposed to owning the other two properties, boy, that's a great goal.

And that sets you up to pay cash for other properties if you want to buy some other rentals and things later. But, boy, you know, the good news is you've got a couple of properties there with some decent equity in them. It's a big chunk towards your $250,000, $300,000. And if you're making that kind of money, you're going to be able to knock out that balance fairly quickly. And that sets you up with no house payments and that kind of income to be able to save and pay cash for other rentals and or invest just in mutual funds or whatever you want to do. I do both.

But what you're describing is exactly what Sharon and I did was we got that first house and when we live in, paid for, we stayed in it forever. For 13 years, we stayed in that same house. And there's nothing wrong with it. It was a great house. But later on, we built a big house that we live in now. But in the meantime, we paid cash for rentals as we went and just built our real estate portfolio back up.

And I love real estate, but I pay cash for it always. And I get my home paid for as the first piece of that puzzle. Kristen is with us in Chicago. Hi, Kristen. How are you? Hi, Dave. I'm great. Thanks so much for taking my call.

Sure. What's up? So my husband and I are in Baby Step 2. We have about $24,000 in student loans left to pay off. And we both work full-time. And this year I started my own business as a wedding photographer. And my goal is to take that full-time within the next couple of years. Yay!

My question is, though. Yeah, yeah, I'm excited. My question is, though, I have the option at my job to go down to four days a week instead of five and maybe give myself a little bit of margin. I'm finding that I'm getting a lot of work, which is great, but, you know, all I kind of do right now is work and sleep. And so I'm wondering if I should take advantage of this opportunity to go down a little bit at my job so I can spend more time working on my business.

But I'm a little bit afraid to do that when we're still in debt because... Well, can you make more money with that day at your business than you would make at your company? That's what I'm not sure of. I know I could... Okay, well, let's do it this way. What do you make at your company? I make $37,000.

Okay. And so what do you make, and what have you made in wedding photography? This year I've brought in for the business probably around $16,000 so far. Uh-huh. Okay. And that's in this calendar year? In this calendar year, yeah. yeah okay so you're making about probably go ahead you're making about two thousand dollars a month yes okay and uh let's see here thirty seven thousand dollars let me just put that in and 270 days um whoops whoops let me try it

again 30 years i'm gonna put this in because i want to do this exact just for the fun of it. So $37,000, 270 working days. Okay. I get $137 a day. Can you, what do you, you should be able to make that. I should, yes. Now, if you use this day off to nap, that won't work. Right, yes. Now, if you use this day off to nap, that won't work. Right, right.

But if you use it as a conversion point towards going full-time by this gradual move and you cut back to four days, I think that moves the boat closer to the dock and gets you more likely to be able to do that goal later. But you need to be very conscious of going, you know, it's an extra $450 a month I need to make to offset that. And I think you could do that easy. Okay. Assuming you use this to create income. And so, you know, it's not a paperwork day.

It's not a stuff I could have been doing day. I need to make an extra $1,000 a month because I'm doing this. And that's more than double what you're making now in that day. Right, right. And I think you can do that, but you just need to think about it that way consciously. Hey, I've got to make my extra $1,000 due to being off on Fridays, you know, that kind of thing. If you do that, I think you're going to be fine. I'm going to send you a copy of Christy Wright's book, Business Boutique,

Equipping Women to Make Money Doing What They Love, because that's right where you are. So proud of you. Very well done. You're making some bank with that coming out of the gate here. You could really turn this into some serious income over a period of time if you keep raising your prices and keeping building your client base and everything as you go along. Wow. Very, very well done. That puts us out of the Dave Ramsey Show and the Books Hour.

Thanks to James Childs, our producer. Blake Thompson is our senior executive producer. Kelly Daniels, our associate producer and phone screener. I am Dave Ramsey, your host, and we will be back. Hey, guys, it's Blake Thompson, chief production officer for The Dave Ramsey Show. This hour's up, but you'll find more on our YouTube channel, where we have over 6 million YouTube views each month. You can find debt-free screens, millionaire hour clips, Dave rants, and so much more.

Go check it out. Guys, let's talk about that timeshare pitch that you fell for. They promised you exclusive access to travel anywhere you want. Tropical beaches, mountain getaways, or whatever. Oh, my gosh. They claimed it was the affordable way to travel, and then they convinced you it was a good investment. But here's the deal. Search any auction site for your exact timeshare and see what it's selling for.

It's listed for a dollar with no bids. That's not a good investment. Now, I know I'm just adding salt to a very old wound, but look, if you tried calling the resort and they won't take it back, if you tried selling it and no one will buy it, call Timeshare Exit Team. Timeshare Exit Team will get you out. You'll have to be patient.

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