The Ramsey Show - App - Don't Move Debt Around...Pay It Off! (Hour 2)

Episode Date: October 22, 2021

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Thank you. Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host, Ken Coleman, Ramsey personality. Number one bestselling author is my co-host today. We're going to talk about your life and your money. Ken on the Ken Coleman show, 75 radio stations, Sirius XM radio, big time podcast and YouTube channel talks about your job, your career, finding work that matters, knowing what you're

passionate about and that you're good at, and figuring out a way to put all that together to make a really fun, good life. We're going to talk to you about that today, as well as take your questions about your life and your money. 888-825-5225. Speaking of jobs, Ken Anton is in Los Angeles with a job question. Hi, gentlemen. How's it going? Thank you so much for taking my call. Sure. What's up? All right. So I have a bit of a

I guess a good problem to have with some options. So just wanted to get your input. And I'm so excited that Ken is on today as well. So long story short, I've been with my company for about four years now. Last year, at the end of the year, I decided that this year I was going to start looking for a new job, mainly due to reasons of lack of development. It feels a little stale. Anytime I would ask for a little bit more work or something to do, it's just kind of like, yeah, well, we'll see what we could do. But management's not really interested in training or developing a career for anybody.

So I was like, okay, I appreciate the work I do, and I'll just see what else is out there. About a month and a half ago, I got a new offer from another company, which I accepted. It came with about $17,000 of a raise and a title raise as well got a new offer from another company, which I accepted. It came with about $17,000 of a raise and a title raise as well. So I was very excited. When I went to give my two weeks, I spoke to my CFO of my current job. And he essentially said that he would match my salary. He would put me on a plan to have a promotion within 12 months and he would make sure to mentor me and help me grow. So that kind of helped me make it. And I decided to stay. So it helped me make a decision to stay. Here's the problem. Nothing got put in writing. So I contacted the new job and I turned down that

offer. Nothing at my old job got put in writing. So when the raises came around, I only, out of the $17,000 that he agreed to match, only about $9,000 came as a raise, and the other $8,000 came as a one-time bonus that got deposited into my account, which is great for cash, but it got super taxed. And, you know, I went to talk to him

about it, and he basically told me that that's the best he could do, because if he actually put the whole 17 000 raised as salary i got it i got it the guy the guy's a jerk he didn't keep his word so what's your question so my question is you know they paid me out the the one-time bonus right and i i is it okay for me to start looking for you? Yes. And like, I feel, I feel a little. This is the danger in what they did to themselves.

Yeah. And it's also the danger. Not only did they lie and not keep their word, they gave you all the money up front. Well, this was stupid. Yeah. And Anton, you knew, you saw, you saw this, you saw that there was no development. They weren't serious about pouring into you. That's a sign of a great culture, a company that develops their existing people and promotes them

if those people receive the development and do a really good job. And you saw the handwriting on the wall, and yet you got talked back into doing it. It doesn't matter. I'm not trying to knock on you, but I want you to learn from this. So yes, you start looking. I'd call the other company and see if there's still an opportunity. Probably but i certainly would start there and i would i would i would look and i would i would hold fast to the lesson that you've just learned yeah and your cfo's getting ready to learn a new lesson yeah he just signed he just gave you a signing bonus for the new company right right that's what happens when you screw people yeah i just uh i just fell in like is it unethical for me to you know what i mean no no let me unethical was him not you yeah he lied

he lied period end of story unless you changed your story is what you told us what really happened yes sir okay then he lied right yeah yeah i think she just uh put his foot in his mouth and then when she went to do it yeah that's a form of lying yeah dave i see this a lot this is this is this is poor management and it's manipulation a lot of managers and leaders I wouldn't even call them true leaders, they're so weak and they manipulate people. And this was a scarcity move. He was like, okay, hey, I'll tell you what. If you stay, I'll do this.

And he didn't value Anton. He didn't have a principal involved in the decision. He was afraid the work wouldn't go down. That's it. I've got to solve a problem. I'm going to manipulate somebody. Well, and he didn't have approval. And so when he went back to...

He's a CFO. He ought to get his own i was gonna say does he need approval yeah this is just bogus so wait let's figure this out all we got to figure out is anton you don't want to be there yeah and uh if you get a job really quick that eight thousand dollars that they put in your account extra is a bonus and that's what it costs them for not keeping their word no there's nothing unethical about what you're doing at all the lack of ethics was on the other side of the equation. Yeah. And be encouraged. Don't get discouraged here.

You found something before. You'll find other things. And now just walk forward. So don't get down on this. One year from today, don't be working there. Oh, yeah. No. Out.

Out. Out. No. Ow. Ow. So, you know, how do you keep good people? Well, number one, you develop them. See, good people want to advance. You give them a track to become more, to move up, and you give them training to move up that track. Oh. And you keep them training to move up that track. Oh. And you keep your word. Yes.

Why is this hard? Yeah. Do what you say you're going to do. Yeah. That's why there's no competition. Yeah. Because most people won't work hard and tell the truth. That's right.

You can beat most people by just working hard and telling the truth. Yeah. Most people can't even do that. Yeah. And so that's why there's no real competition out there so yeah and anton hit the road you know dave there's also a leadership lesson here for people to listen to the show that lead people don't make leadership so dadgum complicated again same advice don't lie to people and if you just if you give them ladder, show them a ladder where they can grow with you, and then develop them so they can do it, as Dave just said. Recognize them, reward them, and keep them in a place where they're doing really, really good work and they enjoy it. They will stay with you for a very, very long time.

But don't overcomplicate this. Don't try to manipulate people. By the way, Dave, we know this from data. People don't leave complicate this don't try to manipulate people by the way dave we know this from data people don't leave companies they leave leaders and when you get they leave their manager that's exactly right they get tired of that guy that gal yeah and the being jerked around being kept in the dark not being told what's going on, not being given anything to do that you can actually measure the traction on. This is just not that hard. No. On Trade Leadership, we teach this stuff all the time.

Yeah. Go dive into that. Yeah. It's the whole thing there. Ken Coleman is my co-host today. This is Common Sense for your life. Common Sense for your dollars and cents. It's the Ramsey Show. People all over the country are discovering a faith-based and budget-friendly way

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And sometimes it feels like the bills are winning. You might wonder if you're ever going to get ahead. Well, listen, it does not have to be like this. You can pay off all the debt. And when you do, you'll finally move forward. You'll build the kind of life you want with your money, and'll show you how we'll show you in ramsey plus with this membership you'll learn how to take control of your money and ditch your debt for good plus you get all the tools you need to make it happen you can get ahead ramsey plus includes financial peace university every dollar premium which ties to your bank

community coaching all kinds of things there to walk with you, help you, make sure you do the stuff you hear us talk about here every day on the air. Text the word TRIAL to 33789 for a free trial of Ramsey Plus. It's a free trial of Ramsey Plus. Text TRIAL to 33789. Jay is with us in Tampa. Hi, Jay. Welcome to the Ramsey Show. Hi, Dave.

Hey, Ken. I hope you're both having a great day. Thank you so much for taking my call. Our pleasure. How can we help? So my question for you guys is sort of a two-parter. First, I have an old employer-sponsored IRA that was transferred to a trust company. I'd like to move that money, but I don't know if I should move it to my new employer's sponsored 403B

or if I should open a Roth IRA because I don't have one yet, move the money there, and kind of take any penalties or anything that may come along with that. There's no penalties, and I would roll it to a traditional IRA, not a Roth, in good mutual funds. How much money is in the account? It's not a lot. It's like $1,500. Okay.

Just click SmartVestor at DaveRamseySolutions.com and find a SmartVestor pro in your area. They can help you with the paperwork and open up an IRA, and you just roll it to that. Someday later, when you're out of debt and you have some extra money, then you would just use that to convert it from a traditional to a Roth, because that makes the taxes come due. There is no penalties on what we're talking about. But here, folks, when you leave your job, you always take your retirement with you if you can. If you've got a 401K, you can.

If you've got an employee-sponsored thing, a lump sum, you can. And you always roll it to a traditional IRA where there's no taxes in good mutual funds. That way you have better investment options and you have more control. Always take your retirement with you and never put it, there's no reason to put it into the new employer, none whatsoever. Michael is in Alaska. Hey, Michael, welcome to the Ramsey Show. Thank you.

It's a pleasure to be talking to you. You too. What's up? Hey, so I just got a quick question. I got a little bit of consumer debt and I own a home, so I got a little bit of equity. What are your thoughts on possibly taking out a HELOC or equity loan to pay off that consumer debt, bring down the APR and stuff like that, and then just throw that equity loan into my debt snowball? I wouldn't.

Okay. You want to know why? Why? Because you're going to feel like you did something and you didn't do anything. All you did was move it. Now, listen, all you did was move it. Interest rate's not your problem. Lack of a budget, lack of focus, lack of attacking this is your problem.

You need to get fired up and pissed off about being in debt. Okay. And get after your debt. List it smallest to largest. Pay minimum payments on everything but the little one. And get after it. Because the problem when people move debt around, they use words like pay it off. You didn't pay it off. You after it. Because the problem when people move debt around, they use words like, pay it off. You didn't pay it off.

You moved it. And 2% savings on the interest rate is not your issue. Your issue is getting focused, getting on a budget, living on beans and rice, selling so much stuff the kids think they're next, get fired up and wired up, baby. That's what does it. That's what moves the needle. Ken, there's so much of what you teach about jobs and what we teach here that is about action. It's motive, which leads to motivation.

Yes. Personal finance is 80% behavior. It's only 20% head knowledge. There's so much about a job, choosing a career, stepping into something that is about, you know, don't try to trick it. Don't try to trick your way past the hard work. There's no shortcut to any place that's worth going, Beverly Seals used to say. She's absolutely right. And so why are you going after it? You've got to remind yourself on the journey, why am I doing this? I get that it takes time. You know, if you

walked out on the street today with a camera and a microphone and you asked people, are you willing to do whatever it takes to get where you want to go, whether it be career or in your money, most people look at you and instantly say, absolutely. But if I followed up and I said, well, but I think they mean that. But then here's the

follow-up question. If I said, are you willing to wait as long as it takes? That's exactly what happens. They literally can respond that way, and here's why. There's something about the human condition where we want everything now. That's what this journey is all about. It's what Dave talks about all the time. It is the budget helps you control the behavior issue to where you go, hey, this is a long slog. This is going to take time.

And so you have to, whether it's in your career and doing work that you deeply want to do because you know you were put on this planet to do it, or it's paying off debt and saving money so that you can live like no one else, all of this is the same exact conversation. You want to live like no one else? You want to work like no one else? It's going to take time, and you better have the big picture in mind and know that this is a climb, but it is going to be worth it when I get there. There's no shortcut.

There is not a shortcut. A generation ago, there was one of the world's best golfers. It was a guy named Gary Player. Yes. And the story's been told about him over and over and over again through the years that he was warming up at a tournament uh on the driving range and he's you know pulling back that driver and sailing that ball out there 300 360 350 yards whatever just popping that drive straight as a string and this guy walks up behind him goes i would give anything

to hit a golf ball like that and i think I think he caught him at the wrong moment because he turned around and said, no, you wouldn't. Yeah. It's a fantastic story. No, you wouldn't. Yeah. You would not stand out here in the heat and hit 2,000 golf balls. Hit golf balls so long that you get blisters.

Hit golf balls so long that the blisters bust. Hit golf balls so long that you can't hold the golf club anymore from the busted blisters. You tape up your hands and you hit another 1,000 balls. You wouldn't do that. that's right you wouldn't do anything to hit a golf ball like that to which the poor guy just said i'm sorry i asked you know but you know but just you know but that's the thing you know i i would do it no you wouldn't you got you got to be willing to do it and so that's the thing and i'm not picking on michael here that's not the issue but the issue is there's a thing about action and paying the price, live like no one else so that later you can live like no one else.

That supersedes a little bit of interest saved by moving it to a helot. So true. Eighty-eight percent of the people that move their debt over for debt consolidation go further into debt, don't get out of debt. Yeah. Nine out of ten times. Yeah. It's interesting. They don't change their habits that put them in there in the first place.

That's right. They feel like they did something. And that's dangerous, to feel like you did something when you did nothing. Yeah. You know, there's a theme here we're talking about, folks, that Dave just brought up. You've got to be passionate about getting out of debt. That gazelle intensity, where does that come from? You've got to be passionate about getting the next job.

You've got to be passionate about doing work that you were created to do to help people. So what's fun is you do a word exercise, and there's a German word, and there's also a Greek word. The root word of passion means to suffer. Now, here's the deal. When it's rice and beans, beans and rice, gazelle intensity, working three or four jobs. The last couple times I've been on the show, we've had single moms, back-to-back shows, who paid off an enormous amount of debt with multiple kids doing everything. That is suffering.

That's passion. It's to suffer. That means these people know it. The word passion, folks, this isn't like some romantic, motivational poster word. This is, I am willing to suffer to go through pain and withhold pleasure, that's what that means, in order to get an outcome that I desire greatly. Whether it's starting a business, inventing a product or service,

getting out of debt, losing weight, changing your relationships, your marriage, I can tell you something. Passion. You've got to be willing to suffer for that outcome. There you go. This is The Ramsey Show. People always say, when I get this promotion, I'll be able to make a real impact. Wrong.

When you make a solid plan on how you need to grow, you can become the leader you want to be. And that's why Ken Coleman, America's career coach and national bestselling author, wrote his new book, From Paycheck to Purpose, The Clear Path to Doing Work You Love. And it's available for pre-order right now. If you want to grow or create a legacy in your career, you need this book. It's not just a concept. It's a proven, clear path that will walk anyone in any industry through a step-by-step plan to take their career to the next level.

Plus, if you pre-order From Paycheck to Purpose today, you'll receive our Get Promoted bonus pack for free, which includes the audio book, e-book, disc assessment, an exclusive talk from Ken, and access to our live event and more. Pre-order from paycheck to purpose at Ramsey Personality, is my co-host today. On the phones in Minneapolis is going to be Kristen, who says on my screen, Kristen, you're debt-free. Congratulations. Thank you. Hi, guys.

Hey, how much have you paid off? $61,091.37. Love it. How long did this take? 48 months. Good for you. And your range of income during that time? Okay, I went back and checked, and it was $32,000 to $51,000, and now back down to about $40,000.

Wow. So what do you do for a living? I'm an accountant and recently a Ramsey Master Financial Coach. Ah, okay. So starting to get some extra income that way. Yep. Very good. Good for you. So what kind of debt was the $61,000? So a lot of it was medical, just kind of stuff that surgeries, children being born, and then

just like once we would accumulate it, it would just hang around and payments, payments, payments. There was some personal loans and a big family loan that we had to do repairs on our home. Okay. Wow. Good for you. So how much was the big family loan? That was like $22,000. That was the big one of the whole bunch then?

That was the big guy hiding in the closet, yeah. Gotcha. Okay. So what happened four years ago that put you on this journey? So my marriage was coming to an end, and that's when we separated our money. And I had always wanted to be debt-free and become an EDM, so that was like pedal to the metal. Okay. So fresh start after the divorce.

Yep. And you already knew about our stuff, but you were just now able to do it because of the disagreement in the household before. Yeah. It was like, you know, putting on a lot of throttle and the car is in neutral. Now I actually got some traction. Okay. Good for you. All right. So you're going to be an everyday millionaire. That's. Okay. Good for you. All right.

So you're going to be an everyday millionaire. That's your future. I love that. I hope so. Yep. And what do you tell people when you're coaching them now that the key to getting out of debt is? Because you paid off $61,000 in four years, making $32,000. Yeah.

For me, there was three things. And I would say the reason, which is my boys, the plan, obviously, and then just the determination. So we just saw a picture of the four boys, right? Yep. On YouTube there. Good-looking family. Yeah, thanks. That's fun. You got a lot of why there.

Yes. Yes. Wow. For sure. So I want to ask you, when you decide, as you're coming out of this divorce, that's a painful thing, and you decide, all right, I'm going to restart, reboot, do it the way that I always wanted to do it, and you've got those boys as your why every day looking at them, what fired you up the most in this process?

Was it the first one, the first debt that you paid off in the debt snowball? Was it just the boys? What was the real driver for you once you got into the process where you began to experience some momentum? I think I had a lot of little loans. So getting started and getting those paid off, there was a lot of immediate, you know, payoff for those. And I just knew what I wanted to give them. I didn't, I didn't want a house full of stress. And I wanted to give them a good future, not like just giving

them money, but showing them what to do. And they hold me accountable. I got a debit card mailed to me, and I opened it up, and they're like, Mom, is that a credit card? They're always watching me. That's great. That's so fun. Very cool. So they know the rules then.

They know what you have to do. Oh, yeah. Yeah. Very, very fun. Cool. you have to do oh yeah yeah very very fun cool so um how long had you been familiar with our stuff before your marriage ended uh quite a while um i think my folks introduced me to your radio show and back in like 2010 and then um i coordinated an FPU starting in 2011. And then I did another one before my last son was born.

So I've done a couple of those. And I was just kind of hooked because I'm a natural saver. And so once kind of the shackles were off and we found a better church that I wanted to be at and I started tithing again. And I think, Dave, you had said like a month ago when you talked about God throwing open the window of heaven. He sure did in my case, because it's like once, you know, we were pushing the bike down the hill, everything just kept piling on. I swear I have food show up in my freezer that wasn't there. I had a expedition that I think two of the pictures are like a time lapse that I got when my son was seven months old, the oldest one, and he's 12 now, and I've still got

it. It's just about 300,000 miles on it, but stuff just kept being a benefit. There was just kind of blessings from everywhere. Wow. Can I ask you, what did you do to go from 32 to 51K? What happened? My regular job was not 40 hours, so I had a base of that, and then I did a lot of side accounting work. And then just try to get, and I got a couple more clients and stuff like that. And then I worked for my mom, who's a a CPA and I did tax work at night. Just kind of everywhere I could pull from. Yeah, that's great. Very good.

You're a hustler. You're getting her done, girl. Proud of you. Very, very well done. Good job. Who were your biggest cheerleaders other than your boys? I would say my parents because they've been down that road and they've been debt-free for a while.

I have a lot of friends. I don't have a lot of naysayer friends. I got a lot of friends who are debt-free or are on their way. And then, yeah, these kids, I can't say enough about them because they never complained. They knew what the plan was. They volunteered. I don't need a treat.

We can save it. So I'm really proud of what they have learned and how they keep me accountable. Very cool. Very cool. Powerful, Kristen. What are the boys' names? So Aiden is 12.

Gavin is 9. Mason is 7. And Morgan is 4. So we're going to try to coordinate it. They're coming in here. They're going to do the screen. All right. They've earned it.

No question about it. Very cool. What a great family project. We're proud to try to coordinate it. They're coming in here. They're going to do the screen. All right. They've earned it. No question about it. Very cool. What a great family project. We're proud of you. Great job. We've got a copy of The Legacy Journey, which is the next chapter in your story, as you said. You're going to be an EDM, an everyday millionaire. You are on your way, kiddo.

And, of course, another copy of The Total Money Makeover, which you'll be able to give to someone and pay it forward and get somebody else's journey started with that best-selling book. So good stuff. All right, Kristen and the gang, $61,000 paid off in 48 months, making $32,000 extra side hustles up to $51,000 part of that time. Count it down. Let's hear a debt-free scream all right ready boy three two one

i love that sound yes that is the sound of a family tree being changed right there. You heard it. Yes. Those boys lived that with her. Yeah. What a legacy. Single mom, leading, modeling the way. I just, you know, I'm always blown away by the stories of everybody we get to hear their debt-free journey. But certainly, I got to host a show last week or a single mom making $32,000. Same thing.

Same thing. And I have a special place in my heart for those ladies that step up and do that. We all do. It's hard enough to parent, certainly by yourself, and then go through that debt-free journey. I want to point out something, Dave,

that I thought was so heartwarming. You asked her who were her biggest cheerleaders and she said beyond her parents or friends, she said beyond her parents were friends. She said they weren't naysayers. They had been on the journey themselves. And I just want to point that out that when you decide to live

like no one else, you better hang out with people that are on board and will support you. You become who you hang around with. Birds of a feather flock together. You read what they read. That's true.

You talk like they talk. You attend church like they attend you uh you know you attend church like they attend church treat your spouse like they treat their spouse i mean this is this is you become who you hang around with so choose carefully my friends choose carefully this is the ramsey show Thank you. Transcription by CastingWords Crabbsy personality, Ken Coleman, host of The Ken Coleman Show, now heard on over 75 radio stations, a very popular podcast, and a SiriusXM radio, joins me today answering your questions about your careers, your jobs, your life.

I'm here to help you with your life and your money, and together we're going to make it done. Get her done for you. Open phones at 888-825-5225. Father John is in Oklahoma. Hi, Father John. How are you? I'm good, Dave. How are you?

Better than I deserve. What's up? Hey, I'm a big fan. My parents learned me on the Ramsey Method when I was a teenager. And I'm definitely convinced that your methods really changed the trajectory of my life. So I just wanted to say thank you. Well, thank you. I'm honored.

How can we serve you today, sir? So I'm a Roman Catholic priest, and I live in the housing that's provided by the parish, and so I don't own a home. I've never been in debt, and I am kind of in between baby steps four and five, and I was just kind of, I was just sort of wondering, because of how busy I am with ministry and also the possibility of kind of, you know, I could get moved anytime, anywhere on the western half of the state. I just, that's the primary reason why I decided to kind of not take up a mortgage and not get a home, and I haven't decided necessarily, you know, if I'm, I don't have children of my own, and so I'm not sure if I'm going to be saving up for my nieces and nephews or not. But I guess what I was just wondering was, so right now I'm paying into retirement and just kind of saving money.

I own my car, and I'm just wondering, you know, is there any reason why I should get a home? Yeah, I figured that's just kind of— Now, so there's two questions I have that I'm not familiar enough with the Roman Catholic priesthood to, and you'll have to help me with this in my ignorance. How often do they typically move you? So we can be moved, well, for us younger priests, we can get moved pretty regularly, but probably anywhere between five to ten years.

So you usually stay in a place five or ten years? Yeah, probably. Okay, that's the norm anyway. I mean, obviously they can anytime is what you've said twice, but the point is they typically don't on a whim, and you've got a five-year. So you're there long enough to own a property if you want, especially once you've settled into a parish that you think you're going to be there for an extended period of time.

That might be a little bit later in your career. Now, the second thing thing and this is going to sound really dumb but i just don't know so i have to ask okay you said you're saving for retirement i don't i didn't i don't know if catholic roman catholic police retire do you quit well yeah see that's the thing it's kind of uh uh retirement in air quotes um Okay. We kind of just... I was kind of under the impression you didn't. No, you know, the retirement age, technically speaking, is 75, but I mean, I just plan on dying with my boots on, so...

Yeah, yeah. The priests that I have known, that's what they've done, but I'm not Roman Catholic, and so I wasn't up close enough to know what the flip was really going on. So, okay. Sure. All right. That makes sense. All right. That makes sense. All right.

So, yeah, you're saving for retirement. Now, here's the reason I ask that is as you move into maybe the second half of your career, A, you're more stable in a location, and B, you're going to want to stabilize the most expensive part potentially of your retirement years. I mean, if you step out of the parish and don't have parish housing at 75 but continue doing priestly work of some kind, but you don't have the housing furnished, you're going to need a home at that point. And that is the biggest line item in your budget at retirement that's now destabilized

because now you're a renter if we don't plan for this. So I want you to plan to buy a house 65 years old and pay cash for it. Okay. Or something like that. You see what I'm doing here? Yeah. We know by then you're probably in a location you're going to stay, and we know by then that there's a possibility somewhere out in the fairly near future

that you might need housing. Mm-hmm. Does that make sense? Yeah, that does make sense. I was just, I kind of, you know, I'd always, I was like, you know, how do I navigate these steps? Yeah, yeah. Housing's provided.

How old are you now? I'm 30 today. Cool. Well, happy birthday. Yes. birthday yes thank you well thanks for your service to the lord sir and uh thank you very much yeah and so yeah so what you're going to do is you're going to start paying a house payment into a mutual fund and that's your house fund that you're going to pay cash with 30 years from now okay okay awesome well thank you very much i appreciate you all taking my call yeah thanks for bearing through my ignorance because I don't know how these things work.

So, cool. That's fun. It's really fun because I want people to grab that. When you start putting a house payment right now into a mutual fund, 30 years from now, he's going to have plenty of housing. He's going to be in really good shape. He's going to have a lot of money. My morning needs. Yeah, that's exactly right.

That's a wonderful opportunity. But his is truly a life of service. Yes. Most of our lives should be, but he's a different kind of commitment that he stepped into there before God. And very powerful. Very cool. What a nice young man. Very sharp.

Open phones at 888-825-5225. Tina is in Cincinnati. Hi, Tina. Welcome to the Ramsey Show. Hi there. I have an insurance question. I'm going to be 59, and my husband is going to be 49. And we took out 20-year term policies that are going to be running out in about six years.

So I'll be able to retire at that point. But then my husband will still have 10 more years of working, and he won't have any term insurance left. Now, our house will be paid off next year, and we're otherwise debt-free, and we have about $650,000 in our retirement accounts right now. So he doesn't think that he'll need to replace that insurance because the house will be paid off and our savings will take care of any need. What is your $650,000 invested in?

It's our retirement plans, our 401ks. I know. Mutual funds? Yeah. Okay. If it's in good growth stock mutual funds that are averaging, if they were to average 10%, about every seven years, they'll double if you don't add anything to it.

So seven years from now, when we're discussing about this six-year policy running out, you should have $1.3 million and a paid-for house. If your husband dies, honey, I think you're going to be okay. Well, that's what he says. Well, you think you could struggle through on a million three in a paid-for house? Yeah, I probably could. I just was just a little nervous just not knowing, you know, how things go. So it makes me feel better to hear it.

Well, I mean, if you had, six years from today, if the money has not grown, you can revisit the discussion, right? Yeah. But hypothetically, you should be, you know, self-insured, meaning no debt. There's no money that you need, and you have a huge pile of money over here to live off of the income that it creates. So what's your household income now? So right now it's about $200. Okay. All right. So what's your household income now? So right now it's about $200,000.

Okay. All right. You would have to live on about $130,000 if he died and you only had $1.3 million, but you wouldn't have a house payment? Correct. I don't know if you can do that or not. You think you can? I think so.

Hopefully he's not listening so he can't tell me i told you so well here's the thing your fear is justified and it's a good fear the trick to use the fear for is to dig in and go okay what are the facts and can the fear go away once i understand the facts yeah and that's what i'm trying to lay out here here is because it is very wise of you to be concerned about this issue. People who are not concerned about how things are going to go if someone dies are the ones that end up messed up. They end up in a really screwed up situation. So you're very wise to have that fear. But then what you have to do is you have to do the actual analysis. And it's okay for you to not say, oh, I don't necessarily trust it just because he says it.

You know, you need to look at the actual numbers. Don't do it because Dave Ramsey said. But if you say, okay, looks like we're going to have a talk to my financial advisor. We're going to have a million and a half paid for house six years from today. We'll let that drop. I think we'll be okay. And you can let that release down inside of you then. Beautiful thing.

Thanks for calling. This is James Childs, producer of The Ramsey Show. Did you know The Ramsey Show is one of the most popular podcasts in the world? Subscribe or follow today wherever you listen to podcasts.