The Ramsey Show - App - Don't Screw with Your Retirement to Buy a House! (Hour 2)

Episode Date: May 21, 2019

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Music Live from the headquarters of Ramsey Solutions Broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show. The debt is done, cash is king, and the paid off home mortgage has taken the place of the BMW as the status symbol of choice. I am Dave Ramsey, your host. You jump in, we'll talk about your life, your money. It's a free call at 888-825-5225. That's 888-825-5225.

Dan is with us in Kansas City starting off this hour. Hey, Dan, welcome to the Dave Ramsey Show. Well, hey, Dave. It's an honor to speak with you. I've been listening to you for years, and I appreciate your input. So thanks for talking with me today. Absolutely. How can I help? Quick question. My wife and I are debt-free, and you're talking about your everyday millionaires.

We are there thanks to you and your help. I have a quick question for you in regards to my daughter. I have a daughter who is in college who will be graduating next year, and her college has been paid for through more paying for my wife and I have a daughter who is in college who will be graduating next year, and her college has been paid for through more paying for my wife and I and through scholarships. The money we had set back that she hasn't used will be around $35,000.

We're trying to see what we should do with that house. Should we gift that to her? Should we tie it to a down payment on a home? What are your thoughts? Okay. What's her degree in? Marketing and a minor in Spanish. How's her character?

She's got a great character. Okay. She's got a great character. Okay. She's got a great character. Okay. Wonderful. Okay. Good. And the money is currently in your name or it is in her name in a college fund?

It is in her name. It's not in a college fund. We have transferred over to her name last year out of some stock. And you did that with some tax advice to avoid gift tax, right? Exactly. Okay. All right. Good.

Okay. So you've already given her the money? Yes, but she doesn't know that she has the money. Okay. So it's in cash at this point. So yes, you're right. It is hers. We were in a similar situation with each of our kids because we saved, before there were college 529s or ESAs,

we just saved the money in the kid's name in an UTMA or a Uniform Transfer to Minors Act for their college. By the time they got to college, we just wrote the checks without using that money. So when they graduated from college, they had a chunk of cash like this that was already in their name that they got that much extra as a head start in addition to having a paid-for college. And that's exactly where we ended up. Now, what we did was we just instructed them on what we thought they should do with it, and because they were people of character, in every case they did. Okay. And so, you know, what do you think she should do with it?

And I think, obviously, if she needs a car, she's going to use some of it for that. Or an upgrading car, if she's still driving a high school car or something, and maybe she wants to move up a little bit, paying cash for that's a good thing. Obviously, a down payment on a house is a good thing. Having an emergency fund is mandatory before we talk about either one of those two things, that kind of stuff. So, you know, it's in your name, kiddo. However, it's in your name because we put it there,

and you've gotten this far because you followed our advice. You are someone we are proud of and have used wisdom beyond your years if you continue that we would if you continue to be wise here's what we think it would look like gotcha and give her a little plan with it and ask her what she thinks and kind of participate in a conversation that plans out where this money's going. Gotcha. So don't really put strings on it. You can't.

It's already in her name. Yeah. Trust her. You're right. It is. It is. She's 20 years old. She's in her savings account.

She's already saved through high school and so forth. She has $15,000 of her own money. Excellent. That she refuses to touch. So she does understand what saving money is and what money is. So giving her this just gives her that head start and saying, you know, we'll help you plan. But you're right, it's already in her name. And here's the other thing that I did, and I did it long before this, and you may have too,

but you do it again because nobody hears something the first time you tell them, is take $35,000, put it in a calculator, and say, you know, let's just pretend you didn't touch any of it. You know, you're 20. When you're 40, here's what it would be worth in a mutual fund. Yeah, that's a great idea. And let's watch our little eyes get big and go, oh, my God, I could be a millionaire because of this one thing. This one thing. And just change the family tree. Exactly. But, I mean, I don't think realistically that's exactly what the money should be used for,

but it's always good to have that aha moment that if I continue my savings patterns and don't marry a doofus and screw up the whole thing right um yeah then this is where i could end up and so you know that's part of the discussion as well but you know that's you know it's just at this point you're you're making the shift from parenting a child to uh to being a good friend to your grown children yeah so do you think at that time it would be a good time to also have her talk to our financial advisor as well? Yeah, definitely. And start having some discussions with them one-on-one? Definitely.

Without us being involved? Well, you could be in there too. I don't care. But the whole thing is, what would you do if this was not your child and it was a 20-year-old friend's kid that came to you for advice? You wouldn't be in a position where you could use your dad voice. You would have to persuade. Yes, you're exactly right.

And that's when you change from being a wise advisor to your grown kids and friend to your grown kids versus being daddy where you just tell them what to do. And it sounds like this kid's worthy of that. She's strong, man. I mean, she's graduating early. She's got a good degree field. She saved money on her own from high school. Her dad says she's got good character.

This kid, she's in a good position. So I think you've done a great job. Congratulations. Open phones at 888-825-5225. Our question of the day comes from Blinds.com. They have a 100% satisfaction guarantee. Even if you mismeasure or pick the wrong color, they will remake your blinds for free. Free samples, free shipping, new promos.

Always use the promo code Ramsey. Ken is in Arizona. I'm making extra payments on my mortgage, but when I do, I get billed for extra escrow, which I'll get a check for at the end of the year. Is there any way I can avoid this? Your mortgage company is stupid. Okay, don't make extra payments on your mortgage. Make principal payments on your mortgage.

If your website that you're doing the payment through allows for you to have principal only, that's what you need to be doing. You don't need to prepay interest. You don't want to pay December's payment right now. That interest is not yet due. And you certainly don't want to overpay escrow. Absolutely zero benefit to that so what you're what's happening is is they're counting this as next month or the month after the

month after payment and that's not what you want to do you want principal only if you're sending in a check write principal only with the account number on it big Big letters. If they can't do it, write principal only. Stupid. I said principal only. And keep working it that way until you get them to actually apply it. They can do that. Once a month is what they limit that to. Let me tell you a story about two families that are very much alike in a lot of ways. Both families have two working parents and a couple of young kids. Each has debt and a struggled to make ends meet. But they're starting to make headway with their budgets and smarter decisions with money. They have dreams and plans, and the only real difference is that one family has the right amount of term life insurance,

and the other doesn't. Big difference. If one of the parents die, and that does happen, their well-being would be destroyed. Paying for the mortgage, utilities, food, and other does happen, their well-being would be destroyed. Paying for the mortgage, utilities, food, and other bills would be impossible, let alone saving for education or retirement. That's why every day I talk relentlessly about getting term life insurance. Just go to ZanderInsurance.com or call 800-356-4282 and see how inexpensive it really is be the family that takes those deliberate steps to be different and responsible it really does make you the hero of your story and it puts you on course

for better things ahead On the road, working on the proximity principle book tour, Ken Coleman is on the line with us. Hey, Ken, where are you today? Well, we are in the Phoenix, Arizona area. Been doing media all day and getting excited for our book signing in Mesa later this evening at 6 o'clock. So Mesa, Arizona, Barnes & Noble tonight at 6 o'clock. And be giving away money again.

Yes, sir. $500. We're going to give you $450 in cash. And then a $50 Starbucks gift card to get that proximity principle going. Got to be present to win. And so we're excited about that. The Village Square in Dana Park, that's the Barnes & Noble location at 6 o'clock tonight. Yeah, very, very cool.

Very cool. And you've gotten to visit with some of our friends over there today while you were in Phoenix. I saw the Instagram post, Good Morning Arizona. Good folks. Yeah, really great folks. We did two different segments there and had a blast. Nationally recognized, I think he's a legendary comedian, Frank Caliendo was in there.

He told me to tell you hi. He's a big Dave Ramsey show listener. Oh, wow. I'm a big fan of his. That's good. He's fabulous. He's a great entertainer. He lives out here in this area and rolled in in between our two segments, and we had a blast.

Oh, that's very cool. Very cool. Good for you. That's fun. Yeah, green room meetups, huh? Very fun. Yes. How about proximity, right?

You show up, you never know who's going to walk in there. And by the way, he wanted me to tell you, he has paid cash for his homes. So he wanted me to tell you that. All cash, he has no debt. So who would know? Wow know wow well he's made some good money then that's awesome i'm proud for him good stuff ken coleman the book is the proximity principle it is on fire the proven strategy to that that will lead to the career you love and And, Ken, as you've been out there bouncing around with media, I'm always interested when I'm writing a book and going in, because we sometimes don't think of media as people,

but it turns out every one of them has the same problems, the same opportunities, the same dreams, the same fears that everybody has. Are you getting, once the microphones are off and the lights off, are you getting some interesting questions from some of these folks on a personal level? Absolutely. And what we're hearing that is so encouraging is that as they prepared for these interviews, they said, this is the strategy that I use. This really does work.

I didn't know to call it the proximity principle, but this worked in my career. It's really exciting because this is, as you know, it's a clear path. We're going to lead readers right to the people that you need to be around and into the places that you need to be in so that opportunity comes your way. So it's been really rewarding to see the light bulbs go off and talk to these folks in the media who've used this very principle to make it in a very difficult industry. Very cool.

Now, tomorrow when you get up, you're heading over to L.A., right? Yeah, we will get up bright and early, early morning flight to Los Angeles, where we've got a fantastic day lined up. Going to be taping a segment on Hallmark. That's going to be fun. That's on home and family. And we're going to be doing several shows. Exploring Mind is a big YouTube show.

And then we've got podcasts and still doing radio affiliates all around the country during the downtime. And by the way, Dave, our Rachel Ray segment aired today. So that was fun. We did that several weeks ago and that aired today as well. Oh, good timing. Very good. Okay, cool.

Good stuff. Very good. So if you're a Rachel Ray fan, you can jump on her website and see the segment, or of course if it airs in your, as you find out where it airs in your market, you will see Mr. Ken Coleman on there. Ramsey personality, career expert. He's host of the Ken Coleman Show

on our SiriusXM Ramsey Network, as well as his own podcast under the same heading of The Ken Coleman Show. The book is The Proximity Principle. You can get it anywhere that fine books are sold. The proven strategy that will lead to the career you love. Tonight in Mesa, Arizona, the Barnes & Noble at Village Square at Dana Park. Make sure you're there right in the phoenix area and uh

we appreciate all of you guys there uh you know we've just got a huge huge presence at ktr ktar listeners there in the phoenix area so come out and support ken meet him get your book signed be and be there for the 450 cash50 coffee giveaway, gift card giveaway. And then the same thing will happen this Friday night after you finish in L.A. You're heading over to Sacramento. And the last book signing of these first two legs of the tour will be this coming Friday night in Sacramento. And Sacramento has always been a great market for us, hasn't it, Ken? It really has.

You know, Dave, I've been so blessed to be at live events for nearly five years at Ramsey Solutions, and those Sacramento crowds are as on fire as any group of people that we get the opportunity to speak to. So we love, love Sacramento. Great, great market. Arden Fair, Barnes & Noble, 6 o'clock there, Friday

evening, this coming Friday evening, as you head into your good way to head into Memorial Day weekend is to win $450 cash. That would be pretty cool. That's right. You need to be in proximity of Ken Coleman for that to happen, though. I'm just saying. I like where your head's at. That's good, Dave.

You see how I did that? That's almost professional there. All right, brother. Well, have a good signing tonight. We're proud of you. That's good, Dave. You see how I did that? That's almost professional there. All right, brother. Well, have a good signing tonight. We're proud of you. Keep up the good work. Thanks, Dave. Appreciate it.

All right. Ken Coleman, Ramsey personality, helping folks with their careers, and he just does such a great job. He's got the right heart. Speaking of right heart, Anthony O'Neill does, especially when it comes to talking with and for and to and about teenagers uh he and meg meeker will be in sacramento tonight bragging on sacramento again a sold out smart parent event there um i think you might still sneak a ticket we'll probably work you

in but uh you know if a thousand of you show up we up, we sure can't because we've sold the seats out. It's that simple. So smart parenting event, the second one of those in two weeks that is a complete sellout, Meg Meeker, America's mom, and Ramsey personality Anthony O'Neill talking to you about being parents of kids of any ages, Anthony being a millennial and teenage expert, and Meg having been a pediatrician practicing for longer than she cares to admit and knows a ton and probably knows more on her little finger than most, quote, child care experts do in America. She is America's mom and really has her hand on the research, the background,

and the actual practical experience of what's happening with parenting right now that's working. Smart Parent Conference tonight, Sacramento, California, May 21st to sell out. Thank you, Sacramento. We really, really appreciate it. Very good stuff. So lots of stuff sold out. We're kind of winding down now our live event season.

Coleman's finishing up this book tour. The live events are wrapping up. We did the generosity event I did in Kansas City on Sunday night. Chris Hogan stopped in and helped me out, and he and I got to do a Q&A for that audience, which was a lot of fun. I'm going to do some more of those. We might not turn some of those into a podcast or something, James. Let's think about that. Because they were just dripping in motivation and in inspiration from the stories that came to the microphone. It was pretty cool stuff.

Pretty cool stuff. The Business Boutique Conference on sale for the fall. Over half sold out. It will sell out soon. October 24th through the 26th. The Smart Conference in Sacramentoramento over half sold out november the 16th the live like no one else first time ramsey has done a cruise actually i did one a bazillion years ago that was tiny but the first real time i've done it is march the 22nd of next year been sold out weeks, but you can get in touch with them, get on the waiting list.

Some of the people that put up deposits may choose not to play through, and you may still be able to get on, but it's an early, early, early sellout there as well. Entree Leadership Summit at the Gaylord Palms and Resort next May already have sold out. We're busy out there, people. We're moving around. The spring season getting ready to wrap up, though, this week as far as places we're going to be this spring. We'll let you know more about things happening in the fall soon. This is the Dave Ramsey Show. I'm out. With me. Thank you for joining us, America.

This is the Dave Ramsey Show. Kevin is in Tampa, Florida. How can we help you? Hello, Dave. Yes, sir. Thank you for having me. Sure. What's up?

I currently have $30,000 in cash in the bank, and I have a $15,000 car loan and a $6,000 student loan. Should I pay off all the debt that I have, which leaves me $9,000, or should I keep that money and continue to pay more than the minimum on each loan? What we have found is the shortest method to becoming wealthy is to be out of debt,

not to have money sitting in a savings account at 1%. Okay. And so I'd pay it off today. I'd be debt-free today. Okay. Now, it's contingent upon, of course, the idea that you're going to write out a budget, you're going to live on that budget, and all of those payments that you don't have anymore plus other money we squeeze out of your budget

is going to be used to build your $9,000 up to three to six months of household expenses as a baseline for your emergency fund. Now, how much do you guys make? What's your household income? $128,000 a year. Okay. So $30,000 is probably a pretty good emergency fund, something like that. Three to six months of expenses.

And not bare bones, but if you just lost your incomes instantly, unexpectedly, could you survive three months to six months? And $30,000 would allow you to do that. So I want to build the nine back up to that as my next step as quickly as you can using your budget. Once that's done, and only once that's done, would I start or restart retirement accounts. I would stop investing temporarily until you get that emergency fund rebuilt. But I'd be debt-free by the end of the day. Okay. It doesn't make sense, though, if you don't play through.

You follow me? Mm-hmm. Okay. It doesn't make sense, though, if you don't play through. You follow me? Mm-hmm. Okay. I also own a house. Mm-hmm. And I owe $120,000 on it. Mm-hmm. It's currently valued at $250,000.

Great job. Should I just, once I pay the car and the loan off, do you think I should just start throwing money at the house until I get it paid off? Mm-hmm. Well, what we teach Kevin is a thing called the baby steps. I'll send you a copy of the book, The Total Money Makeover, which will show you exactly how to do that. Baby step one, I'll walk you through all of them because you're doing a bunch of them

today, okay? Baby step one is put $1,000 aside. You've obviously already done that. Two is debt-free but the house. You're going to do that when we get off the phone. Three is a fully funded emergency fund of three to six months of expenses. And you don't do one or you don't do two until you've done one. You don't do three until you've done two. So we're going to build the 9,000 back up to 30,000. Then we're going to

start baby steps four, five, and six simultaneously. Four is 15% of your income going into retirement. Five is kids' college. If you have kids, you want to start saving for college, that would be the place to do it. And six would be any money beyond those two things that I can get out of my budget, I chunk at the house. The average millionaire that we find, that we've studied millionaires, done one of the most in-depth studies on millionaires, pays off their home in about 10.2 years.

That's average. We run into a lot of them doing it in about 10.2 years. That's average. We run into a lot of them doing it in about seven. But meanwhile, they're putting 15% of their income into retirement. Meanwhile, we're doing something for kids' college if you have kids, and that's appropriate. Once you've gotten the house paid off, then everything mathematically goes into overdrive. Because when you don't have a car payment, a house payment, a MasterCard payment, a student loan payment, you've got money, lots of it.

And so it's very easy, mathematically anyway, to become very wealthy. And that's what baby step seven is. The last step is become very wealthy and give a bunch of it away. Hold on. I'll send you a copy of the book, The Total Money Makeover. Seven million people have read that book or bought that book. I don't know if all of them read it. Probably more have read it because like a husband and wife buy one book, right?

So, you know, and then they give it to a friend and then somebody buys it at a garage sale. So more than that have read it. But anyway, so I'll send you a copy of that. It shows you how to do those baby steps exactly in great detail. So you won't have any questions about what to do. Lance is with us in Pittsburgh. Welcome to the Dave Ramsey Show, Lance. Hi, thanks for having me.

Sure, what's up? So I'm a new listener, but my wife's been listening to me for about two years now. We're on step two, and I have a whole life policy that my parents bought me for me when I was born worth about $10,000. We have about $25,000 left in a car and my wife's student loan. And I'm getting a quote through xander for my life insurance good would you sell the whole life and just apply it towards all of that debt now if you're uh if you're insurable and after you get new insurance in place not before don't don't cancel yeah don't

cancel life insurance no no i want it in your hand, not just approval. I want it in your hand because I don't want something to happen to you, God forbid, in that moment in time between these two policies. So they need to overlap. When you get the Zander policy issued in your hand and your family is taken care of, then, yes, I would cash it in. It is not a good investment. It is growing at a horrible rate of return, and if you die, they do not give you the cash value. They only give you the face amount of the policy.

And so it was a sweet thing, a good sentiment that your parents had to try to save some money for you. They used one of the worst financial products to do it in. Whole life is the payday lender of the middle class. It's horrible. So I would get rid of it as soon as you get the other stuff in place. But don't cash insurance out until you have your new insurance in place. That's always a step. So, hey, thanks for the call. Open phones at 888-825-5225. You jump in. We'll talk about your life and your money. Robert is in the Ramsey Baby Steps community, the largest Facebook community discussing Ramsey stuff.

And it's a private community. We'll let you in, and you'll behave, and you can stay in. And there's a bunch of you in there. Thanks for hanging out. Robert said, the Ramsey Baby Steps community. Is it wise to take money from your 401K to use for a down payment on a house? No, because there's only two ways to take money from your 401K. One would be you'd have to quit the company

because you can't do an early withdrawal while you work there. But if you did that, if you took an early withdrawal, it's a 10% penalty plus you get hit with your tax rate. And so if you're in a 30% tax bracket, that's a 40% hit on your money. That's borrowing money at 40% interest in order to put it on your home. Bad math. Bad idea. The second thing you could do is you could borrow on your 401K, but I never recommend

that in any circumstance. So the borrowing on the 401k unplugs you pay your self-interest three five six seven percent whatever your 401k set up at and um so you're paying yourself say six percent but you unplug good mutual funds that were paying 10 or 15 percent if you've got it invested well uh number one problem number two problem is when you leave your company and you will leave your company when you die, when you get a better job or when they fire you, you will leave the company. When you leave the company, if you've not repaid the loan, it is considered then an early withdrawal.

And again, the 10% penalty. Don't screw with your retirement to buy a house. If you temporarily want to put your investing on hold to save up for a down payment, we call that baby step 3B after you're debt-free and have your emergency fund in place and you want to save for your down payment before you start your 401K or maybe in your case you temporarily stop your 401K investing in order to save up for a down payment, that is fine. Work an extra job is fine sell your stupid car for a down payment on the house is fine but we do not screw with

retirement because there's no upside well the only upside is if everything works perfect and uh i'm old and what that means is i know, I have a 100% probability for you, not everything works perfect, ever. The best laid plans of mice and men do not occur. It's that simple. This is The Dave Ramsey Show. Thank you. Well, if you've listened to our show in the past, you've probably heard us talk about Financial Peace University. For over 25 years, Financial Peace University has now taught more than 6 million people how to not only get out of debt, but get out of debt so that they could save and invest to retire with dignity.

So that you could leave an inheritance. So that you could give with outrageous generosity. We're not just the get-out-of-debt people. We're the get-out-of-debt people so We're the get-out-of-debt people so that you have a better life, so that you become wealthy, so that you get a margin. And everyone who purchases Financial Peace University for the first time now gets a one-year Financial Peace membership. Financial Peace University is a nine-week class. You have a class once a week for nine weeks.

And we teach you the things you should have been taught in high school. Make sure you and your wife, you and your husband get on the same page. If you're single, you get a sense of dignity, a sense of power over your money. And then while you're going through the nine-week class, you're signed up for one year as a Financial Peace member, which includes EveryDollar Plus, which is the bank connectivity to the EveryDollar app. It's the world's best budgeting app. Over 6 million people are using that now. And hooking up to the bank is cool because you're charged. The restaurant pops up there on your app.

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So go to DaveRamsey.com, click on Financial Peace University, or call the Ramsey Concierge Team. They'll help you at 888-22-PEACE, 888-227-3223. Tara is in Miami. Hi, Tara. Welcome to the Dave Ramsey Show. Hi, Dave. My mom told me about your show, so I want to call in. I'm 50 years old.

I have two teenage sons. I'm divorced, and we're closing on the sale of our marital home soon. My portion is $1.2 million. I need advice about what to do with it. Wow. I need a plan. Yeah, I'm excited. Big old house.

But it's a big problem. Yeah. Were you living in the house? The divorce was recent? Yes. Yes. Yes. We divorced, but he allowed me to stay in it a little bit longer, you know, for the boy's sake. And now we're finally, you know, closing on it soon. So obviously you need a house, right?

Well, I'm renting for the first year. I just feel like I want to do that. I don't know. I need to know what to do with that money. Do I buy within a year? Do I invest in a CD? I don't even know what I can afford do that. I don't know. That's what I need to know what to do with that money. Do I buy within a year? Do I invest in a CD? I don't even know what I can afford to buy. So I just really need a plan. What do you make a year? 120. Way to go.

Good. Okay. And so what does the house that you're selling, what did it sell for? 2.45. Okay. So each of you got half. what did it sell for? $2.45. Okay, so each of you got half. And it was paid for? Yes, it was paid for.

All right. We live smart. Yeah, you did. But I want to be smart moving forward. He did all the finances and I didn't, so I'm just kind of lost. It's a big problem. I know that. Here's what I know.

You guys were obviously married probably 20 plus years, right? Yes, we were. 22. You're talking about it in a cheerful voice, but you've either processed or you are processing a lot of hurt. No, it's all good. It really is, because it's all about the children, and there's no egos involved.

So we're all in a good place. Well, but I mean, you have to be grieving a 20-year-something ending. If you're not, you're weird. Yeah, it's sad, but we're all happy and we're all in a good place okay all right good i'm glad i don't want you to be sad i'm just um anyway my point is i want you to make good clear decisions and that's what i was checking in on because sometimes when you're hurting you don't make you're in the fog of the pain and you don't make we've been divorced now we've been separated since 2013 and divorced for three years now yeah so it's all i've had time to absorb all that he just allowed us to stay in the house okay i'm sorry i was misreading okay all right anyway so um good well that's good news then so now here's the thing the the the less debt

that you have like you've already discovered and earlier in your life, before you ever heard my name, the less debt you have, two things happen. One is it's easier to build wealth because you don't have payments. And two is you're much more stable. There's less stress. I agree wholeheartedly. I don't have any debt except a car payment and now my new condo rental. Okay.

So I would pay off my car today. I wouldn't have a car payment. Well, I'm leasing. Okay. Well, call them, ask them what it takes to get out of the lease and pay it off if you want to keep it. Okay. I don't want any payments at all. The second thing that I'm going to consider then is when I buy, if you want to wait a year, that's okay.

But when I buy, can you live in a $1 million house and pay cash for it? I don't know if I can afford to do that. I don't know. That's what I need to know with that money. Well, you've been living in a $2.5 million house, and I'm suggesting a million-dollar house. That's a bit of a drop. Yeah. I mean, yeah, and you don't get that much for a million.

It's a shack. I know. I know. I know the Miami market. It's an expensive market, okay? So, anyway, that's something to think through, because if I could have you debt free at 50 years old making 120 going forward you can retire multi-millionaire i am 50 i know i am 50 i know yeah but if you have you debt free in the house you're living in once you make your home purchase going forward

making 120 000 you can be a multi-millionaire when you get ready to retire right and but but to the extent i put you into a mortgage or let you or suggest you go back into a mortgage, that's one more thing we've got to clean up that's between us and building wealth. So if you want to rent for a year and park it into a CD and decide what to do, that's what I would consider doing. During that time, I'm going to really think about where I could live and pay cash because you've got a million dollars. And even in a tough market like Miami, meaning an inexpensive market,

you probably can find something. And then without a house payment, without a car payment, with a little money in the bank for emergencies and making $120 a year, you can start investing. And if you just invest the equivalent of most people's house payment and you invest 15% of your income on top of that, those two things alone, by the time you're 70, will be millions and millions of dollars. And so that's what I would love to see you move towards.

And so I don't mind you renting for a year and thinking about where you want to land but that would be my target. It would not be a million and a half house with a million dollar down payment. I still got a half a million dollars to clean up before I get to really become wealthy and I'd rather not. I'd rather not and that's the way I look at it. So you got to consider those things and that'll get you going. Hey, since you're new to handling money, he used to handle everything.

I don't know what I'm doing, you said. I'll give you a longer answer that's nine weeks long. The Financial Peace University I was just talking about, nine-week class, and the one-year membership, I'm going to give it to you as my gift. I want to be part of your millionaire future. And you're already a millionaire. But I want to be part of your millionaire future. And you're already a millionaire, but I want to be part of your multi-millionaire future as you move forward. So

hang on, and we'll have Madison pick up. We'll get you signed up as our gift, free, to go through Financial Peace University. We want to be part of this good thing that is now happening in your life. So, thanks for calling in and for being a new listener. That puts this hour of the Dave Ramsey Show in the books.

Our thanks to James Childs and Madison filling in for Kelly Daniel. I am Dave Ramsey, your host. We'll be back with you before you know it. Hey, it's Kelly, associate producer and phone screener for The Dave Ramsey Show. This episode is over, but if you heard about a product or service and didn't have a chance to write it down, don't worry. We list everything that is mentioned during this episode in the podcast show notes section. Thanks for listening.