The Ramsey Show - App - Don't Skip Over Dollars to Pick Up Nickels! (Hour 3)

Episode Date: September 28, 2020

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show. Where 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'm Dave Ramsey, your host. Thank you for joining us. Open phones at 888-825-5225. That's 888-825-5225. Megan starts us off this hour in Kalamazoo, Michigan. Hi, Megan. Welcome to the Dave Ramsey Show. Hi, Dave. Good to be here. Good to have you. How can I help?

So, my husband's a pastor, and I'm an accountant. We're currently debt-free on Baby Steps 3B and 4. We make about $95,000, but I'm hoping that, Lord willing, in the next year or so, I can stay home with children. And I know match beats Roth beats traditional, but I didn't know if, since we're expecting our income to decrease probably greatly in the next year or two, should we be contributing to a traditional now and then roll it over to a Roth when we're in a lower tax bracket?

Nah, I wouldn't fool with it. It might work mathematically, but it's not going to be a lot of money, and it's going to cause a cash flow strain. Because when you roll it over, of course you have the taxes due. Right. At exactly the time when you have less money. And so that's not worth it to whatever little bit you would save on the taxes by doing that. I mean, mathematically, you're the accountant.

You're exactly right. It'll work. But I just don't think you want a bill coming from the KGB. I mean the IRS the year that you quit working. Okay. That makes sense. I just mathematically, my mind is thinking, oh, that's probably a couple thousand there.

Yeah, your mind was right. Yeah. Yeah, it's just the other part that's going to ding you, the heart. Hey, thanks for the call. Open phones at 888-825-5225. Minneapolis is next. Josh is with us. Hey, Josh, how are you?

Hey, Dave, doing pretty well. Thanks for taking my call. My pleasure. Yeah. So right now we're a family of three. We have one 15-month-old son, and we're just kind of doing some family planning for our second child. We're on baby step number six, paying down the mortgage.

We have $110,000 left on a $300,000 home. The question that I have is, is it okay if we take extended maternity leave instead of paying down the mortgage? Sure. Okay. You don't only mean debt, but your house. You're in baby step six. You're on a budget. You can live on your income, right?

Yep. Yep. You're saying I will trade. All you're saying is I will trade whatever debt reduction on the mortgage I'm going to get for time with a kid. Exactly. yeah. That's a good trade. Okay. That's the power of being in control and the power of having a plan

and the power of thinking things out the way you have. Now, where people get into trouble, obviously, is not you, is where they just impulsively go, I want to be with you, baby, until now we can't pay our light bill and the dead gum house is in foreclosure. You know, now you can't do that. That's being childish. Right?

Sure. But you're not. I mean, you have executed a plan which gives your family choices now. And one of the choices is your wife can take the extended FMLA and have some time with the child even though it's unpaid. Sure. I'm with you, brother. I think you're done.

I think it's the reward of your hard work and your planning, and I'm proud of you. Good job. Thanks for calling in. Open phones at 888-825-5225. Paul is in Charleston, South Carolina. Hey, Paul, welcome to the Dave Ramsey Show. Hey, Dave, how are you today? Better than I deserve. What's up? Hey, quick, welcome to the Dave Ramsey Show. Hey, Dave, how are you today? Better than I deserve. What's up?

Hey, quick question for you. So back in 2008, during the wonderful financial times, my wife and I and our kids, we lost everything. And so we have been aggressively rebuilding and have done so. We're debt-free except for the house. My question is, with the particular industry I'm in right now, business is booming, and I am going to receive probably three commissions in the next couple months, double what my actual salary is. Wow. couple months double what my actual salary is wow and just looking at uh i got the email today on

the next commission check and did i want 401k taken out we currently have both my wife and i have 15 percent taken out into the 401ks but uh we were stupid with our 41ks in our previous life and used it in the business that went south in 2008 so um we're we're still rebuilding that we're only at about uh we're in our mid 50s and we have about 200,000 in the 401k so how old are you uh 53 and what's your household income today? Based on where about $120,000. My wife's a teacher. And what do you owe on your home? Just got the appraisal back, so we owe $230,000 on the house.

It's worth $426,000. We just refinanced it and brought the term down. Gotcha. Good. Okay. All right. So the baby steps work perfectly for where you are. The only thing that's making you second-guess that is the amount of pain that's in your rearview mirror.

But let's forget the rearview mirror for just a second, other than we learned some lessons there that we'll never go back to. Me too, brother. Right? Okay. Yeah. second other than we learned some lessons there that we'll never go back to me too brother right okay but the the but the bottom line is today you owe 200 on a 400 000 house you have 200k in your 401k you're making 120 000 a year and you're getting some big butt bonus checks. That's your reality. Those are the facts. Right? Yep. Well, based on that, I would continue to put 15% of my income into retirement, and I would throw everything at Baby Steps 5 and 6.

You got kids? They're out and about. No college needed. No college needed, so no Baby Step 5. Okay. So everything above 15% goes on, so no baby step five. Okay. So everything above 15% goes on the house until the house is paid for. And so this house is going to be paid for

probably in like two years. Yeah. And if the house is paid for and you have $200,000, oh, by the way, if you don't add anything to the $200,000 and it's invested like we teach in good mutual funds, it's going to double roughly every seven years. So when you're 60, your $200,000 will be $400,000. When you're 67, it'll be $800,000 if you don't add anything to it.

But you're going to continue to add 15% to it, and when the house is paid off, you're going to add even more to it. So when you're 68 years old, you're going to have a paid-for home that about that time is going to be worth $700,000, $800,000, and you're going to have somewhere around $1,000,000 for mutual funds. I think this is a good plan. I think you've done a wonderful job. So just run your numbers out like that and see if I missed them or not.

I did that in my head, but I think I'm pretty close. So that is where you're headed, my friend. And I'm proud of you. You turned it around after the crisis. Hey, we all hit the wall. We all get lemons. The question is, can we make some lemonade? This is the Dave Ramsey Show. show. Folks, I love telling you about well-made, well-thought-out products.

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Thomas is with us in Canada. Hey, Thomas, welcome to the Dave Ramsey Show. Hello, sir. It's a privilege to speak to you. You too. How can I help? Four years ago, I was in a car accident and went on disability. Thankfully, I'm much better now. The only two decisions I made financially in the past few years, past few months, was one, to cancel my whole life policy

and I just went to term life. I also sold a property overseas, so I have about 50,000 cash. So the question is, it's a twofold question. The question is, I've made that my emergency fund and I have a little bit left,

but I just started work last week and of course they terminated me because I've been away for so long. The organization changed over time or something to that effect. So the question is, how do I re-engineer myself? And in the meanwhile, with this little money that I have, so I have about six months, they gave me what they call working notice. So either I leave right now or stick around for six months to find a position within the organization so how they're gonna pay you six months either

way yes what do you what do you do for a living I'm by I have a PhD in applied science I'm an academic used to be an be an academic on the side is how we call it, but I managed a department in a health setting. You manage a department in a health setting? In a health setting, yes. Okay. What is it you want to do? My skill set is with analytics.

I am great at numbers. I can manage. I not only just manage things today, I look around the corner is how I call it. I plan ahead for change. That's some of the skill sets that I have. It's just that I've been in it for 12 years now that I know exactly what I can do. But the terms I use may not be the terms that everybody else uses right now. Like, think about ROSAI, which I call change management. They talk about, I talk about Gantt charts and timelines. They talk about swim lanes.

So I understand the terminology that I changed over time, but the skill sets from, you know, learning a PhD. What is your PhD in? Applied science. App skill sets from, you know, learning a Ph.D. What is your Ph.D. in? Applied science. Applied sciences. Okay, okay, I got you. So you're, you know, basically have the skill set to be a world-class project manager if that's what you wanted to do, right?

Yep, yep. Okay. All right. What were you making at this other place? $100,000. Okay. World-class project manager ought to make that or more. All right.

So I don't know that you necessarily need to re-engineer yourself. You may just need to change some vernacular around what it is you're trying to do and say, okay, what is the – because Applied Sciences, as you know much better than me, it's all about critical thinking skills. As you said, forecasting methodologies, looking around the corner, seeing trends and seeing waves and seeing bumps. And let's say, okay, and then extrapolating out of that and just using good critical common sense as well as some good math to figure out where things are going to go. And when you can do that, then you become valuable to any organization. We've just got to put verbiage to it to where that organization sees the value in what you're talking about.

I see it. I've got lots of great world-class project managers here. Some of them are more entrepreneurial. Some of them are more academic. Some of them are both. But they, you know, you don't run a huge project at Ramsey without having a lot of the same skills that you've got. And because there's a lot of moving parts to it, there's a lot of processes that have to be managed and teams that all the stakeholders have to be brought into the loop and kept

in the loop and so on. And so I think it's all about just putting the vernacular around what you're doing. And you're probably, it sounds to me like you might be still emotionally recovering from this accident. Sound like it scared you, hurt you, physically hurt. Like you've dealt with some pain management stuff. And it's normal for that to steal some of your confidence, your swagger. And I need you to have some swagger while you're looking for a job here

because you're a pretty valuable dude. I mean, the stuff you've learned, the stuff you've got in your brain is pretty incredible. So let's just figure out a way to put it into the marketplace where it actually makes money for a company and makes them more money than you cost them, and then it becomes what's known as a no-brainer. So hang on. I'm going to send you a copy of Ken Coleman's book. I think you'll enjoy it.

It's called The Proximity Principle, and I think it'll guide you and give you some ideas in your job hunt. So pretty cool, man. Thanks for joining us. Kevin's with us in Fort Lauderdale. Hi, Kevin. Welcome to The Dave Ramsey Show. Hey, Dave. Hey, thanks so much. I started your program this year, and I watch your videos every day. Thank you. And yeah, in fact, I paid off $323,000 so far this year in debt and home repair, so I'll pay it off except the house. Wow. And, in fact, I've actually paid for the Smart Dollar program for all my employees. They love it. Thank you.

And the only thing I'm mad about is that I didn't do it 25 years ago. Wow. Thank you. Yeah. So now that all the other debt's paid off, what percentage of my income do I allocate toward paying the house? Okay, so you're in baby steps four, five, and six. I am, yeah, except the kids are gone. What percentage of my income do I allocate toward paying the house off early? So you're in baby steps four, five, and six. I am, yeah, except the kids are gone, so no college.

No five, okay. And you're 100% debt-free except your home. 100% except for the house. Way to go. I'm so excited, too. It's just such a relief. Baby step four is 15% of your income going into retirement. Five we don't have to do.

And anything else we can find in the budget, we throw at the house. So there's not a percentage. It's just the only thing pulling against how much you put on the house is, you know, you probably need to have a life in here because you've been very, intense for the past past few months and you probably you need to let your foot off the gas a little bit and uh you know do go out to eat with your wife or maybe go on a trip if you can find some place that's open or whatever whatever it is you're thinking about doing right and um but but everything else in other words i don't you don't do gazelle intense you've heard me talk about that you do not do that in four through six okay you're

just intentional but not gazelle intense gazelle intense is scorched earth lifestyle beans and rice rice and beans that's baby steps one and two but you three and you don't do that at and the others you but you're still intentional you say i'm going to limit my retirement to 15 until i get the house paid off i'm gonna throw any cash i can find above having a reasonably good life at the house as an extra house payment every month. And then that house goes away on average in about seven years. The people that are working their total money makeover baby steps, the total money makeover books now sold about $8 million and some changed copies.

And all the reports back, we've not done detailed research, but anecdotally it's coming out about seven years that people pay off their home from the time that they get to baby steps four, five, and six. About ten years from the start of their journey is the average. Now, average means some people do it faster, some people do it slower. But I suspect you've probably got three to five years. You're probably going to knock that house out. And then you just put as much as you can into retirement because we want to build wealth.

And we want to enjoy money. And we want to be outrageously generous. And these things all work together. So good stuff. Hey, man, thank you for calling in. We appreciate you. And congratulations on the huge success you've had. Very, very proud of you.

This is the Dave Ramsey Show. We'll be right back. In the lobby of Ramsey Solutions on the debt-free stage, one of our favorite debt-free screams is always when a member of the Ramsey Solutions family is on the stage. Stephen Murray is with us. He's been with us for about seven months. And one of the folks over in Ramsey Education kicking butt and making sure that these high school students get this high school curriculum all across America. And you're debt-free, brother! Yes, sir. I love it. How much did you pay off? $16,371. That'll work for me. How long did this take? Six and a half months. Okay. So you started working on it when you came here? Yes, sir. All right. How long have you been out of school?

Graduated in December, sort of. I had one Jan term class I had to finish up, so I tried to get started as soon as I could. Okay. So you came to work for us? Yes, sir. All right. And what kind of debt was this? This was entirely student loans. I got through undergrad debt-free thanks to parents, but made the dumb decision to go ahead and grab some more debt to get through my master's business administration.

Ah, so you got your MBA. Very good. Good for you. And you come to work here. We don't like check your mail or look over your shoulder or anything like that. It's not super weird, but everybody here is getting out of debt. So you kind of didn't have a peer pressure type choice, right? No, it was definitely easy to jump on board once you get in the door. It's hard to try to get teachers and administrators to teach Ramsey Foundations and personal finance if you're still in debt. It's actually been really cool being in some conversations with teachers as they're sharing some of their own debt-free journey. And I can kind of connect with them at different levels. Me too. I'm working at two.

Exactly. And now you're doing your debt-free scream on the stage, baby. Exactly. I think I've got one or two teachers that actually said they were going to listen in. All right. Very cool. That is very cool. I love that.

So did you grow up with this stuff or? Kind of. So I grew up Thompson Station, actually living in the same house that I grew up up in right now my parents were super gracious and allowed me to save some more money um to go and knock out this dead so grew up with ramsey all around you all around me um but other than taking generation change briefly in high school i'd never really engaged with any Ramsey content until college when I found myself just steadily growing my credit card debt every single month, just kind of letting it run away from me. And I had a just mentor in my life that gave me Total Money Makeover, and I actually read it, which at the time was kind of surprising.

I wasn't reading a whole lot then. But after reading that, I realized that I don't want to live that way anymore i don't want to let anything be in control of me okay so you went ahead and cleaned that up while you were in school cleaned that up um didn't take any more debt on until grad school um was trying to pay my way through bits and pieces um but to finish in the amount of time that I wanted to, I ended up taking on debt. But when I got in the door here, it was a really cool opportunity because COVID. I actually noticed that there wasn't going to be any interest added to my loans for a little bit. So I was able to get really hungry and really intense. Yeah, you started seven months ago.

You started in the middle of COVID. Yeah. Holy crap. I came in, and three weeks after I came on, we got sent home. Oh, yeah. How wonderful. Well, you didn't lose your job. That's good.

No, extremely grateful for that. That's good. I actually got paid really well during COVID. Yeah, yeah. Well, and you guys in the Ed Solutions team had to figure out lots of different ways that you could actually make a living during that, and it worked out really good. You ended up having some good months. So very cool.

Well, that's neat. Somehow, seven months I got. I knew you'd been here a little while, and I'm getting down to school, and then it suddenly hits me. That's right in the middle of the day. So you were here how long before we went home of school, and then it suddenly hits me. That's right in the middle of that thing. So you were here how long before we went home? Like three and a half weeks. Okay, and then we send you home.

Yep, it was my first week on the phones actually making sales calls when we had to head home. Wow, wow. And that's a long five weeks in at home. Yeah, it was. Okay, well, it's for everybody else. I was still here, but most everybody was working from home. So good for you, man. Cool. All, it's for everybody else. I was still here, but most everybody was working from home. So good for you, man. Cool.

All right. So these teachers, you're talking to them about teaching personal finance, foundations in personal finance. For those of you out there who don't know, what Stephen does, along with the rest of the group in Ramsey Education, is 45% of the high schools have taught 5 million high schoolers how to handle money. And, you know, somewhere around almost a million a year go through it every year nowadays. And we'd like it to be 95% of the high schools, not just 45. So he's on the phone every day talking to teachers and administrators, putting this curriculum into their schools and changing the next generation on this subject.

So now, ad is over. When you're talking to a teacher now and they go, hey, is this real? You can say it's real. What do you tell them the key is to getting out of debt? For me, it was just being really intense. If I hadn't done this quickly, I don't know if I ever would have done it at all. I had to really just focus and go after it. And you did it really during the pandemic. I mean, it comes down to the good news is your income wasn't taken away from

you. No. And we were managed. We managed to keep everybody on board for those of you don't know here. But you guys were hustling, you were scratching and making it happen. So right in the middle of a scary, scary, scary time, you knocked it out. How's that feel? Exciting? It's something to be really proud of. Yeah, I think so. I'm proud of my team. We got a whole crew of them out here.

We did a really good job. Yeah, they're here cheering you on but i mean when you look back on this 20 years from now you're gonna go i paid off all my debt in the worst possible time in freaking history i mean you just took the worst seven months possible and did something very incredible so that's pretty cool steven that's neat man i'm proud of you thank you very very well done all right you had team as cheerleaders. It sounds like mom and dad were cheering you on. Yep, they definitely were. That was probably one of the best and hardest parts of my debt-free journey was they were extremely gracious and brought me into the house so I could really attack my debt.

But for me, one of the biggest challenges was I'm 25, about to be 26 years old, and I want to be at other places in my life of living on my own making my own decisions all that independence that I had in grad school and it was a sacrifice to choose a more intense route yeah yeah a little more humble route yeah to really set myself up for the future how quick do you move uh real soon love you mom and dad i'm out yeah they know it well that's what their plan was that's wonderful they didn't raise you to stay there nope i'm proud of you brother well done good job well you probably already have a copy of chris hogan's book but we'll give you another one everyday millionaires that's the next chapter in your story for sure. And, man, I'm so proud of you.

Your team's proud of you here. They're here to cheer you on. And it's very, very cool when we can have young guys and gals like you on our team that get to actually live this stuff, but then also talk to the marketplace, in your case teachers and administrators, about, hey, high school students can learn this stuff. I just did it. i just did it i just did it and uh there's nothing like proof in the pudding man so very well done rock star good job man you're a hero thank you dave i love it all right steven murray market response rep right here at ramsey and our ramsey education team. $16,000 paid off in six and a half months. Count it down. Let's hear a debt-free scream.

Three, two, one. I'm debt-free! Yeah! Woo! And that, ladies and gentlemen, is how it's done. Boom. Just like that. Just like that. Just like that.

Man. See, you can do this. I don't know if you're 27, if you're 37, or if you're 67. I do know in 30-plus years of doing this show that I've already talked to someone just like you. And they've done it. Yeah, I'm talking to you. I mean,

Steven doesn't motivate you? Why not? What a sharp young guy. Why don't you be like Steven? Come on, man. Come on, man. What are you waiting on? You sit around being normal? Normal sucks. You don't want normal be like steven i love it this is the dave ramsey show Thank you. our scripture of the day proverbs 19 21 many are the plans in the mind of a man

but is the purpose of the lord that will stand john maxwell said leadership is not about titles positions or flow charts but it is the purpose of the Lord that will stand. John Maxwell said, Leadership is not about titles, positions, or flow charts. It's about one life influencing another. David is on the line. David is in Dallas, Texas. Hi, David. Welcome to the Dave Ramsey Show.

Hey, Dave. Thanks for taking my call. My honor. I'm a fireman, and I'm getting close to retirement, and I know I listened long enough to know your opinion on pensions. So my question is, I have the ability when I retire to take a drop or a cash option out of my pension. And my question is, is that something I consider doing?

Is it cash out of it completely or what? Well, I can take up to 75% of what I've contributed. So I'm 60 years old currently. At 62, that would be a cash option of about $245,000. If I make it to 63, that'd be a cash option of about $245,000. If I make it to $63,000, that would be a cash option of about $260,000. Now, granted, it reduces my pension. Sure, sure. Okay, here's the deal. The amount of money that you leave in there creates the payments that you receive, right? Yes, sir.

Yes, sir. Pretty simple. And so if you pull that out, it reduces your pension, of course. Now, here's the rules though pensions are highly regulated and so they are going to be managing it very conservatively they have to by law and so your calculation on your return on this quarter million dollars is going to be somewhere around five percent yes sir maybe six percent on your money. Okay. And, by the way, when you die, your estate gets how much of that pension? Zero.

Well, I have a follow-up question after. Well, you have a survivorship option for your spouse, right? I do. Okay. My second part of that is, do I go ahead and take the maximum, no survivor, and purchase some term insurance that would protect my wife? Yep. Because here's the thing.

Okay, let's just say that you and your wife are driving along at 64 years old, and the milk truck hits you, okay? Yes, sir. Your estate gets zero. Right. Survivorship option or not. It gets zip. Now, you pull $250,000 out of there, roll it to an IRA, direct transfer rollover. You got no taxes on it.

You invest it in good mutual funds. Something happens to you or her or both of you, that money is still in your family name. Okay. It's a $250,000 swing in this discussion, buddy. Yes, sir. And you can invest it in good discussion, buddy. Yes, sir. And you can invest it in good investments, and it'll pay more than 5% to 7% that that pension is paying. Right.

Well, and I've always known, I've always been a little skeptical of pensions just because there's so many outside influencing factors. Yeah. So I've contributed to the other. Yeah, I mean, that might be, it might fail, there might be some crook involved that's not even it the bottom line is just the structure of the thing is the money's gone when you die or it's not i pick the one where it's not i want it to go to my kids instead of back to the union right right exactly good choice so i appreciate it sir thank you hey thank you for

your service brother we appreciate you taking care of folks out there in texas man jennifer's with us in tyler texas as well hi jennifer how are you hi dave i'm well how about yourself better than i deserve what's up thank you um so i'm i have a question about college we're on baby steps four and five paid off house good so our focus right now is getting our kids through college. Good for you. We have to restart this year and one next year. Good for you. So we've been looking at the American Opportunity Credit and the Lifetime Learning Credit, and someone told us we had to pay a certain amount of cash up front before we could pull out of our 529 in order to get that credit.

Does that make sense to you? I'm not familiar with those credits. I apologize for being stupid what do they do i mean i know i know what a 529 is and you can pull money out of 529 regardless of whether you pay cash or not but what's the credit right the credit it's a tax credit that you get for like the lifetime learning oh i do know what that is no no no okay double check with a tax advisor because i'm not i suck at taxes i don't do my own okay but no the 529 can be used to pay for college period that is the equivalent of paying cash for college oh it is the equivalent yeah you don't it's it is

it's real money it's cash money coming out of the 529 to pay for college you do not have to use money outside 529 to qualify for those i don't think that's what i needed to know i don't think i want you to double check me because i'm admitting up front that i'm ignorant about this but um here's the thing how much is the credit um it depends on your income actually i don't know particularly it's been a while since we've looked at it we've been meaning to call you for a long time okay um but um yeah honestly i don't remember the details it's been a while it's not much though no it's not okay here's the thing because i'm somehow 10 grand stuck in my head over the lifetime of the thing on the lifetime.

I don't know the other one, but this is way back in the recesses of my stupid brain. But anyway, the thing is this. What you have to be real careful of is that you don't let government policy cause you to do something stupid to get a small amount of money. Okay. It's better to just walk away and um show them the hand right and just do like do smart money stuff and if the government wants to give you money too that's okay but i'm not going chasing government money to get you know i'm not going to chase go around the barn three times for four thousand bucks and screw around end up costing me 40 because i was goofing up here does that make

sense absolutely absolutely people made major in that it's like they step over dollars to pick up nickels yes i understand what you mean yeah don't do that and i'm not i'm not positive i'm right about that but let's say that they require that you took out a student loan to get this well screw it i'm walking away oh no i wouldn't i wouldn't do that. I know. That's an example. We've been listening to you for too long. I know, but, you know, that's an example of what I'm saying, doing something stupid in order to get a little stupid government credit of some kind. But if you can pay $4,000 cash outside the 529 and you get a $2,000 credit,

yeah, I'll do that. That's fine. That's what we thought it was. Yeah, because you got – that may be about the numbers, actually. But you got the cash flow to do that because you all got good money and you don't have any debt and you've done a great job with your money. You're killing it. Right.

So when you say go see a tax specialist, we've always done our own taxes. Are you talking about like an accountant? Yeah. Or just a real tax agent. You can jump on at DaveRamsey.com and click on the Endorse Local Provider for Taxes and just call them and say, can I pay you for a half hour of your time on the phone or can you just help me because I'm a Dave Ramsey listener? Can you answer this question for me? And they may just help you for free on the phone because they may just know the answer and I don't.

That's the problem. That's the beauty of this show. It's one of the few talk radio shows where I say I don't know sometimes. Well, I appreciate that. I'd rather you do that than leave me wrong. Yeah, well, really. Me too. Thanks, darling. Appreciate you calling. Open phones at 888-825-5225. John in Toronto. John, I'm short on time. Go straight to your question, brother. Hey, Dave. Thanks a lot. No problem at all. Okay, I'll be quick to the point. point so about four years ago my brother and i purchased an investment property uh we were both still living at our parents house we purchased this home for about four hundred thousand dollars um real estate

has gone up which has been great and it's risen up to now six hundred and twenty thousand dollars and it's been rented ever since wonderful on that property about three hundred thirty thousand dollars okay since then a year ago my fiance and and I purchased our first home and moved into it. We bought for $639,000. Again, graciously, real estate's gone up and it's now worth about $720,000 and we owe $490,000 on it. And your question's what? Lastly, sorry? Your question's what? Quick. My question essentially is, should I continue to buy real estate? These real estate's going up, interest rates are really low. Should I continue to buy real estate and let the market drive the prices up or should i be just paying our homes down instead market the market is wonderful sometimes it drives

prices up sometimes it doesn't uh you called dave ramsey dave ramsey doesn't borrow money i own several hundred million dollars worth of real estate i love love real estate, but I pay cash for all of it or I don't buy it. And so if I woke up in your shoes, sir, I went broke doing what you're doing in my 20s and got the opportunity to start again. If I woke up in your shoes, I would probably let your brother buy you out of the investment property, put some cash in your pocket, and you and your fiance have an awesome life getting your house paid off, And then start buying some real estate, rental real estate, with cash as an investment. You're probably not going to do that, but you did ask me what I would do. That puts this hour of the Dave Ramsey Show in the books.

We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus. This is James Childs, producer of The Dave Ramsey Show. On your smart speaker, you can add our skill by saying, Alexa, open the Ramsey Network skill. From there, you can listen to all our shows. Ask Dave money questions like, how do I invest my money? Or what is the debt snowball?

Find out more at DaveRamsey.com slash smart speaker.