The Ramsey Show - App - Don't Turn a Financial Safety Net Into a Hammock (Hour 1)

Episode Date: April 6, 2020

Anthony ONeal, Debt, Career, Retirement Tools to get you started:  Debt Calculator: http://bit.ly/2QIoSPV Insurance Coverage Checkup: http://bit.ly/2BrqEuo Complete Guide to Budgeting: http://bit.ly/2QEyonc Interview Guide: http://bit.ly/2BuGnZE Check out other podcasts in the Ramsey Network: http://bit.ly/2JgzaQR 

Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and a paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host, Anthony O'Neill, Ramsey personality, number one best-selling author, joins me today on the show as we answer your questions about your life and your money. And boy, both of them are mixed in together right now. The phone number is 888-825-5225. That's 888-825-5225. So, Anthony, your message of hope is tonight.

All of the Ramsey personality's message of hope, you're going to be cleanup batter, which means you're the strongest hitter. And so we're going to put you in there and let you hit it out of the park tonight. And, you know, you speak all over America on money, God's and Grandma's ways of handling money, the same as Hogan or Rachel or me. And yet each one of us have our own individual take on it. You came, for those of you that don't know Anthony's story, came to us, was a youth pastor of a huge youth group that you had built with a wonderful church down in Jacksonville, Florida.

Yes, sir. And so you and I, of the four of us probably have the most uh preacher style of speaking right we're the most uh preacher-esque in our speaking style got accused of that on a tv show the other day and uh he's like guys like you just sound just like a preacher and i said thank you thank you and so but i mean there's something to that i think there's something about speaking in in church on the subject of God that does teach you to use a little different metaphor approach when we're speaking, delivering messages. And you're going to do that tonight. Yeah, I am.

I am, Dave. And you're right. You know, one thing as preachers, we're taught and we eventually learn how to use what happens to us in life and turn that into a powerful message to help whatever we're teaching. And so I'm not going to give too much away for tonight because I really want the people to watch it. But last week, you, Hogan and Rachel really did a phenomenal job talking and teaching American people what to do with their finances during this time. I said, you know what, let me just step back and just be honest and transparent with people about something that happened with me last week. Just a little sneak peek. I went running, Dave, for the first time in my in Columbia.

So Columbia is a country here in the area. And it was dark. And I got a little nervous. Columbia is out in the country, not Columbia, the country. Right, right, right, right, right. A rural area. A rural area. Yes, sir. Yes, sir. a bunch of trees and land and deers all right and so you know i'm not the medellin cartel okay right gotcha okay that's why i like this show with dave um but you know i went running

and and dave to be honest i got a little nervous because it was dark you know i'm scared of deers i'm scared of snakes just coming out and there was was no light. But Dave, I seen something in the midst of my running and I want the people to tune in tonight because that thing just really gave me some words of encouragement for the people tonight to watch my message of hope this evening. All right. And it wasn't a UFO. No, it was not.

Okay. It was not a UFO, no aliens, no deer, no messages from outer space. No, sir. No,

sir. But it was something that will bless the people amen amen it will it's a good it's a good talk i've seen it obviously and you're uh you're an incredible communicator so you guys be sure and tune in at anthony o'neill on instagram facebook youtube certainly at dave ramsey., and you can find all of our messages of hope. By the way, if you go to any of our sites, but, for instance, those of you watching this on YouTube, if you scroll down just a little bit, you'll see all the messages of hope in a line. If you're on our YouTube channels, we put them all on there.

So Rachel Cruz, Chris Hogan, Christy Wright, Dr. John Deloney, Ken Coleman, and now tonight's Anthony O'Neill. And so now, Dave, I definitely want to say this. Parents, get your kids, get your kids, because I'm even talking to the young people as well tonight. Oh, yeah. So get your kids, put them in front of TV, pull it up on YouTube. You know, I'm talking to young people where they are as well and how they're feeling. So I definitely want to make sure that everyone, young person, child, young adult, parents,

watch it tonight. And again, Anthony speaks to high school and college students more than probably anyone else in America right now. Yeah. Tens of thousands of them a month when we're working. Right now, we're all sidelined in terms of our visiting your town and speaking we're all doing that digitally right now is the only shot we got so um but uh good stuff the other thing that's fun is after your number one bestseller debt-free degree uh we kept getting a lot of

questions okay that's great but i got student loan debt yeah before you wrote that free degree. How do I get out? And obviously, Dave Ramsey, Rachel Cruz, Chris Hogan, we've got books around here on getting out of debt, but you were getting tons and tons of questions specifically. And after the Borrowed Future podcast had a million downloads, people are saying, okay, yeah, that's great, but I'm in debt. Yeah.

And I know it's a problem. I know it's evil. I know the student loan thing is out of control. And so we've decided at Ramsey, and we've done a couple of these already, to do little, I call them chapter books. They're about a chapter long, chapter and a half long of a normal book. Yeah. And this one, I think, is 64 pages. Yes, sir. I read a different one the other day. It was 37 pages. But we're calling them quick reads. Yes, sir. I read a different one the other day.

It was 37 pages. But we're calling them quick reads. Yes, sir. It's not a full book. It's a quick read. Yeah. And it's called Destroy Your Student Loan Debt. Yeah.

And, Dave, it seems all it is. I took a deep dive into Our Baby Step 2, where we teach how to get out of debt using the debt snowball, excluding your mortgage. And so this book is for that individual who may not even really be familiar with the baby steps, you know, and we just really do a deep dive into it. We even address in the book, I talk about my thoughts on student loan forgiveness and how I do not agree with it. When is the best time and the only time to possibly refinance your student loans? We answer all the questions, but the key thing is we show you how to get out of debt quickly and not just with the quick read, Dave.

We've even came up with a student loan calculator showing you if you follow the information that's in this book, type in the numbers on this calculator on my website, anthonyoneal.com, we'll show you how quickly you'll even get out of student loan debt. Yeah, just anthonyoneal.com slash resources

has a ton of stuff. Yes get out of student loan debt. Yeah, just anthonyoneal.com slash resources has a ton of stuff on the student loan debt subject. And the new quick read, I guess today is actually the publication of it, right? Just launched today. Yeah. And it's already boom, boom in day. Yeah, it's selling like crazy on Amazon already. Yeah. And so you can pick it up on Amazon as a friend. It's 10 bucks. It's a chapter, okay, chapter and a half, maybe two, if you want to call it that. But I mean, whatever you call 64 pages in a chapter, okay, a chapter and a half, maybe two if you want to call it that. But whatever you call 64 pages in a book, it's a little paperback chapter. Yes, sir. And we're calling them quick reads. And we've got another one coming out very soon.

And we're going to start doing more of these because a lot of folks want to consume content in that bite-sized size. So we like the idea around here from a publishing perspective. We're going to do regular books as well. But some of these ideas we need to get out fast this is something we can turn quick yeah doing a full book takes a year year and a half to get the whole thing laid out and the whole process and everything and but uh we got this up and going really really fast so again destroy your student loan debt you can get it at daveramsey.com on our website and our store. You can get it at AnthonyO'Neill.com slash resources. And you can get it at Amazon, wherever great books are sold.

It's available. We've already got it up in all of those places. Call our customer care team. They're working from home, but they can serve you. And we'll get one of these new ones shipped right out to you. Or buy a box of them and give them to your friends. Yes, sir. Destroy your student loan debt.'s only 10 bucks call customer care ramsey concierge team at 888-22-PIECE

888-227-3223 back with your questions and anthony o'neill right here on the dave ramsey show Business leaders hiring right now may be the furthest thing from your mind, but the fact of the matter is we will recover. One of the smartest things you can do for your business is to be prepared. I want you to know my friends at LinkedIn are ready to help you find the right people for your business when you're ready to hire them. LinkedIn Jobs matches your role with qualified candidates so that you can find the right person quickly. LinkedIn Jobs looks at things like collaboration, creativity, adaptability, and puts your job post in front of qualified candidates every day. So your job is seen by people looking

for jobs like yours. That's why we use LinkedIn Jobs when we hire here at Ramsey. When the time comes to hire for your business, you can get $50 off your first job post at linkedin.com slash Ramsey. That's linkedin.com slash Ramsey. Terms and conditions apply. Anthony O'Neill joins us this hour as we talk about life and money here on the Dave Ramsey Show. In the middle of a, as Ken Coleman said 93 times the other day, unprecedented. He likes that word. Unprecedented moment in time. It is unprecedented.

It is. It's unprecedented how many times he said unprecedented. But aside from that, it's wacky. This is a wacky, weird time in our world and in our culture. It is. Jade is with us. Jade is in Tennessee. Hi, Jade.

Welcome to the Dave Ramsey Show. How can we help? Hey, Dave and Anthony. How are y'all doing? Great. How can we help? Okay, so I am blessed to say I'm attending my dream school, University of Tennessee. I just finished up my freshman year, but, you know, attending UT comes with a price,

and I unfortunately had to take out a student loan this year. And I got a scholarship for the rest of my time at UT that will pay for all of, you know, tuition and mandatory fees. So I'm wondering what I can do now to pay off the loan that I have so I won't, like, have so much money and interest when I graduate. I know, like, I already have a job, so I make monthly payments as it is, but I'm wondering how much money I should put. Like, do I put my whole paycheck? So how much did you borrow?

It ended up being, like, $21,000. For one year? Yes, yes. The University of Tennessee is $9,000. Yeah. year yes yes the university of tennessee is nine thousand yeah well it was um your dorm and stuff like that as well yes yeah i'm a freshman so i had to live on campus and get you know the most expensive meal plan and where are you working at right now jade i I work for a tourist attraction in Chattanooga.

Okay. And how much are you making a month? I make around, I'd say like $500, $600. I'm not working right now due with the whole coronavirus thing. Great. Yeah. So you've got the rest of your years figured out where you go without more debt, correct? Yes, sir.

Your interest and payments do not begin until six months after graduation. Right. Yes. I would let it sit there until you graduate. Yeah. I would let it sit there until you graduate, and I would use every dollar that you can find to pile up to make sure you complete the degree without any additional debt. That's your first goal.

Then we'll worry about getting the student loan paid off after you graduate. What are you studying? Human resource management. Okay. That's a good one right there, Jay. Here, listen. Dave said it, and that's exactly what I was there, Jay. Here, listen, Dave said it, and that's exactly what I was going to say. And I'm going to say just a little bit more bolder

for you. Let it sit there. And while you're working, save all of your money. Do not go out as much as possible. Enjoy the college experience. You know, you're at a great school. Dave Ramsey was over here smiling when you said it. So, you know, it's a great school but i want you to be young and wise not young and dumb okay so young and wise is i'm working i'm going to get through school i'm gonna make sure i'm gonna borrow nothing i'm not going to touch any credit cards i'm not going to make any dumb decisions and just you should be able to graduate making five to six hundred dollars a month you should be able to graduate with five to ten thousand dollars if you do it right and then you can take that and put that towards your student loans as soon as you graduate. But the key

thing here is, Jade, is do not touch any more debt. You hear me? And after the coronavirus is over, if you can even work more, work more. Yeah. If you had twenty thousand dollars in your bank account when you graduate, that wouldn't make me mad. Nope. It would make me happy. Because then you could write a check and pay off a student loan as soon as you graduate. That's the thing. And so I guess doing this show for so many years, I have trained myself.

I didn't always do this to listen to the words the people use the words that she used made her sound like she really felt she had no other alternative she was trapped yeah forced to couldn't have done it otherwise right thing um and really that was not true it wasn't true i mean because look at it she ended up getting the scholarships i just feel as if sometimes she did it a year late exactly and so i think sometimes people are not willing to put in the work and to be patient uh for it to come to pass and so i'm with you dave it's I hate hearing it. Well, I had to take out a credit card. Well, I had to take out this. No, you didn't.

You chose to go this route when you could have went a different route that would eventually have led you to the route where you wanted to be at. And that's what the book Debt-Free Degree is really all about. It's about showing you the things you have to do. You have to get scholarships. You have to work a lot. Yes. You have to choose the right school. You have to choose an inexpensive school have to work a lot. Yes. You have to choose the right school. You have to choose an inexpensive school.

Yes, sir. And you don't have to choose the most expensive meal plan. She did say she did that. So she's realizing a few of the things she tripped up on. But more than anything, what I want you guys to work with your young people on out there, and you young people, Anthony and I are always harping on this, is that debt-free degree is, much as anything it starts with the proper mindset yes that you're not trapped yes you have options yes sir and uh that that's why the book

became a number one bestseller because it walks you through that and so um you know if you say well i'm you know i'm going to xZ famous school and I can't afford it. So I'm trapped. Well, no, you're not trapped. You're just going to, you know, you're going to a Bentley dealership when you have used Chevrolet money. Come on, Dave. You know, and so that's what you've got. You just need to stay off the Bentley lot. You have to. And Dave, last night I was on IG live on my Instagram and I met a young lady. she came on with me and she got her master's degree um as a single mother unfortunately she had a you know a baby when in earlier earlier years in her bachelor's program but she said i did not want to graduate with any debt and so she went a long period of time uh took some extra time, but she graduated 100 percent debt free.

And she's a school teacher now and she's not making that much money, but she's debt free with a young boy. And she said, I just made the sacrifices from listening to Dave and I just didn't want it. And so when I hear people say like that, I'm a single mother, I work my way through school. And when I hear other people say, well, I had to, well, I get confused. I think the lesson we take away from this is not that Jade's not a bad lady. She's going to be fine. She'll work her way through this. We'll help her.

We're not picking on Jade. That's not the point. But I think the point is for everyone to listen to the words you're using because they may reveal what's going on in your heart that you need to shift because you can decide that i'm not trapped yeah yeah um as a matter of fact i'm an old hillbilly as soon as you start telling me i'm trapped i'm about to fight don't try to trap me that's not a good idea i don't like being trapped that's me too and so uh you know i like i don't like being told what to do and i don't like being told there's no options i don't like being told there's no options. I don't like being told it's always that way.

Everybody does it that way. As soon as you tell me that, the first thing I'm going to do is say, uh-uh. Yeah. But that's what I want you to set that in your head. Be careful of the language that you allow your children to use in regards to this if you've got a senior in high school. Oh, everybody. Oh, as soon as you say that, honey, everybody is a bad financial planner. Come on now, Dave.

That'll get you. All right, let's go to Sarah in Virginia. Hey, Sarah, welcome to the Dave Ramsey Show. Your question for Anthony and me. Hey, Dave and Anthony. I just had a question. Dave, I actually called you about two years ago and asked if I should move out of my parents' house. And you said, you know, yeah, you should, and it's been great.

But I recently got furloughed, and so now I'm trying to figure out what to do, and my parents have graciously offered to let me move back home just due to everything. And then also my sister and her husband have offered for me to move into their home. So I'm not sure if I should move out, like back into either home. Are you under a lease? Yes, I am under a lease. It is up May 31st. It's up May 31st.

Okay. And how long ago were you furloughed? About, I would say, like two weeks now. And are they giving you any indication when you might be back? No, it's a private practice and it's elective surgery. Okay, but sounds like that'll be back up and running when the economy is. Is there something you can do to make some money in the meantime? I've tried to look at part-time jobs like from work from home, but there haven't been lots of opportunities. There's a lot of delivery things out there, a lot of stuff in grocery stores out there,

just to keep some money coming in the door. I would fight to do all of that and survive this and turn the corner if I could. If you can't, there's no harm in hitting the safety net. Just don't make it a hammock. This is the Dave Ramsey Show. If you do this one simple thing that we all do, you are literally at risk of being hacked and someone stealing what you've worked so hard for. Do you ever use public Wi-Fi? I'm talking about getting online at a coffee shop, a store, the airport, or even at home. Hackers can use a simple $100 device to mimic Wi-Fi,

and with just a little bit of skills, they can take over your financial life. This means you may think you're on your bank's site or app or securely making that purchase online, but hackers could see and steal that information. That's why I trust CyberGhost VPN. CyberGhost thinks about cybercrime so you don't have to. You can try it for free for seven days. Protect up to seven internet devices and keep all of your internet connections secure. That's CyberGhost VPN. Download it today from your app store and be secure in seconds. Number one best-selling author, Ramsey personality Anthony O'Neill, joins me today answering your questions on The Dave Ramsey Show. The phone number, 888-825-5225.

If you want to see a really unique and special message of hope tonight, be sure and join Anthony for the final of the Ramsey Personalities Messages for Hope. You can see it at Anthony O'Neill on Instagram, Facebook, YouTube, and any of our Facebook or YouTube pages as well. Certainly mine, and you can check our YouTube page and DaveRamsey.com. So all over the place, all kinds of information and things there to help you out. About 30,000 of you in the past, I guess it's six days now, have taken advantage of, no, no, no, it's longer than six days. It was almost two weeks. now have taken advantage of, no, no, no, it's longer than six days.

It's almost two weeks. Yeah, have taken advantage of the 14-day free trial on Financial Peace University. That is a record, and we're glad that we are able to help you. Many of you are at home, of course. Our whole team is working from home, with the exception of about 30 out of our 1,000 folks who are in and out of the building for a skeleton crew to get these shows done. But the rest of them is there. So if you're one of those type of folks and you want to binge watch something that will value, as opposed to some of the things that everyone seems to be watching,

oh, there's some funny stuff out there. But, yeah, check out uh check out our 14-day free trial it's the entire premium package of financial peace university and um davramsey.com slash hope has a full list of products uh including we just put up the middle school curriculum and a few other things for the teens and at home. And so the high school curriculum has been up there and been available. And we put the middle school up this week or weekend. I think it went up Friday. And so all kinds of new stuff being added all the time for you to do at

DaveRamsey.com slash hope. Digital delivery, so don't even have to leave your own home. Stay safe. And, of course, you can go there, and that's where you can also get the 14-day free trial for Financial Peace University. Warren is with us. Warren's in New Jersey. Hey, Warren, welcome to the Dave Ramsey Show.

Hey, Dave. Thanks so much for taking my call. It's an honor to be here with you. You too. How can Anthony and me help? So my wife and I are split on this idea. I'm leaning a little bit towards one way. She's strongly leaning the other. We have three debts left on the consumer side. They're all student

loans totaling about $38,000. I have a unique opportunity or may have a unique opportunity to take a job at a hospital with hazard pay. They come in eight and 13-week commitments, working either three to four days a week. I'm currently a hospital tech, transitioning to nursing in about a year, or nursing school, I should say. My rate right now, my hospital is 17 an hour. The hazard pay is about 42. If I can grind for the next 13 weeks, I think I can pay off the rest of our student loans and put a little money in the bank. That's however, asking my wife then to have a babysitter

come up with the kids during this time and put me at risk for COVID-19 since the hospitals are paying that because their staff is sick. I understand her concerns and they're valid um she also understands why i would want to do that she's got it's valid too um so your first thoughts on that and if you and then i there's two things that come after that depending on what you think you're a medical tech you know more of the risk about the risks than anthony and i put together yeah looking in from the outside that sounds kind of scary but i do know that nurses and doctors are in there every day. Thank goodness. Helping people. Thank you. Applause, applause. And so but I don't know. I mean, if you're young and healthy, the and you don't have respiratory issues, from what I understand as a layman, your risk of death would be low, but you could get very ill, and that could cause problems for your family. It could cause problem inconvenience with quarantines and all kinds of other stuff.

I suppose I don't know how to assess that. What do you think as a tech? You don't sound like you're worried about it. Of course, you're in the medical field. You're going to be in there with sick people anyway all the time, right? That's just it. Even my hometown hospital, every bed is a COVID bed right now. And they're saying in the New York metro area, 80% of us will be infected at some point anyway. Now, I would never say that to my wife in those terms. But that's just the reality. I am a 33-year-old with no non-smoker, with no respiratory issues or history.

So the chances of me dying, like we said, are low. Yeah, like 1% statistically, right? Yeah, it's low. But even just from where I live, the chances of me catching it are high. I'm not sure you can drive to the hospital with a 1% fatality rate. Driving on the New Jersey Turnpike probably has a higher fatality rate than that. Warren, you know something else to consider too. Warren, what about this? We get your health, but what about your wife and it sounds like you have a child. Are they healthy as well?

If you do come home with it, do they have any respiratory issues or anything like that? No. Thankfully, we do have – we actually have four small children. We – thankfully, no one has any heart issues or respiratory issues. We're all non-smokers, my wife and I. But the reality is it looks like the disease is so contagious that if I get it, it's unlikely that no one else would catch it. So that's a consideration.

The other consideration is as well, even in my current hometown hospital that I do work at, it's still every patient is a COVID patient. So you're already at risk, going to work every day. I'm already at risk. What does the change in, what do you perceive the change in duties, how much does it increase your risk? There would be no increase in risk from the hospitals out of New York City to where I live or work now. It's just the other hospitals have been, just have more sick staff at this time than my hospital does. Yeah, but I'm saying the bottom line is you're dealing with COVID patients already,

so you already have some level of exposure today, correct? Correct. Now, I've taken a week off to actually get up to my life insurance, as morbid as that is. So I'm per diem, so I have the flexibility to put shifts off, and I also have the flexibility to pick up this assignment as well. Well, I think that this is a decision the two of you need to both have peace about. Sharon and I don't move forward on major decisions. Obviously, some health care workers are going to choose to provide health care. Thank you for that.

And then there's the real life parts of that choice which is what you're wrestling with i don't think anthony i can tell you to do this or not do this we don't know again you know more about the medical than i do i just think it's interesting to walk through the critical thinking and try to set the emotion of the fear aside what part of the fear is rational good fear and what part of the fear is just generally we're all freaked out about COVID in general. And I think it's a good exercise for you and your wife to go through. And what Dave and Sharon would do would be we would pray about it. If we couldn't both get peace about it, we won't go forward.

But if I were in your shoes and I felt like you felt, I would be challenging her to not make an emotional decision but make a wise decision on the other hand i'd be challenging you to listen to your wife if she's being level-headed and wise and that's a good you know it's a good counterbalance so we don't make big financial decisions we certainly wouldn't make this decision without both of us feeling good i would recommend you don't take it unless the two of you can talk it through and she's on board okay don't take it against her will but also right i'm not gonna argue with her emotions i want to argue with her wisdom does that make sense sharon and i have this discussion because sometimes she

just gets scared about something or pissed off about something, or I do. And she's like, you know, we don't want to argue with your emotions. I want to talk this through from a critical thinking skills standpoint. You're already exposed. You're already a health care provider. What's the differences in the risk? You've got four little kids at home. You want to be there for them.

You want to not cause problems for your own family. But you're already a health care worker. So, wow, that's a lot of, there's a lot of back and forth in this discussion if I'm in your shoes. But again, we're not qualified to help you assess the medical risks other than ask

you questions that make you think. Very interesting. Very interesting. Don't do it just for the money yeah do it because you want to provide health care yeah and because you have an agreement with your wife wow this is the Dave Ramsey show folks I love telling you about well-made, well-thought-out products. Today, I'm talking about Grip6 belts. I don't know about you, but I'm not a fan of traditional belts.

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visit grip6.com that's grip6.com. That's GRIP6.com. Evan's in North Carolina. Evan, welcome to the Dave Ramsey Show. How can Anthony and me help? Hey, Anthony and Dave, how are you guys? Great. Good. Yeah, so my question revolved the term take-home pay. I heard you use it in general rules of thumb, and I've heard it elsewhere in financial advice, and I was just wondering what constitutes take-home pay. It should just be after taxes. After taxes, so not after insurance and retirement contributions? Right, because you would do those things. If you didn't have those available through

your company, you would just do those out of your checking account at home. Like, for instance, you were self-employed, you would pay your taxes, and that would be your take-home pay, and then you can make your decision from there on the other stuff. I mean, you do your retirement to the side, you do your insurance to the side. I mean, there's a lot of stuff you can have taken out of your pay. I mean, sometimes you'd have the car payment paid at the credit union through work out of your pay, but that's not the definition of take-home pay. Okay, so from a budgeting perspective, through work out of your pay, but that's not the definition of take-home pay. Okay. So from a budgeting perspective, should I retroactively add retirement contributions

because technically those numbers aren't reaching my checking account. They're going straight into an investing account. Unless you're trying to do something weird with your budget i wouldn't fool with that but uh um but the only reason i use take-home pay the only thing we really use it for around here is we're trying to see a how much available cash do you have in your hand to pay your bills with that you got at home and in that case you're doing that after retirement and after because you know what are you getting home with to pay bills with um then the other place we use it is uh is 25 percent of take-home pay on a 15-year fixed rate as a gauge for your mortgage but you know like like if you're running

your every dollar budget anthony you you don't take you know you you don't add retirement back in and then take it back out every dollar budget no sir no sir my take-home pay for me is like what you're saying day what is deposited in my account that's my cash that's what i budget off of and so evan so what you're asking dave is should i add that in my budget no just whatever your check is that's your take-home pay you know when you get paid for your for budgeting purposes yes for budgeting purpose yeah that's how i would treat it because but the technical definition of take-home pay is after taxes yes okay but let's say let's say you got a 401k coming out okay so you add it back in and then you take it back out in your budget that's just creating extra work yeah if you're doing it for budgeting purposes

is that logical yeah yeah that makes sense okay you're just adding a step to your budget that's not necessary. Instead, you go, this is how much cash I got. Every one of those dollars needs a name. And that's how you do yours, right? Yes, sir. Okay, and that's how you teach folks, right? Yes, sir. Okay, all right, making sure we got the same thing going.

My head gets screwed up with the budgeting app because my brain still works on a yellow pad. Yeah. I mean, every dollar is much better than a yellow pad because it's kind of designed off of the way a yellow pad works. I put the number at the top that I got to work with, and I give every dollar an assignment. Yes, sir. And that's why it's called every dollar. Yes, sir. It's just a new generation thing, Dave.

You're getting a little bit older. Hey, hey, hey, hey. You're going to get hit on the air. Right here on the radio. Ageism right here. I just heard it. Ageism. Andy is in Washington.

What's up, Andy? Old man Ramsey here to help you, buddy. Okay, one old man to another. Thanks for taking my call. Sure. Andy, my third year as a retiree, and I want to be smart about how I take distributions out of savings going forward here. Obviously, with the downturn in the market, everybody's IRAs have taken a hit. We can live off of the streams of money that are coming in right now. So our Social Security and our pension.

And I also supplement my income with I'm a substitute teacher. Oh, wow. That's good for about $8,000 a year. Yeah. But not right now, obviously. Yeah. So how old are you? I'm 69.

And how much is in your IRAs in retirement? About $270,000. Great. Well, you have mandatory withdrawals, required minimum withdrawals, beginning at $70,500, right? Right. And until then, I would take nothing out, and after that I would take the minimum out,

and I'm going to let it grow as much as I can let it grow. I mean, that's the direction we've been going. Let me see what this SECURE Act, it changed something. I want to pull this up and make sure. Now you can put money. Okay. You couldn't put money in after 70.5, and they've changed that. But now it is still 70. a half to take it out.

It's still required. Oh, no, no, no, no, no. Here it is. Required minimum distribution started at 72, not 70 and a half. That changed it the first year. I thought I remembered that. Okay, good. I'm glad I straightened myself up.

So you can let it sit there with taking nothing, and you say you've got plenty to eat on, right? Oh, yeah. Yeah. I'd let it grow. Okay. Does that make sense i do have yes uh i do have one counter thing on that and that is is that my wife's got a degenerative disease and we have been thinking about uh tapping it for a nice vacation uh oh yeah you know well if you want to if you want to spend some of it for that um and enjoy it while you can so to speak absolutely absolutely but i would not take

it out because of the math and i would not take it out because of covet or because of the dive in the market or something like that but if you want to take her on a vacation absolutely i would do that that's why you saved the money and worked all your life thank you all right thank you very much hey man thanks for the call and you know anthony the other thing has come up is they've uh taken the 10 penalty off of a 401k for those under 59 and a half which it just occurred to me i am now 59 and a half i told you you're getting wiser dave you just there's a lot of dave's age coming up in this segment i didn't say your age i just said you're getting wiser yeah you did i heard you you weren't unclear and uh but the uh but the you're allowed to wait until 72 to take it out that was the part of the secure act in january which is great but now

they're offering you the ability to take out as a part of the part of the SECURE Act in January, which is great. But now they're offering you the ability to take out, as a part of the stimulus package, take out your 401k with no penalty, only taxes by the end of the year. And you get to pay the taxes over three years, or you've got time to put it back

and not get tagged if you want to. All of this inviting people to screw around with their 401ks. And unless you're facing a bankruptcy or a foreclosure, please do not take out money out of your 401k. Yeah. I get a lot of millennials asking me that right now, Dave, who are on a furlough. Should I just borrow from my 401k? No.

Do not do it. Do not touch it. Because you're going to get back to work. And we're going to get you through this process. But don't touch your future because of a little rocky present right now. We're going to get back to work you know and we're going to get you through this process but don't touch your future because of a little rocky present right now we're going to get through it yeah the future you'll be pissed yes when you find out what that ten thousand dollars would have been worth 10 years from now 20 years from now that you take out because you know go get one of these delivery jobs one of these jobs that every i mean uh ups fedex uh amazon's hiring 100,000 people

targets hiring kroger publics is hiring aldi is hiring everybody in those sides of the world are hiring and uh you know go pick up one of those things if you're furloughed and it'll be the year that you remembered that you stocked groceries back in 20 when i did not cash out my retirement when you're old you'll be glad you did that yeah yeah and you know the stock market better than me dave but i'm pretty sure it's going to come back strong and our money is going to grow even a little bit more yeah because of what's happening i think it will so i'm not touching it i think i think there's uh there has always historically yeah i mean history is all you can look at you know past performance is not an indicator of future performance yes it is yes it is it actually is it's the only thing that's an

indicator of future performance so we don't know yeah what future performance is unless you know something about the company that's bad the dna of the company but the the bottom line is is that all the major downturns in the market since the Great Depression have been followed by a rally, a money-making opportunity. And the people that get out on a downturn not only lose the money because they get out on a downturn, they miss out on the rally. There you go. And that's all the historical data. That's what's on there. All you've got to do is go to, like, American Funds or Fidelity or Vanguard, any of these major mutual fund websites, and they've all got great examples.

Look at the actual what the stock market did following a downturn like this. Please do not cash out your stock. Yes. And please don't buy single stocks. And don't get the other side. Don't get greedy because you'll get your head taken off. That's exactly right. Thank you, Dave.

Exactly right. Anthony O'Neill joins me this's exactly right. Thank you, Dave. Exactly right. Anthony O'Neill joins me this hour and this day here on the Dave Ramsey Show. In the middle of these uncertain times, Ramsey Solutions wants to give you some hope. For the very first time ever, we're giving you Financial Peace University free for 14 days. Go to DaveRamsey.com slash hope so you can watch from home.