The Ramsey Show - App - “Get Pissed Off for Greatness!”

Episode Date: June 14, 2022

Dave Ramsey & George Kamel discuss: Buying property when saving up to build a house, How to handle a settlement from a car accident, What to do with a bad insurance policy, How intense to be in baby step 3. Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. We help people build wealth, do work that they really love, and create actual amazing relationships george camel ramsey personality host of the fine print one of our podcasts on the ramsey networks is my co-host today as we answer your questions about your life and your money the phone number

is 888-825-5225 the call is free and some say the advice is worth exactly what you pay for it. 888-825-5225. Brent is going to start off this hour in Akron, Ohio. Hi, Brent. How are you? Hi, Dave. Thanks for taking my call. Sure.

What I am wondering, I've never heard anybody ask something like this before, is my wife and I have saved up a good chunk bad idea to purchase a rental property or just an investment property and hold on to it for the next, say, three, four, maybe five years until we get the rest of our savings for building the house. Where are you living? We are in a rental um work we've been why would you buy an investment property why wouldn't you buy something to live in because we are at a we pay about half the going rate of the rate around our area we actually rent from family um and we've been here about 25 years we like where we're at uh and we have property to build on already we already own the property. So we're just waiting to get the rest of the money to build. All right. So how much money have you got? Right now, we got about $320,000 saved up. How much do you need? Probably, originally, it was probably going to be about $ and then covet hit now it's probably going to be

five maybe 550 what do you make i don't know um we bring in around before taxes around 120 okay so how long is it going to take you to get this other 180 i'm figuring probably at least three years yeah three or four is what i thought what's the purpose of buying the rental property right now just because right now we've got that money parked in a money market account, but we're only getting like half a percent right now. And what we were thinking is if we did that for a couple of years and resell it, we would get more of a return on that money than what we will get over that course of time in the money market account. There's just a lot of risk. You're looking at all of the upside and none of the downside with this rental property situation.

Yeah. The problem with real estate is that it's sometimes hard to get out of. It's an illiquid investment. You can't just decide I'm going to sell it. Now, for the last three or four years, you can just decide you're going to sell a house and it's gone illiquid investment, okay? You can't just decide I'm going to sell it. Now, for the last three or four years, you can just decide you're going to sell a house and it's gone in 30 days. But that's not been a normal way of doing real estate. That's an unusual three-year period, okay?

And if we go back, if we go into a slower real estate market, which I think we're going to, then you might have trouble getting out of that thing when you want to. Uh-huh you know and you don't want to and there's a word there's a word for real estate that sells really fast cheap you give it away because you need the money right and then all your theory of making money goes out the window i probably i love real estate but i probably wouldn't do that i think you're adding a lot of hassle to your life um i would move some of the money into probably an index fund just that is liquid in other words you can cash it out anytime you want but you're going to make more than a half a percent over three years index fund follows the the stock market and you know uh i think over the next

three or four years you're gonna make some money in that i better than a half a percent for sure i've got a bunch of money in that myself and so um obviously i do believe that that's what's happening so um but i you know if you don't want to move it all in there and maybe half of it and you at least you'll make something on it but i just i i'm not gonna the the i don't i'm not worried about the investment property going down in value. I'm worried about the market slowing down, and you can't get out of it as quickly as you need to when you're finally ready to build this dream house after 25 years of renting. Yeah, you've got a specific timeline you're looking for to do this in the next three years. It just feels like there's too much on the line.

Yeah, just to make a little money on it. And so if you make 10% on $300,000, it's $30,000. $30,000 does not solve this problem. It just keeps you from being aggravated, making no money in a money market that's all it does so um i'm gonna move some of it or all of it into an index fund but i don't think i would do real estate in this case because i don't know how quickly the house is going to sell it's a great long-term investment but in the short term it could be volatile like no we'll say we've said it over and over and over for the past three or four weeks, but it bears saying a lot more.

As a matter of fact, I think we're going to do an event on this coming up. We'll let you all know when and everything. But real estate is such a hot topic right now. There's so many things going on with it. But I am positive that real estate is not going to go down in value in the next five years. Some of you are going, oh, it's artificially high. It's going to go down. No, it's not.

There's so much talk of the crash right now. There is not. It's simply not going to go down. And let me help you with this, okay? I've been in real estate for 30 years. It's a real simple equation. 100%, and I just taped a thing a few minutes ago for the Instagram goobies out there with Brooke who runs Instagram stuff. But 100% of real estate prices is based on supply-demand, period.

When there is more buyers than sellers, prices go up. When there is more sellers than buyers, prices go down. Now, there's things that affect how many buyers there are and how many sellers there are, but that's the equation. You know, inflation, recession, stagflation, idiots in the White House, high interest rates affect the number of buyers. But unless the number of buyers goes substantially below the number of sellers in the marketplace, you're not going to see prices go down and we know that this is not going to happen because it this year we have 128 million households in 2007

we had 116 million households 12 million more households today that need houses in 2007 there In 2007, there were 2.1 million new housing starts. This year, 1.4 million. The inventory available for sale of houses right now is 50% of what it was in 2007. Supply is drastically short versus demand. Prices are not going down. There is not going to be a real estate crash. There's nothing in this equation that says there's going to be a real estate crash. Nothing.

And you can take it to the bank. I told you some other stuff that came true. Like I told you inflation was coming. I tell you stuff. Guys, I've been doing this a long time. I'm going to wait on the house prices to go down. They're not going down. What goes prices to go down. They're not going down. What goes up must go down. You're wrong. This is the Ramsey Show.

Hey guys, George Camel here, and I'm so excited to tell you about the newest product from Ramsey. It's called Gazelle, and it's a digital banking experience that will help you spend and save the Ramsey way with banking services provided by PathWord NA. You'll get a single spending account with no monthly fees and it's FDIC insured through PathWord NA. We're offering early access to our beta customers so you can help us make it the best experience it can be. Just go to ramseysolutions.com slash gazelle to sign up my co-host today.

Michael is in Daytona Beach. Hey, Michael, how are you? I'm wonderful. How are you? Better than I deserve. How can we help? Yeah, so I had gotten in a car accident about two years ago, and just now I'm finally receiving the settlement and instead of blowing it I want to try to invest in it invest with it should I say um after paying some debt off with it um I'll probably have like twenty thousand dollars um but my big question is

so I also owe on my car and it's about $500 a month. I owe about $10,000. Um, so I'm wondering if I should take that $10,000 and invest it and make money off of that, or should I just pay my car off, um, and get rid of debt in general? And then, but the problem is, it's hard for me to save money in general do you have any uh permanent damage from the accident oh yes i do have a back i have a lower back injury so i'm kind of limited to work sometimes do you need some of the money to continue medical? Yeah. So I'm thinking that, um, I'm going to keep about half of it, uh, keep it in the account just for, you know, days that I can't work, um, days, uh, you know, I'm having to pay for some type of medical, uh, but, uh, and I'm thinking about 10,

uh, keeping about 10 of it for either paying the car off or using it to invest. And I was thinking about doing some investment in like vending machines, but, you know, doing it like new, I mean, I'm only going to get about one vending machine. And, you know, if I'm lucky making $600 a month off of that, you know. How old are you, Michael? I am 35. Okay. And what's the settlement amount? So I received about 33, but I have to pay off some family debt when I got my house. And there's, you know, some things that I need to work on my house, some investment, you know, fixing up my house, doing some gutter work and stuff like that.

How much debt do you have total? Just consumer debt, non-mortgage. Uh, non-mortgage. Uh, so I owe about $10,000 for the car. Um, I do have another personal loan that I owe a few thousand dollars on. I'm not exactly sure. I haven't seen it in a while. That just comes out of my bank account, like, monthly, so I haven't really looked at it. It's probably maybe $3,000 or $4,000, if I'm not mistaken. Okay.

And how much is the family loan? I'm sorry? How much is the family loan? What do you mean by family loan? You said you owe family some money. Oh, okay. That's about $3,400. Okay. So I'm at $1,604 plus the gutters are going to be how much?

It's about $1,500. Okay. So I'm going to call it $20,000. It's going to leave you $13,000 after you pay off everything. Is that all the money you have to your name at that point? Yes. everything is that all the money you have to your name at that point uh yes right now i've got about um i haven't quite got up to what i'm uh paid off yet but i've got about 27 in the bank still um so like i said about seven of that's going to go towards the gutters and

27 27 000 or 2700 thousand you said seven towards the gutters but you just told us it's going to $27,000 or $2,700? $1,000. You said $7,000 towards the gutters, but you just told us it's going to cost $1,500. No, $1,500 for the gutters. And then about, I think I said it was either $30,000, I think it's $34,000. So, you know, plus I was just kind of like giving a rough estimate. Okay, so here's what I would do. I would be debt-free, I would set aside an emergency fund, and no, I would not buy vending machines. I would think about what your new career is going to be that doesn't strain your back,

and if you need to take some classes, I'd spend some money on that to work your new career that doesn't strain your back. You have an income problem going forward, and you're going to have to get some discipline because you're going to burn through the rest of this money like nothing in two years and you're going to end up with nothing out of this well i do work but uh not enough like uh fool i mean i work probably close to 40 hours a week yeah but you were setting money aside for when you can't work which means you're in the wrong job you told me you wanted to set money aside for when you can't work that doesn't have a good plan over a 30-year period of time you're not going to have this money for 30 years of doing

that so you need to create enough of an income to live on and have enough disciplined process in your budget where you don't overspend what you have coming in so you don't need any money except for maybe a future surgery because you have enough income coming in and enough discipline on that income to control it with a budget and living, you know, straight up on that. Hold on. We're going to send you a copy of the book, Total Money Makeover, which has helped 10 million people do what you're trying to do. And if you'll read it and do it, it'll work.

I promise you. And restocking a vending machine sounds like it would hurt my back exactly it does hurt your back have you ever listed lifted cases of cokes and water no it does hurt your back it's not and besides that that means he's been on get rich quick scam tiktok crap that's exactly wherever you get that because nobody else is teaching you to buy vending machines as an investment except idiots on TikTok. It's coming back around. All the old trends. Well, all the old trends in a new way.

I mean, we just found out a high-tech way to do stupid now. That's all it is. All right. Jancy is with us. Jancy's in Orlando. Hi, Jancy. Welcome to the Ramsey Show. Hey.

How are you doing this afternoon? Better than we deserve. What's up? Great. Great. Okay. I have a question i just did the uh five minute coverage checkup for the confidence in your coverage and you have a question there that says do you have life insurance yes i have life insurance but when you ask cash

value or term mine is i have a level term good policy you're the right guy is that do i keep that yes level term because it does have a cash value it's not level term if it has a cash value term insurance does not have a cash value that's what they're calling level term life insurance um and it has a cash value it sounds like you have cash value who is the company uh horace man okay no you don't keep it it's crap don't keep it at 20 years i can turn around and give them the cash value back no no no no no this is horrible it's horrible horrible horrible investment it's too expensive. Way too expensive. How much coverage have you got?

It's $100,000, and I pay $84 a month. I bet you do. How old are you? 51. Okay. Jump on ZanderInsurance.com and get a quote on real 20-year level term insurance. It has no cash value buildup. The only way it pays is if you die, and you're going to find it to be less than half of what you're paying now.

And if you'll take the money that you save and invest it, you'll have a lot more than old Horace will give you later. Okay, that's what I wanted to know. Okay, so thank you for taking that checkup. That's cool. I'm glad it activated you. It's helpful. That's perfect.

Yeah, yeah, it is good. It's helpful. Yeah, yeah. It is good. It's interesting. But I've been wondering about this policy for a while, what your thoughts have been on it. Yeah, they're an old, old, old antique whole life company. Right. And at the end of the 20 years, the payout drops. Yeah, your grandpa probably bought that. And I put all the money.

That's an old school, backwoods, oh, nasty stuff. Sounds like it was marketed to her as level term, but it really was just whole life. Well, they just lied on the cover of it or something. I don't know, because it's not term. Term insurance is for a term and has no cash value built up. That is the actual definition. So even if you name it a duck, it's still not a duck. It's still a hog.

So confusing. Horse the hog. Yeah. But there you go. So it's been around for a long time. The idea with cash value is that you have the cash value while you're alive. Isn't that great? But you don't get both.

So you don't get the face of the policy and the cash value. Right. So it's a terrible deal when you die after you paid extra to build up the savings they pay only the face amount and they don't pay the cash value they keep the money you paid extra to build up a savings account that when you die they keep it's a really horrible if that was part of the sales pitch no one would buy if cash value insurance is the payday lender of the middle class it's a complete screw job it It's a nasty, bad, horrible product. So if you've got it, get term life in place and then cancel the whole life policy.

Never cancel a policy until you have the new one in place. Chancey, don't cancel it until you get the new one in place. But get on the line with Zander and they'll get you a quick term policy and you're going to be blown away at how much you've been overpaying. This is the Ramsey Show. We'll be right back. In the lobby of Ramsey Solutions on the debt-free stage, Chris and Kim are with us. Hey, guys, how are you? We're great, Dave. How are you? Better than I deserve. Welcome.

Where do you guys live? We live in Exonia, Wisconsin, which is exactly in the middle between Milwaukee and Madison. Cool. Welcome to Nashville. Thank you. Good to have you guys. And how much debt have you paid off? Gosh, we paid off $101,440.16. Perfect.

How long did that take? It took us two years and two weeks. All right. Like it. And your range of income during that two years? That's about $135,000 to $150,150 and back down to about $125. Cool. What do y'all do for a living? Well, during my debt-free journey, I was a correctional officer for a large sheriff's department. And I was a nurse case manager. Ah, okay. And you said you

were. What are you doing now? Well, right now I'm going back to work that matters to me and that I'm passionate about. So now I'm back into landscaping, which I've always really loved. And I'm going to see where that takes me. Very cool. Good for you. Fun. What kind of debt was the 101? Unfortunately, it was everything, Dave.

House and everything? No, it was everything. Oh, every kind of debt. Oh, okay. Yeah, we're super normal. Sorry. Oh, okay. All right.

Credit cards, about $25,000. We had two auto loans for about $24,000. A 401k loan at about $25,000. We had two auto loans for about $24,000. A 401k loan at about $19,000. A consolidation loan at about $14,000. Student loans at about $10,000. And then shortly after we started our debt-free journey, came out a series of medical events that led us to about $6,100 of medical debt. Oh, my goodness.

You collected them all. I mean, you had the whole collection, man. We did. Wow. How long y'all been married? It was 15 years. Last week? Yeah, last week.

So what happened two years ago, Mark, that was the wake-up call, and what changed everything? Gosh, even before our debt-free journey, used we're originally from Massachusetts so we moved to Wisconsin about 2012 and then after owning a house for that time in Massachusetts we had when we moved we went to renting for four years and then at about 2016 we were starting to get a little itchy our littles were running around and we didn't have the space in the apartment complex so we slowly started the process of buying a house. Now, it wasn't the right way to buy a house, but certainly we started the process. So we paid down some debt, but we weren't 100% debt-free.

So then we figured out that it might be a good idea to maybe take a loan against Kim's 401K, which was a really bad idea, hindsight being 2020 for sure. But we took out a loan for roughly $40,000. Some of the proceeds went towards the down payment of the house. And the rest went to things that people always do when they buy a house. They buy brand new furniture. They do new landscaping. They do all the things. So you fast forward a year later, unfortunately, the debt that we had paid off, we had racked back up, which really scared us, quite frankly. It scared me as well. We didn't adjust our budget for doubling our mortgage based on what our rent was before. So we were still living the same way, yet our expenses were a lot more.

So then Kim thought it might be a good idea maybe if we do a consolidation loan. And I was a little weary in the beginning. Gotta move it. Yeah. You guys just did everything. We did. It was horrible.

You did everything. What was the wake-up call two years ago? What happened? So I think, you know, it was funny that that fall leading up to 2020, I had kind of shut down. I was working overtime, a lot of overtime in law enforcement, and I was throwing a ton of money at our dad, at our credit cards, but then the next month, everything was racked back up and then some. So I had kind of given up, and I wasn't man enough to have a strong conversation with my wife and let her know that I was scared. But what we finally saw was Kim bought this book, The Complete Guide to Money by Dave Ramsey.

I'm like, oh, what's this? She's like, oh, it's a book, whatever. She had asked me at one point, hey, can you help me figure out how to do this podcast thing? I want to listen to Dave Ramsey podcast. Was this a trick, Kim? I'm just not very electronic savvy. This is like, hey, help me listen to this thing. The trick comes in pretty soon when I just kind of keep playing it audibly,

leaning back at night. Yep. So since I had figured out a way to get her to listen to the podcast or at least, no, it wasn't me, but no. To get them to work. To get her to figure it out. It was funny. I actually listened to it one day.

And I remember the story of, I think it was a pharmacist down in South Florida that called and said that he was thrilled that he made $200,000 a year and he had paid off $10,000 of debt in one year. And I think you shredded him immediately. You sound like you needed it. Yeah, for sure. And listening to that, I was like, man, this guy's pretty cool. I like this. And of course, as you listen to the podcast, you start hearing that, well, I'm on baby

step two, I'm on baby step three B. And I'm like, well, what are these baby steps? What's this all about? So I immediately took the book from the bed stand or the night stand, and I read it in one night, and I was like, man, we got to do this. This just makes a lot of sense. Kim, you made it his idea. You're a genius.

You're a genius, Kim. Thank you, Dave. I needed that today. Wow. So you said, I'm done with the shortcuts and the life hacks, and we can borrow from the 401K and consolidate over here. And you realize we just got to get out of this thing. My plan was not working.

Moving the money, moving the debt just didn't seem to get us any further ahead, and I didn't know how to tackle it. And this plan helped us to figure out how to knock it out. What do you tell people the key to getting out of debt is? You pay off $101,000 in two years and two weeks. It's so impressive. You did. Gosh, thank you.

Man, I mean, all the same things that everyone talks about. Of course, the budget, being on the same page with your spouse. For me, you know, I think on a simple level, if, if you've been married or you have a spouse or you have someone you're in a serious relationship with, don't be scared to have a hard conversation with your spouse. Because if I was, you know, strong enough to have that conversation years before, we'd be in a different position now. Um, and also I, I think you you just you gotta get pissed off for greatness

you just that's a good quote you just have to you just have to get out of work you know all of the all of the mornings getting up early at one o'clock in the morning to go work at the jail um you know staying late till 11 o'clock at night. You know, Kim doing Instacart that we did together as well as, you know, she worked at a farm. Whatever it takes. She did a dairy farm for a couple weeks. You brought the kiddos with you. What are their names and ages? Let's get them in.

Yeah. So we have Lily. She's 13 and we have Gage is 12. All right. Very cool. We got a copy of Baby Steps Millionaires for you. That's the next chapter in your story for sure. And a copy of Total Money Makeover for you to give away and maybe does what the Complete Guide to Money Guide did for you guys.

That'd be awesome. And also got a one-year subscription to Financial Peace University. Thank you. If you've not been through it, go through it. If you have been through it, give it to somebody. We've given you some things to give away and pay it forward with here as well. Thank you, Dave. So proud of y'all.

Thanks, George. You're heroes, man. You did it. Thank you, Dave. So proud of y'all. Thanks, George. You're heroes, man. You did it. Thank you. So proud. So very, very cool. Worked your tail end off and busted through in a complete change. It's just, man, when the student is ready, the teacher will appear mysteriously on a podcast while your wife tries to get you to show you how it works.

I like this. This is so good. Tech support, ladies. That's the hack to get your husband on board. Tech support. I need some help here with this. Would you help me with this? Yeah.

I don't know how to work it. Wink, wink. All right. Chris Kim, Lily Gage, Madison, Wisconsin area, Milwaukee, Wisconsin area. $101,000 paid off in two years and two weeks. Make it $135,000 to $150,000. Count it down. Let's hear a debt-free scream.

Three, two, one. We're debt-free! Yeah! Woo! Woo-hoo-hoo-hoo! Just like that. And that's why you travel all the way across the country to have that feeling.

Worth it. The Braveheart Scream. Yeah, baby! Get pissed off for greatness, America. What are you waiting for? Get pissed off for greatness. That's like a campaign slogan. Yeah.

That would work. That might get you elected. If you ever run, Dave, that could be it. I'm not running. I'm running from running. But that's not happening, yeah. We like it that way. I don't want to take a big pay cut.

My life's good. Oh, my gosh. you guys are incredible. Well done, gang! Well done! Woo! Heroes in the house! This is The Ramsey Show. Thank you. Well, there's so much crazy going on out there. People are looking for direction on how to handle their finances,

but they're also struggling to see if it's even possible to build wealth. At our Building Wealth live event, we'll walk you through all the crazy that's going on and teach you how to really build wealth in this situation, just like we always do. And these are the only principles that work in prosperous times and they work in hard times. And no matter where you are with your money today, you can get on a path to building wealth. The Building Wealth Live tour has already made a couple of sold-out stops in Las Vegas and Orlando. Wrapping up our spring portion of the tour, it's been great. We're just getting started, though. Got quite a few in, four more in the fall. Phoenix is September the 13th, Sacramento November the 1st, Minneapolis November the 10th, San Antonio November the 15th,

Rachel Cruz, George Camel, Ken Coleman, Dr. John Deloney, and me. We will all be there. We look forward to signing your books, taking pictures with you, answering questions. We're going to do all kinds of stuff. It's going to be an incredible event at each of those cities on those dates. By the way, those are all 85% to 95% sold out. So if you want a ticket, don't wait much longer. Event passes for these things start as low

as 25 and you can get a four pack as low as 60 so take a bunch of friends with you it's going to be amazing ramsey solutions.com slash events phoenix sacramento minneapolis san antonio all this fall gonna be fun george i love it we've had a great time so far and the people have been amazing that's been my favorite part just seeing people again absolutely derrick is in winston-salem hi derrick welcome to the ramsey show hey how you doing better than we deserve sir what's up hey well i was hoping you'd ask me how i'm doing how are you i'm better than I deserve. There we go. Okay, good. How can we help? So my question is, my wife and I just paid off all consumer debt outside of the mortgage. We're sort of looking on guidance how intensely we should put towards the emergency fund.

You know, we've been putting about $1,000 a week towards debt until we got debt free and now uh just sort of looking for the intensity we need to we need to find as intense as you've been getting out of debt until you get the emergency fund done baby steps one through three you do like your hair's on fire scorched earth nothing is going on until you get that emergency fund in place and have no debt because that is the baseline for not being broke anymore then you can start to invest and Nothing is going on until you get that emergency fund in place and have no debt, because that is the baseline for not being broke anymore. Then you can start to invest, and we move from gazelle intensity to, in Baby Steps 4 through 7, intentionality. So what's the fully funded emergency fund for you?

What number? Well, we haven't really done the numbers, but I'd say close to $40,000 at least. That's your expenses for three to six months? Well, no. That feels real high. I would want. No, I don't care what you want. Your emergency fund should be three to six months of expenses, and $40,000 is not that.

That's not $40,000. What's your household income? Yes, sir. Last year, $136,000. What's your household income? Yes, sir. Last year, 136. Okay. So what's it take to operate your house if you don't have any debt per month? Oof. Probably less than 2,000.

You're not doing a budget, are you? Yes, sir. Written every week. Then you should tell me, if you do a budget, how much it takes to operate your house. You should know that. You guessed. Yeah, well, we need to tighten that up. Well, see, our house payment's $900, and then we have no sewer.

We've got a safety tank and well, so no expenses there. So a rough number, you'd say? I'm calling it three grand three grand call it six months that's 18 grand max so yeah you need uh between 10 and 20 000 as your emergency fund and you said you're putting away a thousand a week and so that tells me in 18 weeks you got a fully funded emergency for 10 weeks you know somewhere in there yeah you're gonna be fine with 10 or 15 000 as your emergency fund then you slow down and go to intentionality from intensity at that point. But that's exactly how you do it.

Maybe he's nervous on the radio. Maybe he really has a budget. I believe him. But when you can't tell me your numbers, that tells me you don't know your numbers. So something's up. Or maybe you just caught flat-footed a little scary here on the air it's hard to be on the air it's hard to be on the air unless you do it every day so that's true we'll give him the benefit of the doubt open phones at 888-825-5225 george camel

ramsay personality is my co-host today steve is in wisconsin hi steve welcome to the ramsay show hello sir um don't yell at me first off i've done some stupid things um took out a whole life policy about 20 years ago um at my age that's the dumbest thing you ever did you're brilliant i've done a lot dumber things than that brother yeah i know you're not big on whole life no i wouldn't i mean i wouldn't tell you to keep it, but... No. Well, here's the issue. I'm 60 years old. We got about 800,000 in our 401ks and stuff.

75,000 left on the house. Otherwise, we're debt free. Way to go. Not sure with this whole life if I need it anymore. Can I just get rid of life insurance and not have it anymore or should I turn it and uh get rid of it and get a term how old are you 60 how old's your wife um I'm not gonna tell you if she's gonna shoot me no she's 59 okay all right so if uh what what does she if you died what would it take her to live

a year in income how much income would she need to live on reasonably reasonably not beans and rice but have a good life and be glad you're gone how much would it take well we only i only make 50,000 a year okay so 50,000 a year she'd live on that comfortably? Well, that's before taxes. So, yeah, she'd be able to make it, I think. Yeah. But if she got $50,000 a year and had to pay taxes on the $50,000 or $60,000, she'd be okay, right?

Yeah, I would think so. Okay. If $800,000 produces 10% rate of return in mutual funds, that's $80,000. Mm-hmm. I think she's okay. Do you have the $800,000 invested in mutual funds? Yeah, two different things through 401K and other mutual funds and stuff like that. Sit down with one of our SmartVestor and and have her understand with you how you would invest the how she would invest the 800 000 and make a living off of that without touching the 800 000 if you die once she understands that you'll understand

that you need to pay off the house tomorrow and you don't need any life insurance. Okay. How much cash value is in this policy? It's about $350,000. That one's $350,000. The cash value is $350,000? Oh, I'm sorry. If I die, it's $350,000. There's only $15,000.

Okay. The face is $350,000. The cash value is $15,000. Got it. That'll help pay off the house. I'll never get as close to paying off the house. Yeah, you're only both $75. You get $50 when you cancel this stupid policy.

And so without any house payments, she can make it off of the income that $800,000 produces. You following me here? Mm-hmm. Yeah, I'm following you. But sit down with your SmartVestor Pro, your financial advisor, and understand investor pro your financial advisor and understand how that works and let her understand how that works so she has peace about this and then cancel that policy and pay off your house but you need to understand why you're doing that not just because dave ramsey said to do it yeah and let's see in the math and see it on paper you go oh okay yeah if this happens

this is what's gonna keep me afloat and uh that's called being self-insured and that's what we tell people once the term policy is what we um obviously recommend once that's out and it's over after 15 20 years you should be self-insured if you're following our plan because you have a paid for house got plenty of money in the bank you've been investing that's exactly where he is yeah he became self-insured he got 800 000 in mutual funds and he's got a paid for house and the kids are grown and gone you're self-insured. He got $800,000 in mutual funds, and he got a paid-for house. And the kids are grown and gone. You're self-insured. You have no, I mean, because 6, what, 8% on $800,000, $64,000.

Still, you're going to be okay. And so she's going to be just fine. And you get rid of that mortgage payment, plus you get rid of the whole life premiums. Now we're looking even better. Yeah. I've been trying to get rid of the life insurance for years because I want to be worth more alive than dead because it's good for my health. For Sharon.

I thought that was a Sharon dig. I don't want her offing me in my sleep. So Sharon just wants you to have it for her own personal peace. SWI. Sharon wants it. Anything that falls in that bucket, Sharon gets it. Wow. It's a horrible thing.

But 40 years we've been married, so it's working. It's worth it. There you go. SWI is always worth it. This is The Ramsey Show. Do you love a good day, friend? Want to see the latest Ramsey Show videos going viral? Check out your favorite moments from the Ramsey Show on YouTube. Go watch and subscribe to the Ramsey Show channel on YouTube.