The Ramsey Show - App - Going Forward, Just Say "No More Debt!" (Hour 2)

Episode Date: December 20, 2018

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🎵 Live from the headquarters of Ramsey Solutions, it's the Dave Ramsey Show. Where debt is dumb, cash is king, and the paid off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. This is your show. Thank you for joining us. Open phones at 888-825-5225. That's 888-825-5225.

Cameron is with us in Charleston, South Carolina. Hi, Cameron. How are you? Good, Dave. How are you? Merry Christmas. Merry Christmas to you. How can I help? So my question is, I currently own a home that I bought back in 2016, and it's got some equity in it now, and I was wondering if I should sell it so I can use the money to pay off some debts and then move closer to my work. Okay. Are you single?

Yes, sir. Okay. And what's the house worth? From who else? The realtor that I spoke to said I could get about $185 for it. And what do you owe on it? $125. Okay.

How far from work is it? A little over an hour. Oh, wow. Why'd you do that? Well, when I bought the house, I had a job that was 10 minutes down the road. Oh, I see. Okay. So now it doesn't work.

Well, I might move just because of that. Okay. You know, I mean, I have a seven-minute commute. And in Charleston, South Carolina, an hour away is kind of crazy. I mean, that might be true in L.A. or something, but it's not true in Charleston. I mean, you can drive from one side of the dadgum place to the other in an hour. So, yeah, I'm probably just selling it

just because I want to live closer to work, for one thing. If in the middle of doing that, it gets me out of debt, too. That's just gravy on the biscuit. How much debt have you got? Not counting the house. Probably around $6,000 thousand dollars oh no debt at all okay what do you make around 40 okay well you don't need to sell it to get out of that but you might want to sell it to move closer to work and while you're at it pay off all the debt

you know and have an emergency fund and then put the rest of your down payment on a new place or rent for a little while make make sure this job works. Is the job pretty stable? Yes, sir. Okay. How old are you? 25. Okay.

All right. I mean, it's up to you. You do what you want to do, but you're spending two hours a day of your life driving. I hear that all the time. You know, I mean, well, I mean mean if you enjoy it or something that's cool you're wearing a car i get to listen to your podcast well i appreciate that but uh you're wearing a car out and and you're spending a lot of time in the with your butt in the seat behind the wheel but it's up to you i mean you do what you want to do i i personally because i'm not big

on big long commutes personally i i mean if anybody wants to do it out there you're welcome to do it but i i just um i'm not gonna i'm not gonna let that use up the quality of my life that's not where i'm going so you do what you want but i if i woke up in your shoes i was 25 years old i was single making 40k i would move closer to work that'd be my plan thanks for the call jessica is on the line in fort wayne indiana hi jessica how are you good how are you better than i deserve what's up so um my husband and i have been living in our current home for five years and we're buying it on contract from my in-laws. Now, they would like us to get a mortgage. Good. And the issue is we've been, we did Financial Peace University like a year and a half ago, and we're working on Baby Step 2.

And I'm just feeling kind of like unsure if it's a good idea for us to get a mortgage on this house because I kind of feel like it might be more than what we can afford. Okay. Well, what do you owe on the house? We owe, so it's kind of complicated. They're asking us to get a mortgage for $150,000. Why? Although the house is worth like $325,000.

Okay. So they want us to get, they have the house paid off. Okay. So they want us to get $150 to kind of give them some cash. And then down the road when we're like hopefully doing better financially, we can try to finance the other portion of the house. No. No.

Yeah. Not doing that. That's a bad deal. You need to get out from under owing them money. You don't need to owe them money anymore. So that leaves you a couple of options. One is borrow enough on this house to buy the house from them, turnkey, no side deals. Okay.

Or walk, sell the house, you own the house. What is your balance owed on your contract? We owe, well, we signed a contract for $200,000, and we owe $150,000 on it. Okay, so why is it that they think they're due more than $150,000? Because $150,000 ought to pay them off. Yeah, it's because the house, like when we bought or when we came into the contract five years ago, they had the house in the market for $325,000. I don't care.

And we weren't able to have a house that cost that much. So they said, we'll just kind of co-own it. Like, you'll pay us $200,000, and then down the road, like, if you sell the house, you're going to owe us $125,000 out of whatever you get from the proceeds of the house. Okay. This is a bad deal. This is a bad deal. This is a bad deal. Okay.

I was wondering. I just thought of like a check. You went into a bad deal to start with, and I'm not going to extend it anymore. This idea that they're going to. So what you need from them is a price that you buy the house for today. Okay. Because you now have a contract that says $150,000 plus you owe them $125,000 later. Yeah.

Okay, which equates to $275,000. Okay, now if that's the price and you want to buy a $325,000 house for $275,000 and you want to live there, that's fine. Then the question becomes, can you afford a $275,000 mortgage? If you can't it's time to sell this house and leave okay yeah we can't we um i know we can't um what's your household income and um take home is like 4600 yeah you don't need this house yeah you can't you can't pay this bill now um so yeah it, you just are in a house you can't afford.

That's what it amounts to. And they're trying to do like a shared appreciation mortgage or something where you either get their money later and all that, and then they want their money, and then they don't, and then they want their money, and then, no, this is going to go on. It's bad. Because it's ambivalent. It's a moving target.

See, they have the ability emotionally to just call your loan, which is what they've done. We want you to go get a $150,000 mortgage but still owe us later. No. You know? So I think it's time to admit that this was a bad deal and sell it and move to another property. That's the deal, you know? And I think that's what I would do. So up to you guys.

But I think these people need their money. And I think you're in a house you can't afford. And the writing's on the wall, and it's just time to admit it. So go get you a little rental, something inexpensive, and get yourself the rest of the way out of debt, and then save up a good down payment and buy you a house without your in-laws. Please, without your in-laws. This is the Dave time to buy life insurance? My answer is typically now.

Life insurance is not part of the baby steps because it's needed when your family has debt and not enough savings to provide for their financial needs. That's when they're at the highest risk. And no matter where you are in your baby steps, it's a necessity, not a choice. This includes working husbands and wives as well as stay-at-home parents. It's pretty expensive to replace those stay-at-home parent responsibilities. I only recommend term life insurance since it's the most affordable way to get the right amount of coverage and not break your budget. Go to Zander.com or call 800-356-4282.

These are the guys I personally use. Term life insurance is inexpensive and your family needs this no matter where you are in your baby steps. That's Zander.com. Or call 800-356-4282. Zander.com. Oliver is in McAllen, Texas. Merry Christmas, Oliver. How are you? Merry Christmas, Dave. It's an honor to be speaking with you.

You too. What's up? Yeah, so I graduated in December with a bachelor's in psychology in the minor in business administration. Right now, I am currently employed as an investigator and making 50K a year. I got married in June. At this point, I'm living with my wife's grandmother. Sort of not an ideal situation. I mean, I love being there and everything.

It's just that I feel bad about living at her house. Yeah. But I was really recently, you know, offered this opportunity of assuming a mortgage payment of somebody else. So my father is currently with his wife at a house in which they're paying off to a known owner of the house. So it's an owner's finance. They can't afford the payment anymore, so they want me to take over the payments. The only problem is that the payment is $1,300 more or less.

No, $1,300 more or less. And that would be around like 40%, I think, of my take-home pay. Does your new wife work? Yes, she does. She's a teacher in a private school. And what does she make? She makes very little, probably around $22,000 a year. Okay.

And so you can't afford a $1,300 a month payment? Right. Yeah, the only thing was that it's evaluated around $250. It doesn't matter if it's valued at $2.5 million. You can't afford a $1,300 payment. Exactly. Yeah, that's exactly what I was thinking myself. It's tempting.

I mean, but the fishing lure is hanging in front of you, and the question is, are you going to bite and get hooked? I mean, you're being lured, no pun intended, into a deal here. Well, nobody's got malice. Nobody's trying to mess you over, but you're about to bite off more than you can chew. I wouldn't do it. Right. I'd go get me a little inexpensive rental somewhere and set up your house,

and let's get started running our life, making $72,000 a year, which is not a bad income in McAllen. Right. I mean, you're doing all right. How old are you guys? 29. Okay. You got a good start. You got a good degree, and, you know, hopefully your wife's income will go up, and certainly

yours will over time, and go get you a little rental. Have you got debts you need to clean up? Yes, I do. I got a student loan and a credit card debt. Yeah, let's get those cleaned up, get you a little rental, and, rental, and work as many hours or extra hours or extra jobs or whatever you can. Let's get that stuff all cleaned up, have no debt, and build your emergency fund, and then build a down payment, and then buy. But this is tempting, but it's one of those tempting things that's going to get you in trouble.

And you can feel it. You already knew that before you called me. Yeah. Yes, exactly. Yes, I did. in trouble and you can feel it you already knew that before you called me yeah yes exactly yes i did i mean ever since i got the news you know it was tempting but there was something of me stopping me because i'm a new listener and all of your messages is firing so i mean i'm planning to follow it all the way through uh cleaning up my mess and you know having a financial freedom and i knew that this you know what does So what does your dad owe on that house? Around $160,000.

And what would it sell for? Around over $200,000, probably $230,000. He probably ought to just sell it then. He'd get some money out of it, right? Yeah. Yeah, that'd be amazing. Yeah, keep the equity. Yeah, take the equity and start his life fresh

because for whatever reason, he no longer can afford it either. And let's get back into a situation where both of you are living a life that you can afford instead of just trying to stretch and make something work that doesn't work with magic fairy dust. And it just messes you up, man. I wouldn't do it. I'm sorry. I know it's tempting, but I really wouldn't. Thanks for the call.

Open phones at 888-825-5225. Ina is with us in Washington State. What's up, Ina? Hey, Dave. Tough questions for me, but probably easier for you to navigate this. Okay. So me and my husband are both from divorces with a bunch of kids. And so we have right now four living in our home, three more coming back and forth, visiting and stuff.

So we have to upkeep. Lucky we bought this big enough property for very little, to say the least. He's the sole maker of the money at this time. I am a stay-at-home mom with a two-and-a-half-year-old and another baby on the way. And he's, you know, his income is getting attacked for child support constantly. So we're going to be dealing with his ex for another eight more years, their youngest is. And so I have no way of bringing real income until I figure out what can I do. I have no training or any education in the United States. I come from Ukraine.

So no real business skills. But we were talking about it. I said, if I don't bring in any income and your income is attacked and we are every year in court because we have to take the other party for noncompliance, we're sinking in everything we have. What does he make? Huh? What does he make? It's very little right now. It's like maybe $3,000, barely $3,000 a month to take home.

Okay. Part of the problem he's facing is his income. Now it's like maybe $3,000, barely $3,000 a month to take home. Okay. Part of the problem he's facing is his income. So what does his career path look like? What's he going to do to make more money? In the past, he was working for concrete. Basically, he's been working in construction for many years, and health is not doing great for continuing on that path. Yeah, concrete's hard work.

Yeah. So he quit concrete because there were no more jobs to get where he used to make about $5,000 per time. And now he's just in a lighter type of a job. Okay, so what are we going to do going forward that makes him more money well either if he makes more money more will be coming out of no no that's not that's not your problem your problem is you're starving to death not quite there yet but well i mean you're you're not making much money you got seven kids coming and going and child support coming and going.

Yes. And so, you know, that suddenly goes away. Those problems suddenly go away at $7,000 a month instead of $3,000 a month. That's what I'm wondering. Can I bring any income opening up maybe a business on my name and hiring him to work for me or any other idea? Anytime he makes money, it's going to be subject to child support. And by the way, he's supposed to support his children. Yes, we don't have a problem with that.

It's just a fact of the matter that the other party doesn't really want to work. That's not the issue. That's not the issue. He owes what he owes, whether they work or not. Yeah. And his child support is not based on their employment. It's based on his. And his career path is non-existent right now

yep he needs a career path and yeah you need to start something from home that'd be great but you don't need to hire you what's safe out there yeah i don't want to do mlm businesses they're you know not a good deal i see out there like amazon.com sales blah, blah, blah, blah. I'm not sure what I do. So you have no degree? Nope. Okay. And what have you worked at before? What have you done? Public schools, a staff assistant with challenging children,

but that doesn't bring much income at all. I'm just asking, what skills do you have that we can turn into a business? Crafts. I'm crafty. I make bows and things, but you have to trust into that somehow. Okay. And when you were an assistant, you also were probably pretty organized. Well, actually working in a chaotic environment, it was tough, but I dealt okay for most of the part. Okay, here's what I'm going to do. I'm going to send you a copy of Christy Wright's book, Business Boutique.

She's one of our Ramsey personalities, and she's the creator of the Business Boutique movement, equipping women to make money doing what they love. And I'm also going to get you involved involved in her dreamer class it's called and it helps you dream and figure out what to do and kelly will get you signed up for both of those and get the uh um you know get that work i mean get in that class and start dreaming and trying to figure this out. That's the thing to do. I can't tell here on the air, with the time I spent with you,

an obvious answer that just jumps out right now. But that doesn't mean there's not one. There is a path for you to take to make money, for sure. And there is a path for your husband to make more money, for sure. And we both need to be on those paths. Thanks for calling. It's time to take another look at your budget. That means scouring every expense and making sure you're not leaving any money on the table. One of the biggest expenses is your mortgage payment.

I recommend a quick Churchill checkup. In just five minutes, our friends at Churchill Mortgage can tell you if you could save some cash each month. They've helped thousands upon thousands of my listeners keep more cash in their pockets through a smarter mortgage. I want you to call Churchill for your checkup and see if you can lower your monthly payment, or better yet, see how you can pay off your house early. Think about it. What could you do with your money if you didn't have a mortgage? Call Churchill at 888-LOAN-200, 888-LOAN-200, or visit churchillemortgage.com for your Churchill checkup.

That's 888-LOAN-200 or churchillemortgage.com. This is a paid advertisement. NMLS ID 1591, NMLSconsumeraccess.org, Equal Housing Lender, 761 Old Hickory Boulevard, Brentwood, Gabrielle is with us. Hi, Gabrielle. How are you? Hi, Dave. I'm well. Merry Christmas. Merry Christmas. Welcome. Where do you live? Covington, Georgia. Very cool. Welcome to Nashville. And you're here to do a debt-free scream.

Yes, sir. And how much have you paid off? I paid off about $45,000. Cool. And how long did this take? It took me 17 months. Good for you. And your range of income during that time?

It was around $60,000. Good for you. Excellent job. Very, very well done. Congratulations. What kind of debt was the 45 000 so about half of it was student loans and the other half was credit cards all right i love it very cool so what happened to you 17 months ago so um it actually was actually around this time um about two years ago where um i was trying to figure out how to live a comfortable life after

retirement because all I heard was like, you know, when you get your job, you need to, you know, plan for retirement. So I was trying to ask around and do research, but everybody had different answers and it got me really confused. So I was like, okay, I'll just pray about this. And I started praying about it. And then while I was on this Christian online bookstore, I looked up finance and your book came up. And when your book came up, I eventually read it and I was like, oh, whoa, before I even like go into retirement, I need to get my financial situation under control. And then I was really excited. So throughout that whole time, it was two weeks right before the new year,

so right around Christmas. And so I was like, okay, well, I'm going to just start for the new year. So I started January 2017. And throughout that whole time, I remember in the book you said you got to look at yourself in the mirror and tell yourself you're going to behave with your money. So for the two weeks I did that. And then I did that every day until I believed it.

And then I started the journey and I paid it off. Wow. So thank you. Cool. What do you do for a living? I'm an engineer at a medical device company. Oh, good for you. So you got an engineering degree.

Yes, sir. All right. You're going to be an everyday millionaire. Yes, sir. You are on your way. That's the plan. I'm so proud of you. Thank you, sir. All right. You're going to be an everyday millionaire. Yes, sir. You are on your way. That's the plan. I'm so proud of you. Well done.

Well done. So the Total Money Makeover book was the key. Yes, Total Money Makeover book. And doing that and actually believing in yourself and speaking victory over yourself and just praying and just doing that like constantly every day reminding myself what I want to do. And that really did help out a lot. Absolutely. Very well done. praying and just doing that like constantly every day reminding myself what I want to do and that that really did help out a lot absolutely very well done well congratulations very proud of you thank you good job who's your biggest cheerleader my biggest cheerleader is actually my sister she um I did the debt for a lot I paid off my debt but she was like you should come here and do it live

so I was like okay so here I am I'm not really a person that would do this on debt, but she was like, you should come here and do it live. So I was like, okay. So here I am. I'm not really a person that would do this on my own, but she encouraged me. And so here I am. And she came with you? Yes. She's here. Very cool. She drove the four hours.

She's more of the driver. All right. Very good. Very good. Very cool. Well, way to go. How does it feel? It feels really amazing.

And I know it's around Christmas and people are using an excuse like, oh, because I'm in debt that I can't or because I'm paying off my debt, I can't give and all that kind of stuff. But I don't think you should use that as an excuse to go into debt. You know, if you already did it, Christmas is right around the corner. That's cool. But going forward, just say you're not going to do this anymore because I paid off my debt. And it's like it's almost like I'm giving more because of that, because I don't have to worry about payments. And because I had seven credit cards that I was paying with, I mean, paying for and my student loans. But now I don't have that anymore. You know, it's like really great that I can even give towards people give.

And then I can also save towards save towards and then I can um also save towards um um save towards a house on 3b so it's really nice so way to go way to go good job fun fun so it's good to have a sister in your back in your uh in your court that's cheering for you and is she doing this stuff too soon soon soon she's infected now. She's come into the building. Yeah. I love it. Well, that's good. Very, very good. Very cool.

So what was the hardest part for you? The hardest part for me was telling myself no and putting half my paycheck, like more than half my paycheck towards the debt. Telling myself no so that I can put more than half of my paycheck towards the debt, telling myself no, so that I can put more than half of my paycheck towards the debt. That was hard, but I even read the book, Chris Hogan's book, Retired Inspired. Thank you. And that also gave me the HD vision to remind myself what I wanted to do. And so that was really encouraging. Listening to you every day really helped. And also, if anybody else needs encouragement, I know, like, obviously, going on the Facebook groups was really helpful, too, because they have winning stories on there all the time, and it's also really encouraging. Well done.

Good job, kiddo. Excellent. Thank you, sir. Yeah, love it. Well done. Well, we got another copy of Chris's book for you, signed by him, so you can keep that signed copy around along with your red copy. And we're going to give you a copy right after the first of the year

when it comes out of the Everyday Millionaires book, because that's what you're going to be. That's the next chapter in your story coming up. So very, very well done. All right, Gabrielle from the Atlanta, Georgia area, $45,000 paid off in 17 short months, making $60,000. Count it down. Let's hear a debt-free scream.

Three, two, one. I'm debt-free! Yeah! Woo! I love it! Well done. Well done, well done. Man, that's fabulous. Open phones at 888-825-5225.

That's 888-825-5225. Kathy is with us in Charlotte, North Carolina. Hi, Kathy. Welcome to the Dave Ramsey Show. Hey, David. It's nice talking to you. You too. What's up?

I need your thoughts on a dilemma that I have. Some people would say it's probably a good dilemma, and it's kind of convoluted. But about a year ago, while my mom was still alive, she had quite a bit of money. And my husband and I got involved in this real estate thing with his boss where we bought some land and we're going to build patio homes on it. And it's on a golf course and it's you know a very nice community well it's taken a year for with all the hoa issues and stuff going on it's taken a year to even get the houses started

and my mom has since passed away so my brother and i are going to inherit her money. So my husband and I will probably get about $700,000 from that. Now, the builders are wanting another investment. We put in $150,000 for land, for the whole land for about 40 lots. And they're wanting another 100 now to build the first house and then probably another 100 to build a second house. And then after that, we probably won't have to put anything else in. My dilemma is we're 68 years old. I'm retired. My husband's going to retire next year.

And it just scares me with the housing market and the stock market and all that stuff so the land the land was did you buy the land or it was in the family no we bought the land at this community i see okay yeah and that's actually where we live too and it's already developed into lots oh it's not okay now it's just land we bought the land and then we how much land did you buy well we are in has these with this other guy so it's it's 42 uh uh a third acre lot okay and so we are going to do it in phases right build patio homes in phases. And so what has changed that makes you not want to do this? Well, I just don't feel as good about the housing market right now and everything as I did a year ago. What do your agreements say with the person that you're in this deal with?

We can get out if we want to. Then get out. He'll buy us out. He'll be glad to buy us out. Then get out. But I don't know. I kind of agree with you. I don't think you're in the real estate development business.

It's scaring you to death. You don't know what you're doing. You're not sure about it. Nothing in this conversation said, go forward. Everything said, I'm scared. I don't want to do this. Well, I am scared. Okay. I'll to do this. Well, I am scared. Okay.

But I want an investment. I'll tell you what. I'll talk to you a little bit more. Let's hold on. I'll hold you through the break. We'll talk a little bit more. This is the Dave Ramsey Show. All right, we're talking with Kathy in Charlotte, North Carolina, has invested in some real estate development.

They've got 40-something lots in partnership with another guy for Patio Homes Third Acres. She's not feeling great about putting more money into this to start building houses on it, and that's where we are talking at this stage. And everything she said about it is negative, so I was telling her to sell it, and that's where we left it at the break. Okay, so now, why would you keep it? Well, because it's an investment. I mean, we have no other real estate investments, really, except our house.

What is your half worth? Our house? No, your half, if he bought you out. Well, right now, $150,000. That's what we initially put in. That was just for the land. It'll take us about eight houses to break even. Okay.

I'm just not sure if this... So let's try it this way. Let's pretend you were not in this deal. Yeah. And there's $150,000 sitting in the middle of the kitchen table. Yeah. Would you buy into the deal? Probably not.

Why? Because we're looking at four or five years out where we'll start seeing any kind of return. Right. Your returns on this don't sound really good to me. i've done a bunch of real estate deals in my life i don't know why it takes eight houses to break even i mean the lots there's 42 of them into into 300 000 you know because your house 150 right and so that's your lot price right there. And so, what, $8,000 a lot or whatever, and you put a house on it at 150, and with an $8,000 lot, you've got 158 in that. Why does that not sell for 200?

Well, actually, the houses are going to sell for 299. And why is it you don't break even? Because, well, we have the $150 in because we're going to be putting another $100 in to match his $100 for the first house. And then another for the second house, another $100 to match his $100 to make $200 for the second house. And then from then on, we'll just be able to use the money as we sell the houses.

Okay. And these are spec houses, obviously. Yeah. I mean, they're not sold before you build them. No, they are not sold. Yeah. That's called a spec house. You're building them speculatively.

That means a spec house for short. Okay. So the number one... He's a good partner. He's a good businessman. Oh, I don't doubt that a bit. The number... I've been doing real estate since I was 18 years old. I'm 58. Okay. So the number one. Now, he's a good partner. He's a good businessman. Oh, I don't doubt that a bit. The number, I've been doing real estate since I was 18 years old. I'm 58.

Okay. Done over 2,000 deals of real estate. I love real estate. The number one place people go broke in real estate is in developing lots. Number two is building spec houses. It's the highest risk form of real estate investing.

And for the margin that you make, the risk is outrageous. And so I think you take your $150,000 and you guys go buy you a couple of rental houses and pay cash for them and just enjoy owning some real estate. I'm glad you said that. Because that's what I really want is something that will generate some income right away.

Yeah, some income now. I mean, $150, you'll generate $1,000, $1,500 a month in rent minus the expenses and so on, right? Yeah. And so that's where you'll be. You'll own them. And when I said that, you know what happened in your spirit? You just got calm. You felt peace, didn't you?

Yes, I did. Because you're pretty tight right now in the chest. How'd you know? You know? I can hear it in your voice. I can hear it in your voice. And, you know, your verbal patterns are all right there. And it's not that insightful.

And that's okay it's okay you know listen this guy is a good business guy but i have seen more people more of my good friends go broke my family has gone broke in doing this type of deal you're not going to go broke because you're paying cash for it but you could lose the cash um because the guy you know the thing gets sideways and it sits and sits and sits and sits and sits and sits and sits and sits and sits. You're just not having fun here. I'm not. There is some upside, but the downside is there. You can't put your finger on it from a business acumen standpoint, but you can sense it in your spirit that there's risk here. You're feeling it.

And that's accurate. There is risk here. You can't put words to it exactly. You can't quantify it exactly, but you're accurate. It's wisdom. And so if you were my older sister, I'm 58, you're still, you're accurate. It's wisdom. And so if you were my older sister, I'm 58, you're 68, I would tell you to get out of this deal not because the guy's a bad guy and not because the deal is destined or doomed.

It's destined to crash or it's doomed and it's the worst deal on the planet. No, this is just not a good deal for you. For me, yeah. You're not having fun. And that's why you're out. And I'd get out. And bless him. I hope he goes and makes a million dollars. I hope he does. And you do too. Wish good things on him. And don't feel any regret. I have walked away from a bunch of deals that other people made money

on and I didn't because they weren't right for me. That simple. And there's just some deals that you're not supposed to be in. And you can feel it physically across the tops of your shoulders, across your chest. You can feel it in your throat. You can feel it. And then when you say, I'm out, there's a peace and a relaxation that comes. And that tells you, I mean'm out there's a peace and a relaxation that comes and that tells you i mean there's a when there's a physical reaction like that you know what you're supposed to do and i can tell what you're supposed to do hey thanks for calling i appreciate talking to you you're a sharp lady all right marie is with us in san antonio texas hey marie how are you fine thank you i currently am paying on a $100,000 term life insurance policy,

and I think it's called, it's a return of premium. Right. So what I'm doing is paying about $150 a month, and if I don't use it, if I don't die in 20 years, I'll get my premiums back. Right. Is that a good deal, or is there something better I can do with $150 a month? Well, a term life insurance policy is a fine thing, and I recommend term life insurance. I own term life insurance. I do not recommend the addendum that you pay extra for that has return of premium.

And the reason is real simple. The amount that you pay extra, if you just bought for that has return of premium. And the reason is real simple. The amount that you pay extra, if you just bought term without the return of premium versus this, the amount you pay extra were you to put that in a cookie jar, you would have returned your own premiums. That's kind of what I came up with. Yeah. And so are you healthy? Yes. How old are you? 60. Okay. And so are you healthy? Yes.

How old are you? 60. Okay. And are you single? Yes. Okay. Why do you have term life insurance? I don't know.

I've always had it during my whole career. And I retired, and I'm taking a second look at things and how much do you have in your nest egg um about 350 000 great job okay and how much debt do you have none great okay is anyone count on the income that you have coming in to live other than you? No. Okay. So term life insurance or life insurance in general is to take care of the family that is counting on you or someone that's counting on you, your income, should you die. So if I've got a 32-year father that's creating fifty thousand dollars a year working

and he's got two little kids and he dies those two little kids need some money to replace the income that he used to create that's what life insurance is for in your case if you die financially what will happen is um they're going to be really sad and they're going to be really sad, and they're going to pay for a funeral, and they're going to split up your money. Isn't it? Yeah, pretty much. That's pretty much how it's going to go down. And so you don't need the $100,000, right? Not really, no.

So you're buying car insurance, and you don't have a car. Okay. I would cancel life insurance altogether if I were in your shoes. I think you're insured through what need you would have for it, and you have no need for it. I'd save my money and do something else with it. I like term life insurance, but I don't think you need it. Thanks for the call. This is the Dave Ramsey Show.

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