The Ramsey Show - App - Guidelines for Buying a Reliable Commuter Car (Hour 3)

Episode Date: June 28, 2019

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I am Dave Ramsey, your host. This is Common Sense, for your dollars and cents. Common Sense is so rare in America today

that it's now like having a superpower. So we're glad you got some and you tuned in to us. Thanks for hanging out. We'll add to your tools in your belt so that you can go have a better life living like no one else so later you can live and give like no one else. Open phones at 888-825-5225. That's 888-825-5225. That's 888-825-5225. Doug is with us to start this hour in Chattanooga.

Hi, Doug. How are you? Doing well, sir. How about yourself? I'm better than I deserve, man. How can I help? Excellent. Listen, I was going back through recently my old FPU DVDs back when it was a 13-week series,

and at the time you were telling people to only buy fixed annuities, never buy variable. No, you got confused. No, no, no, no, no, no. Stop, stop, stop. Whoa, whoa, whoa, whoa, stop. I have never, ever in the history of my freaking life told people to buy fixed annuities. You misread that. I must have misheard the DVD then, but it seemed like a couple of times you said that.

No, absolutely not. No, never have I said buy a fixed annuity, ever. Well, that clarifies that problem, then. Okay, good. Do you mind if I ask you one more question? None at all. This is about a 401K. I've heard you talk about a backdoor Roth where you put money into, not a 401K, sorry, an IRA,

where you put money into an after-tax IRA and then roll it. Money put into an after-tax IRA, that money that you put in, you can take out tax-free, but the growth is still taxed. Is that correct? The money that is in the after-tax IRA going in has already had taxes on it. And as it grows, it is not taxed until you take it out. And then it is taxed. Why do you need to roll it to a Roth then if it's not taxed until you take it out?

If it's not taxed until you take it out versus taxed at all. I got it. That's right. Okay. That's all I needed to know. I guess I'm pretty brain dead today. No, it's okay. That's what we're here for, man.

That's good questions. Good clarification. How old are you? 54. Cool. So you're really focusing in getting real serious on your investing, right? I'm trying to. Good. Have you got a focusing in, getting real serious on your investing, right? I am trying to. Good.

Have you got a copy of Chris Hogan's retire-inspired book? I do not. Let me give you a copy, brother, okay? Excellent. Thank you. Hold on. I'll have Kelly pick up, and we'll send you a copy. Good questions.

All right. I have no idea what this name is, Kelly. What is this guy's name? This person's name? Zubair. Zubair. Zubair. Okay. That is correct. I'm sorry. I just didn't want to destroy your name

because I'm sure people mess you up all the time and I didn't want to be that guy. The correct is Zubair. That is correct. Perfect. How can I help, sir? Well, thank you for taking my call. I have a question about a car lease. So I discovered you about six months ago on your podcast, and right before I did, I got a car lease. My total debt right now is $400,000.

It's all student loan. I'm a physician. And the reason why I got the car was I was driving a lot from work. I got married last year, and my a lot from work. I got married last year and my commute went from five miles to 70 miles. And I was spending a lot on gas. So I was spending about $600 on gas. And now with this hybrid car that I got on the lease, I'm spending about 250 per month on gas. So I have 33 months left on the lease. My payout right now, if I wanted to purchase the car, is $27,000. If I wanted to pay for the lease in total, it's $13,000. So I'm not really sure what

you would do in this situation, which is why I'm calling. Please tell me you have a huge income. I do. So I've been practicing for two years and our household income is about $350,000. Thank you, Jesus. Okay, good. Wow. Because you got a mess on your hands. So how fast do you plan to be debt-free? My calculations right now, so in the past year, I've already paid off $100,000. We started at $500,000 and my payoff time is going to end in about three years. Good for you. I like your plan. Okay, that's cool. And so in the future, when we're doing a calculation on a car, there's two things we want to keep in mind that are separate from your question.

Number one is if you have a 70-mile commute, whatever you are driving, when you add up the miles you put on it in a year you are destroying its value that is true and so what we want to do mathematically is we want to destroy the least amount of money um and that means that we would buy the least car that will get the job done now you now we've got to define what get the job done is if i make 350 000 a year get the job done means different than if i make 35 000 a year you want to ride in something decent okay you can afford to destroy a little more expensive vehicle is my point just because you're in it all day long and so i'm going to enjoy the vehicle to a degree but probably wanted to destroy something that's not 50 grand instead let's destroy something

that's 30 or less. Agreed? Agreed. Okay. And it's value. But I want it to be reliable. In your case, gas mileage is very important. Agreed on that. You made a good decision on that part of your thinking.

That was very wise, looking at all of that. Your savings there is dramatic. And so gas mileage, reliability, and comfort, creature comforts, because you spend a lot of time in the car. And, by the way, you make $350,000, so you can afford to have a decent vehicle. But let's not drive a $130,000 Maserati and destroy it, okay, even though you could technically afford that car. But let's not run that thing 70 miles a day each way.

That would be silly. You follow me? Absolutely, yeah. And hopefully the driving is short-term because my wife is finishing her training in one year, run that thing 70 miles a day each way that would be silly you follow me absolutely yeah and hopefully the driving is short term because my wife is finishing her training in one year which is why we're i'm kind of stuck in the commute okay then that'll change your equation too okay so are you running your miles up way over on the lease or you're going to be like way over when you turn it in so the first year i'm going to be over but the it's $45,000 in total, and I don't plan on going over that over the course of three years. Okay.

All right. But you're over schedule now. Correct. Yeah. All right. It's probably going to work out, without me doing the math in detail, it's probably going to work out about a break even to drive it on out through the lease. Okay.

Versus getting rid of it. Now, you're going to take a hit it's just a matter of how are you going to take the hit monthly between now and the balance of the lease or are you going to take the hit when you sell it today and have to go buy something else that has good gas mileage and reliability so i probably would run it on out uh through the end of the lease in your case uh with the numbers you're giving me. Because, you know, if we add up the total, your $13,000 is remaining on the lease, but we also look at how much upside down you are today already,

you're almost driving this car. You're paying a little bit between now and the balance to drive it, but with the hit you would take versus $13,000, you might as well pay the $13,000 is what I'm saying. Yeah. Is that logical to you? Yeah, absolutely. So next time, though, the number one key that we find of people who are millionaires all the way up to decamillionaires is until they have a million-dollar net worth, they drive

a used car. It can be slightly used. And they pay cash for their cars. That's what we find among people who build wealth. Now, a lot of doctors make a lot of money and don't have any money. They're notoriously known for sucking at how they handle money. You're making some really good decisions, so I don't think you're on that path. But the adjustment I would make long-term is whatever you do in the future, you pay cash for it.

You make enough money. Whatever you do in the future, you pay cash for it. You make enough money. Whatever you do in the future, you pay cash for it. And that is your shortest path to wealth. One question I get asked all the time is, do I need life insurance? Listen, the whole point of life insurance is to replace your income for someone who counts on you. So if you have a spouse or you have kids, yes, you need term life insurance. It's the only way to protect them until you're out of debt and have built up your wealth. You're only digging a deeper hole if you waste money on cash value plans

since it robs you of the ability to make real progress. And that's why I send you to Zander Insurance, and I have for 20 years. That's where I get all my insurance, and they only offer the plans I recommend. It is not expensive. It's not complicated. And Zander will be there as your guide every step of the way. Visit Zander.com or call 800-356-4282. You need to get this taken care of.

I can give you the advice, and I can tell you where to go, but it's really up to you to take that important step to get your family protected. That's zander.com or 800-356-4282. Louisa is in Atlanta, Georgia. Welcome to the Dave Ramsey Show. Louisa, what's up? Hi, Dave. Thank you for taking my call. We do have a debt of $60,000, and I would like to know if it is a good idea to get a loan against the house, which is already being paid off.

Not if we can help it. I would avoid it. What kind of debt have you got? We have a $21,000 balance on our card, and then credit cards that we have. So you have about $40,000 on credit cards? Yes. Okay. How long have you been doing that?

Recently. We use all our emergency funds due to a loss in our family, so all the funds were gone and we have to get the credit cards, and then, you know, stuff from the house that broke down, and there are more than $10,000, so we had to have it. That is the reason why we went up to up to $40,000. So did you guys all lose your jobs? No.

Okay. So you had income coming in during this time right now is it will be like about a thousand i mean sorry six thousand sixty thousand dollars a year between the both of us i haven't just got a a better income from his job. Okay. Well, that's good news. All right. No, I would sell your car. Sell the car, okay. Yeah, I would not. You've got a real mess with credit cards here.

I would cut them up and vow to never use them again no matter what happens. Okay. But before I would borrow, I wouldn't borrow on my house to buy a $21,000 car when I make 60. And essentially that's what you're asking me to do. And so I would not do that. I would probably move out of this car and down in car dramatically and then be able to pay cash for whatever you move into.

And then let's attack the credit cards, smallest to largest, using the debt snowball in that order. List them smallest to largest, pay minimum payments on everything but the little one and attack the little one. What's concerning me is this, okay, and I want you guys to go back and address this. You don't have to answer me, but you and your husband need to answer this question, okay? What are you going to do next time there's a problem

okay you got to have an emergency fund in place of three to six months of expenses once you get this debt paid off and um what kind you know is the type of problem that occurred ever going to happen again or was it just a an unusual never happen again type thing? Or was this a thing that stuff comes up and we just, instead of working our way through it and instead of limiting what we bought, we just put, I mean, you're making $60,000, you put another $40,000 on credit cards, so you had a $100,000 problem? I mean, that doesn't sound right, kiddo.

I don't think that happened, as a matter of fact. I'm questioning you. So I want you guys to do some soul searching, because sometimes what happens is that there's a problem in a family, like someone's ill or there's some kind of a crisis. And while that's going on, we go do a bunch of other stupid stuff. And then we blame it on the crisis. But I bet you if you go back and detail out the $40,000 worth of credit card debt, that only a portion of it is associated with your crisis.

And that's what I normally find in 30 years of doing what I do. So I really want you guys to look at that because I'm not positive. But based on my experience, that's what i think has happened susan is uh i'm sorry grace is with us grace in philadelphia hi grace how are you uh good thanks for taking my call sure what's up um so i have a question about a rental that i own so we've paid off all our debt all our debt except for that rental and it's a home that we own in virginia um that we're renting out right now um so we're trying to save's a home that we own in Virginia that we're renting out right now. So we're trying to save for a home, but we owe on the loan on the rental.

So my question was, should we try and pay down that rental instead of saving for a home? No, you should sell it. So we are currently renting until next year, so we do plan to sell it next year. No, you need to sell it now. For the next, sell it now. Yeah. But we have tenants in there. Well, I mean, when the tenants leave.

They're leaving next year. So we plan to sell it right after. You have a lease? That's right. Okay. So that lease expires next year. When? In May of next year.

So you just signed it? Yes. Oh, no. Okay. So what do you owe on the house? We owe $140,000. And what's it worth? About $180,000.

So why are you keeping it? We've just had the tenants since we left in 2014. Why are you keeping it? Why did you keep it in May? Why did you re-sign them?. Why are you keeping it? Why did you keep it in May? Why did you re-sign them? Why didn't you put it on the market now? Oh, I guess we didn't think about it.

Yeah. You were not renting in Philadelphia and said, hey, I want to be a landlord in Virginia. Not at all, no. This is by default. I used to live in Virginia. Yeah, this is by default. You wandered into this and didn't bother to wander out. So, you know, ask the tenants if they want to buy it. Okay.

Let's see if we can get out of it now. And you put that $40,000 in your pocket now, and that moves you towards buying a house in Philadelphia quickly. Get your debts paid off if you have any. But you don't need to be owning a rental property in Virginia when you live in Philadelphia. You're too broke. And besides that, I'm not broke, and I don't own any long-distance landlording. Long-distance landlording is how you end up having somebody change their Harley oil in

your living room. So you just don't want to do that. You need to be on top of property more than that, even if you have a management company. In some cases, especially if you have a management company. So, yeah, I want you to get rid of that as soon as you can get rid of it so that you have a lot less risk in your life and you let your to your point you're 100 debt free and you're able to save up and buy your first home that you live in in the town that you live in and that's way ahead of owning rental property. Susan is with us in Nashville.

Hi, Susan. How are you? Hi, Dave. I am calling you because I'm hoping that we have not paid a stupid tax, but I'm hoping you're not going to tell me that we did. I went to a college counselor who marketed herself as somebody who would help us plan for our child's college, and it was in like a three-tiered approach. One of the things that she raised a point about was the 529 plans and how 529 count against you when you're applying for financial aid in college. No, they don't.

Okay. They only count against you if you're trying to act like you're poor. Okay. If you're trying to get income-based scholarships, they count against you. But you shouldn't be getting income-based scholarships unless you're poor. Well, we're not. Okay. you're poor well we're not okay and and i thought since we were like in this this income level where we should meet with this woman to um minimize our i don't even know what to call it our exposure

so we met with her um and unfortunately um we paid her $1,500 and I thought she was going to help us position ourselves, um, in, in a better way when we apply for colleges and filling out the forms and so on. Um, we walked out last night and, um, what it came down to was basically she was trying to sell us, um, an insurance policy and get us to transfer our 529 funds to this insurance policy. I know that's a horrible idea. Did you do it? No, no, no, no, no.

And my stomach is, I feel like I've been kicked in the gut. Okay. You paid her the money last night? No, we paid her a couple weeks ago, and I'm just wondering if we can get this money back. I doubt it. Oh, I was afraid you'd pay back. I would just call him and ask her.

Okay. I think she probably already spent it. Probably, yes. I don't think you're going to see it again. I mean, but, yeah, I wouldn't pay somebody $1,500 to coach me through on how to get a kid in college. So, just for the rest of you out there. It's not a regulated position for you to pay someone to coach you to do that. There's no regulatory body involved.

And so the only thing I can do is if I were you, I would just call and put pressure on her and go, Listen, we're not satisfied, and we're going to post on social media that we're not satisfied with you, and we would like a refund. And if we don't get one, then we're going to let other people know not to use your services as loudly as we can. And that's the only thing you can try us, America. We're glad you are here. Joe and Shannon are, we're glad they're here, from Cincinnati, Ohio.

Hey, guys, how are you? Hey, Dave. Hey, Dave. We're excited to be talking to you. Welcome. I see on my screen you're debt-free. Congratulations. Thank you so much. Thank you.

How much have you guys paid off? We paid off $66,235 in 19 months. Love it. And what was your range of income during that time? From $110,000 to $130,000. Wow. Way to go, guys. What do you all do for a living? I'm a cardiac nurse in an OR. I'm a foreman at a construction company. Perfect.

Cool. What kind of debt was the $66,000? It was something you always tell us not to do is a land contract. We bought some land behind our home, and we put on a land contract, and we heard, you know, obviously not to do that. So we decided we were going to pay it off. Okay. That was your only death then?

Yeah. We actually heard about you, well, I heard about you about six, seven years ago from one of my cousin's wife. And she had told me about your book. And we've kind of been just living normal. And then what happened is one day we just decided, you know, we're tired of being normal. And we wanted to get it out. And we mapped out a plan and figured we could pay it off in 24 months and end up paying it off in 19 months.

Wow. Very cool. Knock it out. Boom. Just like that. So that makes you 100% debt-free or everything but your house? Everything but our house. Our house is on the next to-do list, so we're shooting for that seven-year mark.

Good deal. Very well done. Good. So how much land is this? It's a little over nine acres. Wow, very nice. And right behind your property? Yep.

Correct. Oh, nice. So that makes you have a total of how much in acreage? We'll have about ten and a half. Yeah. Okay, so the one you're on is about one and a half? Yes. Okay, perfect.

Very cool, you guys. Love it. Well done. So how does that feel to knock that out? Amazing. Unbelievable, Dave. What do you tell people the key to getting out of debt? I mean, you knocked off $66,000 in under two years.

Yeah. I think the key for us was communication and teamwork and, you know, just being willing to pick up, you know, extra work or call, whatever it may be. Just working together and budgeting is huge. That was our biggest problem. Like we had, you know, a big shovel, like you always say, but we didn't know where our money was going. You know, it was like you get to the end of the month and it's like, where did it go? And you feel like you've gained nothing. And once you've got a budget, it's just unreal how much money you spend you don't even pay attention to.

Wow. Well, very cool. Good for you guys. Well done. Well done. What was the hardest part of this for you all? For me, I think, which Joe, I don't know what you feel, is the fact that we started our family through this whole journey, too.

We have two sons now, and Joe's taken a job change, which he took a little bit of a pay cut for just to be closer to home. And then I've completed my, like, some degrees going through as well. So it's just been busy, but it's been totally worth it. Dave, I'd have to say just, you know, sticking to the plan, staying disciplined, probably the hardest part of it. Yeah. But your plan is amazing, and it works.

I just want America to know that, that it works. Well, I'm proud of you guys. Well done. Very cool. Did you have people cheering you on or saying you were crazy? A little bit of both. Yeah, a little of both. I don't think we're too crazy.

We've made it. Finally, we've made it. Yeah. And how much do you owe on your home? I don't know. It's around $200, I'd say, to go. Okay. All right.

Well, you'll get there. You're on track. Very good. Yes, sir. Congratulations. Well, we've got a copy of Chris. We're proud of you. Congratulations.

We've got a copy of Chris Hogan's book, Retire Inspired, number one bestseller, and that'll be the next chapter in your story to be millionaires. Like you said, knock that house out in seven years. That's a big part of that strategy. And then, of course, outrageously generous as you go along. And you got those two kiddos to raise, so everything's perfect. Good stuff. Congratulations.

Joe and Shannon, Cincinnati, Ohio. and shannon cincinnati ohio sixty six thousand dollars paid off in 19 months making 110 to 130 count it down let's hear a debt-free scream three two one I love it! Way to go, you guys. Well done. Josh is in Brunswick, New Jersey. Hey, Josh, welcome to the Dave Ramsey Show. Hey, Dave, it's great to talk to you. You too, sir. What's up?

I know that you're a religious guy, so I'm hoping you can help us with a dilemma we've been having with our son. We're an observant Jewish family, and we're getting ready to send our oldest son to college next year. We've gone through the financial aid process, and we've received some really amazing financial aid packages from some great universities who really want him. But we've been sending him to Jewish private schools his whole life, and he's decided that he wants to attend a Jewish college for the next four years. And we're fine with that,

but the financial aid package from that school is not nearly as attractive and includes $18,500 a year in student loans. Our son tells us, no big deal. Everyone gets student loans. I'll just pay it back. My wife and I, having listened to you, we know that debt is dumb, and we know that he'd be making a huge mistake. We also know that when all is said and done, we're the parents and we're going to make the decision, but what can we say to a naive 17-year-old who thinks that student loans are just a part of life?

Well, I think there's two discussions here. One is the student loan naivete, and it's just part of life. And that's a wonderful discussion to have, and it's one you've already had with him in other ways um you know it's it sounds you know you ever open your mouth and your parents come out that's happened to me okay and it sounds like classic parent lines like well little johnny jumps off a cliff does that mean you're going to jump off a cliff you know and so it's that kind of a discussion right just because everybody else does it doesn't mean you want to do it.

Normal sucks, son. You don't want to be normal. You don't want to be normal. And, you know, as a matter of fact, you're wanting to go to a Jewish school because you don't want to be normal, meaning that you want to look at things through a spiritual lens, not just all the other lenses that everybody else. You're already choosing an unusual path for your own good right where some of your buddies are just going off and doing whatever right so you're already choosing that son you're you know you already are choosing that but you're using this as a

rationalization or excuse so i would just coach him through not being normal and you know looking for excellence in every area of his life and that's certainly uh everybody does it is never an answer. As a matter of fact, with money, it's the answer means you don't want to do it, whatever it is, because everybody's broke. So that's discussion number one, okay? All right. But then there's a valid thing that he's wanting to do here,

and I love it that he wants to go to a school that matches with his faith and that he can be in an environment with matched value systems and so forth. And then you've got to have that discussion and go, okay, if you're going to do this, we've got to figure out a way to pay for it. It's the only way because we're not going to do this. We've got to figure out a way to pay for it. And so are you working extra between now and then? Are we going to sell a family item so that you can do this? But that is off the table.

We've got to find a way to pay for it. Or we've got to rethink this, and, you know, is there a way to embrace your faith without attending a school that is particularly to your faith? And certainly there is, you know. Yeah, and that's what we think is the best option. Yeah, my kids, you know, as you said, were Christians, and our kids did not go to Christian schools. They went to the University of Tennessee, a state school, which has some Christian influence,

but has some wacky stuff going on from time to time, too, right? Because it's a mainstream school, and it doesn't line up with their faith and so you know i think he has the opportunity to uh you know to to teach people in the community that are not jewish about the power and the wonder of of his faith right uh and he won't have that opportunities when he's hanging out with only people of his faith and so our kids went into the mainstream school, so to speak, or the secular school, so to speak, knowing that it's an opportunity to share their faith. And I think he could look at it that way as well. So, you know, you can be

Christian and not go to a Christian school. You can be Jewish and not go to a Jewish school. As a matter of fact, you can be an excellent, excellent at your Judaism or excellent at your Christianity without attending one of those schools. And so it does not define your spirituality by where you attend school. And I want to get that

fixed first. Then we can have the discussion of, is there a way to pay for this? And I don't mind paying for it if we can figure out a way to do it, but got to pay cash good discussion josh thanks for calling this is the dave ramsey show you our scripture of the day romans 12 2 do not be conformed to this world, but be transformed by the renewal of your mind, that by testing you may discern what is the will of God, what is good and acceptable and perfect. Don't be like other people.

How do you keep from being like other people? You put new things in your brain. That's the Dave version. Do not be conformed to this world, but be transformed by the renewal of your mind. Henry Clay said, of all the properties which belong to honorable men, not one is so highly prized as that of character. It's a decision. You get to decide. You get to decide. You get to decide.

You have great power because you can decide. That's power. The interesting thing is that people surrender that power. They say, well, I don't have the right to decide. Why not? Only because you decided. Isn't it interesting that people decide not to have the power to decide? They feel like they don't have the right to decide because they decided that.

You have the right. What is it you're going to do? I hate my job. Change it. I don't like the way I look. Change your eating and exercise habits. I don't like the way I feel. Change your eating and exercise habits.

I don't like being broke. Change your money habits. You have the right to decide. Just like that. It's a powerful idea our question of the day comes from blinds.com you know jade steinfeld my friend started blinds.com about 20 years ago to make the complex process of ordering and installing new custom blinds simple with blinds.com you get free samples free shipping and with the new promos they

run every month you're going to save even more always put in the promo code ramsey and you'll see the best possible deal out there that's the magic word ramsey at blinds.com today's question is from dave and he says what do you think about using a whole life policy as a get out of debt program by borrowing and then paying yourself back with interest? Most dogs that chase their tail only catch the dog in front. That's what I think. That's just plain stupid. Okay, let me get this straight. I'm going to buy a whole life policy.

I'm going to pay 20 times more for the insurance so that there's money in the whole life policy that I put in there. I'm going to borrow that out, and I'm going to pay them interest to use that money to get out of debt. Did you just go around the barn three times chasing the same cow, son? I mean, really. Why don't you just use all that money that you were about to waste and get screwed with an insurance company? Use that and pay off your debt. This really, man, people work so hard at not working.

But this is actually one of the things that's being pitched out there by these stupid whole life insurance companies. Using a whole life policy is a get out of debt program by borrowing and then paying yourself back with interest. Well, you pay yourself back and you pay them the interest. But aside from that, the interesting thing is, whose money is it? How'd the money get in the whole life policy? Oh, you put it in there. Oh, why don't you just use that money instead of you putting it in the whole life policy and pay on the debt?

You short circuit all of this crap. Oh, and by the way, you won't lose your butt in the process. This whole life is like a payday lender of the middle class. It's absolutely horrendous. Jeff is with us in Evansville, Indiana. Hi, Jeff. Welcome to the Dave Ramsey Show. Thanks for taking my call, Dave. I'm relieved to get to talk to you. I'm honored to speak with you. How can I help? So the wife and I built a house and made almost every mistake you could make in that process, and I'm trying to avoid making one more. The construction loan is coming to a close, and it was a one-time

closed loan, so my rates are locked and all that's done. We've got approximately $30,000 left from the sale of our previous home, and I'm trying to decide to put that back towards the new mortgage which was our original plan or should i pay down some of the fifty two thousand dollars and other debt that we have 27 of which is in property attached to our home but on a separate note and 25 is that dreaded loan from mom and dad and you have 30 $30,000 in free cash laying. Yes. So we can't clear both. What's your household income?

Base is at about $120,000. Okay. All right. And if you do not use the $30,000 towards the house, will you have a 20% equity position to avoid PMI? Well, that's unique. I'll be at 15, but the bank made a mistake at closing and didn't have me sign the right papers, and they cannot hold me to PMI. There were words in an email.

Wow. So no PMI? No PMI. Either way. If I had zero down. Yeah, either way. Exactly. Either way.

All right. No, I'll just had zero down. Yeah, either way. Exactly. Either way. All right. No, I'll just close on the loan as is then. I wouldn't mess with it. And let's use the 30 and pay off mom and dad and a little bit towards the land. And then we'll turn around and snowball the land out of your regular budget. I like the sound of that, Dave. I appreciate it. And that clears everything.

And if you've got no PMI, then we go after it. What's your interest rate on this loan, on the mortgage? 3.5. Okay, good. And fixed, I assume. Absolutely. Good, good. 30 years, unfortunately, but it is fixed.

Well, you can, you know, did you say 30 years? Yes. See if they'll, I don't know that they would care to convert that to a 15. Well, that's going to be getting into about 40% of my take-home pay to do that. Ouch. Well, I'm not going to do that either. Okay. All right.

Yeah, not at this point. But I think I'm going to take the found money, we're selling everything that we don't need, and knock that thing down and still pay off in 15 years just on a 30-year note. Yeah. Okay. Well, and as your income 15 years just on a 30-year note. Yeah. Okay. Well, and as your income goes up, you don't adjust your lifestyle.

You start throwing at that house real hard. Yeah, that's good. That's exactly what I would do. Good question, man. And, you know, as you said, I wouldn't have signed up for the trip you're on, but this is the best way to take the trip, the things we outlined. Daryl is with us. Daryl is in Seattle, Washington. Hi, Daryl.

How are you? Doing good. I'm blessed, man. How about yourself? Better than I deserve, sir. What's up? Yeah, so I've been following you for a while. Me and my wife, we're in FPU right now, and we just finished the insurance lesson.

And so last night I was talking to my mother. She's 59 and a half. You know, our family has a history of generational poverty. She was considering, she has term insurance, term life insurance now. And she says her premium's about to go up in a few years. And she's considering getting whole life insurance. And so I told her, no, no, no, wait, let me research this and everything. So I'm calling you now just to kind of see what would be the best option at her age to pursue.

Good for you. Well, you're learning stuff. That's neat. And she's open to listen. Yeah. Does she have anyone that counts on her income to eat? If she dies, who's going to be left hungry? No one.

Okay. So why does she need life insurance? Well, she just wants to leave something for her kids, I guess, just because we just all grew up broke. Yeah, I understand. But life insurance is not the best way to do that. And so I would rather her just save her money okay has she got any money saved uh she she has a few uh retirement accounts from older jobs that she worked in

how much is enough in those to bury her uh we don't know she. She lost track of those accounts like a long time ago, so we have to go back and try to find them. Well, first thing is to raise enough money and make sure she's got a good emergency fund, and that would bury her if something happened to her, God forbid.

And that way she's not a burden to the family. But no, I would not buy life insurance at all. No one's counting on her to eat. So we just saved her a ton of money. Not whole life, not term, not anything. The only thing that she would need is a burial policy, but I don't even think she needs that. I think she just needs to save her money, and you guys use that money to bury her, and you don't leave an inheritance by using insurance.

Insurance companies make money on insurance. Think about that. That's not a way to leave an inheritance. I'd just avoid the whole subject if I were her. Good question, Darrell. That puts this hour

of the Dave Ramsey Show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way

to financial peace and that's to walk daily with the Prince of Peace, Christ Jesus. This hour of the show is over, but you can also watch on our free mobile app,

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