The Ramsey Show - App - How Can I Inflation-Proof My Savings? (Hour 1)

Episode Date: December 9, 2022

George Kamel & Dr. John Delony discuss: Investing vs. paying off the house, How to help without enabling, Pulling from a 401(k) to buy a car, Protecting savings from inflation. Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET 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 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Лайв Live from the headquarters of Ramsey Solutions, broadcasting from the Pod's Moving and Storage studio, 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 they love, and actually be in a relationship with one another. I'm John Deloney. Joined here by my good friend, George Campbell.

And we are taking your calls on life, money, marriage, relationships, mental health, whatever's going on in your life, your work. 888-825-5225. 888-825-5225. 888-825-5225. The call is free. Give us a buzz, and we look forward to talking with you. Let's go to Kimberly in Charlotte, North Carolina. What's up, Kimberly? How we doing?

I'm doing good. How about you? Fantastic. What's up? I have a question. Me and my husband have just started watching Dave Ramsey. I'm 26. My husband is 24. We make about $105,000 a year before tax. We are debt-free except for our house mortgage, and we want to start

investing. My question is, should we start investing now or work on paying our house off faster? Yes. That's it. The answer is yes. And you're going to do both in Baby Step 4, 5, 6. We do them all at the same time. So you kind of get one plate spinning with Baby Step 4. Let's start investing 15% of our income into retirement. You guys don't have kids? No, not yet.

Okay, so we're going to fast pass Disney style through Baby step five for now and go to baby step six. So any extra margin beyond that 15%, you can now throw on top of your principal mortgage. Okay. Also, we have an $80,000 truck that is paid off. We paid it off in a year and a half. Holy truck, Batman. Would you recommend selling? An $80,000? Does it fly?

Yeah. It was my husband's dream truck. He got it before we got married. Then his dream truck turned into his dream wife, and now the dream truck has got to go away. That's what I think. He doesn't want to get rid of it, but would you recommend selling that

and putting that down on the house or investing in it? This is me personally. Not owning an $80,000 truck, yes, absolutely. And our advice when it comes to toys, because let's be honest, an $80,000 truck is a toy, is not to have more than 50% of your income tied up in things with motors in them. And it sounds like you guys have as much income as you do toys. Yes.

What is your car worth? My car is worth like $6,000. Okay, hold on. What kind of grown man will allow his wife to drive a $6,000 car while he drives an $80,000 truck. Hold on. Let me interject here, Kimberly, because George drives a Tesla. John, this is beyond Tesla at this point.

No, I understand. I come from a truck driving state, a place where trucks are equal to, if not a little bit more important than the spouse. I get it. There it is. You said it for me. There you are. to if not a little bit more important than the spouse i get it um there it is yes there is a i i i know of trucks that cost eighty thousand dollars cost 110 000 that are tools they are they have a utility to them oh i thought you're talking about the guys driving them yeah i was like john that's me don't call them tools they have a utility they're nice guys

so they are toys but they're also utility. I also know a whole bunch of dudes who are, A, leveraged to their eyeballs to drive an $80,000 truck when a used $20,000 version of that truck will last them for a long, long, long time. And, as George mentioned, you guys don't make enough money to justify having an $80,000 depreciating asset in your driveway. I know. Especially when that's... I just don't know how to get my husband convinced of it. Well, here's the way to do it.

This is not going to be a math problem. It might be. It could be. But this is a... I'm scared that we don't have an emergency fund. And you have an $80, you have an 80,000. Oh, you do? Okay. We do.

I want to be in a home. I want to start thinking now about what our life is going to look like in five years, in 10 years. And in five and 10 years, you're going to have a $40,000 truck sitting in the same spot in the driveway and we're still not going to have a down payment on a house. I'd love to see you sell that $80,000 truck while people are still paying crazy amounts of money for used trucks and go buy a nice $30,000 truck that's used, that's got mileage on it, everybody's going to live, and let's take $50,000 and put that down on our house. What's left on your mortgage?

Yeah. Pardon me? What's left on your mortgage? Yeah. Pardon me? What's left on the mortgage? About two, we actually just bought in August. It's like 220, I think. Okay. And we haven't set the payoff in 15 years. Forget 15 years. You guys have a life to live. I don't want to be in debt for 15 years. Do you? No. So let's have a goal of five or seven or 10 at the most. And what, what is this 50 K going to do to that goal? It's going to speed up

that process by a lot. So think of it this way. Um, this has been a, a Hank, I grew up and we didn't have a lot growing up and money was a, was a hard conversation. And I didn't know a lot of people with a lot of money for a lot of my life. And one of the ways when I – now I get to sit by Dave every week. I get to sit by people who think about wealth differently. And one of the things they have taught me is to stop thinking about money in ways A, B, and C or D. How can I get this thing? How can I see this?

How can I make the shiny thing even shinier? And here's a unique take on money. How can I buy hours of my life? How can I buy back time? And so if you just look at your $105,000 household income that y'all make, and you think how long would it take us to put, to pay down $50,000 of our mortgage? That might be one or two or three years of your life. And we can buy three years of our life, two years of our life, if we just go sell this big dumb truck. And changing the way I look at my life now, I actually went and bought another mower because it took me six

hours to mow my place out in the woods on a Saturday. Now me and my son do it together and we get done in two. I just bought four hours of my life back. You see what I'm saying? So that's how I've started shifting. Um, how can I, I've started paying for things that I don't normally pay for, but I've started thinking, how could I buy hours of my life back? And I want you to sit down with him and say, Hey, we can accelerate this by two years, by three years.

And then we can get a jumpstart on our debt free life and bring a kid into a world that doesn't know what a mortgage even is. And it starts with selling your beloved baby out in the driveway. Yeah. Is that fair? I agree. And we're all clear. You get the nice car next time,

right? yeah there we go $6,000 versus $80,000 have him call the show George and I want to talk to him too

hey what color is the truck? I'm just curious what color is it? it is red I knew it John I was thinking in my head and he keeps it

oh my gosh he's had it for two years and it's brand new like he keeps that thing as soon as you called in I was like big white fuck I was like this is a child And he keeps it. Oh, my gosh. He's had it for two years, and it's brand new. Like, he keeps that thing. As soon as you called in, I was like, big white fuck. I was like, this is a child who grew up and got money, and he wants a big white fuck. And, hey, he doesn't have a mortgage on it, so high five to him.

But, man, that's a lot. Sell the truck, man. You know what? I'm going to challenge you. I'm going to challenge you to find a $10,000 truck that gets you to and from. Whoa. And put down $70,000 truck that gets you to and from. Whoa. And put down $70,000 on your house. Move that sucker.

That would be baller. Just accelerate it, man. Accelerate it. Buy back moments of your life. That'd be incredible. 888-825-5225. Give us a shout on the Ramsey Show. We'll be right back. Thank you. I'm George Campbell joined today by Dr. John Deloney this is the Ramsey show give us a call 888-825-5225. We're taking your questions about life, money, mental

health, relationships, you name it. Rachel joins us up next in Chicago. Rachel, welcome to the show. Hi, thank you for having me on the show. Hey, how are you doing? What's going on? Good. I was just calling with a quick question here. It's actually pretty similar to the last caller, but at what point do we stop helping family financially? My brother was murdered a couple years ago, and he left behind a three-year-old, so our niece, and we've helped, you know, mom out as she was a single mom for a year or so. And now she's moved on, married. And, you know, we offered to adopt our niece and for turned down. And we don't really see a future for them to be self-sustaining in her new relationship and her outlook in life and just, you know, overall.

So I just don't really know what to do at this point. Our niece is three years old, and I would like your thoughts on, you know, where to go from here, how to help but not enable, and how to really help her when she's, you know, a state away. So do you not trust her with the money that you're sending at this point? Is that the real issue? Yes. You want to support your niece, but you don't think it's actually going to support your niece in the right way. Is your niece safe? Well, that's questionable. I mean, I'm asking

this is simple. Yes or no. Is that kid being abused sexually psychologically is a kid getting food is kids safe as could get neglected there DCFS has been involved in the past okay and you know for neglect and things like that so I would say at this point we don't have any knowledge of that happening, but I think it's a high possibility in the future. Okay. That's one of the few things I just simply don't mess around with even a little bit. If I have an inkling that, because it's a child at stake, right? And I'd rather sleep at night knowing that somebody doesn't like me and their child's safe than the other way around. Okay. So if you ever get an inkling that the child's not safe, then we're going to make

that call again. We're going to make it again. We're going to make it again. I know that system's a jacked up mess, but we're going to keep making that call. Yes. So we do keep in contact and make sure that we're always calling and checking up on her and just seeing her face time. Here's the other side of it. It is really hard to hear. That little girl is her child. Right. And the more you are grieving through trying to insert yourself into this little child's life, the bigger of a mess this is going to turn into.

See what I'm saying? This has become a proxy for your grief. And so, like, George asked a great question, like, are you not trusting with the money? Then stop sending the money. Yeah, we're not. Yeah, then stop sending it. I would have a meeting. I would have a conversation and say, hey, it's been a year and a half.

You've moved on. You're remarried or whatever you are. We're going to stop doing X. We may create an account for her college because that's what we're going to do over time that only she will have access to. But we're going to begin to let you fly on your own. I'm going to have that conversation. I'm just going to cut off one weekend, right? But channel your grief and channel your frustration and channel some of your hurt into something that's going to be more fruitful.

Okay. But right now you're trying to parent by proxy, and it's just causing a mess for you. It's causing a mess for them. It's just becoming convoluted. You see what I'm saying? Yes. And it's hard. I know what I'm telling you is hard.

It's hard. The hard part about this is that it almost feels like, you know, then we won't have any access to her at all. And so here's the hard part. That's her kid. And if she wants to deny access to her aunts and uncles, unfortunately, she's allowed to do that. Okay. What I would want is a track record. like there's no there's no legal right i would say there might even be a moral and ethical right but there's no legal right that an aunt uncle have to access to somebody else's child i would want to uh to create a track record where that kid will know that aunt so-and-so and uncle so-and-so wrote me a card every week every week they i got something in the mail from them for my whole childhood. And that three-year-old, that seven-year-old, that nine-year-old, that 14-year-old won't get it.

That 22-year-old will. That 29-year-old will. She'll go through life knowing, I know somebody who loves me. See what I'm saying? We're playing a long game here now. Okay. So, Rachel, you said you've stopped sending money to them, but you're still wondering how can we help without monetarily gifting money? Yes. I mean, this came kind of all

to a hedge because she's asking for money now, and this is now the next iteration of now we need money for this, and now we need money for that, and we haven't sent it because I wanted to talk to you first. Yeah, so I sit down and say if it's about clothes or if it's about food, I might, I'll do, if you're asking me for help financially and my help comes with fill in the blank, it's your money. I'll help you do a budget. That's the only way I'm going to give you money. I will help you with X, Y, and Z. That's the only way I'm going to give you money. I'm going to do it one more time. And you need to know this is the last from where this comes from. We're creating a college account for her, but see what I'm saying? Like it's your money. So it's your boundaries and it's your

decisions and you can put all kinds of hoops you want to. And if she says, I'm not doing all that, that's great. You're choosing not to take my money. That's her choice, not yours. See what I'm saying? Yes. And I know again, all that's hard. What's the hesitation? She's not going to want to do it. Cool. She's not going to do it. She's opting out. And I say cool, not in a, that's not great for that kid, I'm sure.

I'm not saying like, all right. It's not like that. You know what I mean? Like she's making grown-up choices. Right. Sounds like the next step is another hard conversation to go. Listen, I want to support this little girl who I care deeply about but it's going to be on my terms and the conversation before that one is with your with your husband and y'all sit down and say here's what we're willing to do and here's how far we're willing to go and this is what our boundaries are going to be

and then just know that anytime you set boundaries everyone around you in your life are going to try to test those boundaries to see if they hold. She's going to call you desperate at midnight. I got to have food money. Are the kids hungry? They're going to come test those boundaries. And you're going to have to decide up front how firm we're going to hold. Right?

And then from there, you got to make peace with that's her child. And if you get wind of it not being safe, I'm going to make those calls. But I'm not going to try to armchair parent somebody else's kid in a different house from far away. Right. Okay, I think that's really good advice. I think I can see myself doing that in a variety of instances of parenting, and it's a little hard because we did parent her. She was placed in our home as a foster child when she was born. Hey, Rachel, I think it's wise for you and your husband to go grieve this like a loss.

You love this little girl, don't you? Yeah. And you loved her dad, didn't you? Yes. Yeah. You all need to grieve the loss. And the three-year-old can't prop up you and your husband's grief. Okay?

There's a hole there, and y'all got to address the hole. Y'all got to sit in the hole for a while. And find some more productive avenues to give you peace. You'll make meaning on the back end of this, right? We're going to take care of kids. That's going to be who we are. We take care of kids whose parents pass away. We take care of kids who are right? We're going to take care of kids. That's going to be, that's going to be who we are. We take care of kids whose parents pass away, or we take care of kids who are struggling. We're going to be foster parents. That's, we're going to make

meaning on the back end of this, but right now we have to grieve it. And I don't know that y'all are there yet. Is that fair? Yes. Okay. Hey, we'll walk with you. We love you. I'm going to send you two copies of Financial Peace University. Okay. It's me and George. It's our gift to you. You can sit down and say, hey, I'm going to offer this to you and I'll go with it. Go with, go through this with you. And that's going to be the condition of me giving you any more money.

And this is the last time we do that. Whatever the, I'm not going to give you parameters, what they happen to be, but I'm going to give you some cash to get some food and diapers right now. But I'm also going to give you a tool that's going to help you change this thing. And you're right. She's probably not going to do it.

She's probably not. But you'll be able to sleep at night knowing I put a fishing pole and weights and bait and hooks and know-how on the front porch. She chose to not go fishing. And ask her what exactly she needs. And then you can go drop the diapers at the door. If you don't trust her

what she's doing with the money, then you provide exactly what the thing is and you can sleep easy at night knowing you did what was right for you. But hang on the line. Austin will pick up. We'll get you two copies of Financial Peace University to help walk through this with them and hopefully create some semblance of a relationship so that you can have a relationship with that little girl. Thanks so much for the call. This is The Ramsey Show. I'm George Camel, host of The Fine Print and co-host of the Smart Money Happy Hour podcast. Hosting today with my friend, Dr. John Deloney, host of The Dr. John Deloney Show. You can check

out all of those shows on the Ramsey Network and wherever you listen to podcasts. Open phones this hour, 888-825-5225. Let's talk about your life, your money, boundaries, relationships, mental health issues. We are here to serve you, America. Mike joins us up next in Columbus, Ohio. Mike, welcome to the show. Hey, good afternoon. Good afternoon to you, sir. I've been saving to purchase a home and I've been looking for the last year or so.

Hasn't been much of opportunity on the market. I'm currently renting. I've built up a fairly large liquid cash position as I've been saving up. And I'm worried about the impact of inflation on that particular savings. Sure. How much do you have? Currently in liquid, $105,000. Awesome. And where is that currently saved? It's currently in a bank savings account. Making probably 0.001%. Yeah. You can do better than that. Mike, you said disappointed in Mike. Now, have you heard about like a high yield savings account online? Yes and no. For the most part, I've been just parking money and haven't really been thinking about it much. Okay. We love a savings account for that kind of short-term savings. I don't want you investing

this money, but there are better options for savings accounts. And one is that online high yield savings account. I've got one right now. I'm getting 2.6%, which is incredible compared to what it's been the last few years. So interest rates have been climbing on those savings accounts, which is great. So you can do a lot better on that money if you moved it over. Interestingly enough, is that 2.6% compounded or is that annual? That would be annual, but it would get compounded because you get 2.6% every year. And so as you earn that 2.6%, you're going to earn 2.6 on that amount now. And so it's a great deal to keep your cash liquid. Yes, you could invest it in the market,

but as we've seen, my 401k is down like 25%. So I'd be real upset if I was in the stock market right now. I'm not even looking at mine. John just doesn't look. Probably for the best. I'm not looking. So Mike, that's what I would do if I was in your shoes. You're on to a great start. I mean, is that enough money to get you a down payment right now for the house you're looking at? Yep, it is. And about 20% for the range that I'm looking at, which is pretty good.

What's your hang-up? There's something not sitting in your soul right. What is it? Immediacy of action because I'm looking to purchase a house right now. I've been renting for a little bit. I'm going to month to month because I had a house that was lined up with a good offer, and it kind of fell through. You working with a good agent? I believe so, yeah. Okay. You working with a good agent? I believe so, yeah. Okay. I have a tendency,

Mike, to get frustrated with the situation and go do something to shake the snow globe and I make a mess. So the hardest part for you is to not let this hundred grand burn a hole in your pocket and your frustration with renting make you do, a foolish long-term decision whether that's to go dump all this money into an index fund and lose 10 of it over the next year because the market is still fluctuating and you need the cash or to go buy a house that you really don't like but you're just sick of all man you need to just be patient even if you have a friend you say hey your job is to make ask me these questions before I go do something stupid. You're not going to earn 20%. You're not going to earn back inflation. You're not going to earn back 8.3 or 8.6, whatever it is. You're not going to earn that back

in a liquid account. You're just not. So you got to make peace with inflation is what it is, but I am interested in holding onto this cash right now. Does that make sense? Yeah, it does. Can I ask you one other question really quick? Sure. How would you differentiate this from an emergency savings account, and how would you handle the two differently? I mean, I would keep them in different accounts so that I don't go into the cookie jar and then go, oh, that was my emergency fund. But I keep the majority of my emergency fund in a high-yield online savings account.

And so that's where I would tell you to put that home savings as well. Now they're different. So I would leave them in separate accounts. You can create multiple accounts with those banks. But I'm looking at the numbers now. You could be making 2,700 bucks a year right now if it was in a high yield savings instead of close to zero. That comes out to a little over 200 bucks a month. But let me tell you, Mike, the secret sauce is not the interest rate. It's Mike. You putting money away, living on less than you make, that is the secret sauce to beating inflation, not a savings rate. And you've done that. You've done it, man. I mean, how many people look up and go, I got a hundred grand in the bank and I'm ready to buy a house and I'm ready to do it the smart way.

So now you've done the work. You said a hundred grand was enough to get this house, right? So now it's the game of patience. Like John's talking about going, well, I want to buy the right house and not just because I'm sick of renting. This is the biggest purchase you've ever made in your life, right? Yep. So I'm going to walk with a lot of caution, a lot of wisdom, work with a great real estate agent, and desperation leads to bad financial decisions. And when you can do it with patience and you're not in a rush, that's when you can actually get the best deal because you're not feeling impulsive to just get it now and not negotiate and take your time and walk away if it's not a great deal.

All right. So you've done great, man. The one move I'd make is just switching it over to high yield savings account and at least for now you'll feel better making that 200 bucks a month so thanks for the question it's a good one and george you and i've talked about this offline just when we're hanging out in the green room somewhere talking about how we each do how we actually live these principles out in our own lives and i have my emergency fund in the same place with my checking account i i earn i may earn a high five every year, right, annually.

For me, it's not worth, I need to pull up this bank, and I don't keep apps on my phone. So it's just a personal decision. I think the main thing is, do you know where it is, and can you get to it in the case of an emergency? Is it liquid? Yeah, and we always say an emergency fund is insurance, not an investment. And a lot of people look at $10,000, $20,000, $30,000, and they're going,

well, John, that's unsophisticated. You should put that. You could invest that money. That's the wise thing to do. It's not an investment. It's sleep insurance. It's meant to protect you. Yes, it's sleep insurance.

There you go. I can go on a vacation, and if something goes wrong, that's fine. You got the money. Yeah, that's right. That's a good word. All right, Dave joins us up next in Erie, Pennsylvania. Dave, welcome to the show. Well, thank you for taking my call today.

Sure. How can we help? Well, real quickly, I'm 58 and a half, everyday millionaire, debt free. I'm going to continue to work. When I'm 59 and a half and can utilize my 401k, is it okay to use it at that time to purchase a new vehicle and let that ride for a while and build back up and then purchase my wife a new vehicle and use that as a vehicle fund? Will you still be working at that point? That's correct. I'm still going to continue to work. I'm still going to continue to contribute to it. And I thought that might be just as simple as, you know, saving up and using that fund for that. And you're completely debt-free? Yes, sir. Home and everything?

Yep, everything. I owe nothing, worth about $1.25. Way to go. And, you know, we cash flow everything and just, that's a lot of money to build up. You know, what a new vehicle costs. I thought, geez, if I can hang on with some old 2006 vehicles for another year, I can utilize that fund. But taking the current financial state of the country and everything, I just wondered if that was okay to do. So I want to ask a question to George. Dave, your question sparked a question with me and so both of you answered this.

Why wouldn't Dave and or George, I guess, just stop making payments to the 401 and go ahead and just save up cash? It's going to take you a few months, but why would you end up owing yourself? I could do that and I just wonder, is it six, one, half, the other?

What would be the difference? I don't know. I guess my question is, why wouldn't you just save up and cash flow it with your income? I mean, you've done so great. You've stayed out of debt. You're doing all the stuff the right way. I just wouldn't want to rob my retirement to start my retirement off as soon as you can pull the money out and rob the growth that's happening in that account. How much is in that account? One fund has right around $1 million and another one has about $200,000, $250,000. I mean, doing the math on what the compound growth of that account is today and taking $40,000 out of that to buy a car, it would just hurt me emotionally. And so I would go, I'm going to cashflow it and I'm probably going to make a different decision if I'm cashflowing it versus taking out of my retirement. And so I would just

tread with caution there. There's nothing wrong with it. I just don't think you need to. And so I would just save up with your future income with savings and do it that way versus robbing the retirement on day one. That's one man's take. But congrats, man. You've done a great job. Super happy for you. This is The Ramsey Show. I'm George Campbell. To my right, Dr. John Deloney. You're listening to The Ramsey Show. Give us a call, 888-825-5225. Glenn joins us up next in Kansas City. Glenn, welcome to the show. Oh, thank you. Thanks for taking my call, George.

Happy to do it. What's going on? Oh, you can label me tentative to retire. I like that. So I just need a third-party opinion. You know, I work with a financial advisor. Good. I do way too much reading, but I just wanted to run through my scenario and see if you guys think, do I need to keep working in this economy, or, you know, can I pull the plug at 59 and a half?

Okay. Just make sure you pull the right plug. Yeah. Yeah. No, not the, not the life support plug. Keep that. You want that one in the wall, brother. That's right. So hit us with the numbers. Okay. So, um, I'm about 80% tax deferred, 20% Roth. Um, I've got, by the time I retire, I imagine I'll have about 1.5 million. Um, and of that 1.5, I'd, I'd have about 90,000 cash. Um, I planned on waiting to collect social security till I'm 70. Um, my wife is going to continue to work until I'm 62. So then, you know, so I was going to try to spend down cash in the first couple of years

and then work on the tax-deferred money and try to stay under 80,000 a year total tax commitment. Okay. Or total income. So you're going, am I ready to do this? When's your plan to do this, to actually retire currently? 13 months, 3 days, 36 minutes, something like that. Wow. What do you do for a living?

I'm a power plant manager. Okay, cool. So what's your current income? About $150,000. All right. And you're not looking to replace all of that $150,000 in retirement? No. Right now, I only come home with about half of my income. All right. And you're not looking to replace all of that $150,000 in retirement? No.

Right now, I only come home with about half of my income. I put quite a bit into my Roths and savings account, so I could live off $80,000. And you'd be happy? Because that's really what it comes down to is what's your picture of retirement, and do the numbers match up to that picture? Okay, I'm speaking for myself. I'd be happy. I don't know if my wife would be happy. Ah, what does she think about all this? Does it make her nervous for you to quit working? Absolutely. Yeah. She, that's why she wants to keep working. She works remote and we want to

relocate. So I have no interest in paying down my mortgage. I always overpay, but I'm going to take the equity out of this home and put it in another home where we relocate. But yes, she's nervous. Here's a couple of things that I would do if I'm in your shoes, and I'll let George, obviously he's way smarter with the numbers side. Before I quit, before I retired is a nice way to say that. I would take my wife on a retreat of some sort, go out for a day or two, and literally spend a couple of hours being highly intentional about telling old stories.

What are some things in our marriage that we loved, some of the adventures we've had, our kids? Some of the stuff has been great. I talk about some of the stuff that's been hard. And then I would shift the conversation. And this might take half a day. And I would talk to her about this before you do it, and you spend some time by yourself and her some time by herself. What do we imagine the next potentially 40 years to be like? We often think like, oh, I'm going to retire at 60. You might be 40 years, my man. Okay. 30 years. What do we want that to

look like? To George's point, if you both don't have a unified picture of what retirement looks like or the next phase of your life is going to look like, you're going to run into a brick wall. And what we're going to do is we're going to blame that crash on money. We're going to blame that crash on my wife. She's going to blame that on my husband. She's sitting around the house. But all of that is tied into we were not unified in where we were headed when we started off on this new journey. The second thing that's important is you need to know the research on people

who just up and retire is not great. They fall apart. And so you've done the math. What I want you to begin to consider is maybe you're done at 60 managing a power plant. We want to get out of this town. We want to get out of this state.

We want to go somewhere different, somewhere hotter, somewhere cooler, whatever. We're going to buy a new house. I want you to imagine, it doesn't have to be a job, but I'm going to volunteer at, I'm going to get really involved in local whatever.

I am going to start bagging groceries. I want you to get really involved in local whatever. I am going to start bagging groceries. I want you to have a thing that you go to, not that you go from. Just the data on it is, the data has convinced me that retirement is no longer a thing I'm interested in. Spending money and building wealth, those are things I'm all excited about, but not having something that I get up and go to every day is something I'm no longer interested in solely based on the psychological data. So that's where I would tell you when you're having the conversation, should I retire? And then the number comes in here, George, with actual data. Yeah. So Glenn, you said you'd have about $1.5 million in 13 months.

Yeah. And that's if the market bounces back? No, that's taking in the losses that I expect. Okay. You really want out of this thing, huh? Well, I mean, she just wants me to be happy and I do have a strategy, an exit strategy, and it's going to be working with my kids. So both my kids live in another state and I really enjoy doing things for them. So I think that's, what's really going to make me happy. So I'm not worried about myself. I think my wife is worried about getting her nails done

and getting her hair done. And I'm a pretty tight individual when it comes to spending money. And your wife is saying, I don't want my life to suck for the next 30 years because Glenn retired. Because Glenn didn't want to work, right? Exactly. So we've got to take that into account. Hey, don't be dismissive of that, okay? I know it can be annoying, like, you mean I've got to work so you can get... Yes, that's exactly what that means, because y'all are a team, right? So let's have that conversation. So Glenn, you've heard of the Trinity study? No. You said you read a lot, so I figured. But basically, I've never heard of it. The study shows that a safe withdrawal rate, you know, if you take out 4% from your nest egg every year, then the money will not run out. It

will continue to, you know, outpace. If the market's at 8%, 10%, 12%, you will continue to have your principal amount in there, which means when you croak, you'd still have $1.5 million, ideally. And so I would start to look at that with your financial advisor. So we've done the cash flow thing, and the 4% rule is not really something, I guess I've looked at it that way, but every online calculator shows that there's no way you can retire. So that's what I keep seeing. But he says I'm good to go.

The financial advisor says, yeah, your plan checks out? Yeah. And that's if you're withdrawing, what, $70,000 a year into retirement? No, that was like at a $120,000. Wow, that was an extra. That was like at a 120. Wow. That feels high. Yeah. And that's kind of why I, but that was covering insurance and other things too. Okay. And since I don't have to, I, you know, I back it back down. That's just a larger percentage of the, of the 1.5 million. You're looking more like a 8% withdrawal rate at that point. Exactly.

Which then you go, that money's going to run is going to run out then in the next few decades. And so just take that into account. I would still run the numbers. You mentioned waiting to take Social Security. You might be better off taking it sooner and investing that money. And so I'd still run some numbers. I'm going to give you some homework there to work out with your financial advisor. I'm not saying you can't do it.

I just want you to get a real clear picture of what your lifestyle is going to look like in retirement, where you guys want to go. And I'd also encourage you to go into retirement without a mortgage payment. You mentioned that you're hanging on to the mortgage. You're paying a little bit extra. I want that thing to be gone before Glenn says, I'm done working. I think that'll give your wife some peace of mind as well. Yeah, the fewer liabilities you take into a no work season of your life, the better.

And even if you think, well, I can invest this, the difference between my 3% mortgage and that, I get all that, but we're just talking about risk and liability. And when you look at your wife and say, we owe nobody anything, here's what we're going to do. That's a different conversation. I'm just talking about neurological safety, brain safety. Changes the way you make decisions. Your brain goes, whew, okay. So if the worst case scenario happens, we're still sitting in the same house because we own it.

It's ours, right? And we just got to scrounge up enough nickels to pay the taxes every year on it. That's different than, no, we're going to be homeless. What's left on the mortgage, Glenn? About $280,000. Okay. Yeah, I don't want to be homeless. What's left on the mortgage, Glenn? About $280,000. Okay. Yeah, I don't want to be taking that when I retire in 13 months and still have payments on $280,000 worth of loans.

So I'd also look into getting rid of that or downsizing, pay cash for your next place, and then I'll feel real good about this retirement plan. Let's have a conversation as a couple. What do we want this thing to look like? Make it a two-day retreat, enjoy one another, have a good time, but let's get some real concrete pictures. Absolutely. That puts this hour of

The Ramsey Show in the books. We'll be back with you before you know it. Do you love a good day, Brandt? 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.