The Ramsey Show - App - How Do I Build Wealth for Retirement? (Hour 1)

Episode Date: April 24, 2023

Dave Ramsey & Jade Warshaw answer your questions and discuss: "My friends want me to go into business with them", "The best way to save for a house", "How do I grow wealth for retirement?" "Should we be content with our current home?" "Should I use my collector cars as an investment?" 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/3cEP4n6 Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Interested in advertising on The Ramsey Show? https://ter.li/s64ye3 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Live from the headquarters of Ramsey Solutions, broadcasting from the pods of Moving and Storage Studios, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. The one and only Jade Warshaw Ramsey personality is my co-host today as we answer your questions about your life and your money. The call is free at 888-825-5225 and some say it's worth exactly what you pay for it. All right, let's go to Michael in Topeka, Kansas to kick off this hour.

Hey, Michael, how are you? Good, good. How are you doing? Better than I deserve. What's up? Hey, so I appreciate all the insight you've given me over the years. You've really helped me in my personal life and just to make more sound decisions. So thank you.

Thank you for that. Well, thank you. Hey, so I had some friends who they reached out to me last year and they said, Hey, we've got this business and you know, we've, we're, we're kind of struggling. We bought it and it, it didn't really have the sales that we thought it would. And they were always trying to get me to go and sell for them. And I will say, Hey, you know, I've got a full-time gig. It's not something that I could really fully commit to. If you could send me your last year's P&L, I'll try to see what I can do.

But it didn't look too good. I mean, in their first year, I think they netted only $10,000, and that was after paying some employees. So it wasn't doing very good. And these were good friends of mine. You know, they'd helped me out when I was in kind of a bind one time. So I said, hey, let me see what I can do towards the end of this year and I'll make some cold calls around the area

and see what I can do to help generate some sales. Well, now they're starting to, you know, net roughly, you know, anywhere from $6,000 to $8,000 in a month. So they're, they're doing a lot better now. And they're still asking me like, Hey man, we'd really like to see if you could, you could come in and do this full time for us. And, you know, I just don't really even know how to, how to structure a deal. You know, it's, it's a couple of guys and another individual and one of the individuals wants to get out and, you know, they've got $110,000 in debt.

So I'm saying, hey, I don't want to invest in this or absorb any debt, but I could do some sales. You can't work as a contractor? You can't just work as contracted labor for them? Well, and that's kind of what I proposed, but that's something I've never done. Again, I have a full-time gig and it was something where I didn't really invest that much time I mean I made like three or four phone calls and was able

to generate some some sales in a very short period of time really just did this you know kind of what do you what do you make Michael now currently yeah um roughly you know, 100, 150, 160. And you sell now for a living? Yes, I do. You don't like the company you work for? I do. You know, they treat me very well, and I like them. I think it was very kind of you to help your friends.

There's a fair difference in throwing them a lifeline and getting in the boat with them. I think I'm going to stay out of this boat. It sounds like it's sinking. Is that where you're at? Yeah, okay. You've got one guy wanting to get out. They didn't know how to turn a profit until they got you to make sales, and now they want you to come in there and make sales and be an owner with them.

There's more can go wrong with this whole scenario this isn't like two guys that were successful and said come join us these are two guys that couldn't do it and said come join us yeah yeah you know not a i mean if they weren't your friends you would be laughing yeah yeah unfortunately and that's and that's been kind of the challenges you know i'm trying to explain to them you know hey hey, here's the sales product. They're not really sales guys. You know, they own another side business. If you want to keep helping them, you know, and keep your gig

and keep helping them to get, you know, until they can get a good salesperson hired, maybe you even help them train that guy, and they pay you one-offs for doing that, that's fine, but don't go get in this boat. It's leaking. How would you? Yeah, that's fine. But don't go get in this boat. It's leaking. How would you? Yeah, I appreciate that. If it were me, I would just set up some kind of commission for every sale that I make, say that this is the percentage I want, and you're just structured on 1099, and it's just easy, just like that.

And for that, I'll make sales, and I'll also help you as your friend train your first salesperson if you'll get them hired yeah but I'm not but I'm not coming over there I appreciate I mean that was the direction I was thinking of it as well you know I've got some real I've got I've got one really good friend who's a banker can you imagine if I wanted to no not going with him right he's a banker I like him anyway but he's a banker you know no i'm not doing that just because he's my friend no i mean there's a difference here i mean what are you supposed to do with your life and you know it does not align you know the only thing pulling

you here is your need to be good to your friends which makes you a good guy but don't don't let that pull you into this boat. Yeah, definitely not in any ownership capacity, as it sounded like they're trying to get you in there. I would just, yeah. Yes, I'll take a commission for every sale I make. And I'd probably start with a really short time limit on that, too. Hey, let's try this for a couple of months. And if it goes well, we can extend it.

Just be very clear with whatever terms you write. Put it in writing. We'll do a part-time gig. And I'll go over here as a side hustle and help you guys get this thing up and running until you get somebody hired, and then I'll help you train them. I'll bust it for 90 days. During that 90 days, you've got to get somebody hired.

During the next 90 days, I'll train them, and then I'm out of here, and you guys are going to sail this boat by yourself. Love it. That's a plan. Good point, Jade. Very good point. So good rule of thumb is this. And Michael's coming at this

a little bit differently but in entree leadership we run into this all the time and i'm now the new host of the entree leadership podcast if you haven't heard so it's a small business podcast answering questions so jump in on that but one of the things we tell folks in that world all the time is and i see it with small business i mean and guys will get girls do it too I get gals do it too but the way I always see it is a cup about three guys are sitting around having a beer and then they decide they're going to open a something together gosh and this is the and every one of them are dumber than a rock and the idea is dumber than a rock but by god we're going to do it together

and their wives are telling them please don't do this please don't do this with guys if we're going to go in the construction business or we're going to do whatever ladies open a dress shop and these are just guaranteed ways to end up not friends at the end of it to end up losing money at the end of it and we tell people all the time in those situations the only ship that won't sail is a partnership stay out of that one okay that one sinks and so if you if if you really do want to go in business with your friend one of you own it and the other one work for them if you're really going to do it so michael the only way i would even consider moving over there is if you bought this business that's that's losing and horrible for a dollar, and the guys that can't run it get to be your new employees.

But I wouldn't do that either, by the way, in this case. But that's the only way I'm going to do it. I'm going to be in control of the situation because there's all these things that we call the D's that can happen. Divorce. Yes. Drug use. Default. Disability. Death. divorce, drug use, default, disability, death. When any of these happen to your partner,

you get to work with your partner's spouse after that. Yikes. So he gets a divorce. Two old boys start something, it's successful, they get a divorce. All of a sudden, you're working with your buddy's ex-wife because she got the business and the divorce. Yeah. This is woo-hoo. Yeah. See what I woo-hoo. Yeah.

See what I mean? Yeah, that's scary stuff. Bad plan. The contracts are never, it's never in writing very well. Even if it's in writing. There's always this gray area. Death will undo it. That's true.

Even if it's in writing. This is The Ramsey Show. Jade Warshaw, Ramsey personality, is my co-host today thank you for joining us open phones at 888-825-5225 our question of the day comes from ryan in arkansas jade you want to take it i'll take it he says i'm 45 years old i'm married with two children under 12 and completely He says, month. We are currently watching the housing market and still learning the area and are socking money away to buy a home. I have $45,000 in the bank doing nothing for me, but I've been hesitant to invest as we would like to have the money available should a home come up that we can buy. I've been told that cash in a savings account is like melting ice. What do I do with it? Well, in this situation, when it comes to saving for a house, it's a little

bit different than just any other money that you're putting aside. Typically, we wouldn't invest the money that you're saving for a house unless you know the timeline is five years or more. Although, Dave, I've heard you say that a lot of times you'll just pop some money in an index fund and let it sit there and grow if you know what you might use it for. I particularly don't have the stomach for that. I'd probably put it in the HYSA and just get the best return on it that I possibly could for the time being, because it sounds like you're kind of in that moment where if the right thing comes open, you're ready to jump on it. So, yeah, I would keep it out of the market, and I would put it in a high-yield savings account, maybe put it, you know.

I've heard Dave say that he'll put it in a CD, that sort of thing. Yeah, high-yield savings account, like you said, is perfect. It's not melting ice when you are getting ready to use the money, and you're getting ready to use this money. And so if you were going to leave it in a stupid savings account for 10 years, then, yeah, it is melting ice. But that's not your description. You're in the housing market.

You're ready to buy and get rid of this premium rent and everything else. So, yeah, you definitely go that route. You're not doing the wrong thing. Now, Jade, I did have a young guy come in. All the work I've done over the years with different NFL and other professional athletes, they just happen to be listening to the show and say hey would you look at my stuff yeah look at your stuff so it's always interesting stories and of course we've run into all the negative stories where they've uh burned through all the money you know

i made 100 million dollars i got nothing to show for it or whatever that kind of stuff i've met those guys and there's always a lot of shame and stuff on those guys but in the in the in the light of what ryan is saying this guy comes in he's young i mean he's like 20 oh well 28 years old maybe 26 years old he'd been he'd been the league a few years but not you know he wasn't an old guy in the league by any stretch and his sweet little wife and uh they they drive in a used van wow and they come in and they go like dave you're gonna kill this we've messed up and i'm thinking they're gonna tell me they've blown all their money and he goes i i you're you're just gonna be so mad at me and i'm like i'm number one i'm not gonna be mad at you regardless how dumb you are but what did you do i mean did you do something dumb he goes yeah we've got all our money in savings account and I said uh how much money do you have in savings account uh 36 million

oh whoa I'm like no I am not going to yell at you I'm going to hug you because you did everything right but one tiny thing you actually you're a pro athlete who has money. You know what this is? A unicorn. I mean, you're incredible. Way to go. You're amazing. I'm so proud of you.

You actually lived on less than you make. You're driving a used car. You're not trying to impress your posse. You know, you didn't buy your mother a house you couldn't afford to buy her. All the stupid butt stuff I usually run into. You have $36 million, and the only thing you did wrong was you didn't invest it no you you get a hug you don't get a yelling you know so but yeah in his case he is melting ice for sure he doesn't need to get that money invested so he was wrong

but not only get yelled at wrong side though the smart side way to go man I mean wow absolute stud absolutely so proud of him. All right. Keisha is with us in Atlanta, Georgia. Hi, Keisha. Welcome to the Ramsey Show. Hi. How are you doing?

Better than we deserve. What's up in your world? Hi. I was calling because I was looking for some advice. I am a retired veteran collecting disability, so I have the arrogance that I have money until I die. So I have the arrogance that I have money till I die. So I do save money. However, I don't have any IRAs because of what I just mentioned. What is the best way for me to try to put money to save money where I'm benefiting and not losing like the previous

caller, the caller today, I have money sitting, not gaining a lot of interest. How much money do you have in savings? Now I have $50,000. Good for you. How old are you? I just turned 50 last year. Okay. Are you working?

No. No, unfortunately, the job market, my transition from the military was extremely difficult. So I'm not working. Okay. So you're getting a substantial disability, you're saying, from the government, right? Yes, and my retirement. I mean, I live within my means. Sure.

I wasn't questioning that. No, I'm just saying the only thing that I have is a mortgage and a car. What's the nature of your disability? How extreme? Mental. How extreme? Mental health. Yes.

So it keeps you from working in a traditional work environment. Is it something that would keep you from working in a non-traditional work environment, maybe doing some work from home? It keeps me from working from a traditional and I could work from home, yes. Okay. So like PTSD-type symptoms, is that what we're dealing with? Yes. Okay.

That's great. Hey, thank you for your service, Keisha. Thank you. I'm sorry. You're welcome. I'm sorry you ended up struggling with this as a result of serving your country. And I'm glad that we have good retirement and good disability in place to take care of you. That's a good thing. We, the people, should do that.

And so this is a good story because you're a good lady. Now, if I woke up in your shoes, what would I do? Well, I've never struggled with PTSD. I've never been in a traumatic situation like that that would affect me ongoing. So I can't really get into your shoes honestly. But in general, were I to face some kind of a disability, I would find something I could do in spite of or with as a workaround that disability. So in your case, as Jade was saying, a nontraditional thing,

maybe some kind of almost self-employed thing where you control the hours, you control the stress level, you control the volume of work that you do. I would want to put my hand to something because I think it's good for us. There's dignity in work you know what I'm saying yes I'm not saying you're lazy that you did not hear me say that but I am saying if I were you what yeah how do you it's got to be designed just for Keisha yeah whatever it is it's got to be designed just for you and that's why it might be a self-employed thing. It might be that you go take some coding classes and learn to code, and you simply do contract work from home,

and you do coding where you don't have to deal with humans much. And you just, I don't know what it is. I'm making stuff up right now. But all of that to say, I'd probably add something to that. Now, having said that you can live on your retirement and your disability, you don't need the $50,000. We would don't need the $50,000. We would label part of the $50,000 your emergency fund, and we would begin to invest the rest. One of the good things about creating an income is in order to do Roth IRAs, you have to have an earned income. Retirement and disability are not earned income by the IRS's definition for purposes of a Roth IRA. So if we can get you making a little bit of money,

then you could do a Roth with some of this money, and that's what I would start talking about. Investing in a Roth. Yeah, but again, you'd have to create some income that's not retirement or disability. Doesn't have to be mine. So in the meanwhile, I have 75% of my income available that I could be saving. Yeah.

What's the best thing to do with that money? I would get in touch with one of our SmartVestor Pros and simply start doing some investing in mutual funds. It's just not going to be in a retirement account. And what you're looking for is what's called low turnover. Write that down and ask the SmartVestor Pro about it. Click SmartVestor Pro at RamseySolutions.com and you want to ask them about a low turnover mutual fund.

That's a low taxed environment type mutual fund when you're not inside of a retirement account that's good to look at. jade warshaw ramsey personality is my co-host today open phones at 888-825-5225 i was being interviewed on another podcast this morning and the guy asked me jade he said um so what has changed over 30 years and i said well everything's changed over 30 years the principles that we teach have not changed at all but the there are new and uh improved ways to do stupid absolutely that comes out every year and uh to you know and sometimes they rename old things and uh try to make them sound like they're new and stupid. But they're still violating basic principles. So let me give you the basic principle. The basic principle is the shortest distance between where you are and wealth

is your greatest wealth-building tool, which is your income. When you pledge your income to someone else in the form of debt, you slow down your ability to build wealth and you add risk and anxiety to your life it's a very simple equation zero debt leads you faster into wealth than anything else you can do with money the number of millionaires when we did the largest study of millionaires ever done in north america that said they borrowed their way into wealth was precisely zero. The number of them that said that their airline miles on their card made them a millionaire was precisely zero. The number of them that said, but I became a millionaire because I

leased a car was precisely zero. The number of them that said they became a millionaire because they took out a whole life insurance policy was precisely zero. The vast majority of them had avoided debt completely or like the plague, and it kept their incomes freed up and caused them to be able to invest. I don't have any money for my 401K. No, but you have a $750 car payment, idiot. No wonder you don't have any money for your 401k. $1,300 car payment.

That's right. Or here, let's bring back an oldie but a goodie. Now, because everybody's doing it again, you know, those clothes, if you keep them long enough, they'll come back in style. And the same is true with stupid. So the home equity loan is back. Yes.

Home equity line of credit. The HELOC. The home equity line of credit. And Lifehacker says, I used one when I got in trouble. So you should, everyone should have one. In this stupid butt article, I remembered we'd taken out a home equity line of credit when we bought the house and it saved our butts. Oh, really?

Oh, really? His whole house is leveraged on this money. Yeah. So, you know, do you know what a home equity line of credit is? Explain it for him, Dave. It's debt. It's a second mortgage. And you know what they base the interest rate on?

Your credit? Nope. Whatever they feel like when they wake up that morning. Because it's variable. It's completely variable and it is not indexed to any outside thing. So Mr. Banker says today, I think I'm going to charge Joe and Susie stupid money. So you mean to tell me in 2021 when I saw everybody in my neighborhood redo their yard, redo their kitchen, redo everything, and I'm going, where is this money coming from? It's because they took advantage of their home equity.

They leveraged. That's the word I like, Dave. They leveraged. Well, I'm sophisticated because my equity otherwise was not working for me. And now I have new bushes. At what cost? Yeah. That's what the banking ads sound like, don't they?

I mean, if you listen to SoFi. Oh, yeah. It's smart money. Smart money moves. I'm just going to gonna sofa throw up right here oh my god man i dave i told you this before the break it's a good thing because i did so much stupid stuff before i got a hold of of the principles here if i had known about a heloc thank god i didn't know about this because i would have just added it to the list of dumb stuff

right next to co-signing a loan. I would have put HELOC. Well, here's the thing. There's a lot of idiot financial planners and people like Lifehacker who will tell you to get a home equity loan in case there's an emergency. Now, let's follow this line of, in air quotes, logic. Okay? So you lose your job or you have another financial calamity of some kind. So the home equity line is there to help you.

You can go draw on it and you have money. So at the moment that I've lost my job or had a financial calamity is precisely the moment that I want to go deeper into debt. This is the line of thought. That's a head scratcher. Yeah. So I've had financial planners talk about this for years, and I've had to just rip them to shreds because it's just so freaking stupid. Not all of them do this, but, I mean, some of them will say,

open a home equity line of credit, don't use it, and use the fact that you can go tap into it if you need to as your emergency fund. And I always tell them, so what do what i want to do when there's an emergency what i want to do is add to the anxiety and the stress by going deeper into debt right you're turning it dumber than a rock oh my god it turns the emergency into a crisis into a crisis because now you got whatever it is that you're having to deal with and you have to pay off the debt and it's at a variable rate of interest so her point was is that they had a uh they had a uh damage storm damage and they were able to use their home

equity loan to fix it because apparently you don't know how to work with your insurance company because if you have storm damage and your roof's leaking your insurance company will show up start writing checks in about 36 minutes yeah uh if you actually know how to talk to them instead they didn't show up for you you know why because you didn't need them because you went into debt yeah there's a lot underneath the surface here on this article and let me tell you what else happens every time you do this crap right here okay house gets torn up we use debt to fix the house and we're going to pay off the debt when the emergency when the insurance check comes you know what you always do a hundred percent of the time people well 98 percent of the time people will do more repairs to the house because while we're at it we're going to

go ahead and renovate then the insurance check will cover so when the insurance check comes it's not enough to cover because we while we were at it we did some other stuff. Yeah. Human freaking nature. That's what I love in this article. He says, the HELOC allowed us to get started immediately with the repairs. As if insurance won't show up when a roof gets blown off your house. Yeah. I mean, really, if you have an insurance company on homeowners that will not show up and give you help immediately when there's storm damage,

you have other issues that a HELOC won't fix. You know, I wonder what would happen if you just saved up for emergencies. Oh, wait, you had money. If you just saved up. Oh, there's an idea. I wish I had thought of that. And you had the amount. We should do a radio show about that.

That's awesome idea. And in your three to six months, you had the amount of your homeowner's insurance deductible. And you didn't have any payments. And so while you're at work, you're making money without any payments. And you have an emergency fund. And then when you have a crisis, you have this thing called money. That's a great idea, Jade. And you just go, what is it?

That sucks. All right, write a check. Yeah. That's all you do, Dave. Emergency fund turns a crisis into an inconvenience. And a home equity loan turns a crisis into an opportunity to be crisis squared. Double up, triple up, exponentially worse. So you're not sophisticated if you used a home equity loan to cover your problems in life.

You're broke. And there's nothing sophisticated about being broke. It's just dumb. Okay? Just dumb. Now, I've been dumb and I've been broke. So stop being dumb. Stop being broke. We're going to walk you through this. And you don't use, well, I'm utilizing the equity in my home that otherwise would not be working for me.

You're an idiot, okay? When you say stuff like that, you're just an idiot because you're truncating your most powerful wealth-building tool. You're slowing your wealth-building down because you didn't have any money to cover emergencies. So everyone should have an emergency fund after they're out of debt except their home, baby step three of three to six months of expenses. We've been saying that longer than home equity loans have been in existence. They were not even in existence when we started this radio show 30 years ago. They didn't make them.

And now we have a HELOC. Because HELOC. It sounds so... Well, you're locked in. I'm a financial person of a HELOC. You get a HELOC, you get locked into debt. Yeah. That's about it.

You know what? I think somebody ought to complain. Why didn't they call it a she-lock? Dave, don't go there. Don't go there. I think I just got canceled somewhere in the universe. This is The Ramsey Show. Jade Warshaw, Ramsey personality, is my co-host today.

Open phones at 888-825-5225. Stuart is in Atlanta. Hey, Stuart, welcome to The Ramsey Personality is my co-host today. Open phones at 888-825-5225. Stuart is in Atlanta. Hey, Stuart, welcome to the Ramsey Show. Hey, Dave. Thank you guys so much for taking my call. Sure. What's up? So just wanted to get your thoughts on where my wife and I are at.

We are 32 years old. Our income is roughly $185,000 a year, and we are currently on baby step six. And my question is more around what we should do over the next couple of years. So we are almost ready to pay off our house. And over the next couple of years, we are going to want to, you know, to move to probably a bigger house. But my question is more so around contentment, because I know that once we pay off our house, we, you know, we won't have any other payments. And so my question, I guess, revolves around, should we take the next three or so years and save up a really big down payment to get the house that we would live in, you know, forever, I guess you could say,

or should we not do that and instead just stay where we're at in the current house that we're in and just use the money that we'll have every month, you know, to invest more, etc. Yeah. Well, I mean, there's a lot of different ways you can get at this. First, let's just dispel the idea that there is such a thing as a forever house. I'm 63. I've had four forever houses so far. I keep thinking they're forever, and they're not.

Sharon and I are planning to build another house right now and she says well this i'm gonna build this because i'll probably die in this i said not a chance unless you die quick i mean it's just because we're not i mean we we're just we're 10 12 years 13 years and we move on the next one i mean so uh maybe maybe not but so all of that aside you got a really good question you put yourself in a wonderful position congratulations you make a lot of money uh you're debt free you're being very wise you're thinking about things which makes you also wise most people just do crap and then wonder how to clean it up and you're just doing really, really good, Stuart. So this is more of a discussion of smart or smarter, okay? There's no dumb in this discussion, okay?

So just way to go, dude, way to go. So if you live there and you're going to pay off the home, is it paid off now or it's almost paid off? It's almost paid off. We should be making our final payment this month. Oh, way to go. And what's that house worth? Probably around $220,000, $2 payment this month oh way to go and what's that house worth um probably around 220 225 way to go good for you okay and then you're going to want to move up sometime in the next few years to a house that is worth maybe what

uh we were we were thinking probably around 500 okay so Okay, so double. Okay, so you need $300,000, and you make $180,000, right? Yep. Okay. So I just do big math in my head is the way I do it if I'm looking at this stuff to start to see how I can emotionally swallow this or not, okay? Is it going to take me 10 years, or is it going to take me 20 minutes? You know, that's what I'm always looking at. And so in your case, if I did $100, 100 a year for three years, you're there, right?

And you live on 80. Right. You live on 80. So that's one kind of contentment. Another kind of contentment is you live in the current home you're in for the rest of your life. A lot of people do that. Another kind of contentment would be to go ahead and sell your house now,

buy the $500,000, $ the 500,000 550,000 house put the uh whole equity from your current home into it and then turn around pay it off in three or four years with your great income none of these are in the dumb column now i will tell you this if you pay off your home the way you've been intentional about this the words words you're using, how dialed in you are to the Ramsey stuff, and you sit there in a paid-for home until Christmas, I will tell you from personal experience, it's going to be very hard to take on a payment again and swallow it and get that down your throat.

Yep. Yeah. That's what we've thought about, too. It's up to you. I'm just saying it really tastes especially bad the second time yeah it's like getting to swallow your food the second time that looks gross you know so uh yeah it's just hard uh you know again it is anybody who can put down enough money and pay off their home in three years stupid no no you're not even close i mean you're just in great shape so any of these are fine or you can kind of meet in the middle sharon we don't borrow

money so we would have to wait and save it up sharon and i but we don't yell at people on the ramsey show for taking out more than a 15 year mortgage where the payments no more than a 15 or a fourth of your take-home pay and you're nowhere even near that side of the equation so you could actually land in the middle and say okay we're going to live here one year and put another hundred thousand in the bank and then we're going to do it and so and then we're going to pay it off in two years or we're going to live here two more years and put 200,000 in the bank and pay it off in one year to be honest with you Dave I you know that third option that you gave you said regardless regardless, Stuart,

whether you save up for three years or it's such a small period of time, too, because I'm the type three years I'm like, oh, if we're going to pay it off in three years anyway, I'd rather live in it while we're paying it off. But these are the these are great problems to solve, because like Dave said, there's no stupidity here. It's just it's just options. And if you make that final home payment and you're like, I like this, I will never go back into debt again, then wait it out. But for those people listening, I do think it's important to hear that you pay off one home. You're not a bad person if you go back and get a small mortgage again to move up in-house. What I will tell you is this.

Don't start looking at $550,000 houses after you've looked at $750,000 houses. That's a good point. That won't work. So just don't even go over there. Don't even go over there. Because you can actually pull that off too. But you gave me these guidelines.

That's a good point. I would hold you to those in the name of contentment. Because I didn't give you the number. You gave yourself the number. So stick to it. guidelines that's a good point i would hold you to those in the name of contentment because i didn't give you the number you gave yourself the number so stick to it because i gotta tell you you you look at a million dollar house they're great until you look at a two million and it just the line keeps moving doesn't it it doesn't matter i mean you know you know what's nicer than a fifty thousand dollar car a hundred thousand dollar car yeah so i mean it's just but don't go drive one

unless you're going to be buying one. So, yeah, stay out of that neighborhood. Don't go to open houses. I just want to see what the color. No, no. Don't play yourself. No, no, no. I want to feel like.

No, you don't. Stay away from there. Hey, Stuart, you're doing good, man. Congratulations. Tom's in Peoria, Illinois. Hey, Tom, what's up? Hey, Dave. you're doing good, man. Congratulations. Tom's in Peoria, Illinois. Hey, Tom, what's up? Hey, Dave. Long time follower.

First time caller here for you. Thanks. How can I help? Really appreciate you taking the call here. Just want to get your idea here for me. I'm kind of in a unique situation. I am 56 years old. My wife is 52 years old.

We live, we are completely debt-free. Our house is paid for. Following your steps early on in life here, starting in my 30s, our first home, we took out a small mortgage for, I shouldn't say small, is a 15-year loan. We paid it off in five. We saved up for in five. We

saved up for approximately five more years living at that home comfortably until we started having children. What's your question for a run-out time? I just want to know, I'm a big car guy, and I have quite a few collector cars here, and I just want to know what you thought as collector cars

as an asset for later on in life to cashing in on value. I don't know if you follow the collector car market at all. I just want to know what you thought as collector cars as an asset for later on in life to cashing in on value. I don't know if you called it the collector car market at all. I just want to know what you thought. I've got a 1970 frame-up Restro or 1960 frame-up Restro Corvette. So, yeah, I got one in my garage. Oh, very nice. Got one in my garage.

So I was born in 1960, so I wanted a 1960. So, yeah, I'm in the business. The thing about collectibles is they're so dependent. It's such a weird market. It's such an imperfect market. It's an unpredictable market, and it's more dependent on your expertise than it is actually the market as to how much money you end up making on one. They're an asset for sure, and they do increase in value

if you did a decent one for sure that car's probably going up some in value since i bought it uh but but uh i don't i tell people of collectibles of any kind fine art wine collection i've got a gun collection uh you know they're all assets because i got money tied up in them but uh they shouldn't be more than 10 percent of your net worth because then you're betting the farm, so to speak, on that category. And so it's okay, and you can make a little money on it, and it's a great hobby that goes up in value. That's fun, and you got the margin because you got the money.

I would do it, but just limit the value to about 10% of your net worth or somewhere around there, and you'll be okay. That puts this hour of The Ramsey Show in the books. Hey, what's up guys? It's Jade. If you love the show and want a deeper dive on your money journey, we have a weekly newsletter that gives you trending and helpful articles and tips on following the Ramsey way. Just go to ramseysolutions.com today to sign up for our newsletter. Again, that's ramseysolutions.com to sign up for our weekly newsletter.