The Ramsey Show - App - How Do I Shift Out of a Poverty Mindset After Getting an Inheritance? (Hour 3)

Episode Date: November 5, 2020

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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. Rachel Cruz, Ramsey personality, is my co-host today here on the air. Open phones at 888-825-5225. That's 888-825-5225. Gavin is with us to start off this hour in Kansas City. Hi, Gavin. How are you?

I'm good, Dave. How are you guys doing? Better than I deserve. What's up? Well, Dave, I'm a longtime listener. It's such an honor to speak with you. I don't think there's a minute that's gone by your show in the last two years that I haven't heard. My goodness. Thank you. Yes, of course.

I'll give you a little back story. I'm 19 years old. I used to be a young idiot and graduated high school. I connected myself with your material, and you connected me with Anthony and Ken, and I found myself going to college at a private university here in Kansas. Cash flow and the whole thing through Ken Coleman's material. I got up off my lazy butt and went and got a job in sales. I make about $4,000 a month, and I'm having no problem cash flow in my degree.

I'm a quadruple major and four years here, business administration, finance, accounting, so forth. But I had a question for you, Dave. You know, going through this endeavor here, an entrepreneur such as yourself, I really wondered at the end of the day, what's most important that I need to be getting out of my education to be successful in the marketplace later in life, sir? Well, it's not a class in medieval poetry. Underwater basket weaving, you mean?

Yeah, or left-handed puppetry. That was my example. That's Rachel's example. That's Rachel's. That's Rachel's example. That's Rachel's. That's a good one, yeah. So, yeah, it's, you know, so you're studying things that you're going to use if you're in business and you're an entrepreneur. I mean, I was in college 40 years ago and almost, well, I was in college 40 years ago. And, you know, the accounting principles have not changed the statistics

principles which have been interesting in the last week or so to actually know something about statistics when people you're watching don't and um it's you know it's a very interesting uh to understand that when i'm analyzing something here inside this business. In other words, I use some of the academic knowledge that you are training for that I got similar training of. There was no Internet. There was no digital marketing, but marketing is still marketing. And so I use some of the things I learned in college almost every day as the CEO of Ramsey Solutions.

So I think you're getting very good training. And I'm big on knowledge. I'm big on academics as long as they have applicable uses in the marketplace. It's when people study some nuanced corner of nothing and then are mad because society owes them something because they can't get a job with a medieval poetry degree. And so, you know, that's what you don't want to do, and you've not done that. You've done a good job. I don't know, Rachel. You got a degree in communications.

You use it all the time. Yeah, I do. I mean, I would say, Gavin, there's an element. This is not to slam for your education because we are pro-college for sure. But there is nothing like real life, being in business, working with people. I mean, you can learn things in a classroom, but when you apply it to real life in the real world,

it takes a totally different meaning. And so what I would say to you is the fact that you're working right now, I think is huge. Like real world experience is amazing. That's why I always tell college students, like go get an internship like if you think you want to work at an ad agency that may sound great

sitting in a you know in a in a class that has 200 people and you're listening to professor but actually go work there like see what the work is like so the fact you're getting real life experience gavin i think is amazing amazing i sold real estate all the way through college just like you're selling right now all the way through college. I've still got stories from those days that I still apply. The things you're learning in the workplace, I think is extremely valuable. And to not be under the assumption, which you're not, Gavin, I'm not accusing you of this, that a degree, even a quadruple major, isn't going to make you successful in and of itself.

That sheet of paper isn't going to. No, it doesn't. The knowledge gives you a tool in your belt to be a craftsman in the marketplace. To go out and actually use what you've learned, what you are doing right now as you're working. So it's amazing. So I just, there's kind of all sides to it, right? Like getting a four-year degree and actually learning something beyond a high school level is extremely important.

And that degree will get you indoors. I mean, there are certain jobs and industries that require a four-year college degree, and it's amazing. So it's going to help you, but don't be under the assumption that life is going to work exactly how the professor in the class says it's going to work, and that just because you get that degree means you're going to be successful. What you're doing, as hard as you're working right now to pay cash for this, and you're loaded yourself up academically,

you've got a lot of stuff going on with a quadruple major here, what you're doing is very strenuous. I was stressed out when I was doing what you're doing. It's hard. But it's not forever. In a couple of years, you'll be done, and you'll come out with a degree without the debt, with the knowledge without the debt,

and you'll have this tremendous work ethic and the ability to organize and manage your time and the other benefits that are going to come from the stress and strain that you have put yourself under with a series of choices. But what you're doing is really hard. But it's worth it. So do it. He's making like 50k a year. I know. At 19, it's crazy. Like, it's amazing. Roll up your sleeves and stick with it. Finish. Play through. It's worth it. Everything you're doing is worth it. You're not going to come out of this with that with regrets and uh oh i wish i had worked less you know uh you you got plenty of time to do all kinds of things in your life you're going to be just fine john is in portland

maine hey john welcome to the dave ramsey show hey david ranger good to talk to you. You too. What's up? So my wife and I just recently walked into Baby Steps 4, 5, and 6. And I've got two 14-year-old boys that walked with us. And now they're interested and intrigued in what they can begin to do now to start doing some investing for their future. We do a commission allowance for them, and they want to use a portion of that to get started. And I'm not quite sure. As I understand it, they need to have an earned income for a Roth IRA,

some of the other options there are. That's it. You have to have an earned income. And so they would have to have a job, or you'd have to file. I mean, like when our kids were that age, I filed a tax return on them and so if rachel did babysitting she kept the money but i filed a tax return on the money she made in babysitting and the money she made selling books and the money she made working here and the money she made doing whatever and if it was eleven hundred dollars that year i filed a tax return on eleven hundred dollars i I paid what little taxes that created, if it created any taxes,

so that I could do an $1,100 Roth. And, you know, they weren't huge, but, you know, $1,000, $2,000 a year through their teens. I piled money into a Roth. I had the extra cash to do that with. And I guess that's probably your 30. That's probably turned into some money. Yeah, thankful for that.

Who knew? I did. At 14. This's probably turned into some money. Yeah, thankful for that. Who knew? I did. At 14. This is the Dave Ramsey Show. Has your family grown larger over the years? Ours has too. Christian Healthcare Ministries is now helping over 425,000 members bear each other's health cost burdens. CHM offers budget-friendly options to suit a variety of needs,

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right for you and your family. chministries.org slash budget. That's chministries.org slash budget. well hard to believe that it's christmas time because it's not but it is time to start the Ramsey Christmas giveaway. Our Ramsey Christmas giveaway is $500 a week every week between now and Christmas and a $5,000 grand prize. You can enter daily. No purchase is necessary. Go to DaveRamsey.com slash giveaway.

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I mean, that's a deal. And you can mix and match. You can get a Rachel book for your one friend and a Dave book for another friend and a Hogan book for another friend. You can mix them up. So check it out, DaveRamsey.com. Brandon is with us.

Brandon is in Maryland. Hi, Brandon. Welcome to the Dave Ramsey Show. Hi, Rachel. Hey, Dave. Thanks for taking the call. Sure. What's up?

So I'll get right into it. My wife and I, we're 28 years old. We have a nine-month-old baby boy, and we're about to make a huge life change here. We are in between baby steps five and we're about to make a huge life change here. We are in between baby steps five and six, I guess you could say. We have $50,000 saved. We have $110,000 in retirement accounts. And my wife is a teacher. She's all done with school. She has her master's degree. I'm in the middle of working on my bachelor's degree. I'm active duty military,

and I'm about to get off of active duty, and I'm going into the police academy beginning in January. Our combined income beginning in January will be about $100,000, and up that $100,000, $35,000 is my income. You don't make great money your first year as an officer, but there is a $20,000 increase every year for your first five years. So after five years, I will be at top pay of 115 grand. So we'll probably be making close to 200K together. My question is, when I graduate the police academy, my wife and I are trying to figure out if we should rent or should we buy a house. Our goal is to buy a house around $400,000 to $450,000, and I think that we can get up to $150,000 in savings over the next year and a half,

partly because my wife is living with her parents, so she's not having to pay anything in rent. I will be living in New York going through the academy and once I graduate my son and wife will join me. So do you think it'd be best to rent when they join me until we can get our savings up to towards 150k or should we just buy a house in which we probably have around 75-80k by the time they join me i as long as the house payment is no more than a fourth of your take-home pay on a 15 year you could go either way i don't think i don't think that's going to be the case if you put down 75k with the numbers you're giving me unless i'm missing something i think you're gonna have i think you're gonna have too big a house payment

for your income you can get approved for it, but not Dave approved. And so I'm probably going to rent for a little while. Renting for a short period of time to hit some goals is not a sin. It's just patience. I agree. I think that that's the route I wanted to go because with how frugal we are with our money, I think we could get up to $150,000, even more. How long are you in the police academy?

The academy is eight months. And so you're going to live apart from your family for eight months. Do you live on a campus or something? No, I will be living with my father because it's a 15-minute drive from the academy from the house. So why isn't your family living there? Because my wife is a teacher in Maryland and she's waiting to finish out, uh, the year before she'll join me, which would either be the upcoming summer or the break that she has between

the Christmas break and what she would, she would put in her notice ahead of time, and she would leave basically halfway through the school year. Yeah. I mean, you guys do what you want to do. That sounds stressful to me. I don't like being apart from my family for very long. I understand military folks do it all the time.

They're deployed. It's part of what they sign up for. Right. But there's a lot of ways you can do this, and I'm going to do something where she joins you sooner, as soon as heavenly possible. I mean, definitely not going to Christmas, definitely in the summer. And if I could figure out a way to do it even sooner than that, I would. If she can land a job, because there's so much topsy-turvy in education right now with kids in the classroom,

kids not in the classroom, teachers not in the classroom, teachers in the classroom. Especially New York, if that's where you guys are moving, Brandon. Yeah, but you're in upstate New York, right? Westchester County, which would be right outside New York City. Yeah, I mean, that's, yeah. Well, you're not Manhattan, but it's the suburbs. But still, it's an expensive area. But that's not where you're going to stay either

after you graduate the academy, or is it? They'll actually be living the next county over, which is Dutchess County. It's a lot cheaper. It's about a 40, 45-minute commute for my work. My wife, I don don't think would have a problem getting a job teaching there it would just be what county would she end up teaching in yeah so i would just get her that's my only comment to the whole plan is i would rent for the first

little while get your 150 built up and then i would try to come up with some kind of plan to get the family to join i was gonna say you got a little baby and her and yeah, I mean, I would, as much as the family can be united in this case, I would totally agree with that. Totally agree. But the rent as well, since you're moving to a new spot, I always feel like it's just wise to rent for a little bit, even if it's six months. Even if you had the down payments, there's a part of me that would just rent because you guys want to look around neighborhoods, get a feel of the area. You can kind of get location. I mean, it's just, it's a new place. So I think, I think renting for a little bit is fine. Good. Good plan. Tracy is in Fairbanks, Alaska. Hi, Tracy. How are you?

I'm doing great. Thanks. Good. How can we help? My question, well, my question is we're kind of changing from a poverty mindset to a generous mindset. We've been married 24 years, spent the first 20 years in ministry, scraping by. My husband's now active duty military, and I also have some inheritance that I've recently received and just trying, learning some principles and some practical steps for changing that mindset as well as also continuing to, you know,

obviously be financially responsible and how you balance generosity with responsibility. Yeah. Tracy, where are you guys at financially? Just a big picture. Are you, how much do you guys make? Do you, do you have debt? Sure. Where are you guys at? Sure. We have no debt. We make, I think gross is maybe 125 K. We have seven children. One and a half have been through college.

And we have about 500K in inheritance money and just probably like 10K in IRAs and such like that. Okay. Yeah, I think what would make, I think the uneasiness is knowing with this inheritance money, how to use it well, right? Like you're like, I don't want to go and just splurge because that feels uncomfortable because there's not a plan. And so having a really cut, cut and dry plan of, okay, what is this $500,000? What are we going to do with it? And what's going to be best long-term?

Is it part of it going to go to kids college and kind of mapping that out as part of it going to be helping fund retirement as part of it, just putting it in mutual funds and letting it grow when it's there for the future. Maybe a little bit comes out and you can increase your lifestyle a little bit. But I think just having a plan for you guys on what's best for your family, mapping it out where it goes, takes the ambiguity out of the situation. And I feel like whenever there's fogginess and confusion, that's a lot where the questions come in. Yeah, you feel broke when there's chaos. And so when you lay it out and you say, this money is labeled for this,

then that gives you emotional permission to spend it for that. And if it's generosity, then you go, okay. And that's in light of the whole picture, which our family's okay. Yep, that's right. So then you can be generous without thinking you're being a freak while you're doing it. This is The Dave Ramsey Show, Rachel Cruz, Ramsey personality, my daughter, number one best-selling author. On the debt-free stage right here at Ramsey Solutions, Seth and Caitlin are with us to do a debt-free scream.

How are you guys doing? We're doing good. How are you? Better than I deserve, sir. Where do you all live? We live in Indianapolis, Indiana. Cool. Well, good to have you. Welcome, welcome. How much debt? Better than I deserve, sir. Where do y'all live? We live in Indianapolis, Indiana. Cool. Well, good to have you. Welcome. Welcome. How much debt did you pay off? We paid off just over $30,000 in five months.

Way to go. Wow, y'all. That's great. Very cool. Amazing. And your range of income during that time? $60,000 to $65,000. Cool. What do y'all do for a living? I am an operations planner for a medical devices

company. And I'm a nursing student. Awesome. Well done. Good. Okay. What kind of debt was this $30,000? Some medical bills and student loans. Okay. All right. Very good. So what happened five months ago that put you on this journey? Well, it was just over five months ago, just over a year now. We had our daughter. She was born. And with that, we started talking a little bit more seriously about what we wanted to do in the future. And we realized that in order to hit those goals, we couldn't keep the student loans around like a pet. And we had to clean up the medical debt that we had accumulated with the birth of

our daughter. So with that in mind, we switched from Davis, which we had been for the first year and a half of our marriage and just put everything to the debt. And that's, that's awesome. So the baby was kind of the catalyst to say, okay, we got to change some stuff. Yep. Yep. It's amazing. You guys. Yeah. And without our, both sets of our parents helped us a ton and allowed us to throw a whole bunch of our income towards that. They came down. We live about three hours away from our hometown. We both grew up in the same place,

and they would drive down to babysit while I was at work. Wow. And my wife was taking classes. So without them and their support, there's no way we would have been able to clean that up that quickly. That's amazing. Well, you guys are a young family doing this. So what was the hardest part?

Because this is a lot of sacrifice, a lot. Yeah. So, I mean, the hardest thing for me was saying no to my wife, especially when she wanted to get stuff for Ella, thinking we're our daughter, having that conversation about need versus want. So having to say no, that's more of a want than a need. Caitlin, are you my kind of girl? You're the spender? Yeah. Yeah, so we definitely limited the Target trips and Starbucks.

Yes, for sure, for sure. Amazing, you guys. Absolutely, absolutely incredible. so what would you say was the key to doing this journey and if people are listening with a newborn a one-year-old baby and they're like oh man what's that thing we have to do to get this started I mean for us it was it was getting on the same page so like I said we were Dave-ish my parents they did FPU when we were younger. So I got to see that journey for them and see the freedom that they had once they became debt-free and paid

off their home. So I was- Ah, so you're a financial peace baby. Yes, sir. Yes, sir. So I had seen what that freedom was like. And I knew that I always wanted that for the family. And then after we had Ella, that allowed us to get on the same page. And that was the key. Once we both saw the same picture for our future, it was easy. That's awesome.

Very good, guys. Well done. How does it feel now that you're free? It feels awesome. And we have our second baby on the way, so it feels really good. Oh, congratulations. Thank you. That's awesome. Very cool have our second baby on the way, so it feels really good. Oh, congratulations.

Thank you. That's so wonderful. Very cool. Well, life is good. You've got control of the money. The babies are coming. Things are happening like they're supposed to. Very, very well done. Congratulations, you guys.

Congratulations. Thanks for coming down from Indianapolis to do your debt-free scream. It's an honor. Very cool. Very cool. Good stuff, guys. All right, we've got a copy of Chrisris hogan's book for you everyday millionaires that's definitely the next chapter in your story you're going to be there and uh coming out of nursing school things are going to that income

is going to go way up in this household lots of stuff's going to happen here lots of good things in your future so proud of you guys you're heroes thank. Thank you. Well done. Well done. Thank you, Ella, for coming on the scene and giving them a wake up. Good stuff. All right. Seth and Caitlin from Indianapolis. $30,000 paid off in five months, making $60,000 to $65,000. Count it down. Let's hear a debt-free scream.

Three, two, one. We're debt-free scream three two one we're debt-free yeah well done guys very very well done that is awesome stuff excellent emily is with us in pensacola. Hi, Emily. Welcome to the Dave Ramsey Show. How can we help? Hi. Thank you so much for having me. I have a question about a medical bill. My husband and I are almost two years married, and we had a surprise baby. We found out we were pregnant at the beginning of the year, and I ended up needing to go to the emergency room

and had a pretty big emergency room bill that we were told at the time my insurance would cover, but they ended up not covering. We are debt-free except for our house. We don't have any student loans or anything like that. But I'm wondering, we're trying to follow your plan and would you recommend paying it off in one lump sum or working with like a payment plan? How much is it? It's in total with the emergency room and physician about $3,700. $3,700 and how much money do you have in your savings? Right now we have about $8,000. Okay. All right.

And I'm a little bit concerned. I want you to go back and revisit and push on this insurance question before you pay it because most of the time the emergency room is covered under most health insurance policies. It's very unusual for ER not to be covered. We did, and I was still covered under my parents' insurance. We hadn't switched over from when we got married. And my parents' insurance covered me as their dependent, but not anything related to my pregnancies so since we didn't realize that it was a pregnancy issue when we went to the emergency room they will not cover it yeah have you switched your insurance now oh yes yes yes we tried to backdate it and it's about two weeks short

that won't work okay so it really was it was the fact that you weren't sitting on a full adult policy. You were riding on a dependent care, which doesn't cover that. Now, that does make sense. Write a check and pay it off. Okay. Be done with it. All right. Does that make you nervous, Emily?

Does that hurt? Yes, it hurts. It does. Yeah, and then just roll up your sleeves and rebuild your emergency fund as much as you can. You don't need to do any other debt reduction or anything. You don't have any debt anyway, you said. But just pile up cash during the pregnancy here. And your job one is build a big emergency fund during pregnancy.

That's your only job. We actually just had him in september oh okay okay then you well then yeah then you're debt free and you need your own baby step three and working on building your emergency fund because you just use some of it for an emergency yes that's what it's for awesome it was literally the emergency room i mean this is a this is a signal here you know so yeah that's that's what it's for but it does hurt i mean that's that's the funny thing is once you have that savings you don't want to let it go you're just like oh but that is that's but that doesn't mean we put it on payments number one number one that's going to ding her credit

because that's gonna you know medical bills do not come with terms you didn't sign up a loan on that they it's all due and if they can't get it out of you they'll take payments which happens a lot to the hospitals but you've got the money write the check it's going to give you peace and then you just rebuild your emergency fund your baby step two if you've been doing retirement savings, you may want to stop that temporarily if you want to accelerate the rebuild of the emergency fund, depending on how fast you can rebuild it, what your income is, and those kinds of things. But good news is baby came.

That's good. It's awesome. Awesome stuff. Good times. Good times. This is The Dave Ramsey Show. Our Scripture of the day, Philippians 1, 9 and 10. And it is my prayer that your love may abound more and more with knowledge and all discernment, so that you may approve what is excellent and so be pure and blameless for the day of Christ.

Vince Lombardi says, Perfection is not attainable, but if we chase perfection, we can catch excellence. That's good. Leo's with us. Leo's in Birmingham, Alabama. Hi, Leo.

Welcome to the Dave Ramsey Show. Hi, guys. Thank you for having me. Sure. What's up? My question is, is it smarter to pay off my home or my rental property first? Hmm, what do you owe on the rental? I owe $127,000 on the rental. What about your home?

$367,000. Okay, and what's your household income? My base household income is $166,000. Okay, base. But, I mean, what do you make in a year usually? It depends because of overtime, but I average anywhere from $185,000 to $195,000. Okay, very good. Congratulations. Great career. Thank you.

Okay. Well, I mean, there's no real bad answer to this. Both of them get paid off eventually, right? Yes. And so it's just a matter of which one. The rental is so small, you can knock it out pretty quick. So I tend to go towards it just because it's smaller. If they were equal, I would pay off your house first because of the piece that it gives you.

Okay. And, you know, the risk is lowered because in a worst-case scenario where you're going to lose something, you would want to lose the rental, not the house, right? And so we pay off the house first. But your house is four times or three times what your rental is. And so I might go ahead and knock out the rental just because it's you know you probably do that within a couple years easy yeah if i added it up right we should have that down in six years six years of both of them both of them no not for both and just for the

rental uh for the for my house now the 367 again if i did the math right i'd have that down in 10 years if i threw everything at it not making 200k uh i have also some other income that comes in through the va yeah but i mean if you, if you make $200,000, you can't pull $50,000 out of $200,000 or $60,000 out of $200,000 and be done with that rental in two years and still have a great life? Yeah, we can still have a great life. I was just trying to pay off everything as fast as possible. Yeah, that's what I just said.

$60,000 for two years out of $200,000 pays off $120,000 in two years. Yes, okay. Yeah, I give a shame. And then we do the same thing on the house after that. That's a good Lord. I'm still living you $150 150 000 plus your military income to live on you got plenty you got plenty of wiggle room in this dude um but yeah i i if you're going to do it that slow what you're talking about earlier i might do the house first i'm i was running the numbers we're going to do it pretty fast but um if you're going to go at your speed rather than my speed i would probably pay your house off first because i want

that thing done the rental couldn't give a rip less about at that stage of the game patrick is with us in nebraska kerning nebraska hi patrick how are you hey guys hey rachel dave how's it going y'all good how can we help so we're my wife and i were on baby step two um we just actually sold our car back at the dealership got rid of that dang thing um we just paid off all the our credit cards and um we're going full-fledged into our student loans with as you guys say gazelle intensity good for you that's awesome and And so my question is, I know Baby Step 1 is have an emergency savings of $1,000. I'm self-employed. And so we would feel more comfortable having a little more of a pillow there. So like anywhere from 3 to 5K. And we just wanted to know what

your recommendation on that would be. Obviously, that's against the Baby Steps, but being self-employed, you feel like it might be a little bit of a different scenario. Yeah, I mean, you carry a little bit more risk because of that self-employed. What do you do? What industry are you in? I'm a personal trainer. Okay. Do you have months you make zero? No. Okay. So what's your worst month uh probably about 3k okay um i'd stay with the thousand now when you get to baby step three and you look at the three to six months i might have the six month side because your emergency fund but the the point of baby step one is not to have enough

by the way if one thousand is not enough three thousand is probably not enough either right you're right because whatever i mean whatever's going to come up is going to come up and if it's got to do if it's related to you being self-employed three thousand one thousand it's not it's not going to matter so the point is it's not enough it's just to catch the little stuff the alternator that goes out on the car or that kind of a thing. Yeah, because if you guys have a big emergency that comes up, a medical issue or something, that's when we say pause the baby steps and take care of that.

So, I mean, it's that $1,000. But, again, that's not related to being self-employed. The only thing that's being related to self-employed is irregular income. Yeah, and this is a – and, Patrick, your question is self-employed or not though. Like this is a question we get a lot is people get nervous with a thousand dollars, which I understand. Like I get that. I'm a mom, three kids.

And I'm like, who, if it was that thousand dollars, but part of it is having that, that urgency to get through it quickly. And then the other deal is like, Hey, if something comes up, then then you pause the debt snowball, figure it out and then play it back again. Yeah. Because you're still making an income. It's still coming in. Somebody inside the building was looking at something the other day.

Like, Dave Ramsey's out of date. He doesn't understand $1,000 is not enough. And I'm like, dude, there's never been a time that $1,000 was enough. I mean, 30 years ago when I started talking about this, $1,000 wasn't enough then. So, you know, that's... It's not like I didn't keep up with the times or something. I remember the writing, love your life, not theirs. This would probably have been five years ago.

It was right before Amelia. So, yeah, five, six years ago. And I so badly wanted to change baby step one to one month's income. Do you remember that? I came in, I was like, listen, we could change the baby steps. You looked at me like I had three eyes. You were like, no, we're not changing the baby steps.

I've been teaching this for 30 years. I was like, yeah, okay. And it still works. And it still works. So I get it, Patrick. I totally understand. Yeah, I do too. It's not enough.

But that urgency is what needs to drive you guys. The only time $1,000 feels like a lot is if you've never had $1,000. Yeah. I mean, that's the only time it would feel like it was a lot. Well, and honestly, 40% of Americans can't cover a $400 emergency. Yeah. So for half of America, having $1,000 is like, oh, wow, I actually have savings in the bank. I don't even want to talk about half of America today.

Have you ever seen? No, no. Oh, wow, I actually have savings in the bank. I don't even want to talk about half of America today. Tell us your savings. Have you ever seen... No, no, we're not. No, we've got two minutes left. We've got to end it. We almost made it. We've got to end it. We've got to make it.

All right, Shelby's in Raleigh, North Carolina. Hey, Shelby, how are you? Hi, thank you, Dave and Rachel, for taking my call. Sure, thank you for being there. Absolutely. So I just turned 51. Dave and Rachel for taking my call. Sure. Thank you for being there. Absolutely. So I just turned 51. I refiled my house about two and a half years ago,

so I've got about 12 and a half years left to pay on my mortgage. I work for an organization that has a pension, and I have to contribute a mandatory 6% out of my paycheck each month. So that means 9% is what I'm putting into a Roth IRA and a Roth 401k. I've only been investing for about four and a half years, so I'm a little behind. So my question is, next year, I want to focus paying off my house and putting extra towards it. But I wonder, should I reduce what I would pay, some of the extra that I would pay on my house and maybe put maybe 3% extra towards my Roth 401k? No. Get your house paid off. There's two things that we find with the data on the millionaire study that we did that people have when they become millionaires.

A paid-off house, and they built their nest egg in their retirement. And so it's a one-two punch. And so you're going to get both of them done. It's just a matter of how fast. And the good news is you're paying attention, you're being intentional, and that's a great sign of things to come. Very well done. Hey, thanks for calling, Shelby. Appreciate you.

Rachel, good show today. Yep, thanks for having me on. James Childs, Kelly Daniels in the booth. Well done. Thank you, guys. We appreciate you. 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. Have a friend or family member that needs a daily dose of Ramsey advice in their life? Let them know about the Ramsey Call of the Day podcast. It's a quick hit of advice about life and money in under 10 minutes. Check out the Ramsey Call of the Day podcast wherever you listen to podcasts.