The Ramsey Show - App - How Do I Start Over After a Divorce? (Hour 2)

Episode Date: April 29, 2024

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🎵 🎵 🎵 🎵 🎵 🎵 🎵 🎵 🎵 🎵 🎵 Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships. I'm Ramsey personality George Campbell, joined by best-selling author of Money's Not a Math Problem, Jade Orshaw.

We're taking your calls at 888-825-5225. You call in, and we'll help you take the right next step for your life and your money. And remember, it's just our opinion, but we are experts on that, at the very least. So let's kick it off with Tim in Los Angeles. What's going on, Tim? Hey, George and Jade. I appreciate you for having me. Sure.

How can we help? Yeah, I'm in a weird situation. I used to work with my parents. They started a company eight years ago, and I ran production for them. Every time I asked them for a raise, it was just an excuse, and we can't afford it, blah, blah, blah. So I left, and I'm working for their biggest competitor right now. Juicy. Wow.

Yeah, they got really upset about that. I can imagine. Did you do that for spite? Well, whenever I would ask for a raise, if you can't pay me, and I'm working my butt off for you you know like i'm just gonna so out of spite got it all right yeah i'm like what's fine own it okay yes so he ever since i was 10 years old if my dad doesn't get his way he calls the cops and i just turned 28 so this happened happened last year when I was 27.

Okay. He called the cops saying that I was going to go home and unalive myself. Oh, wow. Yeah, because he wanted me to work for him again. They bought a $2 million house, and when I left, they realized they're losing money because they don't know how to run production. And now I'm working for the biggest competitor. And so he calls the cops and lies to them about saying that you're going to do something really bad to yourself and that they need to show up.

He basically he realized he was losing money. So he asked me to work for him again. But how is this a solution to make you lose your job or something, and then you have to come crawling back to him? What was his strategy here? That's what it seems like. Well, what happened next? So the cops come, and then what happens? Yeah, so he asked me to work for him again.

I said no. He calls the cops, and they put me into a hospital i wasn't even there for a day i told the doctors what was going on you know and they let me go um but i have a sixteen thousand dollar medical bill because of all that what's the sixteen thousand just you going in the emergency vehicle that and then being in the hospital for almost a day i guess yeah and you didn't have health insurance uh at the time no oh boy oh boy okay yeah because that's just riding in an ambulance yeah and you're wanting him to pay it because he caused this which of course he's not going to do i told him if you ever want to see me again you have to have a check and he said you're

not getting a penny from me so wow well i'm so sorry this is beyond i would call this the last straw and uh i'd be done with this relationship because clearly he is he did he opted out i want to make sure you know that tim because i know there can be a lot of guilt and shame and baggage that comes with a hurt relationship, especially one as close to a father and son. But this is not on you. He opted out of this relationship, and you need to just move on. Now, the medical bill might be on you to take care of,

because truthfully, as jacked up as many of the things are in this situation, the one thing that is on you is you didn't carry medical insurance. And so it came back to bite you in the butt in a sucky kind of way. But here we are, you know, so I, unless you're trying to get lawyers involved, which I probably would advise against. The only option is to try to sue him for the 16 grand. Yeah. And I don't, I personally doesn't seem like any of this is worth that.

So what do I do about this because I'm the type of person I'm not in debt I have no debt and just pay it dude you pay you can see if you they'll be willing to sell do you have that money in savings uh I do but I feel like I shouldn't even pay it. I'm like, I... This is, listen, this type of situation, I think John might say like not by your hand, but in your lap kind of situation. You know, there's a lot of dysfunction here. There's a lot of unhealthiness here with the relationship with your dad. And he chose to do something that he made a decision,

but the reaction of it, the consequence of it ended in your lap. And part of that, you know, yeah, you didn't but the the reaction of it the consequence of it ended in your lap and part of that you know yeah you didn't have the insurance to cover it and you'll learn your lesson from that but kind of what george was saying your choices here are you can either go after him legally for that money but that's not going to end well like it's just going to further deteriorate what's already going on it's going to take your mental energy emotional energy physical energy financial energy just to fight this and y'all have already gone tit for tat, right? Like I wanted a raise. They wouldn't give me a raise. So I'm going to for spite go work at their competitor.

He's going to do that. Well, I'm going to call the police on him. So you guys are going back and forth and somebody's got to stop like the crazy cycle. Somebody's got to go enough is enough. I'm going to be the bigger man and make a choice that the other guy isn't going to expect because he's expecting you to retaliate. Right. And so just be the bigger man and go, okay, if I have the money, I'm paying this or I'm settling this and I am dusting the dirt off my feet and I am moving on. And that's kind of what I was like, do you think I should pay it then? It's not in collections, is it? It's just with the hospital still? Yeah, it's just still with the hospital i would contact their their financial office and sit down with them and explain to them the situation and see if they'll have some mercy on

you and maybe they'll forgive it maybe they'll cut it down and you just write them a check and be done with it but i would at least try to fight in that regard yeah especially if you didn't have any real care. Like you might not, like the ride in the ambulance, that's like 5Gs without even thinking. But if you look through that bill, because they ask for an itemized bill and really go through and say like,

did you give me this? Did they do that? And really get on the phone with them and say, listen, here's what happened. That 16 grand turned into seven once you asked for an itemized bill and go, what did you actually charge me for? And if you can get proof from the police or otherwise, some actual legal proof that this was fraudulent, that he did this out of spite and there was no real merit behind it, they may wipe it for that reason.

I don't know. But it's worth at least digging into. Okay. Okay. Yeah. And looking at the itemized bill. Because they let me go. I wasn't even there for a day. I explained to them the situation. And if they have no proof after running testing, you know, so I would, I mean, we're not lawyers. You may want to contact one just for a consultation to see what your options are to try to get this removed. But man, the harder part is just realizing that you just lost a relationship with your father.

Yeah. That's going to sting more than the 16 grand. We can pay off debt. We can't repair an unrepairable relationship. Yeah. And for that, I'm truly sorry. But the good news is you're healthy. You're here. You've got the money to pay it off.

I'm going to just learn from this and move on. If you have to get a restraining order on this guy and make sure the cops are aware of, hey, if this guy ever calls on me, know that he is just a spiteful, crazy man. But goodness, I cannot imagine being in that situation. Yeah, the hardest part for him is going to be not to retaliate because that's the pattern that they have with each other. Well, that resentfulness, that'll stick with you if you're not careful and you start to drink your own poison thinking that it's going to hurt the other person. That's true.

You got to forgive them. And so, Tim, you might want to just go to counseling and therapy to deal with the loss of your father in a sense. Because I think that grieving is going to take some time and maybe some professional help. So I'm sorry you're going through it. Glad you're on the other side soon. Hopefully you'll be back to debt free in no time. This is The Ramsey Show. Welcome back to The Ramsey Show.

I'm George Campbell, joined by Jade Warshaw. If you're enjoying the show today or any other day, do us a quick favor. The show is free. The favor is free. All you need to do is hit the subscribe button, hit the follow button, leave us a kind review, share it with a friend. You can hit that share button. leave us a kind review, share it with a friend. You can hit that share button. Maybe it's a clip, maybe it's a full show. Whatever you need to do, word of mouth is the best marketing engine we have, and you guys are the best marketing. So thank you all for sharing it. It helps with the algorithms and get this word of hope to more and

more people, and you guys are a huge, huge part of that. So thank you for doing that. Madison is up next in Atlanta, Georgia. Madison, welcome to the show. Thank you so much. And thanks for your time. I appreciate it. Sure. How can we help?

So I recently found myself unexpectedly and kind of traumatically facing a divorce. I'm 52 and I did not have time to kind of do a long plan. It was a matter of space being needed to file for divorce. But my question is, we do not have any retirement, but we do have some rental properties. And I'm trying to figure out the wisest move. If my husband has offered, we could split them up. We could form a company and keep them together. But honestly, that's not going to work with the dynamics. So it's kind of, is it wiser to hold on to a couple or just liquidate? And I'm trying to get a pulse on what I want so we can move to the next phase of negotiating. What's the bigger financial picture here?

Where are you living? Do you have any debt? Do you have income? Sure. So, well, my husband, I have been a stay-at-home wife and mom for most all of the marriage. So his income is $270,000 a year. Okay. And then another $26,000 from our rental properties per year. Okay. How many rentals are there? Thank you. So we have right now four. Okay. Are they paid for or do they have mortgages on them? They all have mortgages and most of them, I do know the cash flow and the equity of them, but they do have mortgages. Okay. And if you sold all of the rentals and after paying the mortgages and the realtor fees, how much would you net combined as a couple? Around $800,000.

And you would split that evenly? It would either be evenly with Chase, yes. It would be 50-50. I, to be honest with you, am going to ask for more, but 50-50 is definitely. Okay. So that's option A is you walk away with about $400,000 that you can then use to invest. Correct. Okay. And do you have any other debt other than the rental property mortgages

we do so we have um one credit card that's 32 000 one is 22 000 um now to be honest with you it's not a negotiations are not done but his intention at this point is to take on that debt. It's what he's told me. I don't know that I can 100% count on that, but he plans on... But this debt is in both of your names currently? It is. Okay. And what other debt outside of the credit cards? Outside of the credit cards would be two vehicles. So one has a payment, it's a Jeep of 636. What's the full amount you owe? I believe the full amount we owe on that is 12,000. Okay. And the other one? And then the other one is going to be about 35,000. Why in tarnation have you guys been racking up all this debt when you've had a household

income of $270,000, $300,000 at 52 years old? Well, there's some personality dynamics and a strong personality. So you're saying these were all his decisions? Pardon? These were all his decisions? Pardon? These were all his decisions? Yes. But you co-signed on them. Your name is on all of the debt.

On most of it, yes. So you're working with a lawyer, right? Or are you guys trying to do this amongst each other? So I have a lawyer and to save on lawyer fees if we can work out what we can without the lawyers whatever we can agree on i'm trying to do that okay and then you know utilize my lawyer as needed but it's obviously um he's a high-end lawyer and it's. And you're going to have some serious spousal support after this is all said and done? I am going to get spousal support.

I need to find out what my rights are as far as how much. He has offered me a certain amount. What has he offered? Just so we can have something numbers wise. Yeah, no, I appreciate it. He offered like $4,000 a month. I countered with $45,000, but I think I'm entitled to more based on what he makes, but $4,500. And then he said he would pay all the bills.

Like that would just be- So all the debt would go to him? Correct. Interesting. I might take more spousal support. If you can get $100,000 a year from his $270,000, you'd be better off and use the proceeds from the rentals to knock out all the debt together. So I would do some serious math before agreeing to it on face value. And I would talk to your lawyer about what makes the most sense financially.

Because long term, I'd rather have you have a double the income versus going, well, I don't have to deal with the debt, which is a short term problem. However, the one debt that I would want to be dealt with is these mortgages. Like if I were in your shoes- I'm clean, just clean slate. Yeah, I would not want to be on any of this property with him. I would not want to set up any sort of business. I would say, let's cut our losses. We sell them, you split the profits, and then that's that on that clean break. So you have over $100,000 in consumer debt. Are you living in the house that you guys lived in together? And is there a mortgage on that? We have, um, I'm not, we are not living together and we sold the home that we were

living in together. What happened to the proceeds of that home? I have, we split that and I 50 50, I have, so that wasn't a lot cause it was only a year old, but that's like 32,000 and I have, it was 60, I have half of that. I have 32,000 of that in my bank account. We're also selling another property. Not one of the four? Not one of the four. It was another one we were going to move into, and that one should net about $170,000 in profit. And you'll get half of that? You'll split. And we'll face split. It's 50-50. That's guaranteed. So you get another $85,000.

Great. Is that all the money to your name then, the $32,000 and the $85,000? Nothing in retirement, and that's everything you have in savings? And where are you living now, by way what's your living situation so i moved out and i'm staying with my adult daughter so i've been like kind of living on a couch and out of a car and trying to figure out no yeah well like my belongings are in storage but then the things i needed are in the back of my car so i've really been displaced and just trying to figure out, I don't want to, I want to put down roots somewhere that I know I want to be.

And that's going to probably be an out of state move. And it's just been pretty traumatic with, you know, it's kind of a, I would say lifetime movie, but really like a dateline movie. Yeah. Cause it sounds like you were fleeing something, and I hate that for you. It was abusive. Yeah, it was abusive, and I would have never, ever used that word before, but it was, and it became unsafe, and I had to literally leave when he went out of town within a couple days. Well, A, I'm proud of you.

I'm proud of you. That takes a lot of guts. Thank you so much. I'm sorry you're going through it, but I know it's the healthiest, best thing for you, as much of a nightmare as this situation is. So let's recap, and we'll give you some next steps. I would absolutely sell all of the properties and get as much as you can out of all of that. I would fight to get as much spousal support as you can. And if he wants to take on the debt, that's fine.

If you need to split it and you pay half of it, he pays half and we call it square. You need to just cut all ties with this man. Other than the spousal support, which is part of it, that's part of the deal. And at that point, you'll be debt-free. You'll have a giant pile of money. And at that point, I would contact a SmartVestor Pro.

You can do that at ramsaysolutions.com and they can help you make a plan for the few hundred thousand you have sitting there. Maybe part of that is fully funding retirement. Maybe part of it's in a brokerage account outside of retirement, but they can help you with that. And I'm also going to have our team send you this article.

It's on our website. And for those of you that are wondering, we'll put it in the show notes. How to survive divorce, protect yourself and your finances. That's on the Ramsey blog. And I'll have our team, Kelly and Christian, will pick up. They'll send you a link to that. And we'll also drop in the show notes for anyone watching. I also want to gift you, Madison, a free financial coaching

session from one of our trained Ramsey financial coaches, because there's a lot to unpack here. I want to make sure that we take care of you more than we can in a five-minute radio call. So hang online. We'll gift you that. And everyone else, tune in for that article. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm George Campbell, joined by Jade Warshaw this hour. And in the lobby of Ramsey Solutions on the debt-free stage, we've got Steve and Julie here. How are you guys?

Good. How are you? Good. Where are you guys from? South of Raleigh, North Carolina. North Carolina. Well, thanks for making a trip to celebrate debt freedom with us. This is exciting. How much have? Good. Where are you guys from? South of Raleigh, North Carolina. Well, thanks for making a trip to celebrate debt freedom with us. This is exciting. How much have you guys paid off? We paid off $217,000. Okay. How long did that take? That took about six and a half years. Uh-oh. I'm sniffing something out here. This is about to get

interesting. And what was your range of income during that time? We started out making about 200 combined and finished up right around 320. Amazing. What do you guys do for a living? Well, I work in oncology research. I'm an early childhood educator. Wonderful. Awesome fields. And what type of debt was this 217? That was our mortgage. Bingo, bongo. There it is, Jade. That's exciting. You were sniffing it out. I was a bloodhound over here. I'm like 217,000, six and a half years.

That's exciting. Wow. We're looking at weird people here. Not that you guys look weird. You look wonderful. But that is a weird thing to do. So take us back six and a half years ago. You had this mortgage sitting around.

What happened? We actually moved. We actually took a little step back in our journey, took on a little bit more mortgage, moved to be a little closer to our kids' school. And through that time period, we just decided we wanted to finish it early. We took out a 10-year mortgage instead of 15, but paid it off in six and a half. A lot of people don't know you can even do that legally. They're going 10 years. So you pre-decided that you didn't want this mortgage hanging around. Yes, we did. We didn't know exactly how long it was going to take because we had a lot of other things happening in that six and a half years. We had three kids to go through college. We paid for that and a wedding. Cash flowed all of that wow and our daughter's

wedding very good you guys are impressive thank you okay so what got you on this Ramsey journey how'd you hear about us and what influence did we have I think the first time we heard you was actually on the radio show and we were just kind of going about life like people normally do or what we thought anyway. We used credit cards. We had car payments. And one day we just decided we had had enough of that. And that kind of started the journey. Wow.

Very cool. And then you do the move and you go, you know what? We don't want this mortgage hanging around. We're going to pay it off early. Let's do a 10 year. And you paid it off in six and a half. Six and a half years. Wow.

So three and a half years ahead of schedule yes if you just made normal payments and yeah we had a low interest rate mortgage and yeah i know we did the wrong thing yeah wow and uh you stand here before us living to tell the tale of paying off the mortgage right in light of how much you could have made exactly did people ever think you were crazy for doing that as you talk to your friends? Because you're a smart guy in oncology research or early childhood, you know, people go like, what are you doing? Or did you not talk about it? We don't necessarily talk about it with our, like our parents so much because they are of the mindset of you should keep your mortgage. So you're like, we don't need their opinion. Really? Yeah. We love them. We don't want their financial advice. I mean, have we had people look at us like we had three heads when we

talk about it? Yes, we have. Wow. And look at you now, totally free. Yeah. No regrets. No regrets. What's this house worth? It's worth around 680, I think. Oh my goodness. Very cool. And what's in retirement, nest egg, all of that somewhere around uh 1.5 oh my goodness so you are well beat you were already baby steps millionaires we are long ago yeah but now you don't have a mortgage that's right wow can i ask how old you two are because you seem pretty young you got a lot of life ahead of you with no mortgage thank you george i appreciate maybe not her age but yours i just turned 54 okay i'm 53 that's amazing yeah so what now what do you do i mean you've reached the pinnacle yeah travel

lots of travel lots giving we have a brand new grand baby oh that's so spoiling the grand number that's a1 yeah so what's the first thing you did or will do now that you're completely debt-free? So we actually paid the mortgage off a couple months ago, and that was right after our youngest son finished college. So we just finished with that, and we took a week to Maui. Oh, my goodness. That's amazing. Just you two? Just us two.

Just us two. It's actually our second trip to Hawaii, so we're maybe going a third time. I love it. Oh, my goodness. That's exciting. Yeah, yeah. Wow. So how does it feel to be completely debt-free for people that don't know what that's like?

It's just really hard to describe. When you do your budget every month, you realize you have all this margin that you can give more to people. And I don't know. It's just really an amazing feeling. That's fun. It gives us options. Yeah. We have choices.

Now you can work because you want to instead of until you have to. Right. Yes. That's incredible. Yeah. And I see there's some people here on the side of the stage. Who are these people that have joined you today to celebrate? It's our daughter, Katie, and son-in-law, Joel, and our granddaughter, Charlotte.

Oh, yay! Oh, my goodness. That's so sweet.law Joel and our granddaughter Charlotte. Oh my goodness. That's so sweet. I'm glad the granddaughter's here to witness this. She'll go back on YouTube and be like, that's my grandparents. She will definitely remember this. That's incredible. So what do you tell people the key to becoming totally debt-free house and everything is? My answer is I think the two of us working together, having combined goals, a combined vision

and just executing that plan together. I mean, before we were not aligned and now we are, and that's been huge. I will say for a lot of years, I wanted for us to just use debit card only. And we were just doing the points credit card kind of thing and I just knew the more I pushed it was not going to help and finally he just came to the realization on his own one day and we just really got on board and dialed down the budget and just the shared goals really helped. Wow. Yeah. How do you get there Steve like one day you just wake up and you go, all right, fine. I'll do it her way. I'm a little slow, George. But eventually it happens, right? Eventually at 54, you might wake up and go, it's time for a change.

Happened a little earlier than that. Thank goodness. Yeah. Well, you guys are inspiring. I hope I'm like you one day living and giving generously with a grandbaby now. I got an eight-month-old now. And so you start to think about legacy and you know what really matters in life and money has went from an obstacle for you guys to a tool yes absolutely that's the best part of all of this and the cool thing is we're able to

teach our kids as we went yeah they watch this whole process exactly so we have changed our family tree with our own children we have we have three children katie and then her two brothers wow yeah Who couldn't be here to join us today. What a difference. They're celebrating online. Yes, they are. Well, this is exciting, guys. This is the moment we've all been waiting for. So we've got some gifts for you, some parting gifts, and that's two every dollar premium subscriptions. And you can use those. You can give them away, maybe to the kids, maybe to friends who thought you were crazy, the ones cheering you on. But this is an exciting moment. So we'll be sure to give you those as you head out today.

All right, here we go. It's Steve and Julie, Raleigh, North Carolina. $217,000 paid off in six and a half years. House and everything, making $200,000 all the way up to $320,000. Count it down. Let's hear a debt-free scream. Three, two, one. hear a debt-free scream. Three, two, one. We're debt-free!

Baby Steps Millionaires in our midst, Jade. They're all around. And you might not know it, because my guess is Steve and Julie live pretty normal lives if you just saw them walking down the street. 10-year mortgage. That's all I have to say. What a flex.

10-year mortgage paid off in six and a half years. Y'all out here flexing with your fancy cars with a $1,000 payment attached. They're out here flexing with their 10-year mortgage they paid off in six and a half. I know. That's right. They said no flex. They freed up a few grand and they're not here to impress anyone. They just want to make an impact, leave a legacy, go to go to maui enjoy their life and they did it all with cash and i love that

they gave up the game yeah they were saying yeah we used to be those people we did it for the points and we had our payments and life was okay but it wasn't like this yeah this is different they weren't levitating with freedom and that's what I love is when you stop playing someone else's game, you zoom out and you go, oh, I was just a rat in the credit card company's maze. I just, I also love the example of patience. You know, when Julie was like, hey, I could have pushed harder and harder, but I just, I let him come to the conclusion and he did. I just love that. And then once that happened, it was game on, on the same page. I'm telling you, shared goals, shared vision. They have a better marriage, they're communicating more, and now they can do whatever they want, which means less money fights.

It's amazing how that works. Probably none. Yeah, probably very. Now the money fight's like, well, we went to Maui last time. I want to go to. That's right. That's really the arguments now, is where we're going to go on vacation next. I'm happy to have that be my worst marital problem. Well, folks, I hope that inspired you guys as much as it did us. That is the power of the baby steps. Everyday people living out the principles, becoming debt free, leaving a legacy. That's what this is all about. This is The Ramsey Show. This is The Ramsey Show. I'm George Campbell, joined by Jade Warshaw. The number to call is 888-825-5225. We've got a lot of events happening around here. One of those is a brand new one called Dave Ramsey's Investing Essentials. And at this event, Dave Ramsey and myself, we're going to deep dive into investing. And for the first time ever, Dave is going to unleash his

personal playbook on investing, including how he buys real estate, which is something that he has not done at length, which is really cool. So this is a two-night virtual event happening May 21st and 22nd. And because it's online, you can watch from the comfort of your own home. So you don't have to worry about us being in your town because you get to watch. We're coming to you. And investing is something that you all ask us to dive deeper on all the time. And this event is our response to that. So we're going to start with the basics, build a foundation, and then get into specifics, some 201 and 301 content, mutual funds, real estate, investing traps and trends, how to maximize your 401k, and a whole lot more. So join us. Tickets

are 249 bucks, but you can tune in with your spouse and you don't have to get another ticket. So that's nice. Go to ramseysolutions.com slash events and get your virtual pass today and join us May 21st and 22nd. And yes, you can watch the replay. I think we're giving them a week with the standard pass to watch it. So if you miss it, you'll have many, many days to enjoy it and tune back in and catch the replay. Take notes.

You're going to want it. ramseysolutions.com slash events. All right. Tony is in Salem, Oregon coming up. What's going on, Tony? Hi, George and Jade. Pleasure to talk with you. Yeah. My beautiful wife and I are in baby steps four, five, and six, but we're wondering if we have too much locked up in sinking funds. Ooh. Let's talk about it. How much you got and what's it for? Yes, we have $42,000 in emergency fund that's not a sinking fund, $10,000 in travel, $11,000 for taxes, insurance, and our kids' school, $8,000 for medical, $5,000 for home maintenance, and $3,000 for gifts slash Christmas. Well, let's see, gifts slash Christmas, tax, medical school, travel. There was another

one in there that I missed. You went through them pretty quickly, but it sounded necessary. Do you think any of these are overfunded currently? I like the insurance, that if something comes up, because the way our budget is set up, I feel like even though everything's fully funded, we still month to month, you know, it gets to the end of the month and we're down to nothing. So are you unable to cover other expenses or goals because of these sinking funds?

What is it holding you back from? Everything's covered. I just feel like we can't budget for some of these things and our current budget just out of my paycheck. So this is the piece of mind I've come to. I think you're choosing one thing over another, and I think it's your choice to make. By funding these every single month, yeah, you're taking away some of your monthly cash flow because you're saying, no, we are going to take a trip. And you have to probably put some caps

on these, I would think. Is the trip going to be more than 10K or is that enough? Like, does that need, does it need to be something that's continually on there? Same thing with, you know, taxes, school and insurance, only you know if you've hit that mark or if you've exceeded it or if you still have some to go. But let's just say where they're at right now,'s pretend that they're fully funded then all of a sudden that money is back in your month-to-month budget but if you say well some of them are fully funded some of them are not then that is a little bit more cash flow or if you say no no matter what i constantly want to be putting towards these then you've made the choice that at for comfort like you're forsaking month-to-month comfort of having extra margin for a year-round comfort of knowing, hey, we can take a vacation at the drop of a hat.

Yes, it's more the latter. They're fully funded, and we like to just on a whim go travel. It's there. We can cover it. I don't have to think about it. Then I think that that's the choice you've made. Nothing seems broken here. It's almost like you're wondering have I gone overboard.

And the truth is, like for the medical, what is the 8K for exactly? We're on a high-definition plan. And so when I first went to that, my wife was nervous. So I said I will fund an account just to pay for medical, and we've yet to turn in a receipt over three years. So at some point – And that's where I'm like that might be unnecessary. You have an emergency fund.

If there truly was an emergency that went above and beyond, you could either cash flow it or dip into the emergency fund temporarily. And so for some of these, I would just go, are these actual expenses that will be coming up within the next calendar year? Or is this just the like, oh, crap fund? And truly, that's your emergency fund. I also think there's something to be added to this, whereas you guys kind of just got to baby steps four, five, and six. So it's taken some time and it's taken clearly a lot of your budget to make this happen. But to Georgia's point, the deductible fund, it's done. Like you don't have to keep adding to that. There was another one in there that I feel like it was for 5K. Home maintenance. Yeah, home maintenance. It's like...

Are you spending 5K a year on home maintenance currently? Because if you're not, you might want to scale that back down. Unless you're saving up for a remodel. But then it's like, okay, if you're saving up for a remodel. So I think it's just you guys... Or the roof needs to be repaired in two years. Let's save up to make sure we have that funded. So I think you're fine. You're probably overthinking it, if anything.

And I would make sure you're investing 15%. Do you have kids? We have one son. And you're funding some into a college fund? Everything. We're making actually more in our house payment every year. We're paying for his school, his private school, as well as putting him to college.

And I feel, I'm at a point where I feel the light at the end of the tunnel. We're 280k away from a debt-free scream. It's going to happen. Awesome. Good. You guys are dialed in, man. I can throw more of this towards it. And just make sure you enjoy life. I love that you have the vacation travel fund it's going to happen awesome um good you guys are dialed in man more of this towards it and you're just make sure you enjoy life i love that you have the vacation travel fund because it tells me that

you are wanting to enjoy some of this money and that's how i see it is just make sure you don't get a flat tire are we giving enough are we spending enough are we saving and investing enough if you got all three of those covered you've got a rich healthy life perfect so yeah thanks for the call that That's a fun, that's a fun question. It is a fun question. No heartbreak here. Yeah, I think, you know, I think that when you need sinking funds, they're a really great tool. You know, if you like to have the extra for, you know, your deductibles, if you want to fund multiple, you know, vacations ahead of time, I think it's a great tool. And so for those of you that don't know what we're talking about here with sinking fund,

let me clue you in. A sinking fund is simply a way to save up for a bigger purchase over time instead of needing the money that month and not having it ready. So if you know you're going to spend $1,200 on Christmas in December and it's January, well, we need to fund $100 a month into a savings account in order to make sure we have that money, so on and so forth. And so as you go through home maintenance, a vacation, if you know you've got the vacation coming up, let's save over time instead of trying to muscle our way through it within a month or two. And so that's the whole point is you're being proactive, you're thinking ahead instead of being reactive and hoping. I think in many cases, though, for a lot of folks, it's a way to make sure that no matter what, they never touch their emergency fund. Like when you start doing a separate one for, you know, your deductibles and things like that,

I think there's part of you there that's like, no matter what, I don't want to touch this emergency fund, which I can 100% understand. Oh, yes. And most people that do this, they're like, they haven't touched the emergency fund. Because really what happens is as you get this financial foundation under you, you sort of get better at things you buy higher quality items you do the proper upkeep and maintenance and then when an emergency does come up it's usually the ankle biters yeah and you're able to cash flow it in next month's budget right because think think about the biggest one the biggest thing that could happen is like your roof right i feel like that's like the big one your maybe hvac yeah if you live in south florida though a new roof is like your roof, right? I feel like that's like the big one. Your roof. HVAC. Maybe HVAC. Yeah. If you live in South Florida, though, a new roof is like $30,000.

And so, but usually you can see that coming. And that's my whole point is usually most emergencies, unless they're medical, you can kind of see it coming unless you're a person who like sticks their head in the sand. And if you can get ahead of that and start a sinking fund, then it's a great way to not have to touch your emergency fund. Exactly. So I think a lot of it, when you're broke and trying to follow the steps and get out of debt, it feels like everything, life is just coming at you. And every little $100 emergency or $600 emergency, you're like, this is going to be my whole life. Then once you get above it and get out of debt and get the emergency fund, you sort of have better luck.

That's right. But it's not really luck. It's just you putting yourself in a better place. That's right. So that's what I love about the emergency fund and it's a good call out that this is different than a sinking fund the emergency fund you only use if it's urgent necessary and what's the last one uh unexpected unexpected there it is i knew it was there jade that was like an alley-oop it was i was glad i was ready for the pass definitely did not want to fumble so that's a big one so So baby step one, $1,000 starter emergency fund. And then baby step two, let's knock out all of the debt. Then baby step three, we can get that fully funded emergency fund and begin to put those sinking funds away. And even if you're in baby step two, it's wise to have that sinking fund ready to pay the insurance

bill at the end of the year that you know is coming. Yeah, that's true. And so if that slows down your debt snowball, that's okay. We want to make sure we don't go back into debt because we weren't aware of an upcoming expense. Yeah. Yep. I'm that person too that likes those deductibles. Like I'll keep the deductible in the HSA. You know, you can invest the rest or whatever.

And I just like knowing it's there. It's part of financial peace. Yeah. I just like, I like knowing it's there. Love an out-of-pocket max. This is the nerdy conversation you listen to the show for. Where else can you get this kind of content? We get to nerd out.

Only the Ramsey Show. Well, that was a fun hour, Jade. Thank you so much. Thank you to all the folks in the booth keeping the show afloat and keeping the audio smooth. And thank you, America, for tuning in. We will be back before you know it. Thank you.