The Ramsey Show - App - How Much Should I Spend on a Car? (Hour 3)

Episode Date: January 16, 2023

George Kamel & Jade Warshaw answer your questions and discuss: "What should I do after selling my house?" How much to spend on a vehicle, "When should I move out of my parents' house?" What to do with a big insurance settlement, "Should I consolidate my debt?" from the blog: What Is Debt Consolidation? Accepting a lower offer on a home sale. Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studio, it's The Ramsey Show, where America hangs out to have a conversation about your life and your money. I'm Ramsey personality, George Campbell, joined by Jade Warshaw this hour. It's a free call at 888-825-5225. You call in and we'll give you the best advice we can. If you're at a crossroads, you need a second opinion, a third opinion, we are here for you. Unbiased, but also biased to the fact that we want you to win financially and do it debt-free. That's right. I take that back, Jade. We can have our opinions. That's true. It's the Ramsey Show.

We got the Ramsey opinion. That's what we're here for. And you get what you paid for. Sean is up first in Kansas City. Sean, welcome to the show. Thank you for taking my call, George and Jade. You're welcome. Happy to do it. What's going on?

So I will be selling my home this spring, and my wife and I will be purchasing a new home. And my question is whether I should roll all the profits from my sale into the new home. I'm currently in baby step two. We have worked our deficit down to about $30,000 remaining, which I had planned to have it paid off in the fall but if I put 10 to 15 percent down on the new home then what we would have left over from the profits would actually take us out of baby step two and we would have the fully funded emergency fund and baby step three and we've been going through this for some time. So I kind of like the idea of jumping, kind of knocking out the debt, having the emergency fund with the new home purchased.

But at the same time, I'm not sure if I should roll everything into the new home and then keep working Baby Step 2. If you were to put 20%, take 20% of the profit and put it towards the new house, would it give you enough to do baby step two? And how much of the, would you get three months out of it? Three months of savings? No, I don't believe so. Depending on what the sale is, we would clear between probably 75 and 85. And I think had $35,000 through Churchill Mortgage. We were planning on putting $35,000 to $40,000 down. Okay. What's the home sale price of the one you're buying?

It'd be $175,000 to $200,000 is what we would be selling, and what we're pre-approved for is $300,000. Okay. So you're going to is $300,000. Okay. So you're going to put $40,000 down on a house that you bought for how much? $260,000. $260,000 is the home? All right. What's your take-home pay? Together we bring, well, I know we make $10,000.

We bring home $10,000. Okay. So $10,000 take-home pay. So we want that mortgage to be about 25% of your take-home pay. And so if you put $40,000 down onto $60,000, that would put you right there. That's a sweet spot. Now, if you put down $35,000, you'd still be good. So could you put down $35,000 and still be able to pay off your debt?

Yes. And have an your debt? Yes. And have an emergency fund? Yes. Oh, this is, you're rocking and rolling, man. Heck yeah. The odds are in your favor. Absolutely. So whatever the equity is, we're paying off the debt, building an emergency fund. The rest is going to go towards that down payment. Perfect. Perfect. I love it. And then you're,

because what that does, like you said, it catapults you to baby steps four, five, six. So then we begin investing 15% of that household income. And then we still have margin left over because we have a very reasonable mortgage comparatively to our take-home pay to pay off the house early. Oh, yeah. So you're doing this with a lot of wisdom, and I hope it's a smooth transition and move. I know it's a, man, it's stressful. Even when you're in your spot, it's still just a lot mentally and physically.

Yeah, I know. My wife, she really wants to get out of baby step too. She's in trouble. Well, you're doing it the right way, Sean. We're proud of you, man. Way to go. And good folks over there at Churchill. All right, let's move on to Jackson in Dayton.

Jackson, welcome to the show. Hey, thanks, George. Thanks, Jade. How are you guys doing today? Doing good. How are you? I'm doing very well. What's going on?

All right. Hey, so get straight to the point. My question is, how much money should I put into a used car? Well, that depends. How much cash do you have? Well, I guess like savings, like my emergency fund and like my savings. Well, yeah. Do you have any money that you've started saving specifically for a car? Like tell us a little bit more about the situation.

Okay. So about a month ago, I hit a deer. Ooh, yikes. And yeah, no fun. And my insurance totaled my car and they're giving me about $2,800 for it. They're giving you, they're writing you a check for 2,800 bucks? Yes. All right. What other money do you have in the bank? So in my actual savings, I have about, say, $10,000. Okay.

And in my emergency fund, I have about $8,000. Okay. So let's say you've got about $20,000 to your name. Yeah, let's say that. Is that right? Do you have any debt? Correct. I am actually debt-free. I am actually debt-free. I've been debt-free for my whole life.

Nice. Personally. Way to go. Way to go. Way to go. So the goal here is to not touch the emergency fund. And so let's say you said your emergency fund was about $8,000 right now? Correct.

Okay. So that gives us the $10,000 you have saved plus the 2800 that the insurance company is giving you and so my goal would be can we get you a twelve thousand dollar car a twelve thousand dollar car okay it's out is that laughable to you i hope not because that's my budget for my next used car no no so i guess for me for me it's like um how do i kind of also preserve some of my savings i'm 20 years old and i guess my long-term goal is like get a house someday and do you want to spend less than that on a car oh so you want to go lower perhaps maybe That's kind of what my... Let's go. That's great. I'm here for that.

I mean, you can find... Now, you're going to get a lot of haters, but they're literally out there for sale. Oh, yeah. That are $6,000, $7,000, $8,000. Yes. That are great. They're going to be higher mileage.

They're not going to be the shiniest, newest, fanciest, but it sounds like you don't care about that. I just love that he's thinking this way. No, I don't care about that right now. So you'd rather allocate more money towards the down payment. What's your income? Oh, yeah. So right now I'm only making, what, say $28,000 a year.

Okay. As a cobbler. How old are you? I'm 20 years old. Oh, yeah. And are you in school or do you go straight to the trades and you're just going to continue cobbling? I just went straight to work since high school.

Took your foundations and personal finance senior year. I was like, you know what? I'm going to try this out. See how it works. That's great. And your income is going to go up. I mean, you're 20 years old. You've got plenty of time, whether you continue cobbling and, you know, build that out further.

I would consider a side hustle to save up this down payment. Do you get some time on your hands outside of your cobbling job? Yeah, I do. And a part of my cobbling job is also leather working. Oh, nice. Yeah, I've been trying to think of some projects I could do. Jackson, I love it. Man, you make some cool leather goods and start selling them in the neighborhood on Facebook, on Etsy. You're going to have that down payment saved up in no time. But I'd go start researching the car you want, get a pre-purchase inspection, regardless of where you're buying it from, by a good mechanic to make sure you're making a wise decision there. But I don't think you really care about cars. You care more about

your future. And I respect that, Jackson. Oh, I respect Jackson. I love the way his mind works. Woo! More of The Ramsey Show coming up. this is the ramsey show i'm george camel co-host of this show of course but also smart money happy hour with our good friend rachel cruz you can check that out on the Ramsey Network or wherever you listen to podcasts. Join this hour by Jade Warshaw, and we're having a good time here at the Ramsey Show taking your calls about life and money. 888-825-5225. Paul is up next in NYC. Paul, welcome to the show. Hey, guys. Thank you so much for taking my call. I'm actually a first-time caller and a long-time listener. Awesome. How can we help? All right, so basically right now I'm looking into basically making a timeline of when I could move out of my parents' house. I mean, I'm not quite there yet,

but I'm basically just making my early steps in advance. Okay. How old are you? 31. Okay. So what's the plan looking like so far? So, I mean, 2022 was a very good year for me financially. I actually was just going through my finance spreadsheets, and I actually finished out the year with $81,000.

That was my total year-end revenue. And I'm also a music teacher as well, teaching chorus and general music, and I do private lessons on the sides for piano and drums. And yeah, it all worked out really well for me last year. I'm also a student debt free as of this past April. Excellent. So, uh, yeah, yeah. So, uh, having the new income coming with my most recent teaching job really helped out tremendously with that. So as of now, yeah, as of now I have 42,000, uh, saved up and, uh, I'm hoping by the end of this year I can get past 80,000. Okay. Is that, and that's the goal? $80,000 saved up. And I'm hoping by the end of this year, I can get past $80,000. Okay.

And that's the goal, $80,000 saved? Yeah, at least. And that's going to be your down payment on, I'm guessing, an apartment? Or what are you looking for? I mean, either house or condo. I don't know if I'm just going to be comfortable paying like two grand or more in rent and just having that. Are you looking to live in the city or are you looking in the outskirts? No, Long Island.

Okay. So if you moved out today, what would your rent be? If you rented somewhere. Yeah, if I rented somewhere, I mean, probably around where I live, I mean, it would probably be north of two grand, which I would definitely not be able to swing now. What's your take-home pay? Take-home pay, I guess each month is probably going to be around six grand. Okay. So if you could find something that's,

could you find something for $1,500? I mean, it might be a bit of a stretch. I mean, especially around here. I mean, in Long Island in particular. But I mean, I could start looking and to see what comes up. I would start looking. I think, you know, I know that you want to get to 80K, but that sounds like it could take a stretch of time. And I'd like for you to make that timeline a little bit slimmer to get out of your parents' house. I mean, you're making 6K a month. I don't

think there's any reason that you can't support yourself and live on your own. And if you stayed, I would have clear communication with parents going. Hey, here's my goal 12 months from now i'm moving out my goal is to save this much Even if I have don't have all that saved i'm moving out even if it means renting somewhere Because I think it'll give you A lot of dignity and independence that you don't currently have and I know it's a high cost of living area I mean, it's an insane situation over there. I'm from Boston, so I totally get it. That it's a lot of money you need to save up for that down payment. Have you looked at condos in the area to see what that's going to cost you to buy?

Yeah, I just started looking at those. I mean, if I'm looking, let's say, between 300, 500 grand, I mean, that's obviously very steep. But yeah, I've only recently just started looking at that. I haven't really like tailored my searches on the condos lately. Yeah, I'd start looking into that. And also, you know, how many hours, I know that you're kind of freelancing right now, you're into music. How many hours a week are you working? Is there a way that you can pick up more lessons, pick up more, you know, teaching and really amp up your income even more so that you can make this happen faster? Or even increase your hourly rate by a few bucks. Yeah, I mean, currently, it's funny.

I mean, I'm at probably the busiest I've ever been. I have probably 30 students on the side freelance, but my main job is teaching in a public school. So that's already five days a week. Okay. So I've got all those going on at the same time. I'm working six days a week. What does the public school job pay? So that's around $67,000 per year. Okay. And my private lessons account for between, that's an additional $20,000 to $25,000 a year. That's good. Can I just ask you, how much are you charging hourly for your lessons?

So hourly, it's around, well, it's split up by half hour. And I teach at two different places where it's like 15 or so per half hour. So we're a little over 30 an hour. I can't feel super cheap. It's super cheap. Super cheap. Can I just say this? And can you teach me Paul? I mean, goodness gracious.

I did lessons, Paul, I did lessons for years. My husband did bass lessons and keys lessons and I taught piano and voice lessons and I only did hour blocks and I charged a dollar a minute. So it was at least $60. And then after I had a certain block of students, which you have more than I had,

I charged a hundred dollars an hour. And if you're students, which you have more than I had, I charged $100 an hour. And if you're teaching music and you know how to play music, you know your stuff. You need to charge more money, dude. And you can. Paul, think about this. If you raised your rates to 30 for a half hour,

you could do half the work for the same amount of money. Yeah. And no one will bet on that. Exactly. Yeah, the only problem is it's within two places, like two separate businesses. I'm not teaching private lessons on my own anymore. Man, I think that you can, Paul.

I think there's major opportunity here. And here's the thing. I think that when you get out of your parents' house, there is a certain level of comfort and security when you know you've got that place, right? You know, mom and dad, I can just pull in the driveway and it's there. But when you start having your own place and you got to hit that rent, I think that that is going to motivate you in ways that you never, you're going to become so

much more innovative because necessity is the mother of invention. When you need to get that money, you need to make that money, you will start having ideas and you will start making those ideas happen because you have no choice but to make those ideas happen. So I think, Paul, for you, for your music business, for your lessons to take off, I actually think that getting out of your parents' house is going to be essential for you. And I hope that you make that move sooner than later. Absolutely. I love, I mean, Paul is just like a likable guy. We're just rooting for Paul. He is the main character and we want to see Paul win. And by the way- I want to see him raise his prices, George.

Yes. And this is a great reminder that you don't get a pass on math because you live in a high cost of living area. True that. And so if you want to live in New York City, Long Island, Boston, LA, you name it, you got to make more in order to still hit your money goals or you gotta show up there when you and with a whole bunch of money which most people don't have yep yeah looking at the numbers here you know getting a condo even for 300 grand with 80 down that's

still 2200 bucks a month almost yeah on that 15 year which is the only mortgage we'd ever recommend you have because the goal is to get out of debt not be in it twice as long and he might have to rent and that's all right so that was my thing he may need to rent and keep saving do the side hustle for one more year save up another 20 use all the side hustle money to in a savings get to a hundred grand on as a down payment yes and i bet you this when paul gets out of mama and papa's uh house he might meet himself a nice fine lady. You know what I'm saying? I'm just guessing. I'm just guessing here, George, because there's something to that. Dual income, like while marriage is great, dual income is also something that not a lot of people

talk about. That's right. Having the power of two incomes at your disposal changes the game. It changes your money goals. And we've seen the numbers. Married couples just build wealth quicker because you've got more manpower. They build wealth quicker. And it says that if they combine their finances, they are actually happier. They're more likely to stay together and they build wealth four times faster. There you go. If that's not a reason to get married, I don't know what is. Marriage has got a bad rap in today's culture. It has. It's looked at very negatively, especially from the men. They're like, well, she's just going to take me to the cleaners. I'm like, well, no wonder you're still single, dude. No one wants to marry that guy with that attitude. Yeah. I have to say I'm honestly

confused by that because I have seen that when you are in a loving relationship, no addiction, nothing crazy going on, right? So there's no reason to not combine the finances. But when you do combine them, man, you get out of debt faster. You build that wealth faster. It's a win-win. Amen. Hey, more of your calls coming up. We want to hear from you. Join the conversation at 888-825-5225. This is The Ramsey Show. We'll be right back. This is The Ramsey Show. We're a show that talks a lot about building wealth. And if you're wondering, building wealth in this economy? Are you kidding me? Well, we keep hearing that question. We get the confusion. There's a lot of noise out there,

a lot of naysayers, a lot of hope stealers. And there's some legitimacy, right? We've got inflation and massive layoffs and rising interest rates. And we want to give you guys the answers you need. And so we're hitting the road and coming to a city near you this spring with our Building Wealth Tour. That's right, Dave Ramsey and our entire team of Ramsey personalities will be doing a Building Wealth Live Spring Tour where we dig into all of these hot topics and give you a proven plan to build wealth and keep it, yep, even in this economy. And tickets are selling real fast, so don't miss your chance to secure your spot today. Here's where we're going. Come see us out on the road. Indianapolis, February 16th, Austin, Texas, February 23rd, Salt Lake City on April 24th, and Anaheim on May 2nd.

Tickets start at just 49 bucks, or you can get a four pack of tickets starting at 175. So bring your friends. It's going to be a good time. Go to ramseysolutions.com slash events to reserve your seats now. And Jade, you'll be joining us at a few of those. I will. The first two dates. That's exciting. You're going to love it. These crowds are, they are electric. I love it. I love me an electric crowd. Can't wait for that. All right. Let's get to the phones. Corey joins us up next in Chicago.

Corey, welcome to the show. Hey, how's it going, guys? Doing good. How can we help? I just want to first say I'm a big fan of you guys and the Ramsey Show, and I just really appreciate you guys taking my call. Oh, thank you. So I did have some financial advice I was hoping to get from you guys.

So I recently came, acquired a settlement from a car accident I was in. Now it is a lot more money than I've ever had before, and I'm just trying to get some advice on what to do with it, where to put it, and the first steps. Sure. Are you okay? Yeah, I had some surgeries, probably some future surgeries. My doctor said in years to come, I'm 30 right now. So, you know, possibly later down the road, they said I'll have to come.

I'll probably end up having some. Are you able to continue working or has it affected the way you work? Yeah, so I'm finally back to work after the first couple of years was rough, but I've been back to work for now two to three years now. Oh, good. I'm glad to hear that. I'm sorry that happened, but I'm glad that you're back to work and doing okay. So how much was the settlement? So right now it should be between $175,000 and $225,000. Okay. Yeah. They're just doing their due diligence and yeah, it should be between, roughly between that amount. Okay. Do you have any debt or what's going on with your financial

situation? Yeah, so we do have some debt. I'll start, first start with, we have about $15,000 in credit card debt. Okay. $15,000 in credit card debt. About $25,000 on both cars. Okay. So we're almost done paying them both off. We also have about $280,000 in the house. Okay. And that's pretty much it. That's pretty much it. Okay. And do you have, all right.

What's your household income? So roughly we are just under $100,000 after taxes. After taxes after tax okay and you're both working correct cool yeah you know this money i think that you can do a lot with it uh you're definitely going to be able to get yourself debt free when it pays out and i think that from there on i would definitely make sure that you know i have the right people in place i think that from there on, I would definitely make sure that, you know, I have the right people in place. I think that with this money, you always want to make sure you have the right tax professionals helping you, especially because after that, you're going to pay off your debt. You're going to put aside some three to six months of savings. You're going to start investing. And once you start investing, that's when you're really going to want, you know, the help of

some tax advisors in your corner, investment professionals in your corner so that you can make the right choices with this money. Yeah, this is, that's what I would do with it. What do you think, George? Yeah, Corey, do you have any other money in the bank? I actually do not. We don't, we don't have a savings. We actually just started listening to your show recently and we became both huge fans. We really want to start, you know, the baby steps. We want to be fully and actively engaged. And I know with, you know, the payments and the credit cards and the car payments, all that was very tough. But now we do have a blessing to get us in the right steps. And we're very committed to the plan, and we just want to attack, attack, attack. Awesome. What's your mortgage payment every month?

So we are currently paying about $21.50. Okay. So here's what I would do in your shoes. Number one, obviously, you want to move very slowly with this amount of money. We're not going to, this is not a shopping spree. Obviously this, this money was paid for with your injury. And so we want to use it wisely. We don't know what the medical future looks like for you with these surgeries. So we want to be very wise and have a fully funded emergency fund. I would lean towards six months if I'm in your shoes. And so let's say you let's low ball it. say you get $175,000 on this check. I would immediately pay off all of my debt. So get rid of that consumer debt, the credit card, the car loans. That's $40,000 worth about?

Yes. And so that would leave you with, if it was $175,000, it leaves you with $135,000. Then we're going to set aside six months of expenses. You think $30,000 would be fair for six months of expenses? Yeah, it's probably generous. Okay. That would then leave you with 105,000 left over, and that would put you at baby step four, five, six, and beyond. And so maybe you fully fund Roth IRAs for both of you. And that's 6,500 piece. So that's another 13 grand gone. And the rest, you can start attacking the mortgage with. Okay, that's a really good step,

because we were looking into Roth IRAs, because we don't really have too much experience. Both we come from families that live paycheck to paycheck. So, you know, I've never really been accustomed to, you know, living in a household where we were continuously saving. So, this is all kind of new for us. Well, and that's where having the right people in your corner, the right pros who you can trust is going to be so key. Like Jade mentioned, you need to be working with a tax pro and you need an investing pro and you need an insurance pro. And so I would go to ramsaysolutions.com. You can click on

Ramsey Recommends and connect with all of those in your area, in the Chicago area, who can walk with you through this and make sure that we're maximizing this, protecting ourselves, because there's also family to worry about now. They're going, whoa, Corey just got a big payday. And so you got to be very cognizant of the people in your life. I wouldn't go telling people you've got a big settlement because it makes you a target. Thank you. And so if you've got a great head on your shoulder,

I would just really walk slowly with this. Other than paying off the debt and getting a pile of money in the bank, I would move slowly and do it when you feel like you're ready. And don't go spending, you know, buying up nice cars and toys. We got to protect our future. And not only medically, but also I want you guys to retire with dignity. And this money can help you guys do that in a big way. Thank you. And yeah, like I said, we're very fully invested. And I, you know, wanted to get, you know, get on the Ramsey plan before we even got our hands on this.

Corey, do you guys have any kids? Yes, we do. Okay. Okay, great. And have you guys actually gone through Financial Peace University? Unfortunately, we just haven't had the finances to do any of that. Okay, well, let's get them set up with Financial Peace University. I think it'd be really great if you guys go through that, because I can tell you do want to be really smart about this. And if you have that foundation under you, you're going to know exactly what to do. Those nine classes are really going to set you up with step by step. And it's not just going to be the what, it's going to teach you why as well, which I think for you guys with this

money, that's going to be really important because you're in this for the long haul. You got baby step four, investing the 15%, baby step five, you're going to be able to start putting away for your kids' college and then on and on to baby step six and seven. So you guys have a really great financial future in front of you. And like you said, this accident, it sucks, but you got this settlement and now it's kind of setting you up for a better situation here. So like George said- It's the card we were dealt. So let's just use it wisely. And in Financial Peace University, the investing lesson, the insurance lesson is going to leave you with so much confidence

and less confusion about my future and what should I be doing. And there's so many voices out there and there's so many options out there. This filters it all down and tells you exactly what you need. And we're rooting for you, man. Call us back if we can help along the way. It's nine lessons. I want you to do all nine lessons. Don't stop after lesson one. This is The Ramsey Show. Our scripture of the day comes from Galatians 5.14. For the whole law is fulfilled in one word. You shall love your neighbor as yourself.

The great Reverend Dr. Martin Luther King Jr. once said, Darkness cannot drive out darkness. Only light can do that. Hate cannot drive out hate. Only love can do that. Love it. Good stuff. Love that. From MLK that. Love it. Good stuff. Love that.

From MLK there. All right. Let's go to the phones. Jalen joins us in Tupelo, Mississippi. Jalen, welcome to the show. Hey, guys. How are you doing today? Doing good.

How are you, Jalen? I'm doing good. How can we help? Yeah, so just a quick rundown. I'm 23 years old. I make about $50,000 a year. And I'm trying to clean up a big car mistake. Okay, how big?

$35,000 worth. That's the loan? Yes. Okay. And what's the car worth? So the car is worth, by Kelley Book, is about $27,500. Okay. You got any money in the bank?

Not much. Very little. Is that your thousand? Three. Three thousand. Okay. Is that your only debt? No, I have about $4,000 in credit cards.

Okay. All right. Yeah, we got to get out of this loan. If I'm you, I'm definitely going to get out of that loan. It's too much of your income. If I'm you, in this case, it's worth, you've got $8,000 in the bank. No, no, no, you've you've got 8K in the bank. No, no, no, you've got 3K in the bank. So in this case, I would, honestly, I would sell it

and I would take out a small little, go to a credit union and take a small loan out for that 5K that you're upside down. And at that point, it's worth it for you to get out of $35,000 of debt. And then you can take the money, you know, from there, we're going to try to get a cash car after that. How does that sound to you? That'll be my next question. I've already looked at the possibility of getting a loan

and I actually already have a loan. I'm just yet to sign the papers. What do you mean you have a loan? What kind of loan is this? It's a consolidation loan. No, no, no, we don't want that. What are you trying to consolidate? Yeah, you only have two deals here. Well, the cars, I'm not going to get 27.5 for the car. I've looked around at the offers, and I've been offered 25, 26. From where?

Places like just local dealerships. Well, yeah, you don't want to go there. I mean, you need to do some homework and shop everywhere, go private party, Craigslist, AutoTrader, Facebook Marketplace. Hey, don't do that consolidation. Don't sign that. Don't do that. Okay. That's not helping you. All it is is moving around the debt with crappier terms, and it's not going to get you out of debt any faster. It'll just make you feel like you did something. Yeah. How many hours of work are you working? It varies. I'm on salary, so I just work like five, six days a week. Okay. I want you to work more because what I want to do, I want to get you out of this debt. And like I said, for me,

it's worth getting out of this car loan, but you're going to need to save up a little bit of money before you can do that. So I want you working so hard, bringing in as much cash as you can, because I want you keeping the 1K as your starter emergency fund. So that gives you 2K that you may be able to put towards your next car. And I want you to save up a little bit more money so that you can get out of this 35K loan and also be on your way to paying off that other 4K that you have in debt. All right. Okay. I understand. Yeah. I think it's overwhelming because you're looking at this and it's like, oh my gosh, you just made this huge mistake. And it's really easy to just try to jump into a solution that

feels like it's going to solve everything for you instantly. But let me tell you, consolidation is really not the way. A lot of times you end up getting a bigger interest rate on whatever the consolidation is because it's based on your credit score. They're paying you money. You're paying them money to do something that you can do yourself. They're not going to pay off the debt for you. You still got to pay the debt off. So what's what, you know, in this case, it's just not worth it for you at all. Like I said, if it takes for you to get a

small loan from a credit union just to to bridge that gap between the 35k and, you know, whatever you're able to sell it for 25, you know, 27 and a half, it looks like it's worth it to do that to get out of it. But I also want you to be able to get into a cash car. So let's work like crazy, man. Let's get another two, three, 4K saved up and let's get out of this thing and let's get a cash car. It doesn't have to be great.

Get yourself a beater that gets you from point A to point B. Do you have a long commute? I actually have a work vehicle. What? Look, dude, you're holding out on us, bro. Can you use that for a while? Oh, not to drive, no. Okay.

So, what do you use the work vehicle for? Uh, just work. But do you use it to get to work? But you can't get to work in it? Yeah, I do. Okay. So, when do you use the personal car? Just on the weekends?

Honestly, I hate to say it, but never.len jaylen jaylen jaylen that's you are getting rid of this car today because at this point bro you just need a beater just something to get you i just went to auto trader i use the tupelo zip code i sorted low to high yeah there's some great cars for four or five grand yes and so I'm taking the personal loan, getting out of this thing and using that money towards a used car that you're never even going to use. So there you go. Thanks for the call, Jalen. Michelle is up next. She is in Sydney, Australia. Wow. Michelle, what's up? Hi guys. Okay. I'm really nervous. So in 2015, my husband bought, before we met, my husband bought a house for around 240,000. Fast forward to now, or actually like late last year, we loathed being long distance landlords. So we decided that we were going to sell it, got an agent, had zero

offers between September and middle of December and realized maybe we need to get a new agent. Got a new agent. She sounded really good, lots of experience. Two weeks ago, we got an offer on the house that we listed for $375,000 on her advice. The offer was $335,000. So obviously we were not that excited about it. We declined. We said that our lowest is $360,000 that we would want to accept, which we've been since lower to $350,000 because we're starting to get nervous. And so I have a two-part question. When they made the offer of $335,000,

it took them two weeks to come back with a counter of $340,000. So we didn't really make much progress there. And when we kind of said we weren't excited about that to the agent, she wrote us a really long email basically telling us why we should accept it, that that price seems good for the house because of this, that needs to be done, that needs to be done. And kind of like, I don't know, just resigning to the fact that that's what it's worth. So when we got on the phone with her, she was like, well, this person said it's worth this much. And people doing walkthroughs are telling us it's too expensive.

So I'm kind of thinking like, well, you told us the price of $375,000. Did we just set ourselves up for failure? Is this in Sydney? No, this is in England. My husband's British. He bought the house there like seven years ago. Okay. Have you guys seen the comps in the area? I mean, are you able to look at what's going on and see how your property measures up to the ones selling around it?

Yeah. So apparently like there was a comp a few weeks ago that sold for 350. That was like one bedroom less and didn't need any work which the house we are selling does need work and so what would it cost for you guys to do the work or do you think the amount that they're lowering it by is is valid you know is it 25 000 worth of work i mean cut no like true work needed maybe $10,000, but like to make it updated and new, yeah, it might cost that much. Well, you've got two options. Either you guys fix it up so that you can price it higher. If you think you can fix it for $10,000 and it will net you $25,000,

that's probably worth doing. That's such a hassle, though. It's just so hard to even manage. If you want more money for it and people are going, I don't want to deal with it. You don't want to deal with it. Someone's got to deal with it. And that's the thing, the market's going to speak. I remember when Sam and I were moving from Florida here, you know, the realtor had said, oh, we're going to be able to sell your house for X amount of dollars. And we're like all excited. But then as the market spoke, everybody was offering, you know, 20,000, 30,000 less than

what he was saying. And after a while it was like, okay, this is reality. So we can either do more to, it wasn't worth it for us to do more to fix up the house. But when the market speaks, it speaks. Yeah, that's tough. I mean, you can get another opinion from another realtor and say, hey, is this real? Are the comps real? Are the fixes real? And then make the decision from there. But you might have to just take less because there's work to be done and ain't nobody want to do it. That's right. This puts this hour of the Ramsey Show in the books.

My thanks to Jade Warshaw. My thanks to everyone in the booth and you, America. Until next time, spend wisely, save intentionally, and give generously. Hey, it's George Camel. If you like what you heard in this episode and want to know more about getting started on the Ramsey Baby Steps, go to ramseysolutions.com and click on the Get Started button.

We'll help you figure out the best next step for you based on your specific situation. That's ramseysolutions.com and click Get Started.