The Ramsey Show - App - How to Buy a Junker and Drive Like No One Else (Hour 2)

Episode Date: March 5, 2019

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🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studio, 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. I'm Dave Ramsey, your host. Open phones at 888-825-5225.

That's 888-825-5225. Zila starts us off in Austin, Texas this hour. Welcome to the Dave Ramsey Show, Zila. Hi, Dave. Thank you so much for taking my call. Sure. What's up? Okay.

Excluding our house, we have about $2 million in real estate assets. So we have some rental properties. And we owe about $350,000 on three of the properties. And we have over a couple million in stock market, about one and a half in Roth and non-Roth IRA money. And I'm wondering, my husband just turned 60. Is it possible for us to take some of the money out of the IRAs and pay off the rental properties, the 350K wheel? The interest rate on them is quite low.

One of them is a 10-year. It's got four years to go at 3%. The other two are 3.6%. Way to go, Zela. You guys have killed it. Congratulations. Thank you. So you've got a net worth of over $3 million.

Over $4 million. Over $4 million. Over $4 million. Excellent. And how much of that did you guys inherit? About $300 million. Okay. Is that what made you wealthy, or were you already wealthy? No, we were already there.

Okay. Lately. Before I answer your question, I'm just curious, would you tell us how you did this? Just, I think, more being very, and not frugal. We're just not spenders. I'm not a spender. My husband's not. And I hear a lot of people calling in saying about having old cars.

My husband's car is older than all of them, even though we have a lot. And we spend on experiences but not on material goods, I think, and also investing wisely. Yeah, you obviously have done very well with your investing. And so what was the best year household income that you guys ever had? Probably with the rental properties and my business and his work. I wouldn't know. Probably in the $300,000 somewhere. You've done very well.

Congratulations. Thank you. Well, and so if I understand you correctly, you're 100% debt-free except for $350,000 on these rentals. Correct. And you have one and a half in retirement IRAs or one and a half half in the stock market in retirement, and a half million not in retirement. Correct. Why would you not use the half million that's not in retirement? They're in 401K.

So that's retirement. Yes, retirement and Roth. You said you had one and a half in retirement. The other half a million is in retirement or not? No, no. Sorry. I misstated it incorrectly. We have one and a half million in IRAs, non-Roth and Roth, and then 550 in 401Ks.

I got you. So you don't have any stock market investments or any cash that is not in a retirement plan of some kind? We have some money outside sitting. We actually have more assets than $4 million, so we have some money parked in money markets. How much? $300 maybe, but we don't want to move that, actually. Why? Let's say we're not market timing, but let's say I'm more in tune to wanting to move a little bit money out of the market and put it because of just where we are in our phase of life, just a little less exposure.

Well, you've got $4 million. I think you've done a great job. So, yeah, if he's over 60 and there's no penalties, and I actually would probably use the 401K money rather than the Roth money to pay him off. And the reason is the Roth will grow tax-free the rest of your life. The 401k has a minimum withdrawal penalty or a minimum withdrawal amount, the required minimum distribution, at 70.5. The Roth does not have that.

And so I'm going to let that Roth money just churn debt-free over there as long as I can, especially since you don't need it. I would actually cash out the 401K money enough to pay the taxes on it plus get 350 clear. And so that's about a half a million, which is about what you got in there. So, you know, I'm going to go ahead and pay my taxes on that and let that Roth grow if it's me. I mean, either one's okay. There's not a dumb move in this equation. Both of these are good moves.

So you could do it the way you want to do it or you can do it the other way. I personally would rather have the tax-free growth without the required minimum distributions and leave that alone. And let's let that 401K pay these rentals off. And then everything is sitting there growing i love it you guys have done so well absolute everyday millionaires very very well done hey thanks for the call open phones at 888-825-5225 matt is in birmingham hi matt welcome to the dsey Show. Hey, Dave. Thanks for taking my call. Sure. What's up? So my wife and I have been married going on two years now,

and we're in the middle, hopefully toward the end of baby step two right now. We took financial peace literally like a month and a half after we got married, and I've been on the track ever since. I am the nerd saver by far. I was, I mean, I was having a Holy ghost experiences while we were in the class, hearing your stories and hearing the people talk. Um, while my wife, uh, loved it, um, it was more so of a, Oh, these are good principles to apply. Um, my challenge we've had is, and I need you to tell me if I'm being crazy or if there's

something else I can do, is getting my wife to be more gazelle intense about all this. In what way is she not intense? The amount of debt that we have is significantly less than probably most of the people that call into your show. And she feels like because we have a plan to pay it off, that it's still going to take over a year for a very small amount with a current plan, that she's fine with that. And even then, I see getting down to the future baby steps that we are perfect. Okay, so wait a minute. How much debt do you have?

At the moment, we're about $7,200. Right, and what's your household income? About $100,000. And she thinks that takes a year. Given our budget, that's what we're looking at. Why? Where's all your money going? That should be a six-month plan at the most.

I would agree. So what are you spending money on that you shouldn't be? A lot of things that I see include food. I mean, obviously, extra food, not a rice and beans budget, personal spending for her to get clothes and makeup and things like that, saving for vacations. You don't save for vacations when you're in Baby Step 2. I've tried. I've tried explaining that, and the way her personality is,

the way she was raised, she is absolutely miserable. A lot of us are raised with all kinds of dysfunction. That doesn't mean you keep it in the family. So I don't know how you get her to do it. I mean, she needs to have a reason to be out of debt that's bigger than her reason to go on vacation. And until you get that, you're not going to get out of debt.

You guys are going to go back into debt. That's what's going to happen as soon as she wins one of these other arguments. This is the Dave budget each month. Pure Talk USA offers smarter wireless with unlimited plans starting as low as $20 per month. You never pay data overage fees, and we never turn off your data. No contracts, no hidden fees, and if you're thinking our low cost means less coverage, think again. Our voice and data service covers 99% of Americans, and our 4G LTE network provides the fastest internet speeds like more expensive carriers. We operate on the

largest GSM network in the U.S. to ensure you receive reliable coverage virtually anytime, anywhere. Plus, you can keep your same phone and number and add multiple lines to save more. We're so confident you'll love Pure Talk USA that we invite you to try our service risk-free. Visit puretalkusa.com or call 844-862-3677. Enter promo code SAVEDAVE and receive 50% off your first month. That's puretalkusa.com. Thank you for joining us, America. We're glad you are here. Hunter is with us in Vancouver, Washington. Hey, Hunter, welcome to the Dave Ramsey Show. Hi, Dave. How are you?

Better than I deserve. What's up? Hey, so I'm 20 years old, and I currently have a full-time job, a Monday through Friday, 9-to-5 office type of job. And I make $39,000 a year salary. And I just got offered another job about two hours away from home up north towards the Seattle, Washington area. But I'm actually from that area. So I have family in the area, working around heavy equipment. And I got this job offered from a family friend who I'm really close with, and it would nearly double my salary.

And so I just wanted to kind of get your opinion on if you think that's a good move to jump into, going from like an office job over to a physical type labor, working with heavy equipment job. And then also I have a pretty serious girlfriend here in Vancouver, and so getting your opinion on trying to keep a relationship with moving that far away to take a job like that. Well, you're going to double your income, and you're going to change your career direction, and you're going to change your location.

Yeah, and, I mean, do you think it'd be crazy for me to try and make that two-hour commute, maybe like two days a week so I can, you know, see my girlfriend. And I could definitely do it on the weekends as well. It would be Monday through Friday. How long have you been dating her? Only about a year. So, I mean, it's not super serious, but, you know, I do really love her,

and we have a really strong relationship that we'd like to keep. Well, the money is tempting, and that's obviously why you're considering it, but there's really nothing else here. It's very tempting. There's really nothing else here that's exciting. Because I think if you told me you were going to get a $1,000 a year raise instead of a $40,000 a year raise, and you were going to leave that job and take a job in heavy equipment,

I don't think you would have even considered it. Yeah, it's probably not. It wasn't like you called me up and said, my dream since I was a little boy was to operate heavy equipment, and I finally get to do my dream. That wasn't what you said. You said, I'm being tempted to a location that's inconvenient, to a career track that really was nothing I planned on at all.

It just showed up just because of the money. So the only way you would do this is for the short term, you would say, I'm going to give this two years, and I'm going to pile up some cash, and then I'm going to go on with the rest of my life. But I don't want you to wake up at 35 being miserable operating heavy equipment if that makes you miserable. Right, and I don't know, honestly.

It'd be something that I'd have to kind of experience and see if I really do have a passion for it, I guess. Well, I understand that. So here's the thing. The question I always ask myself is, you're 20 years old. If I'm in your shoes, what does the 30-year-old me look like, and is this a step on the process? If the step is I'm going to go make some money and pile it up to hit some of my other goals that's an okay step or i'm going to go

experiment with this and make some money while i'm experimenting and not be stuck in it the problem is sometimes you make a decision like this and you wake up 40 years later and you never changed right and i don't want you to do that about i don't want you to do that i want you i want you if you make this decision i want you to leave a lot of freedom to undo the decision and once you discover what direction you want to go with your career and so i would rather you take a step of some kind even if it's a background a backward step on income that takes you toward your dream. If you could do anything in the world you wanted to do by 30 years old and it paid $100,000

a year, let's just say whatever it is it paid that, what would you do? That's honestly what I'm still trying to figure out. I'm not quite there yet. I don't know exactly what I want to do yet with my whole life ahead of me. Gotcha. Okay. Well, I think I'm going to start exploring that, and if I take this other gig, it's going to be as a short-term adventure to make some money.

An adventure, not a venture, an adventure. Like, woo-hoo, I get to drive bulldozers and make money. Okay? That's an adventure. A venture is you're going to stay plugged into it, and I think you're not going to keep doing this unless it's default and you just get lazy, intellectually lazy with yourself, and you don't force yourself back out of the cocoon again.

Because there's nothing on the table here except you like this guy, and it's a lot of money. Everything else in the discussion is negative. Right. Except for the other part is that, you know, at my job right now, I'm not necessarily happy. It's not like I am floored to go to work every day, that's for sure. Yeah. And there's a lot, you know, a lot better benefits come with this new company.

My company now doesn't even offer a retirement plan of any sort. What does your girlfriend do for a living? She's a host and server at a restaurant. And has a roommate? Yeah, she has a roommate. She lives in an apartment. She actually just moved to this area from the Portland, Oregon area. And so now she actually just moved to Vancouver, got her own apartment with a roommate. And so now she's kind of bummed that I would, you know, well, shoot, now this comes up and now you want to take this big step and you know potentially move two hours away or try and make that commute she thinks it'd be hard to i think i think the commute is ridiculous i wouldn't think it yeah

i mean it's a weekend deal at the most uh and so you're going to limit the amount of time you spend with her unless she picks up i mean being a host at a restaurant isn't that hard to land in seattle it's not like it's a hard job to land and so she may pick up and move again but i don't know how serious you guys are so you're gonna have to decide that for yourselves whether she wants to chase you around or not but um i i don't know if i'd do it or not it's not a slam dunk for me um there there's the only thing that got your attention was the money. And you liked the guy, but that was almost secondary. So if you want to do it, I'm not going to be mad at you about it. I don't want you to get stuck in it if it's not God's call on your life.

And I do want you to find that in the next 36 months, at least the next steps towards that. You don't want to wake up in the 40-year-old you and be mad at the 20-year-old you for making this decision and then never changing it. So one thing, whatever you do, be willing to change it until you land. Change, change, change. Change is everywhere. Well, folks, our question of the day comes from blinds.com. Find out for yourself why blinds.com is the number one online retailer of custom window coverings.

You get free samples, free shipping, and with the new promos they run every month, you save even more. The promo code is RAMSEY. Joshua's in Wisconsin. My wife and I are beginning to take the necessary steps to follow your plan for getting out of debt. We've reduced the 401k contribution to 0% and have been canceling any services we don't need. I currently put $100 a paycheck into my HSA, and I'm wondering if I should cancel the contribution until we're further in our baby steps. Yes.

The health savings account is a medical emergency fund. That's all it is. And I would not add it. I wouldn't cash it out, but I wouldn't add any more to it, like I wouldn't add anything to any investments until you're clear of your debts in Baby Step 2, and you've got your Baby Step 3, a legitimate, full-fledged emergency fund in place. Folks, if you want to be part of our mission to giving hope to millions of people, come check out all the opportunities we have.

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We win Best Place to Work, or have won Best Place to Work, 10 times in Nashville. And the reason is we're the best place to work. It's pretty simple. So click the Dave's Hiring tab on the right-hand side of the homepage, and we'd love to have you on this team. One of the things we do around here is the wrap with dave we call it which is after people have been here 90 days i sit down with them last night there were about 30 of them um here and we bring in chick-fil-a wraps jesus chicken and uh tenders

and we talk and they ask questions about the company and about us and about our history and what are we going to do and anything you want to know you get to talk to me and i get to spend time with you i spend time with everybody that's here eventually some people more than others just because of the work we're both working on is together but i'm here in the building almost every day and uh talking to our team working with our team i leave this place it's a lot of fun hanging out with those young, sharp people last night, and they all seem to be young since I'm getting old. This is the Dave Ramsey Show. Benjamin's with me in Phoenix.

Hi, Benjamin. Welcome to the Dave Ramsey Show. Hey, Dave. How are you doing? Better than I deserve. What's up? Hey, so I'm a 21-year-old and just trying to figure out if it's time to move up in car. Uh, I currently have a Mitsubishi Glant, uh, Oh three with around a hundred K miles on it. Uh, I bought it for about

1400 just over a year ago, but I've put in about 2000 for repairs and it breaks down about every four months. It's actually in the shop right now as well. Uh, so I'm a junior in college, completely debt-free. I've got about $3,000 right now set aside for the rest of my schooling. The next year should cost $4,500, including housing and food, and that'll be my last year of schooling. I have a $1,600 emergency fund and another $1,000 set aside for my next car that I was planning to get when I graduate. And I was just seeing if right now would probably be a better time to get it. Okay. What would the Mitsubishi bring if you sold it today?

So Kelly Blue Book has private sale at about $2,500. You think you can get that for it? I think I could get either that or about $2,200 for it. Okay, and with $1,000 added to it, we're talking about a $3,200 car, give or take. Yes, but I've also got an extra $1,000 that I haven't allocated to college or the car fund yet. But you're short of money on college. You only have $3,000 of your $4,500 for college. Yes, but I won't have to pay for that until August,

and I currently work two jobs. I have a position here on campus that I get about 800 months from and will be going up to about $1,200 over the summer. And then my other job is a delivery job for grubhub which is a food delivery service that i make about 2000 a month for good for you and so what are you what are you what are you studying what are you studying mechanical engineering okay and you graduate when? May 2020.

Okay. So 15, 20 months. Okay. No, I'm sorry. Yeah. A little over a year. Okay. Yeah.

And then I... And do you have any student loans? Sorry. Do you have any student loans? No student loans. Completely debt-free. Where are you going to school? Grand Canyon University in Phoenix. Good for you. Well done, sir. Well done. Okay,

so you've got a couple grand you could put with it. You're moving into a $4,000 car. Okay. Yes, I figure with the, and then scrounging up from some of my other savings accounts, I could do $4,500 for my next car if I were to do it this week. I'm in. That's fine. Here's the thing, okay? The Mitsubishi Gallant, an old one like that, is going to be an expensive car to work on. Whatever you buy doesn't need to be an expensive car to work on.

So even if you've got a great deal on it, you don't buy an old Mercedes. It's going to be very expensive to work on. Okay? You buy a plane, Jane, Ford, Chevrolet, Honda, something that's easy to work on. Toyota. Okay. Yeah, I was thinking Toyota. Yeah.

Something that's A, reliable, and B, not expensive to work on. Everybody that turns a wrench can work on it. And you've got kind of an expensive car to work on there is the problem. Yeah. And the thing you can be sure of in the $5,000 and under range, you're going to be working

on it. You're going to be. I mean, you can get something more reliable than the one you've got, but you're going to be working on you can get something more reliable than the one you've got and uh but you're going to be working on it so that's thing one is get something that's kind of a more generic in terms of like again again a good honda accord a toyota camry a a chevy a ford of some kind something that it'll pick up i't care, something like that that's very predictable and generic, and they're everywhere, and it has absolutely no sex appeal. Yeah.

All it is is transportation. That's thing one. Thing two is it has absolutely no sex appeal. What you are looking for here is not necessarily a pretty car. You are looking for a reliable car because you're not going to drive this car but about four or five, ten months after you graduate. Because you're going to be making serious money as a mechanical engineer coming out, and you're going to have no debt, and you have rocked it, dude. You've done so good. I'm so proud of you.

And you're going to be able to buy a $10,000 or $12,000 car in 20 minutes and pay cash for it. So this car has a two-year life with you. You're not going to live with it. So if it's ugly, like you have to give it a name kind of a car, but it is mechanically sound, okay, an example would be it has hail damage, which you don't get in Phoenix unless somebody imported it, okay? Not the hail, but the hail-damaged car. But that would be an example. If you had a hail-damaged car. But that would be an example.

If you had a hail-damaged car that had just 30,000 miles on it, and it was a Honda Accord, and you got a fabulous deal on it because of that. And then you drive an old pot-marked-face car or whatever you name the thing with great pride because it's going to be very, very reliable. There's a lot of life left under the hood, but the hood's dented. Or the paint is ugly color or whatever. You are not, this is not your forever car. You're not ever going to have a forever car. But this is not a car you're going to keep a while. It's not a car you're going to take great pride in.

This is a wise purchase to get you through because you've been very wise about everything else you've done in this equation. The stuff you get you through because you've been very wise about everything else you've done in this equation the stuff you told me is way beyond your years you're very impressive well i grew up listening to you dave i'll take all the credit but not really you're a good man uh that's what i would do i would buy it but you're looking for something generic and cheap to work on and something that has a lot of mechanical life in it. And if you have to forego aesthetics, beauty, sex appeal,

in order to get high mechanical value, low mileage, in great shape mechanically, I'll take that. That's the $4,500 car I'm looking for if I'm you. Folks, that's how you purchase a Hooptie. You buy it out of grandmother's garage. Grandmother passed away, and the kids are having an estate sale that includes the old station wagon. And you can buy that sucker for $700, it has 20 000 miles on it and it's a

1994 and it has literally the tires are dry rotted because it's been sitting in her garage and you have to put tires on it this is how you buy a hoopty and you can get a lot of life out of a hoopty doing that now do i want you to drive like that forever no i'm not telling you that don't be call me up and tell me your junk car is a dave car your dave car is when you're an everyday millionaire and you drive whatever you want but if you'll drive like no one else later you can drive like no one else benjamin's driving like no one else he's working like no one else and he's going to school like no one else that young man is a rock star he's paying cash school. He's working like a crazy man, two jobs. He's going to school.

He's graduating on time. And he's got a great field of study, and it's all with cash, and he's 21 years old. He just made some of you 42-year-old whiners look pitiful. He just kicked your butt. You look pitiful beside him. You're whining about things you say you need. You don't need nothing.

You got everything you need. You want some stuff, and I'm not afraid to let you get some things you want, but some of you have had your wants eat your whole life up, and they're piled up in your closet, and they're piled up on your desk in the form of credit card debts. And that young guy right there, man, he's got a tiger by the tail. The 31-year-old version of him, he may already be a millionaire before he's 30. It's possible the way that kid's thinking, unless he marries poorly.

If he marries a princess, he'll screw the whole thing up but i don't think so i don't think that's going to happen to him hey guys this is how it works this is how it works the shortest distance between you and the life you want having a pile of money so that you can do the things you want to do change your family tree take care of your family travel drive like no one else live in a better home than you're in now the shortest distance And do the things you want to do. Change your family tree. Take care of your family. Travel. Drive like no one else. Live in a better home than you're in now. The shortest distance between that, that's not greed.

And it's not a prosperity message. The shortest distance is for you to get rid of the freaking debt and stay out of it. And that's exactly what he was planning, how he's planning right there, all the way back at 21 years old. God, I wish I would have been half that smart. This is The Dave Ramsey Show. We'll be right back. Logan is with us in Wichita Falls, Texas. Hi, Logan. Welcome to the Dave Ramsey Show. Hey, Mr. Ramsey.

How are you doing? Better than I deserve. What's up? So my wife and I, I graduate here in the spring, and she has already started her job. She's a teacher. And so together we have about $ thousand dollars in student loans um and my parents want to pay off the portion that is in my name which is about eighteen thousand dollars uh and so my wife does not want to do that and i'm kind of with her just because you know we want to take responsibility for our own stuff and um you know pay pay the things that we took out are you are your parents

uh is your relationship with them toxic oh not at all no it's so they simply want to they simply want to give you an eighteen thousand dollar gift well and see that's kind of the way I looked at it at first. But I'm just worried that, you know, it'll be something that, you know, down the road, I don't think they'd ever hold it against their head, but I'm afraid that maybe she would feel like that, you know, one day. Why would she feel like that if they don't? Well, I think her family kind of has that relationship with money with each other. So in the family she grew up in. Well, the problem is not your parents or the gift. The problem is your wife.

Yeah. She's got a problem. In other words, so once I saw a guy in a black car turn in front of me, so everybody that drives black cars is evil? Yeah. That's is evil? Yeah. That's not logical. I'm sorry her family is toxic, but apparently yours isn't. Yeah, that's how I felt about it, but I wanted to side with her just because,

you know, I wanted to make sure that we were on the same page. Well, I think you need to do that. I think you need to do that. But I think it's a healthy thing for you and your wife to work through this emotionally. But I think the, and it might be an okay thing to sit down even with your parents, the four of you, if you've got a very healthy relationship with your parents, and just say, I would like to do this, and you're all's generosity is unbelievable. Yeah.

And, but, you know, but, you know, whatever her first name is, don't say it, but whatever her first name is had this problem with her. And so she needs to get comfortable that our family is not going to do what her family might have done or some of the things that she's experienced. And so we just need you to say out loud that you're not going to hold this over our heads or play this card against us later. And in that case, that'll help us work through this. Could you do that, the four of you?

Are you on good enough ground, the four of you, to have that kind of a healthy conversation? Yeah, I think we could for sure. I think that's probably a really good idea. Yeah, and talk it through. Because I don't hear anything you're not telling me. I didn't hear a single word in your sentence structure or anything that indicated that your parents would actually play this against you later yeah i don't i don't think they ever will they're you know they're a lot better than i am a lot more generous and well than i am so and they just got some money so i'm in your parents position i'm in a position to

just give a gift to my kids if i want to uh i don't want to do it in a way that causes them uh uh to not be incentivized to be who they're supposed to be but i don't sense that from you all and your parents don't either and that's why they're willing to bless you um instead it just gives you a leapfrog forward um And I also don't want to give my kids a gift and set up a thing where I call back on the gift later to be controlling in some way. Once the gift is given, it's no strings attached. You don't get to look over your glasses at us and ask us what we spent on vacation. You don't get to inspect anything else. You don't get to have a side judgment just

because you gave this gift five years ago yeah and if you very much mr randy yeah if you can do that and it sounds like your parents can and i can then you know i think you accept the gift but i think what it is is an opportunity for you and your wife to work on that the um i i was more in your wife's camp when i was young and married like you it was harder for me to receive uh gifts and it's not an indictment on my family or anything but it was just i was just a very prideful person as you might imagine i still am but um but i was prideful to the negative and i i just wanted to do it on my own and i didn't her parents were always offering to do something, and I'm like, no. Her daddy actually owned a little gas station,

and he'd want to fill up our car with gas when we're down there. No, I'm going to pay for it. I pay for my own gas. I carry my own weight. I carry my own water, that kind of thing. And it was a really good exercise for me spiritually to learn to accept, to learn to receive as well as give. And so that might be the opportunity that you guys have in your young marriage

with you and your wife discussing this through. Again, we're making the caveat that your parents are going to in no way use this back against you later, and there's not any toxicity. But I don't think there is in this conversation. Hey, thanks for the call. Melissa is with us in San Diego. Hi, Melissa. How are you?

I'm doing great, Dave. How are you doing? Better than I deserve. What's up? Well, thank you for taking my call. I'm calling because my husband and I were recently looking for term life insurance, and I'm not sure as to what to do because I have been denied the life insurance.

Why? Well, all I gave them was my medication list, and they came back and said they couldn't find anybody that would cover me. Why? What does your medication list indicate? Oh, gosh. Well, I have a wide array of health issues. I have severe rheumatoid arthritis.

I do have a heart condition, which I've had a pacemaker for since 2005. Well, you gave me your Social Security number, right? You know, I don't remember. Well, you had to to make application and there's a just like there is a credit bureau file on your credit there's a medical bureau file on your health and so even though you just gave them your medications they got a full rundown on your health when they pulled your file yeah well rheumatoid arthritis and a pacemaker at your age yeah you're probably not insurable did you run this I had a heart attack in January.

How old are you? I'm 38. Yeah. So, yeah, you've had a lot of major stuff. So, yeah, you're going to struggle with that. Did you talk to Zander Insurance by chance? I did, yes. My husband was approved, but I myself am not.

I don't know. You know, we have four young children. The youngest is two, so I'm not sure. What do you personally earn? Personally, nothing. I'm a stay-at-home mom. Okay, cool. And the kids are what ages?

Nine, seven, four, and two. Wow, you've got a house full,do that's wonderful we do you're blessed okay well and you've obviously had some health struggles so here's the thing any insurance that you get is going to be at least five times more expensive probably 10 times more expensive than what your husband's is okay and you can get what you can get what's called guaranteed issue insurance term insurance or you know god forbid whole life but i wouldn't get that and it means that they don't check medical they're just going to they're going to anyway an example of guaranteed issue is you can call your mortgage company and they will sell you mortgage life insurance

that pays off your mortgage in the event of your death. But for that amount of insurance, had you just bought that much insurance as a healthy person, then you would have paid about five to ten times less. Right. But you could do that, and that would at least pay off the mortgage. Okay. I know you're really against the whole life insurance. I didn't know if maybe we should do... You can't get whole life.

Oh, okay. They're not going to issue you whole life if you're not going to issue your term. You're not insurable. So then should I do like a traditional savings account, or should I just go and buy right out a... I know like a funeral. Yeah, you can go... That's a a funeral. Yeah, you can go. That's a guaranteed issue.

Yeah, you can get a guaranteed issue on that if you wanted to. So, yeah, the first thing I would do is go ahead and work your baby steps and let's build the emergency fund and be debt-free, except the house. Yeah, we have all that. Good. Then I would buy mortgage life insurance that pays off the mortgage. And if you built a big emergency fund, that would cover a funeral, God forbid. And so you're just going to, the best antidote for this financially is to build some wealth.

Get out of debt and build some wealth. In the meantime, buy a few little policies here or there. I would not do prepaid burial, but I would do mortgage life and a couple of other guaranteed issue policies if you can pick those up. But whole life's not going to be your answer, and prepared burial's not going to be your answer. So I'm sorry you're facing all this. Thanks for calling.

Hey guys, it's Blake Thompson, Senior Executive Producer for The Dave Ramsey Show. This hour's over, but you can find more great content on our YouTube channel. Catch the most watched Dave Rants, debt-free screens, and the very popular Everyday Millionaire segment. Go to the Dave Ranty Show YouTube channel and click subscribe.