The Ramsey Show - App - How Wealthy Do You Want to Be? (Hour 2)

Episode Date: September 6, 2018

The show about you

Live from the headquarters of Ramsey Solutions, 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 am Dave Ramsey, your host. You jump in, we'll talk about your life and your money. It is a free call at 888-825-5225. 888-825-5225. Brian starts off this hour. Orlando calling.

Hey, Brian, welcome to the Dave Ramsey Show. Hey, Dave, I appreciate the opportunity to speak with you. You too, sir. How can I help? Well, my wife and I are leading our first FPU class in about three hours. Wow. And I'm calling to get some last-minute advice and encouragement.

Good for you. Thank you for doing that. And this is your very first one, obviously. Yes, we took the class last year. This is our first one. How many are scheduled to attend? 17. Wow. Good class. Good for you, man. Well, thank you for doing this.

Well, I think a couple things that I learned the hard way, maybe you won't have to if I tell you, is the first thing is if you don't know the answer to the question, that's okay. I do this show every day, and I don't always know the answer to the question. If I don't know, I just say, I don't know, instead of trying to BS my way through it, right? And so just if you don't know, go, I don't know, but I'll call the folks up at Financial Peace University in Nashville and talk to them and see if I can get you an answer and get back to you, you know? And you don't have to be the answer man all the time. And the second thing is, whatever dumb things you and your wife have ever done uh with money be sure you share those well there's a lot of a lot of stories there

yeah yeah share your uh foibles because that makes you human as a leader authentic as a leader and you're not trying to be too cool for school there's three primary negative emotions people have around money guilt shame and cynicism guilt and shame are kissing cousins and that is removed when you find out everybody else in the room are human too and almost every well everyone has made money mistakes. Some have made ridiculous money mistakes. Some of us have done it with zeros on the end. Some of us have a Ph.D. in DUMB. You know, but just go ahead and let the sooner the room can get real

and everybody's not acting like they have their crap together because nobody does, the sooner you'll be having a great discussion and the opportunity to support people that are scared and help people change that are prideful and everything else. So that's the guilt and the shame one. The cynicism one is people have been messed over by money people. They've been messed over by an insurance person, a mortgage person, a real estate person, a lawyer, whoever it was, and they're suspicious of anybody that's under the heading of money people, and as of tonight, you're under that heading, so they're suspicious

of you, and that's why I told you to make sure if you don't know the answer to something, just say, I don't know. I mean, I just went through the class once myself. It helped me, and that's why I'm doing it, and so we're doing all this together. It's a journey we're doing together, and just look at people in the eye and care about them. And if you do those three things, you're going to be just fine. You're going to have a blast. And what you're going to find is you have a front-row seat to watching people change their lives.

And it's very exciting and rewarding to do it. Thank you so much for leading the class, man. Well, thanks for doing it. Thanks for everything you do. Sure. And if you get any more questions, call me back anytime. I'll help you, man. Well, thanks for doing it. Thanks for everything you do. Sure, and if you get any more questions, call me back anytime. I'll help you, man. I appreciate you doing this. Kate is with us

in New York. Hi, Kate. How are you? Hi, I'm well. How are you? Better than I deserve. What's up? My husband and I are having a disagreement about the next step in our finances. We're debt-free, and we have our emergency funds. Right now,

we're saving really, really hard for a down payment. We're not homeowners, so we're saving about 50% of our income for that, but we're also maxing out his 401k. So the question is, once we're done saving for the down payment, I have told him, you know, we need to increase that saving to 15%. And my husband feels like, well, we're already at the 401k limit. Why would we bother upping our percentage? Do you have a suggestion? I mean, is he right? Am I right?

And if I'm right, can you give me a better reason to tell my husband than save Cesso? Okay. Well, I mean, the question is that you guys together, I think the way you set the table on this discussion is, are we saying we're following Dave Ramsey's plan, and do we understand why he has that plan, and if we understand why and we like the plan, then let's follow that plan. If we're not, if we're going to make up our own plan, then what Dave Ramsey says doesn't matter.

Sure. So I think that's the question. I don't think he under or I don't even know if I understand why 15%. Yeah, but I guess my point is my opinion doesn't matter about your plan. My opinion about my plan, if you're following it, is the only one that matters. So you see what I'm saying? So you guys kind of got to decide. Now, what we figured out is, and we've done it for decades with millions of people,

so our plan is called the Baby Steps. And you're through Baby Step 3. You're debt-free except your home. You've got your emergency fund in place, and you're on what we always call Baby Step 3B before you start saving for retirement or as you're saving for retirement, you aggressively save for a down payment on a home. Now, when you get the home purchased, then you would be in Baby Steps 4, 5, and 6 simultaneously.

Baby Step 4 is you put 15% of your income towards retirement. 5 is you save towards your kid's college, and 6 is any other money we can come up with, we get the mortgage paid off as fast as possible. The data points tell us that the typical millionaire is paying off their home in 10.2 years. A lot of people are paying off their homes in seven years following that plan, and then that sets you up to max out everything. So it sounds like he's a high-income earner. What's your household income?

About $228,000. Okay, cool. So what it would sound like is you save like crazy for your down payment, and once you've gotten the down payment there and you purchase the house, if you were following our plan, how old are you guys? I'm 31, and my husband's 32. Do you work outside the home? No, I'm a mom.

It's 100% his income. Okay. So he can do $18,500 into the 401k, and if I understood you right, you're already doing that. Right, yes. Okay. And his only thing is I don't want to do any more than that. That's plenty. Right.

Okay. Well, my answer to that is people ask me, how much should I save? And I say, how wealthy do you want to be? Right. Obviously, the more we save, the more we're going to have. $18,000 a year will make you wealthy if you don't do anything else starting in your 30s. Okay? You'll be wealthy.

The question is, could you have been wealthier making your kind of income? And the answer is yes. So I probably were eye in your shoes. I would try to get it up to 15%, which is about a $30,000 or so. And so we're $10,000, $12,000 short. You could do a couple of Roth IRAs, $5,500 each, and that would get you very, very close. You cannot do them directly because of your income, but you can do what's called a backdoor Roth. And the backdoor Roth works like this. You open an after-tax traditional IRA, an after-tax traditional IRA, and you roll it to a Roth an instantaneous second later.

And I do that every year. It's called a backdoor Roth, and that would get you another $11,000 going in, which basically puts you at about 15%. So really all you're arguing about out of $200,000 is after we buy the house, do we do another $11,000 or not? And I would say, yeah, if you're following our plan, I'm going to try to get you 15%, then start saving for your kid's college, and then pay off the house that you just bought. That's our plan.

Now you've got to decide if you're going to follow our plan or yours. This is the Dave Ramsey Show. Are high health care costs getting you down? Are you confused trying to navigate your options? Do you wish you could find an affordable, biblical solution to your health care costs? Based on New Testament principles, Christian Health Care Ministries, or CHM, helps Christian families, churches, and ministries join together as the body of Christ to share their major health care costs.

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Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live Events. chministries.org. Samantha's in Boise, Idaho. Welcome to the Dave Ramsey Show, Samantha. Hi, thank you for taking my call. Sure, what's up? So my husband gets about 10% of his salary in stocks per year from his company. And we're in baby step two, so I was wondering, should we sell these stocks should be transformed to another company because i think i remember you saying don't keep it in the same company you're working for or do we just let it grow he's been there for about a year and the balance is about 7 000 okay well it's nothing to panic about the thing you don't want and a lot of

people do this is they take stock in their 401K, they got stock, and you look up and, you know, 50%, 60%, 80% of your total net worth is in one company's stock. In your case, $7,000 is a small amount. What baby step did you say you're in? Two. We just started two. Oh, then you need the money to pay off the debt. That's kind of what I'm thinking.

Yeah, just cash it in and pay off the debt, yeah. Okay. It's not inside a retirement plan, right? They have it vested. It says Target Retire Fund 2045. Well, it may be inside its 401K. You may not be able to cash it out. I do not want you cashing it out if it's in a retirement plan. I want you to sell it and roll it around in the retirement plan um but if it's um if it's outside of a retirement plan it's just stock options

and you can cash it out without having any um penalties then yeah i'm going to use that on baby step two the point about single stocks is like for instance i had a lady a few years ago uh come into my office and the company she'd worked for for 38 years was a huge household name company. I'm not going to name it because the company doesn't matter. But she had $734,000 in that company stock and $800,000 net worth. I mean, it was her whole net worth. And then that company went down 38%. And so her $734,000 dropped almost in half.

And so that's734,000 dropped almost in half. And so that's just too much risk. So if you want to mess around with company stock or single stocks, just make sure it's not more than 10% of your total nest egg, your total net worth. I do not buy any single stocks, and I'm very good at this. But I don't want to fool with the risk. The probability of winning on that is so low that, to me, it's just right there with playing the roulette wheel in Vegas. And so I just don't bother with it. I'm a tortoise. I'm not a hare.

And I just continually, steady invest, continually, steady invest. I'm not trying to make a lick on one thing to impress my golfing buddy. don't care what he thinks that's not it so that's the deal that's what you uh if you can cash it out cash it out in your baby step two without any penalties go ahead and do that if there's a penalty because it's in a retirement then just if you want to cash it out inside of that and move it into a mutual fund inside the 401k when you're vested i probably would do that but it's not the beat not a big deal if it's not over 10 of your net worth jesse is in yakima washington hi jesse jesse how are you i'm good dave thanks for taking my call this morning sure yeah i just had a question on a roth ira contribution here basically um my wife and I were making between $230 and $240 a year.

And I had read somewhere there if you make over a certain amount, which I think was like $180, you were not able to make a Roth contribution. I'm just wondering if I continue to make this Roth contribution with the company I work for, am I going to suffer some kind of ramifications? You mean you have a 401k Roth? Yeah. Oh, it doesn't affect that. It's only an individual Roth.

Oh, okay. You can do a 401k Roth at any income. I do. My 401k here at my company is Roth, and that's what I do, and my income is way over the limits. Okay, excellent. It's if you want to do an individual Roth for $5,500, $6,500 if you're over age 50. That's when you cannot do that, a direct thing on that.

Now, you can still do it. You just have to do what's called the backdoor Roth. I was just talking about that a minute ago. Yeah, I heard that. Yeah, that's where you put it into an after-tax IRA and then roll it to a Roth. I do that every year. I'm over 50, so I do $6,500 each, $13,000 between Sharon and I. And so we just do that. It's not that

big a deal, but it's just that much more money that can grow tax-free every year. And so I go ahead and do it in there while I still can. Anything that the government will let me do to keep their freaking hands off my money, I do. And so, you know, that kind

of thing. So that's what I'm after there. But, yeah, in your case, the Roth 401K, you've got no limitation on that, no income limitation on that. Matthew is with us in Cincinnati. Hi, Matthew. Welcome to Dave Ramsey Show. Hi, Dave. How are you?

Better than I deserve. What's up? Hi. So me and my fiance are getting married in October. We have our net worth is $23,000, so we have no debt. But about $11,000 to $13,000 of our net worth is in a car. And the question is, should we sell the car and get like a clunker for about $2,000 so we can buy a house soon? What is your household income going to be when you're married in October?

$70,000 a year. No. I would keep the car. And I'd spend the next year living on a budget. You don't have any debt. You've done a great job. How old are you two? 22.

Great. Here's what I want you to do. Breathe. Take your time. Take your time. You do not need to buy a house in the first year of marriage. It takes a year of marriage to know how close to your mother-in-law to buy. Sure, yeah. You got to get to know each other. You'll make a wiser decision after a year. Okay? Okay. a year okay okay you'll be a lot wiser 23 year old than you are a 22 year old and uh that would be true of all of us not just you you have done a great job with money so far you're way ahead

of the average 22 year old dude you know that right yeah i mean you can actually spell listen you can actually spell and calculate the word net worth. I mean, that's pretty amazing. So that's what you've got to do. I mean, you know what you're doing. You're thinking, so let's go slow. Let's go slow and buy a house after a year. During that year, build your emergency fund of three to six months of expenses

and build the biggest possible down payment and you get married in october uh of 2018 uh 2020 spring of is when i would buy my house okay start looking in january and buy in the first quarter of 2020 if i were in your shoes because you can get a big fat juicy down payment you guys can dream and look at houses for a whole year and do that together you will learn a lot about your new wife just by looking at houses with her and she'll learn a lot about you you'll be amazed you really will and um just got you you're still going to own a house before you're 25 and you're going to do it right you're going to do it smart before you're 25, and you're going to do it right. You're going to do it smart, and, man, you're just killing it.

I'm so proud of you guys. Well done. Hey, I want to give you a wedding gift. I want you to go through Financial Peace University. I give you the one-year membership as my gift, okay? Hold on. I'm going to have Zach pick up and give that to you guys. We want you to have that one year of every dollar plus,

and we want you to go to the nine lessons at your local church, and then you've got a year of access to the whole class on video audio the communities all the stuff all the tools it's an amazing thing in a year oh and you can even go through legacy journey which is the follow-up class online yeah it's all right in there and i'm gonna give it all to you and just man it's it's like a three four hundred dollar gift you just got so so someday when you're rich and you're doing good and you know some young guy that's sharp like you uh you pay for them to go through okay but this is your wedding gift i want you guys to get started on me well done very well done man don't you wish you were that smart at 22 i mean most 22 years can't

i don't know what a net worth is i most most politicians don't know what a net worth is. Most politicians don't know what a net worth is. Or they wouldn't spend like they do. I mean, he's already thinking. How can I? That's so good. Oh, that's so good. He's going to be doing so good. Wow.

I mean, you're sitting there listening to me. You're 42, and you have absolutely no freaking clue what's going on. That guy's got you beat already, you know? I mean, so, yeah there listening to me. You're 42, and you have absolutely no freaking clue what's going on. That guy's got you beat already, you know? I mean, so, yeah, he's game on. He's watching what's going on. You can do this, people. You can be just like him. You can be just like Matthew.

He's ready to sell his car to go get a house. There's a smart man. Cars go down in value. Houses go up in value. He's thinking. He doesn't need to because the car's not super expensive, and he's got a good income, and he's got time. Everything's okay. So no need.

If it was a $50,000 car, though, making $70,000, we'd have been selling it. Y'all know that. But that guy, Matthew, he wouldn't have bought a $50,000 car to start with. He's too smart to do that, not making $70,000. He's 22, and he's smarter than you. Smarter than I was was i can tell you that way to go dude proud of you this is the dave ramsey show so I get asked all the time, when in the baby steps is the right time to buy life insurance?

My answer is typically now. Life insurance is not part of the baby steps because it's needed when your family has debt and not enough savings to provide for their financial needs. That's when they're at the highest risk. And no matter where you are in your baby steps, it's a necessity, not a choice. This includes working husbands and wives, as well as stay-at-home parents. It's pretty expensive to replace those stay-at-home parent responsibilities. I only recommend term life insurance since it's the most affordable way to get the right amount of coverage and not break your budget. Go to Zander.com or call 800-356-4282. These are the guys I personally use. Term life insurance is inexpensive and your family needs this no matter where you are

in your baby steps. That's Zander.com or call 800-356-4282. Zander.com. Or call 800-356-4282. Zander.com. Evan and Katie are with us in Dallas, Texas. Hey, guys, how are you? Hi, Dave. How are you? Better than I deserve. I see on my screen you're debt-free. Congratulations. Thank you. Yeah.

Very cool. How much have you paid off? $67,850. Excellent. How long did that take? 18 months. Wow. And your range of income during that time? $120,000 to $140,000. Wow. What do you guys do for a living? I'm in sales.

I'm in insurance sales as well. Okay, great. Yep. What kind of debt was the $68,000? So much. It was a couple credit cards, a stupid loan from when our house broke that we shouldn't have bought, a student loan, two cars. Yeah, pretty much. Very cool.

Well done. So you're kind of normal. Yes. Very good. And how long have you guys been married? We have been married for two and a half years. Okay. So after about a year of marriage, you looked up and said, we're getting out of debt. What happened? Tell me the story.

Well, we found out we were pregnant, which is always a good thing. I had quit my job not too long before and then kept spending like I didn't. And then this is the second time around that I'm I did Davis before. I was at free before, but I thought I knew better and didn't cut up cards and didn't put my emergency fund in place.

So this time, we really went after it okay very neat well congratulations you guys that's fun so what do you tell people the key to getting out of debt is you did it um well for me dave it's just being intentional um you know we were uh always about just like out earning ourarning our stupidity, essentially. And, you know, in order to become debt-free, we just had to be intentional. And for me personally, it was, you know, intentionally tithing first and foremost, and everything else would just fall in place, and just entrusting our finances that we were doing the right thing.

And so that's what it came down to, just being intentional and being consistent and making sure that we were both on the same page. Cool. What about you, Katie? What do you tell people the key to getting out of debt is? I would definitely say budget. And for me, if I do something, I go big. So I had to kind of really go big and be obsessive. Sorry, not sorry to everybody else who had to hear me, but I was obsessed but we did it yeah well that's kind of what you have to do you're right because otherwise you get ish yes you either gotta you gotta submit and go bananas or you go ish and ish just doesn't work ish is a wish yep that's all it is you know and i wish i wish i was out of debt i wish i could

build some other people can do it but I can't do it, ish. And that's what you get into, and you're exactly right. But when you finally went all in, then that's when it happened, right? Yes. Good for you guys. Crazy. Very, very well done. Who was your biggest cheerleader?

Ooh, I would say it was between my parents and my cousins and uh and along the way we've we've uh each other too yeah oh definitely each other yeah good very cool do you have people saying you're crazy like you kind of got the jet we got judgy looks every now and then and sometimes those judgy looks were from ourselves. Like we knew we were lame for not going out to eat. But we looked at it in the long run and go, I don't want to pay for this meal two years down the road. Yeah. I hear you.

Way to go, you guys. How's it feel? It is. Incredible. Like the most freeing feeling. Yeah. It's freedom is what it comes down to. And the other thing, too, is going through this whole process, it's made us view just making purchase decisions in a different perspective,

you know, where before we would just, you know, make that just spur-of-the-moment decision, I'll just slap it down on a credit card. And, you know, going through the process and feeling that money leave our hands, now that just changes how we just approach clothes shopping, for example. You know, we don't just make those brash purchases just because we want it. Yeah, the impulse is gone. You know, children do what feels good. Adults devise a plan and follow it.

So it's about growing up, you know. Good job, you guys. Very, very cool. We've got a copy of Chris Hogan's retire-inspired book for you, and we want that to be the next chapter in your story, that you guys become millionaires and you're on your way to do that and be outrageously generous as you go along. So great job, great job great job thank you proud of

you all right evan and katie dallas texas 68 000 paid off in 18 months making 120 to 140 count it down let's hear a debt-free scream three two one we're debt free! Love it! Man, oh man, oh man. That's how you start it right there. Good job. New baby, new marriage. Life is good.

This is great. Sarah is with us in Las Vegas. Hey, Sarah, how are you? Good. How are you? Thank you for taking my call. Sure. What's up?

So my husband and I are in baby step number six, and we've always just been doing the 15% into our 401k that's offered at our work. We recently got with a smart vesture pro, and he recommended breaking that 15% down three ways. And I don't know if this is right, so I wanted to ask you about it. So he recommended putting in the amount to get the max match that our company does. So our company does 5% and they'll give, if we put in five, they'll give four. Okay. So you get the match first. Is your company a Roth 401k or just a regular? Yes, they're both Roth.

Okay, good. And then maxing out both of our Roth IRAs, and then the remaining 15% put into mutual funds. No. Just mutual funds are not in any plan? Is that what you're saying? I'm sorry? Okay, so you're saying take your match and no more on the 401ks, then do individual Roths,

and then put money in a mutual fund without it being in a retirement plan that's what he recommended and i don't know if that's correct but yeah no that's not correct that's not correct i would go i would put the remaining in your 401k that's not matched oh okay let it grow let it be in a Roth 401k unmatched, and that gets you to 15%. Okay, so we should max out our Roth IRA, and then the rest should be Roth 401k. You got it all the way right until we got to the mutual funds, okay? They're all in mutual funds, by the way. But number one, we're going to take the match in your Roth 401k.

Okay? Okay. Okay. And then the next thing you're going to do is do two Roth IRAs in mutual funds. If that total does not get you to 15% between all of those things of your household income, then whatever addition you need to invest to do that, go back and do that non-matched in your roth 401 case okay does that make sense yeah that way it's all in a roth one way or another you got the match you got the unmatched 401 and you got your regular and you got a good diversification

so hold on i want you to talk to zach and tell zach who that smart investor pro is so we can give them some instruction. Because we don't want their advice to be inconsistent with ours. That would be like an integrity thing for me. So, yeah. Okay. Open phones at 888-825-5225. Speaking of SmartVestors, we've got several thousand of the SmartVestor pros around.

And if you need some help, if you change job, for instance, and you haven't rolled your 401k, well, that'd be the way to do it. And you jump over there and click on SmartVestor at DaveRamsey.com. Put in a little information. It'll drop down a list of the SmartVestor pros in your area. And you'll get advice that is consistent with us. And we're pretty much make sure that happens. It's consistent with us. And the big thing, though, is you get the heart of a teacher. And you're meeting with somebody who's teaching you what you should be doing.

51% of employees who change their jobs leave their money behind at the old 401k. I wouldn't do that. I would take it with you by rolling it to a direct transfer rollover into an IRA with a SmartVestor Pro. You've got much more control of it, many more choices to invest, and that's the direction I would go. This is the Dave Ramsey Show. Thank you for joining us, America. This is the Dave Ramsey Show.

Emily is in Casper, Wyoming. How are you, Emily? I'm us, America. This is the Dave Ramsey Show. Emily is in Casper, Wyoming. How are you, Emily? I'm good, Dave. How are you? Better than I deserve. What's up? I'm calling for advice and a little bit of grace. Okay.

My husband and I have had many smart years with our finances, but recently have had a couple dumb years. And so we just have the baby steps all jumbled up. We're feeling cash poor, and I'm wondering if we should downgrade in car to pay for some necessary home improvements. Okay. So do you have debt? Just the car. Oh.

And we also have our house paid off, so that's what I mean by we're all jumbled up. Okay. How much do you owe on your car? $14,500. Okay. Do you have any money saved? I have in my emergency savings $8,400. Okay. And, um, all right. And what's your household income? About $90,000 to $100,000.

My husband's salary is $75,000, and I'm self-employed, so I make $20,000 to $40,000 depending on the year. And what are the home repairs? Our deck is falling off. It's all rotten and needs replaced. For summer barbecues, we wouldn't even let more than three people stand on it. Okay. So we could save all winter and then replace it in May.

But if I pay off the car and then fund my emergency fund, I won't have enough to pay for a deck next summer. And we're just feeling like we're sick and tired of being sick and tired of feeling like we don't have enough money to even put a deck on our house. Yeah. How many feet off the ground is the deck? It's tall.

So we have a walkout basement. So it would go up above that. Okay. So it'd be an elevated deck. It's one story in the air. Yeah. Okay. Yes. That's really dangerous. Okay. It is. Don't let the kids go out there. Well, I mean, you can do whatever you want to do. You've been doing whatever you want to do. I know.

So it's your choice to do what you want to do if you called me for advice then i'm going to tell you to do what i would do but that's not what you've been doing and you're already aware of that and why would i do it that way because i think that is the shortest path to wealth and living like no one else so that later I can live and give like no one else. And instead of screwing around being a dog chasing its tail, trying to get these things out of order and then wondering why my money's not working. Exactly. So, I mean, you guys can decide. You make $100,000 a year.

You're not stupid people. But if you want to do your plan, then it's okay. I'm not mad about it. You can do whatever you want to you get all the grace you want you know grace is everywhere right but if you want to if you want to do if you want to do what we teach then what you would do is follow the baby steps which means you would take 7400 out and put it on this car leaving 1000 in your emergency fund and you're in baby step two and you get the car paid off as soon as the car is paid off you build up your emergency fund and,000 in your emergency fund, and you're in baby step two, and you get the car paid off. As soon as the car is paid off, you build up your emergency fund, and as soon as the emergency fund is built up, then you take the yellow tape off the back door, and you

put a deck on there. But that's what I would do if I grew up, and if I woke up in your shoes, because that is the shortest path to me being wealthy. But if you want to do your plan, I'm okay with that. Do your plan. It's not the shortest. Well, I want to be being wealthy. But if you want to do your plan, I'm okay with that. Do your plan. It's not the shortest. Well, I want to do your plan. I just, my husband is, I'm hoping to get him on board.

But what I was wondering, this is a new car we got. Well, if he wants to do his plan, he can do his plan. But that's not what we teach. And the reason, there's a reason behind what we teach is it takes us, it's the shortest path to getting where we want to do. See, it's, the problem is, is that we run around doing what we want to do right now, and the right now robs our future. Yep. And there's always a right now, isn't there?

Sure is. There's always a rotting deck somewhere in our life. And at some point, you've got to go, you're going to wait, rotting deck. And when I get to you, I'll get to you. I may take a sledgehammer and knock the thing in the backyard and use it for firewood and seal off the back door with a tube before until I can get there. You might be a redneck if, but, you know, that's what we did. And, you know, but we decided we cared more about never being broke again

than making $100,000 a year and looking up and, I got nothing. I got a car payment and $8,000. And I make $100,000 a year and my deck is rotting off. I don't want to live like that. So at some point, you got to realize you can do your plan, but your plan sucks. You know, you guys can do it. I'm not mad at you.

But what is going to get you to where you want to go? That's the question you and your husband need to sit down and ask yourself and ask each other. You know? And, yeah, you can do whatever you want to do. It's okay. We'll still be friends. It's all right. I'm not mad at you.

I've got friends that do that kind of stuff all the time. One of them brought his new leased car up to the house the other night to show me. You know, I was just looking at him. I said, great car. Thinking to myself, you're an idiot. But, you know, it's just, you know, but I love my friend, but I'm not, you know, it's a dumb idea to lease a car. So you just got to decide what you want to do. And I'll celebrate with you whatever you want to celebrate.

I'm good. Doesn't make me mad at all. Hey, thanks for calling. Open phones at 888-825-5225. Thomasina is in Knoxville. Hey, Thomasina, how are you? I'm great, Dave. How are you?

Better than I deserve. What's up? Well, I was calling. We're kind of in, I guess, what you've called Baby Step 3B, where we're debt-free, and we have our three to six months of expenses and we're trying to save up to buy a house great yeah and um well we kind of we had a really bad year we had a baby in may and then he only lived about a month oh my god um yeah and it was and it was it was a hard pregnancy i had a lot of bed rest and then then our family had to be separated because we had to go to Cincinnati to the children's hospital.

And I was up there for about three months. And my kids and my husband were at home for most of that. So I kind of reached a point where now that all that's done, I'm wondering if we should take a little bit of the money that we save not our emergency fund but our money toward you know other savings to maybe take like a small family vacation to kind of reconnect with our other kids i would i would just like i went to spend that money that's okay but it's just listen so hard to save it it's okay you you can get more you it's a good thing for your family to heal honey y'all are hurting yeah well and that's my husband i mean you know he yeah he loves your plan um that is that is my plan you're not off okay you're not off my plan doing that the only thing

you're saying is is we're gonna delay buying a house just a little bit to take a vacation and just spend some time hugging each other yeah and that's that's pretty much what what i wanted to do and we talked back and forth and he said well you know i don't know and there's not a step in there for this no see here's here's the thing after baby step three that's when gazelle intensity stops you've got your emergency fund in place and you're out of debt that's where you are then you started doing other goals okay after baby step three other goals go back and forth you can save for a house you can start four five six you can do any of that kind of thing in there you can save up by a couch you can go on vacation any of that's okay and you do let your foot off the gas a little bit on the intensity meaning you're not beans and rice anymore okay so you can enjoy a little bit but

everything that you enjoy we we all know this, means some of my other savings goals are not going to be hit as quickly. If I was saving for a car and I go on vacation, then I'm not going to buy the car as quick. If I'm saving for a house and I go on vacation, I'm not going to buy a house as quick. If I am saving for a vacation and I buy a house, I'm probably not going on vacation.

You know, so it's just, you know, you're just making choices at that point. And that's where you are. So you're right dead in the middle of our plan. You're doing exactly what we teach. And all I answer here is what would I do if I woke up in your shoes? I would delay my home purchase just a little bit by whatever number of months it takes to replenish that amount of money. And I think you guys will be spiritually, emotionally, relationally well served to fill your gas tank with a little time together away from this crazy world that you're living in this year. Thanks. Can I just say that we are so glad that we did your plan, that we had the money to do what we did? Yeah.

Because actually, without that, our emergency savings amount, we could not have gone to Cincinnati. We could not have funded that. And we would have probably spent the rest of our lives wondering, well, what if we couldn't afford it to go to that hospital? No regrets. No regrets. That's awesome. Right. That's awesome.

I'm so sorry that you guys have been through this heartbreaking thing. Thanks for calling. This is the Dave Ramsey Show Hey it's Kelly Daniel Associate Producer and Phone Screener for the Dave Ramsey Show Did you know that in 2017 Dave Ramsey Show listeners paid off 50 million dollars of debt That's pretty impressive.

And it could be you this year. Keep listening for more inspiration.