The Ramsey Show - App - I Don’t Know How To Pay Off My Student Loans (Hour 1)

Episode Date: August 17, 2023

Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studios, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Thank you for joining us, America. It's a free call at 888-825-5225.

Dr. John Deloney, number one bestselling author of the book Own Your Past, Change Your Future, and host of the very popular Dr. John Deloney Show on Ramsey Network's podcast. You should check it out if you want to know about mental health and relationships and just getting along with other humans. It's a big deal and hard to do sometimes because sometimes those humans aren't that human. Or sometimes those humans

say human wrong. That's cool. That's cool. You really didn't think I did. Okay. I know you did. Yeah. Okay. So just making sure you're on track. He has a new book out that we just put into pre-sale, and it is Breaking All Ramsey Records in Pre-Sale.

Thank you, America. It is actually going to be published and shipped to you on October the 3rd. But if you buy it now, the book is called Building a Non-Anxious Life. If you buy it, go ahead you buy it now the book is called building a non-anxious life um if you buy if you go ahead and buy it now it's only 20 bucks and we throw in 75 dollars worth of items in other words it helps john me the marketing team if we pre-sell these it helps with the marketing process um big time and so we're willing to bribe you to pre-sell it and also on top of that it's an awesome book so you will get uh of course the e-book and the audio book and other things smoke fire and freedom uh his latest talk will be sent to you right now and all on this subject of building a non-anxious life in one of the most

anxious cultures in the history of the world that's right yeah i'm excited that i get that out into people's hands i've been doing doing the podcast circuit as we ramp up, and I think the book's more of a felt need than even I thought it was. Yeah. Yeah, well, we knew that because you did the quick read, which is the equivalent of a chapter that we put out called Redefining Anxiety. 150,000 of those sold.

So we knew that a lot of folks were concerned about this subject. There's six daily choices in the book that you make in order to build an unanxious life. And, you know, it is, honestly, you really did find a way to weave between the nerd world of psychology and grandma's common sense. It's got a lot of both in there, but in a way that's digestible. I just want to tell you this happened the other day. I was speaking, you and I were just talking off air. I was speaking to a university faculty, and all the faculty come together.

They call it pre-session. It happens at every university. And I was meeting with the faculty, and I finished the talk talk and it went very well. And at the end, and then the president stands up to go up and I sit down in my seat and I'm all by myself and I feel somebody tug on my shirt. And there's a man in the aisle had walked down in front of everybody in this theater we were in. And he's got a name tag on his shirt. He's one of the maintenance guys. And he grabs my head from the back of my he puts his hand on the back of my head and gets real close he can whisper in while the president university's talking

addressing this faculty the esteemed faculty and he said this changed my life thank you and i remember thinking and he said i've been listening to show i've read one of the other things and and i remember thinking i wrote this book for you i wrote this. It took all this nerd stuff that me and my nerd friends have to somebody who doesn't read a lot of books, who just wants to be a better dad. And I got choked up sitting right there. I was doing everything I could just not lose it because it was a brave act for that guy

to walk all the way down and to bless me in that way. But that's exactly what I set out to do, which is not to write, man, the human beings of the world, those guys are brilliant. And those Peter and Tias in the world, those guys are brilliant. I can't of the world. Those guys are brilliant. And those Peter T's in the world, those guys are brilliant. I can't write like that. Those guys are smart and they have,

they have that, that area covered. I want to write a book that for people who don't read a lot of books, but are just sick and tired of living this anxious, stressed, burned out life. And so it's resonating in a way that I didn't anticipate. It's pretty neat.

Yeah. I think one of the reasons this show has worked for 30 years is that we realize that people actually need other people. And one of the six choices is choosing friends, choosing community, choosing relationships. And the lonelier you are, the more you set yourself up for anxiety. So one of the things is to start choosing in that area, right?

Yeah, I have just come to believe I don't believe the things is to start choosing in that area, right? Yeah, I have just come to believe, I don't believe the human body can be well in isolation. I don't believe it can be okay. You can make a bunch of money, you can get six pack abs, you can find somebody to marry you. I don't think your nervous system will rest and relax until it knows I got somebody watching the right flank and somebody watching the left flank and somebody that's there for me in the middle of the night. We're just not designed to do it. And so I don't know. I think you can do all the meditation

and you can do all the gratitude journaling. You can do all that stuff. If your body knows you're alone, you are not going to be well or whole. And you're going to show up to work on Mondays wondering why you're snapping at your kids, wondering why you just hollered at your husband, wondering why you're so mad at your boss.

Has nothing to do with any of that stuff. It has to do with the body trying to get your attention saying, we can't do this by ourselves. Being a hermit is a mental illness. It's tough. Yeah. It either is caused by it or will cause it. And it's recursive, right? It works in and of itself, and it just builds on itself.

Yeah. If you're a little crazy, so you go off by yourself, you get even crazier. That's right. And I'll be the first to say, if you're hearing me say that, and you look around and you say, yeah, I'm 41, I'm 36, I'm 58, and the idea of, quote, unquote, going to make a new friend sounds about as much fun as setting my hair on fire just to watch it burn. I address that.

It's the worst, and we've got to go do it anyway. And I think back to our my grandparents i'm about your grandparents um i think your grandparents got off the ark but my grandparents they um i mean it was everybody smoked everybody smoked and it's when everybody i think they didn't feel good but everybody smoked and it's when they came out and go hey whoa everybody this is killing it it's gonna kill you you gotta stop and um there were some grandparents that did and some that didn't it was hard it was just hard and it's hard to keep smoking and live that life and it was hard to to stop smoking after smoking for x number

of years you had to choose which is a hard path and um if you choose the one that's going to give you longevity in life and give your health back that that's hard. And if you're going to keep just plugging along, that's going to be a hard path, too. Making friends is very similar. Living alone is going to kill you. So you're going to live a lonely life that's hard, or you're going to do the scary hard work and say, hey, man, you want to go grab a drink? You want to come over and have dinner? The culture has forgotten how to call up and say, hey, bring a dish. We're having dinner tonight.

Just be weird. Yeah. Whatever you got left in the fridge, come on bring a dish. We're having dinner tonight. Just be weird. Yeah. Whatever you got left in the fridge, come on over. Yeah. Half a bottle or whatever, come on over. Yeah. Yeah. Exactly.

Yeah. Forgotten how to do it. Yeah. And when someone does it, it's like, oh, that was cool. It's the awesomest thing. There's part of me forgot that. I mean, like when we were kids, we used to do that, you know? And yeah, but we're too plugged into where we're going out to eat.

We're too plugged into. It's going out to eat uh we're too plugged into uh it's the it's the instagramification clicking a button yeah and crap showing up on the front porch well i even uh i've been working with somebody um off air not on my show and one of the assignments i gave him and his wife is you have to have somebody over for the next 30 days once a week and you have to intentionally leave something out in the living room like a laundry basket or a like a trash sack you can't over curate this this house you've got to be you and you've got to deal with that uh what they're going to think about me it doesn't matter they're your friends like they brought over a half a dish it's probably not even that good if they do, then they're not the right.

Yeah, exactly. Winston and Rachel came over recently. They didn't mention the cleanliness of our house at all. We just laughed a lot. It was awesome. Rachel doesn't need to mention the cleanliness of anything. That is correct. All right. Just to be sure there, just to be real clear on that. All right. There we go. This is The Ramsey Show. Dr. John Deloney, Ramsey Personality, is my co-host today. Debbie is in San Francisco on Line 5. Hi, Debbie. Welcome to The Ramsey Show. Maybe not.

I think I messed it up. Try again. How about now? Debbie, are you there? I am here. There we go. Let's try again. How about now? Debbie, you there? I am here. There we go. What's up? How can we help? Well, I just want to know if there's ever a time when it would make sense to pay off home debt with traditional IRA. My situation is that I recently retired retired and before I retired, we were cruising along. We owe on our house about $65,000. We had everything paid off. My husband's self-employed and had a business credit card that he would pay off every month through that. And all of a sudden,

we had a situation after I retired where we had a series of unfortunate things happen. So now I'm sitting here and it's like we owe $64,000 on the house. We now have a brand new car loan that I didn't plan on buying for another year or two. And we're basically retired. My husband's still doing a little bit of side work. How old are you? I'm 65. And how much is in your retirement? We have 1.1 million dollars. Why did you not just take out money and buy a car? Because it's all in traditional. I don't care. So yeah well okay so that's that's my question. You have no money except your IRAs? Well, we had about $40,000, but now it's down to about $5,000. You have no money, basically, except your IRAs?

Correct, yeah. You have a million dollars in traditionals. Yes. Way to go. You're millionaires. You're amazing. It's great, but I'm so stressed out by having to do that. The fact that it feels all trapped kept it from feeling amazing,

but let's just take a minute here and go, hey, Debbie's a millionaire. Woo! Let's just stop and say that, right? Well, thank you. And her old man is, too, because he took the ride with her. So there we go. But, yeah. All right.

So what do you owe on a stupid car? Okay. So we owe $32,000. Okay. So you need $100,000. So you're going to take out $150,000. Ta-da! Yeah.

Okay, so it's my stupid tax, right? No. You have to pay taxes on it. Yeah. Yeah. You might as well pay some taxes. Okay, so I'm so relieved that you're saying this. Yes.

Yeah, the only time we tell people not to cash out retirement at your age to pay off debt is if they don't have enough. Like if you told me I have a $500,000 mortgage and I have $600,000 in my retirement, I'd be going, that's a hard one, right? But you're not looking at that. You got $900,000 left over when we finish talking, right? Right. And then the other time we tell people not to use retirement is if they're not over 59.5, so they get penalized.

So you don't cash out your 401k when you're 45 because the government takes 10% plus your tax rate, and they kick your butt. So all you're going to get hit with is the taxes that you have never yet paid on these earnings. Oh, I'm going to sleep so much better tonight. Okay. So, yeah, you're debt-free by the end of the week. You've got a couple keystrokes on the computer to do to get the money out and get over there, and then you're fine. And you've got mandatory required minimum distributions at 72. You know that, right?

Yes, yes. Okay. Very aware of that. I just felt like I had screwed everything up. No, you haven't screwed everything up. I mean, the only thing you did you probably bought it i might go back and revisit that car decision it sounds like you guys panicked but uh but yeah but either way um you know uh you got the money you're millionaires i mean you can make a forty thousand dollar mistake

when you have a million you can't make a forty thousand dollar mistake when you have forty thousand it's kind of a problem so um but you set yourself up and it's not even a mistake because you actually own the car and now we're just paying it off the only big mistake was that so that that's the process all right let's go to uh joel in houston hi joel welcome to the ramsey show hi ramsey how are you doing better than than we deserve. How can Dr. John and I help? Well, thank you so much for taking me on. But, see, I'm calling you today just because I'm very nervous about the new student loan payments resuming and everything. So I'm 24 years old.

You know, I make $60,000 a year. And I am soon to be married, so I'm currently engaged. you sir thank you appreciate it um what do you do yeah so um i am a so i work in logistics uh transposition logistics you got a supply chain degree and you make 60 grand yes000? Yes, sir. Well, that sucks. You need to make more than that. You're probably worth $80,000. I'm working towards it, yeah.

It took a while to get to $60,000. No, I'm telling you, dude, the marketplace right now is about $80,000 for a newly graduated. I mean, you got a four-year degree in supply chain? Yes, sir. Okay, yeah, you're underpaid. I'll just tell you. You need to go look at it. Anyway, how much student loan debt have you got uh so i have about 30 000 on a car you know 30 000 joel and you make 60 okay how much is your student loan debt 18k okay and and your fiancée, what does she do? She works for a government facility.

It's a children's assessment center. You know, they take care of children. What does she make? Whatever. She makes $19 an hour. And she has a four-year degree? Yes, criminal justice. Okay.

The two of you are vastly underpaid so we're going to work on your careers for sure um you bought a car you can't afford sir the car is in cray cray land nutty nutty 30 a sixty thousand dollar car you make i mean you make 60 and you have a thirty thousand dollar car that doesn't work you don't have a student loan problem. You've got a car problem. Nervous laugh means you're going to keep it. What's that mean? And listen, dude, I drove the streets of Houston. That's where I grew up, in a 1988 Tercel Easy hatchback.

$1,000. You don't need a $40,000 car when you're broke. That is true. It was just an emergency. I had no... No, it's not a thirty thousand dollar emergency it wasn't the beer just fell in my mouth officer no you bought it okay man uh nervous laughs aside the number one mistake newly minted college graduates make is they go buy a car they can't afford so you're not dumb you just did what most college graduates make is they go buy a car they can't afford. So you're not dumb.

You just did what most college graduates do. You went and bought a car you can't afford. And if you don't hear this loud and clear, it's going to hold you back. Because if you didn't have a what $650 car payment making 60,000, you wouldn't be calling me about the student loan debt. So if I woke up in your shoes, if you were my son and you call me my nephew and you call me and you said, I'm getting ready to get married, Papa Dave, what should I do to get ready to have a great life with this woman I'm in love with? I would say work on your career. You're underpaid. You're worth more than you think you're worth in the marketplace today. You're a stud. Supply chain is an excellent degree field. Way to go. Good choice.

And you bought a car that indicates you were doing drugs. So stop doing this. Stop. Stop. Stop. This would be Papa Dave talking to my nephew. I'd be going, you're out of control, dude. You've got to sell it.

So the best thing you can do for the future Joel and the future Joel's wife is to get rid of this car and get you a beater and get rid of student loans as fast as you can do for the future joel and the future joel's wife is to get rid of this car and get you a beater and get rid of student loans as fast as you can by living on beans and rice rice and beans and work on your career choice and she needs to work on hers you go get a four-year degree to make 19 you can make 19 at target if you didn't even get out of high school so um that that's just ridiculous she again you both have accepted positions and you've somehow justified or rationalized it that you're you're both worth more than you have been so far but it's time time to work on those two areas if i were you that's what i would do

yeah my my dad's a criminal justice professor i know that's underpaid i know that's too low and there's a number of things you can do across that. Yeah, a whole bunch of stuff you can do with criminal justice, but that's not $19. Right. And by the way, that's when we say that. That's when she says, well, I really love working with these kids. So I get that.

I get that. But right now, you can't afford to follow your heart or do your passion thing or whatever Instagram is telling you to do because y'all got bills to pay. Quit your job and work with a youth group of the church, but that doesn't make sense. You got bills to pay. You do work with a youth group of church and work a job. That's how you do that. You do both. You can't mix the two up and be underpaid.

It doesn't work. So, hey, man, we're going to put you guys through Financial Peace University as our wedding gift. Hold on. Austin's going to pick up. And we were messing with you pretty hard, but if you listen to what we said, it's going to put you guys through Financial Peace University as our wedding gift. Hold on. Austin's going to pick up. And we were messing with you pretty hard, but if you'll listen to what we said, it's going to help you. This is The Ramsey Show. Dr. John Deloney, Ramsey Personality, is my co-host today. Hey, guys, we would love your help, and if you'd like to help us, here's how you can.

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But help us by sharing, subscribing, following, and leaving five-star reviews. Justin is in Hattiesburg, Mississippi. Hey, Justin, welcome to the Ramsey Show. Hey, thank you, Dave and John. It is awesome to talk to y'all. I'm excited. Absolutely. How can we help?

So my wife and I are on baby step two and we're trying to get really gazelle intense to pay off our debt. And I wanted to see if you and Dr. John could speak to the physical and mental challenge of working 80 to 90 hours a week. On the physical side being like, you know, fatigue, lack of sleep, and on the mental side, you know, your mind is telling you to call it a day when you still need to grind out, you know, those last few hours to make a really good week. Why are you losing sleep? You have plenty of sleep time left. Well, I guess like, you know, a day you work 16 hours and you have you know an hour commute and you know eating and stuff like that you make it you know five to six and on a longer day you know

make it four hours of sleep i often see folks try to continue the life they were living before they went gazelle intense and they tried to squeeze it in meaning i used to watch um all the shows well now i have to just watch my two and there's an hour right there or there's an hour and a half and i want to go to every single little league game well during gazelle intensity you're gonna probably have to miss some games because you gotta work some shifts and that's okay because you're playing a longer game but i would wonder how much how much all in are you yeah that if there's some of that and yeah you check your actual time audit on where your actual hours are going um number one um then sleep is necessary the second thing though is is you're not asking yourself to do this long term.

This is a short sprint. Right. This is not sustainable for five years. That's not what we're asking ourselves to do. And I got a feeling just in talking to you that you have done in the past, maybe in sports or something else, you've done something where you stretched yourself to a limit. And if you're a person who's done that, you've experienced what any of us that have done that, physical or mental or

otherwise, you never return to the same shape after that. That's the benefit of the stretch. Yes, sir, I have. God has really blessed me with a body that can handle a lot. Yeah. And so, you know, once you've done a half marathon, you've done a marathon, you've done whatever the thing is that pushed you physically and mentally or whatever, then it changes your level of confidence. It changes the way your swagger, the way you look at the world after that because you accomplish the goal and and you know you break the tape and you and you go on through so that that's the way that i have done it is i number one i look at it as a

short-term play and so it's not going to kill me because right before you die from hard work you pass out don't worry about it i mean it's okay so but the uh so it's not gonna kill me and uh it's short term and then the second thing is is that i'm gonna get more benefits than just the money in this case you're doing it to make a lot of money to get out of debt okay but i'm gonna get character benefits emotional psychological spiritual benefits even relational benefits because as a couple we now know we can do things we didn't know we could do before as an individual i now know i can do that because before i did and it gives me a different level of well if i can do that then i can do another thing and if i can do that then i can do another thing and that's that's what this is versus being the typical fat american sitting on

their couch watching netflix and never stretches themselves at all. And Justin, there's some incredible neuroscience that is, obviously this doesn't, you can't game or hack this system, but you've known people who get under a squat bar and they feel that weight and they get that weird smile. And there's been people who get under that bar and it's like, ah, too heavy. And they get off. One of those people says, this pain is going to be worth this. Watch this. And the other person says, I need to opt out of this pain right now.

And so there's, it's the, your mindset as you're driving home, you can be like, I'm so tired. I hate all this. This is the worst. I'm so tired. I just clicked another click. How long you been married? We've been married five years. How's she doing with all this? Um, that's interesting. You asked that, uh, one of the other kind of hard things for me is like,

say that she has a day off and I'm at work, you know, when it's those last few hours, when I still got, you know, four hours left and I'm already tired, and she sends me a text like, I miss you, ready to see you. I'm thinking to myself, man, I'm ready to see you too. I want to come home, but I need to stay here another few hours. I know you lost 50 pounds, but here's some fresh baked cookies. Also, again, that's your mindset, bro, because she's reaching out saying, I want you to know i'm not at work with you but i'm in this with you right and it's real easy for you to be like oh

yeah you know i mean it's so yeah i do your best to i mean you're all in a short sprint i do do your best to roll that out so the good news is she's not she's not whining about she's not going ha ha ha oh yeah you never you're never home with me why aren't you ever home with me? She's not doing that to you. She's just saying, man, I miss you. I wish you were here. Because I'm married to a country girl that's a hillbilly, and if they learned one thing at her house growing up, it was unbelievable hard work.

She has no patience for people that won't work hard, especially if it was her husband. And so I got the opposite. I'm like, get your butt out of here and get this mess cleaned up what's wrong with you you know and so it was she kicked me out the door you know and so occasionally now when I don't need to work she's like would you go to work and get away you know like and so um you know so the uh uh but she but that so I had the benefit of a spouse that was beyond supportive supportive is not the correct term she supported you with her foot with her foot yeah that's it but i mean you know in your case you've got a sweet one that's

being sweet and saying i i miss you but i'm proud of you so you might even tell her that just go hey listen when you do that it it makes me not angry with you but it makes me angry with this whole situation it makes it hard to work five more hours so if you would do that and just add to the end of it i'm proud of you you got this it sure would help me when my wife was pregnant with josephine after um she had we had had hank she gave me a list it was not a long list but it was a short list but she gave me a list of questions i was not allowed to ask in the hospital and when she was in labor and i said why did you do this she said because i know you love me and i know you're gonna ask how are you feeling does that hurt are you okay do you need anything and she said when you ask those questions it makes me want to strangle you

i want to set my eyeballs on fire just enough to look at your face your eyeballs right so she said the best way you can love me is don't do this i'll let you know if i need something and so i think for you just like dave just said if you let her know hey when't do this. I'll let you know if I need something. And so I think for you, just like Dave just said, if you let her know, hey, when you reach out, man, I know you're telling me that you're proud of me, you love me, but it just makes me hate being at work, which makes me hate myself and makes me hate all this. Can you just text me and say I'm so proud of you?

And I'll know that you miss me. When you're running the stadium stairs, you have no memory of doing that when you look at the scoreboard at the end of the Super Bowl and you won. You make that catch, yeah. You have no memory of running the stadium stairs. Your brain allows you to do only the celebration.

Justin, you're a stud, man. I'm proud of you. And I think you're going to be okay. The good news is you're smart enough to talk about it and say I'm tired. You're smart enough to even take a look. take, okay, I got to take a day. I'm done. I got to take at least a day. I can't breathe.

You know where your limits are, but pushing those limits is not a permanent thing. It's not a way of life. It's a moment in time and the benefits are going to exceed the pain. I can promise you live like no one else so that later you can live and give like no one else. Dr. John Deloney, number one bestselling author of the book, Own Your Past, Change Your Future, is my co-host today. Thank you for joining us. Open phones at 888-825-5225. You jump in. We'll talk about your life and your money.

Tricia is with us in Washington, D.C. Hi, Tricia. Welcome to The Ramsey Show. Hi. Thanks for having me. I have one simple question and one that's a little bit more complex. The first is maybe step four, 15% of the the income is that based on the base salary or is that total including potential bonuses total gross before taxes okay and then my second question relates to a second mortgage that I have or a mortgage that I have jointly with my mother-in-law or that my husband and I I guess have with my mother-in-law or that my husband and I, I guess, have with my mother-in-law and how we should really be accounting for that in the baby steps. Does that go in bucket two, or does that go in the bucket with the general mortgage payoff? Yeah. How do you have a mortgage with your mother-in-law?

So when my husband and I were expecting our first baby, my mother-in-law was retiring and we wanted her to move closer to us but she couldn't afford a house near us and we thought that you know helping her move toward where we were would be you know better than paying for a stranger to do child care for us so we essentially assisted her in getting the house so i'm on the so you took out a you're on her mortgage um we're jointly on the mortgage we own it you know, 50%. But it's her house. Yeah, it's her primary residence, yes. Okay, so you took out a mortgage.

You're a cosigner, in a sense, on her mortgage on her house. Well, I'm on the title as well. Oh. Yes. This is your mom? No, it's my husband's mother. Oh, okay. So all three of you are on the title.

Yes. Okay. All right. So my question basically is, do I just kind of let this linger out there and make the payments? I mean, the payment is fine. Are you making the payments? We split the payment. As a method of helping her? yeah and she helps um what happens to

the house when she passes are there other siblings um my husband has two siblings we haven't actually discussed that um what happens when it passes um when she passes we haven't discussed that which is all the money that you're paying in reducing the principal may go to them? Well, I'm on the title. I know, but you don't have exclusive title. She's got the title too, and her estate will get her portion of the title, and that portion of the estate could go to the siblings. Sure, yeah. Number one, not discussing this is a really bad plan.

Not having a plan is a really bad plan. So we need a will and a game plan immediately and you may want to have it where the house is just uh where the deed is changed and it comes to you at death okay okay um that that would solve a whole lot of things if you can get control of it like that then i would put this in your plan. A normal second mortgage on your residence, we tell folks, if it's less than half your annual income, put it in Baby Step 2. If it's more than half your annual income, it's in Baby Step 6. So what's the balance on this particular house, although it's not a real second mortgage?

The balance is $371,000. Okay. I'm guessing you're not making $800,000. After bonus, it'll be $ household income uh 500 my husband's retired well i mean he gets you know 30 000 through the whole year for disability but um yeah you really need to get this straightened out so that you can get it paid off but it really is a baby step six item okay and um but but if you pay it off and there's a paid for house and half of that house is owned by her and she dies and there's no will that half of the house will be split among you and your sip or your husband and

his siblings yeah dumb plan well and i gotta, I'm going to ask you a question about Trisha's situation. Trisha, I'm using your situation as Dave. What happens if Trisha pays off her half, but mom's still making payments? It's an undivided interest. There's not a half. So 371 is just the total balance of the loan?

If you pay down 371 by half, she's still liable for the other half. It's not two loans. It's one loan. That's what I mean. But, Tricia, your 371 isn't half of the remaining balance of the house. That's how much the whole remaining balance is?

Yeah, that's the remaining outstanding amount on the mortgage. So you're not talking about splitting the payments with mom. You're talking about just paying the house off. I am. I'm saying pay off the house and but pay it off in such and when you put the documentation in place that the house is yours yeah that that you know treat it like it's a rental property and it's in baby step six and you pay it off but right now it's not a rental property right now you start paying it off you're going to get in an argument with somebody a judge or a sibling or both because there's no will and no plan or there's

a will that says just split it among the three of them it's dumb that's dumb i mean that was not the intent of this deal that's not a fair deal here because the others haven't put anything into this house you should split the rest of stuff stuff with them, or that's fine. And certainly if you go and pay off a house that has your name on it, but her name on it too. It's your house. And you're benefiting those siblings if you don't clean this mess up first. So, yeah, we've got to do some estate planning work here,

and then we need to put it in baby step six as your overall answer so hey good question um just note i would not have done this the way you did it i think there was other ways to help grandmother and help her move and help her be there to help raise your kids and all that kind of stuff without uh getting all tied up in this barrel of fish hooks that you got yourself in but you can straighten straighten it out by paying it off and by getting it deeded to you upon death or before. Either one's fine with me. Open phones at 888-825-5225.

Gio's in Miami. Hi, Gio. How are you? Hey, Dave. How are you doing? Better than we deserve. What's up? Yeah.

All right. So I just had a quick question. Um, so I'm thinking about buying a rental property with my sister. Um, but she's made it very clear that she doesn't want a, a 15 year. She, we were kind of on a time limit. Um, because my, my income of this year is gonna be like, not really that high. And so year is going to be not really that high, and so we're going to be going off on my income of last year. And so I was just wondering if it's going to be a rental and if we're not really going to be living in it,

and if we can potentially sell it before the 30-year mark. You have three reasons you should not do this deal. Number one, you're broke. You don't make enough money to do the deal. Number two, you're going to be in a partnership with someone you're already in a disagreement with on how to structure the deal. That's dumb. Partnerships are dumb.

Partnerships with family can be really bad idea. And number three, you shouldn't buy rental property with debt at all you should pay cash for it so um but you're kind of new to this whole ramsey thing so you didn't know any i was going to say any of those things but one of the sayings we use around here is the only ship that won't sell is a partnership because i'm doing 30 years of financial coaching uh you know what i see a lot people like you and your sister in my office both of you pissed off yeah i can see it yeah because it didn't because the partnership didn't work i would i would tell her i love you enough that i'm not gonna do this

yeah or i'm out it's not gonna work for me well i mean you're not making as much money tells me that you're not you know you're not making good money you don't need to be getting in a rental property and you're financing it and you want to do a 15 because you got at least that much of a glimpse of the ramsey stuff uh and she's like no i want to stay in debt forever no well it's i dave i just keep having this conversation with folks about my age a little bit younger a little bit older I just keep having this conversation with folks about my age, a little bit younger, a little bit older, who just keep living on TikTok and they think that they are broke if they don't have rental property. Let me tell you what. They will live in a two-bedroom apartment and try to buy a rental house with a 30- or 40-year note. It's madness.

Yeah. It's heartbreaking what it is. It's the, it's a get rich quick syndrome. And it's this idea that, you know, I I'm going to invest in property, uh, cause that's going to make me wealthy. And the truth is that real estate does not make broke people wealthy. It makes them broker. That's why they call them brokers. And so it's, you know, it's just when you're broke, real estate is, is a game that you play when you have cash. Lots of it. Because you need to play the long ball with real estate.

And when you get up against the edge and the sparks start flying because there's friction, because there's no margin, that's when you're going to lose your butt in real estate. So I started with nothing. I had $4 million worth of real estate by the time I was 26 with a million-dollar net worth. I was making $200,000 a year in 1980 freaking three. That's a lot of money back then. I lost it all because I was playing the same stupid butt games that you people are watching on Tic Tac. This is The Ramsey Show. Hey, it's Dr. John Deloney. If you love the show and want a deeper dive on your money journey, we have a weekly newsletter that gives you trending and helpful articles and tips on following the Ramsey way.

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