The Ramsey Show - App - I Have $120,000 in Student Loans! (Hour 2)

Episode Date: February 17, 2020

Chris Hogan, Anthony ONeal, Debt, Budgeting, Savings Tools to get you started:  Debt Calculator: http://bit.ly/2QIoSPV Insurance Coverage Checkup: http://bit.ly/2BrqEuo Complete Guide to Budgeting: http://bit.ly/2QEyonc Interview Guide: http://bit.ly/2BuGnZE Check out other podcasts in the Ramsey Network: http://bit.ly/2JgzaQR 

Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studio, this is the Dave Ramsey Show, where American hangs out to have a conversation about your life and your money. Sitting in for Dave, I'm Chris Hogan, and I'm joined in studio by national best-selling author, Mr. Anthony O'Neill. How are you, Mr. Anthony? Mr. Chris Hogan, I'm doing good, sir. How about yourself? I'm doing fantastic, my friend. As I tell people all the time, I'm focused and not finished. Oh, man, I'm blessed and highly favored. I like that. I think you got me on that one.

Here's the deal. I know you've got questions about money, and guess what? We're here for you. So put this number in your phone, people. 888-825-5225. Again, that's 888-825-5225. Just go ahead and make a contact in there so you can reach out and let us know what's on your mind. Now, you also can find us on social media,

at Ramsey Show, and you can feel free to send your question in that way. Or you can find Anthony at Anthony O'Neill or me at Chris Hogan 360. So we love taking your questions. And Anthony, as I've found, when people get the right information, they can make progress.

And the reason why they're making progress is because they made the right information. Well, they've got to have the right information. Got to have the right information. So we're going to get to the phone here. I've got Zach on the line out in Washington. Zach, how are you? Hey, not too bad. Thanks for taking my call.

Oh, you're welcome, my friend. What's on your mind today? Hey, I just have a quick question regarding a car loan that I have. I have my baby step on, my $1,000 saved, set aside. Good. I make about $80,000 a year. Okay. Total debts are $22,000 on a car, $13,000 in student loans. My question is, do I pay the

car down enough to sell within about three or four months or so, or just try to pay the car off completely in about nine to 10 months? It's a great car. It's got 20,000 miles on it long run I'd like to keep the car but long run I'd also like to be debt free okay what Zach I'm curious what caused you to get to the point where you say I'm sick and tired of this debt I want out well the the long story short of it is I doubled my income this year um and I had all this money, and I looked at it, and I just said, I want this to be mine. I don't want the money to be anybody else's.

I earned it. I earned the increase in my income. I want it. Yes. Let me ask you, what line of work are you in? What line of work are you in? I'm in aerospace. I'm building aerospace. Okay.

I'm building drones. Okay. Yeah. Fantastic. Double your income. That's a big deal. So the only debts you have are $13,000 in student loans and $22,000 in a car. Yes.

Okay. Do you own, are you buying a home or are you renting right now? I'm renting. I'm renting. I'll probably rent for a while because I'm not sure if I'll stay in Washington. That's where the doubling of the income came from, moving from Arizona to Washington. Okay. See, the thing that I like that you're saying, Zach, is that you like this car. How much is the car payment right now?

It's $470 a month. Okay. How much have you been paying on it? I've been paying the minimum because I had called the finance company, and their situation for paying it off early was kind of weird. They mentioned that if I give them, my plan is to do about $3,000 a month in payments. They said that it would only prepay the next three months, and the leftover goes towards principal. I want that entire payment to go to principal. That's right.

That's right. I don't want to keep paying interest. Well, and here's the deal. And Anthony, I want to hear you chime in on this. With your income being what it is, I'm going to tell you to stay true to what we teach and as far as the debt snowball. I want you to attack, again, the student loans and then attack the car. You can do both. And like you said, having this car paid off in the next seven to eight months, now you've got it free and clear.

You drive this thing and be intentional. We all know finance departments of vehicles, they don't want you to pay it off early. They want you to go low and slow so they can get as much interest as possible. Yeah, and here's the key thing, man. I will call them back and tell them what you're going to do. Don't ask them. Tell them, hey, I'm going ahead and make this for this payment. But the extra money I wanted to go directly to the principal balance of of the car loan. And I agree with you, Hogan. You said, hey, I'm willing to sell it within three months. But it sounds like you like the car. You're a young man. You're not that much in debt. You're making good income. So this means by the end of this year, you could be out of debt and you're driving a good quality car that you had a pink slip to. I'm with you, Hogan.

I want you to keep it. But here's the thing. Do not sleep on it. I want you to go ahead and put that $3,000 towards the car. Call them and tell them, hey, I want to actually go towards principal. Do not take no from them or say, hey, it's going to push you ahead of time. That's what they're going to say. But tell them what you want to do.

You'll be out of debt in the next few months. You really can. And again, with the debt snowball, America, what we're talking about is smallest to biggest. So, Zach, you've got $13,000 in student loans and $22,000 in car loan. You're going to make minimum payments on this car loan while you throw every extra dime toward the student loan. And that's the deal. And I like what you said. You looked at your income and realized you wanted more of it staying with you. You get tired of sending

it to other people. And as Dave always says, when you get sick and tired of being sick and tired, that's when something will change. So I'm very, very proud of you. Okay, let's get back to the phone here. Next up, I've got Janice on the line. Janice, how are you? I'm doing great. How are you? Oh, we're doing fantastic. How can we help you today? Well, I'll be nice and get some advice. My husband has $120,000 in student loans.

He has, what is it, $80,000 in private and $40,000, give or take, in federal student loans. So I just feel like I'm robbing Peter to pay Paul 24-7. Okay. What's your household income? About $90,000. Okay. About $90,000. Is that all you all have is the student loans, or is there any other car loans or credit

cards? We have two car loans. We only have like $300 in credit cards. And then, of course, my house mortgage. Okay. We only have like $300 in credit cards. And then, of course, my health mortgage. Okay. How much do you all owe in car debt? It's about $30,000 total between the two vehicles. Okay. And how much are you paying out in car payments? About $800. Yeah. Yeah. You got a lot happening. Anthony, what's your thought? You know, Hogan, this goes right back to what we just said on the last call. We've got to work baby step number two.

I understand when we see this $120,000 in student loan debt, it gets us kind of discouraging. But, Janice, what I'm going to recommend you is go ahead and just sit down. Number one, you've got to get on the budget if you're not on the budget already. And then two, you've got to go ahead and just work the baby steps, smallest to largest. And when you do get to the student loans, I really want you to get aggressive at it. And you have to really focus with these student loans. That's something I'm very passionate about, you know, that Hogan wrote the book on a debt-free degree. But I want to make sure that we can attack it. But I'm going to say we got to work baby step number two. I agree. Janice, you said that you're

tired of robbing people to pay Paul. Is your husband involved at all in the money? No, I pretty much handle all the money. He gives me a portion of his check and then I go without. My problem is, is on top of it with doing a budget, I work, I'm a commission sales rep, so I fluctuate. February is extremely slow for me. Hey, Janice, hold on. Do you all have a joint checking account? We do not. We do suffer.

See, that's the problem. You guys are approaching this two individuals instead of working together as a team. You need a joint checking account. You need to sit down together. Shoulder this thing. Janice, you shouldering all of this stress by yourself, it's going to have you stressed out and wigged out, and he's skipping around like nothing's wrong. Get together

on this thing. Lock arms and attack this. You can fix this if you decide to. You just got to make a choice. Stay tuned. This is the Dave Ramsey Show. We've been voted one of the best places to work in Nashville 11 times. You want to know how we do it? Well, our team has been using LinkedIn jobs for years to find the best people from all over the country to come and help us change lives. Think about it. LinkedIn has more than 600 million active members. I'm talking about people who come to LinkedIn to make connections, grow their

careers, and discover new job opportunities. In fact, 90% of LinkedIn users are open to new opportunities, but not actively scanning job boards. This means LinkedIn Jobs gives you access to an entirely different demographic. Don't wait. One hire can change the direction of your company. Post a job today at linkedin.com slash Ramsey and get $50 off your first job post. That's linkedin.com slash Ramsey. Terms and conditions apply. Hello, everyone. You are listening to The Dave Ramsey Show. And before we went to break, I got a few kind of messages. People were saying, Chris, you were too hard on Janice, the lady that was on the line before we went to break.

And no, I wasn't. What I was trying to do was to encourage her. Right now in the bill-paying sector, she's handling it all. And the husband's not involved. In fact, she said, and I quote, he gives me a little bit of his paycheck toward the debt. Well, this is not participation. This is too much for her to shoulder on her own. Thus the reason I said they need to get a joint bill-paying account.

No more of these separate things. The separate account means you're having a separate thought process and how you're proceeding to look at this and to be unified, to be together this and to be unified, to be together and to be intentional, sitting down, looking at the budget together, walking through it and really understanding what's going on. Right now, Janice is the one who is having a headache and heartache over the debt because she's the one that's wrestling with it by herself. And I just think many hands make light work.

And so for the husband to get plugged in, so I was encouraging her to really sit down and let's go with this thing. But she can't do it alone. So it's important to work as a team. It very much so is, Hogan. Here's my thing. How can you get to the end goal if you're not walking together, if you're not walking hand in hand? You know, the end goal should be to build a legacy, to build wealth,

to get out of debt, to pass down something. She can't do all that by herself. I agree. And he can't do it all by himself. It has to be done together. And coming from a single man, that's something that I desire and something that I'm teaching young people, millennials right now. Like, hey, yes, we're operating as singles today, but tomorrow when we are blessed to find our spouses, finances, we need to have a conversation together every single month at least once a month when we're doing the budgeting so we know where we're going together

i completely agree now and and you're not alone if you're out there if you're single or newly single yeah and you find yourself in that situation you want to find an accountability partner someone that cares enough about you to ask you questions so you can check in and really get on the same page. Go ahead. Now, an accountability partner is not your best friend who likes to spend a lot of money. No. No. No.

Accountability partner is somebody that will tackle you. Yes. And have a tough conversation, you know, like I do you. Oh, so really, Hogan? Well, we had a conversation. But you know what, though? You did help me. We had a conversation last week.

You did help me. I did. You did help me. And I made the right decision, America. I'm proud of you. I made the right decision. I'm proud of you. I didn't buy that expensive car.

Nope, you didn't. And I was so glad you trusted me enough to talk about this. I did. And we did. We had a conversation. And it is good. Because here's what I found. It wasn't that you needed my input.

It was a matter of you talking it out loud and looking at it and going, hey, no, you're right. I don't want to get caught up in this moment. What's best for me in the long run? And as I told A.O., I tell people, I want you to make a two-year decision. And what I mean by that is I want you to make a decision today that you'll look back on in two years and you're glad you made it. See, that causes us to raise up and look out ahead and not be too short-sighted.

Well, actually, I made a good decision. It's going to last me at least four or five years. Okay, good. I'm going to hold you to that, too. Hashtag accountability. Back on the line, I got Sam on the phone. Sam, how can we help you? How's it going?

Good, good. How are you, sir? I'm doing pretty good. I was calling in today to get some advice on saving money. Okay. All right. Last year, I made about $45,000

and I'm 19. Oof. But I got nothing to show for it. And I got about $3,000 in credit card debt and then $2,000 on a loan

that I took out to get some stuff for my new apartment. But I'm kind of mad at myself for not having anything show for the 45 000 i made last year so i want to do something different yeah that's good that's good that's good so you're five thousand dollars in debt you're 19 years old making 45 000 a year like man that's amazing you

have some people graduating with bachelors making about 38 to 50 so you're in a good place right now tell me a little bit about yourself are you you in college right now? What are you doing with your life? Are you in the career field? Are you in school? Are you in trade school? What's going on with you right now? I actually decided to go not the college path, but the career path. Right now, I'm working at the

post office. I'm a rural carrier. It's not really a steady job, but I'm making it a steady job but i'm getting i'm making it a steady job by um working every day yeah but it's not a full-time job it specifies a part-time job yeah yeah but i've right now i've been working full-time i worked full-time all last year sam you know one thing that i liked what you said was i'm i'm upset with myself because i do not have i cannot show how much money I made last year.

So you're young and you're already acknowledging the fact that, Hey, I need to start making better decisions. So here's the number one thing I want you to do. I want you to get on a budget, every dollar budget. Okay. And if you're making $45,000, I'm going to pray. I just going to believe that you already have a thousand dollars in your savings account. Correct? i have zero savings okay so now so not so now hogan this this is where we have a problem man now i'm starting to get frustrated with you uh so we

need to go ahead and get on a budget okay i need you to stop spending money right now i want you to focus on getting a budget and listing out all of your income listing out all of your expenses and we need to follow the baby steps man okay bottom line thousand dollars in your emergency on getting a budget and listing out all of your income, listing out all of your expenses. And we need to follow the baby steps, man. Okay, bottom line. $1,000 in your emergency fund, then we're going to tap the $5,000 in debt that you have. But making your income right now, that should take you no more than three to five months. No, I agree. And Sam, I am proud of you for being 19 and waking up.

Many people haven't woke up yet. They're still making, working hard and leaving the people they love the most to go work with some crazy people, and they don't have anything to show for it. So for you being 19 and to see that and to feel that already, that's your wake-up call, because that's exactly what I felt. I was frustrated and irritated. My income was growing, but my results weren't. And so this is where you are. You've got to clean up. You've got a $5,000 mess to clean up. But as Anthony said, you want to get that $1,000 in place right now, first and foremost, and really start to get intentional. Once you get out of debt, I want you to build up a fully funded emergency fund and baby step three of three to six months expenses.

I like the idea with you right now, this being part-time. I like the idea of you leaning towards six months of being part-time, I like the idea of you leaning towards six months of expenses. And then I want you to get started investing because you're at that age and stage that where you start investing here in the next year, you're going to put yourself in a beautiful position to become an everyday millionaire. What we have to do is we got to make decisions. These decisions, it's crucial, Anthony. And again, people can do it. Let's get back to the phones. I got Daniel on the line down in Texas. Daniel, how are you? I'm good. How are you doing,

guys? Oh, I'm focused and not finished. What's on your mind, buddy? Hey, so my wife and I have started our fostering to adopt journey. So going from zero kids to two to three is the plan, and ultimately for permanent, you know, having kids, you know, that way. three is the plan and ultimately for permanent you know having kids you know that way um what is the best way for us to budget we're debt free we have our savings we've kind of already started the investment route of our lives um i guess not kind of we've done that now it's just the kid route is so new to us um so what i mean that's what we're looking for some advice on that right on that end of the spectrum, because kids aren't cheap

necessarily. We're smart with our money. We just want to continue that way. I think it's extremely unique. Before we get into the tactical side, what caused you all to want to do this? Because this is an amazing thing to open up your home to kids that don't have one.

Yeah, so sorry if I break down a little bit so it's uh we enjoy it so much um so we um you know we we we can't have kids on our own that's kind of the backstory um but we um also that's not really the main reason the reason is that we have the ability to be financially stable and give kids a life that they can have that they may not be able to have somewhere else you know whether it be they're in our house for a day or they're in our house forever until you know they move out then we have the ability to hopefully pass on something they they may not be able to have and um i think that's

kind of what the pure and undefiled religion if you read the book of james that's kind of what the pure and undefiled religion, if you read the book of James, that's kind of where our heart is, is that we love the widows, love the orphans. Yes, sir. And we want to be able to give someone else an opportunity to have a life that they may not be able to have. That is absolutely amazing. And so you guys don't have debt. You've got your emergency fund in place? Yeah, we do. Okay.

And are you guys? We have about four months. Okay. We're continuing building that up. Very good. So you've been investing for the future, correct? Yes, sir. We've been, yeah.

So my job, I work for a city job. Their retirement fund is there. I also do a 457. I just started that recently, actually. And my wife has her 401K we've been investing in. Okay. That's it. So, yeah.

So, and my job matches my retirement two to one. So, pretty much 21% of my check goes to retirement. Very good. Daniel, I want you to hold on the line. We're going to go to the break. Because when we come back, I want to talk about the budgeting and how do you do that with kids. Because you're right. There's a process to that.

And you've got to have a game plan. So, stay with us. We'll be right back. This is the Dave Ramsey Show. Hello, everyone. This is The Dave Ramsey Show. I'm Chris Hogan, filling in for Dave, joined in studio by bestselling author Anthony O'Neill. And before we went to break, we were on the line with Daniel and Daniel was calling in because he and his wife are very intentional about wanting to foster some children. They're out of debt. They've got an emergency fund. And he was calling in just wanting to know what are some things to budget for and to be able to look out for. And Daniel,

again, I want to just thank you and your wife for your hearts to be able to reach out and to be able to help. Looking at this, here's my thought about the budget. You said you all are sitting at right at a three, four-month emergency fund. I like the idea of bumping that up to around six months. But then starting to look in the practical side of things of the typical expenses. Your food budget is going to go up, obviously. You might have more entertainment. And so as you look at this, beginning to give yourself an opportunity of what is the buffer

as you're looking at your budget. But as we were during the break, Anthony brought up some good questions that he wanted to ask. Yeah, Daniel, let me ask you two quick questions. Currently, where are you living? Is it a one bedroom, two bedroom? And what kind of car are you driving? Is it just a small enough car for you and your wife, or is this a car that could hold the three potential kids? Yeah, so we actually have a house. We did kind of do something out of order, so slap on the wrist there. We did buy a house last September.

We were able to put some money into it. Kind of shocking. We actually had to pay off debt twice. we're able to put some money into it. Kind of shocking. We actually had to pay off debt twice. We kind of got our emergency fund built up, paid off all this debt, bought a house and invested, put a lot of repairs into it. So we have some unexpected repairs that knocked us out of it, but we built up our money again to get to a point where we could be where we are.

Cool. And what kind of car do you have? So we have a small Honda Fit, which is a five-seater car. Then I have a beater van, I guess you could say. So I drive the minivan proudly every day, though, to get it paid off. And Don's worried about that. Absolutely. Well, where you are, what is the average for fostering a child per month?

I know the national average, it can range anywhere from $650 to $850. But do you know, for example, where it is for you in Texas? Are you talking about money you receive? Correct. Yes, sir. Yeah, that just depends. Our agency pays us a little. And honestly, sorry, because we try not to use that money necessarily because we feel like we want to budget our money but if it's money we're given we usually use it for child care and things okay um i know man typically i want to say the daily rate oh i don't remember

i can't even list it i want to say it's around like the there's a daily rate i can't remember is it like 30 is it like 30 bucks yeah it's like 30 all of a day for your basic and it goes up for depending on what level. Okay. Well, I love that you guys – I think here's what I want to caution you on. Typically in situations like this, your natural tendency is to think you need bigger, a bigger vehicle, a bigger place to live, and you don't. What these kids need is stability, and that's what you guys are going to bring to the table.

And so being prepared from a food budget standpoint, obviously depending on the age and stage of the kids that come in, but just be ready to just love on them and guide them. And, again, I'm proud of you guys, praying for you, and hoping that you really are able to make a serious impact on these young people for as long as you have them. And so I think that is a true ministry and takes someone with the right kind of heart. So I want to congratulate you for that. Thank you very, very much for your call. Next up, we're going to California and I've got Carlos on the line. Carlos, what's your question for Anthony? Hi there. My question is if I should stay for four years and buy a house in cash, or if I should buy a house in a year and stop renting. Man, that's a nice one. Give me a little bit of information about yourself, Carlos.

Where are you at on the baby steps? Are you debt-free? I'm guessing you're debt-free and you already have your three to six months of expenses, right? Yeah. So we actually, the emergency fund is going to be fully funded next month. Okay. So we kind of wanted to, and when I say we, I mean my fiance and I, we kind of wanted to start getting ready for it, seeing what's the next move. How old are you? How old are you two? I'm 29.

She's 27. Okay, cool. And how much is, what's your income a year? So I grows around $275 to 325 and she makes around 55 and obviously we're not counting it because we're not married yet we'll be married in september okay cool great so how much of a house are you looking to buy in california because i mean i'm from san diego so that's not a cheap area to buy yeah no so we're actually looking at a townhome, something around $600 to about $650 or so. Cool.

Out here in Chino Hills, Yerba Linda. So it's definitely expensive. Cool. And you feel as if within four years you can pay cash for that? Yeah. So right now in our current, we're renting for about $2,300 right now in an apartment. Okay. And we feel that we can save around $125 to $150, maybe a little bit more, just depending

what kind of year we have. Yeah. You know what? Man, I actually like the fact of you, if 29, she's 27, so this means by the time you turn my age, 35, you can pay cash for a home. As long as you're following the baby steps and as long as you're still investing I don't have a problem with you being patient and buying cash but if you decide to go in and buy it now

within the next year there's nothing wrong with that but I'm always going to lean towards the side of going ahead and paying cash Hogan now I'm proud of you guys Carlos with where you are so you don't owe on anything else right now no no we actually followed the baby steps.

We were, I want to say maybe, or I was more like maybe $160,000, $170,000 in debt and paid it off in around 18 months or so. Wow. What kind of debt did you have? I was young and stupid, so I bought

myself a supercar and it you know it goes from there and i paid that off a little bit and credit cards and all the different stuff and uh a supercar what kind of car was that uh an audi r8 i don't know if you've heard of that yeah i've heard of it man yes sir what happened carlos what caused you to look at that debt and say no more well i was around uh 20 25 and around that time and i bought it and then um you know two years passed and then i started realizing that you know i make all this money but uh i'm still kind of living you know paycheck to paycheck and you know just uh not really really making that money grow and you know being where i should be

and then um uh i decided to get rid of the car stop buying you know grow and, you know, being where I should be. And then I decided to get rid of the car, stop buying, you know, stupid things that, you know, a young person, I guess, would be buying and didn't know how to manage money. So, yeah, that kind of happened. And for the last two years or so, something around that, I've been really focused on, you know, becoming a millionaire. Gotcha. When are you planning to get engaged? We're already engaged. We are being married September of this year. Okay. Gotcha. And so you guys are already having conversations about money, even though you're not married yet.

Right. So, uh, we did our own baby steps. She had her own dad, very small compared to mine though. And she paid hers off a long time ago and well and mine took a little bit longer, so I just finished in December. And then now my emergency fund and, you know, get all that taken care of. So we wanted to make sure we were getting married with no death. Yes. Well, I'm very proud of you. I'm proud of your focus. And, again, looking at this, being really intentional.

And California, you California, the West Coast, it's real easy to get one-eyed us. It's real easy to look at what someone else has and really get your eye off the ball of what it is you're doing and what you guys stand for. And so I like your mindset. I like that you've been through some stuff and had to clean up a mess, but I like that you're focused now and you're very intentional on what it is you're doing. Talking about buying a townhome for the dollar amount you're talking about and discussing $600 to $650, you totally could save up and pay cash. Or if you were to move forward, you could still attack it and pay it off. So either way, I like the idea of you having this thing paid off before you ever get close to being 33 years old, which gives you an amazing advantage

if you stay focused. And so it's about being intentional. And I'm proud of you and I'm proud of the direction that you're going. Okay, Anthony, I want to hit you with a social media question. Go ahead. It says, this is from Cameron from Instagram. He goes, I've worked hard to get a couple of scholarships to the state university. I've wanted to go to my entire life. There's

still some that either I or my parents will need to pay. My dad wants me to go to a local community college. I don't want to do that. Can't I just take out a loan for the rest of the school I've always wanted to go to? No, sir. Here's the thing, man. It doesn't matter about where you start. It doesn't even matter about where you

finish. It matters about how you finish, Hogan, and how you finish is debt-free. So I agree with his father when it comes to going to a community college, save those scholarships, continue looking, and then you can transfer to your dream school from there. I like that. Being intentional. You don't want to start off in the hole. We've got a $1.6 trillion problem with student loans right now. And Cameron, we want you to avoid that pitfall. This is The Dave Ramsey Show. hello everyone you are listening to the dave ramsey show i'm chris hogan filling in for dave ramsey and i'm joined in studio this hour by national best-selling author anthony o'neill and anthony you are busy you you are ripping and running and going all over the place but i know

you are highly active on instagram i I really am, Hogan. You know, right now in celebration of Black History Month, something that my team and I decided to do was, of course, celebrate all the history throughout this month. But then also I wanted to have a conversation with current African-Americans who are young, millennials, older, wiser, mature. And I just brought them all together. And we actually had a conversation about, you know, where are we as a culture when it comes to finances,

financial literacy? How do we feel we can build wealth? You know, how do we continue moving forward in celebration of this amazing month and month of February? And so we've been having a lot some deep conversation, man. Some of the answers and responses has been shocking. Uh, but they can head over to my YouTube or to my Instagram and catch a lot of clips of them. Either one is at Anthony O'Neill on both YouTube and Instagram. But I'm telling you, man, the conversation has really taught me a lot of, uh, some things that I need to be teaching when I go into the minority communities. Very good. Very good. Well, I'm going to tell you, green is a color we all deal with. We call money. And we need a plan. And unfortunately, we can work hard and work really,

really hard and not make any progress. And it's frustrating. And so if you're out there and you're deciding, I want this year to be my best financial year I've ever had, I'm going to tell you without a shadow of a doubt, Financial Peace University is the course for you. This is a course that is going to guide you and to be able to help you understand the steps to take inside the membership. You're going to have access to a lot of content, a lot of information that's taught by Dave, Rachel, and myself. We've got some new stuff coming that Anthony will be involved in as well. And it just gives you an opportunity to get some solid footing. It is so frustrating to work hard and not make progress. And we got a unique opportunity. Anthony, I'm going to tell you this. We talked about this at the Financial Peace Live. I was

telling the audience, I used to be of the mindset that I needed to wait for my income to grow before I can make progress. And that's not true. Because if you can't handle where you are right now, making more is not going to fix it. You see, what will happen is you'll end up getting more stuff. That's what I did. I had stuff-itis. And so you have to have a wake-up call. And you have to look and say, no, I'm going to manage the $30,000 or the $40,000 or $50,000,

whatever it is to the best of my ability. Then something amazing happens. As you start to get more intentional, you give yourself a raise. When you get out of debt, you give yourself a raise. And so we've got an opportunity to still chase down our dreams. What we do, what we need is the right plan and the right purpose to help us get there. Okay, getting back to the phones. If you've got a question, we want to hear from you.

The number to call is 888-825-5225. Again, that's 888-825-5225. Again, that's 888-825-5225, or find us on social at Ramsey Show, or at Anthony O'Neill, or at Chris Hogan 360. Okay, I'm going to the lines. We've got Janelle on the line in Utah. Janelle, how are you? Hi, I'm doing great. Thank you so much for taking my call. Oh, it's an honor to speak with you. It's a pleasure to speak with both of you. Well, thank you. It's our pleasure.

Well, thank you for what you do. I'm such a long-time listener, and we've had all the financial diseases melt me on, and it's been a long road, but we have come to a place where we just need some big brothers in our lives right now to help us make some decisions. Well, what kind of decisions are you looking to make? Well, we have paid off a whole bunch of debt. We've seen the bottom and beat our way out of the market crash in Las Vegas. We finally found ourselves in a place now where we feel like we have a critical decision to make, and that was our home. Our market is high right now, and we have three kids who will be going to college by next year. And we're in baby step number two the only debt we have left is 40,000 on a HELOC

and we have this beautiful home that we love it's bigger than we need it has a basement apartment with my my mom is currently living there right now. Okay. And we just feel like we kind of have a golden ticket. Everybody's on board to make the right decision, and we just want to do it right. Okay. Whether to sell or stay and use. Okay. All right.

So tell me this right now, Janelle. What's your household income? Household income is $150. Okay. And how much do you owe on the first mortgage? We owe $320. Okay. And how much did you buy the home for?

We bought the home for $405. $405. Okay, and you all have been in this home about how long? About 10 years. Okay. So have you all talked to a real estate agent to get an idea of what? We have. Okay, so what are they saying the value is right now?

So it's an ELP in our location. They said we could list the home for $670,000. Okay, $670,000. All right. And so right now you guys owe around $360,000 on it. First and second mortgage. The HELOC is a second mortgage, by the way. They just don't ever market it that way. So if you were to do this, where would you all, what would you do you do to live well our thoughts are that we would possibly just rent for some time and wait for the market to stabilize a little bit and then just buy it buy a home well again we just we want to buy it well okay um if that makes sense that's kind of where we start going well or do we stay and rent out this apartment for $1,100 a month and have some long-term money to go into retirement?

Is your mother living in that apartment? Is your mother living in the apartment right now? She is because it's convenient, but we have space in the home where we could even move her to a different room and still have the apartment available. Okay, and you said you have three kids going off to college this year. Did you all have triplets? we could even move her to a different room and still have the apartment available. Okay. And you said you have three kids going off to college this year. Did you all have triplets? No, no, no. No, we had, they're close, but we have one that's a junior,

we have one that's a sophomore, and one that will be a freshman. All right. And I just have to double-check, Janelle. So you all, what else do you owe on outside of the home? Nothing. Okay. So you don't have a car loan, student loan, credit card or anything. I'm just clarifying. No, sir. We're on the path. All right. And how much is your payment on the first mortgage of 320? It's 2,500. Okay. And how much on the $40,000 HELOC? $500. Okay.

Do you know your interest rate on your first mortgage? Yeah, it's three and a quarter. Okay. All right. I'm looking at this. I mean, if the mindset is I would have to ask you and your husband, what's your husband think about this thought of selling the home? We're just sixes we we feel like that he he said he's really we're just both turned on into getting in retirement phase and just saving up and just really start hammering away at retirement and getting our emergency fund and everything put put away how much do you all have toward retirement right now?

Not much. We have $41,000 in a row. Okay. So around $41,000. Because here's the mindset. Here's what I'm asking. You're on a steady appreciation rate with where you are right now. The mindset is this.

If you were to sell this home and you were to, say, end up with, I don't know, 175,000 or whatever in equity, and you put that toward retirement, but then you turn around in two years and go back into debt for a mortgage, then what you see, well, we've done is kind of the shell game. You see what I'm saying? And so mindset wise, I think you guys really sitting and talking about it. You know, if you don't owe on anything but this home, could you call it an option of selling it? Yeah. But I think best case, you've got a good interest rate, a decent interest rate on it.

You know, you guys, what you've been doing is you've been borrowing. Okay? That's the HELOC. And so the mindset. So this is going to be more of an attitude change more than just a plan change. You've been on the plan. I don't know. Anthony, what's your thought? No, no. You just said

what I was going to say. I like that, Hogan. Yeah, I think it's important. So you guys can sit and chat about the options. I like you stay and put where you are. You just need to start investing 15%. That's it. And then you need to start putting money toward the college and what you all can cash flow. Everything else extra is going toward the house.

I mean, that's the key. We've got to get this mortgage out of your life. I mean, that's the root of it and being intentional. Well, listen, I want to thank all the callers for calling in. Thank you so much for calling in with your questions. I want to thank all of you for listening and tuning in. I want to thank James Childs. I want to thank Amanda Rogers, call screener. And I want to thank you, you for listening and tuning in. I want to thank James Childs. I want to thank Amanda Rogers, call screener.

And I want to thank you, America, for tuning in. This has been The Dave Ramsey Show. This is James Childs, producer of The Dave Ramsey Show. Did you know you can now listen to The Dave Ramsey Show on Pandora and Spotify? For all the ways to watch and listen, check out our show page at DaveRamsey.com slash show.