The Ramsey Show - App - I Still Own a House With My Ex-Wife! (Hour 2)

Episode Date: August 3, 2021

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Ramsey Show, where dad is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. Ramsey personality George Campbell is my co-host today here on the air as we answer your questions about your life and your money. Open phones at 888-825-5225. That's 888-825-5225. George is launching, along with the Ramsey Networks and our whole podcast division,

a new podcast today, or actually launched yesterday, technically called The Fine Print. That's right. The hidden truths that are keeping you broke. I just love a good podcast, Dave. I hosted our Borrowed Future podcast. I host the Entree Leadership podcast. I thought, why not one more?

There's room. And so we did it. It just launched. We've got a 10-episode season that's coming out right now. And here's where it all came from. You've been taking calls like this from people who fell for money traps. And a lot of people out there are not where they want to be financially. Wouldn't you know it?

And they don't know who to trust. They don't know what to do, the steps to take. They're listening to headlines. They're listening to social media. They're broke friends. To make all these major money decisions. And we believe that winning with money doesn't have to be complicated. And so what I want to do is do the research for them, break down the myths,

break down the traps, help them understand the trends, so that they can make smarter decisions with their life and their money. Ah, there we go. Check it out. George Campbell and the team, the new podcast is called The Fine Print. Anywhere great podcasts are sold. That would be on, of course, what, YouTube? No, not YouTube.

We are on YouTube. We are on YouTube. Yeah, it's 2021. You've got to be everywhere. So we're on YouTube, Spotify, Google Podcasts, Apple Podcasts. You name it. We're everywhere if you just search for The Fine Print. And we're trending closely to The Ramsey Show.

I'm starting to get nervous for you, Dave. Okay. If you knock it off, it'll be in The Fine Print. That's right. We'll do an episode on you. That could be scary. You never know. Yeah, the first two episodes have already dropped,

How TurboTax is Screwing You, and the true cost of credit card rewards. Be sure and check them out. David's with us in South Bend, Indiana. Hi, David. Welcome to The Ramsey Show. Hey, Dave. Hey, George.

Good to talk to you guys. You too. What's up? So me and my wife just got married on July 24th. Congratulations. Thank you. Thank you. So we just got back from the honeymoon. So with the wedding gifts we have from all our guests, we got about a little over four grand that we have our choice to choose from.

The thing is, my wife, she's pretty much on baby step three now. Now, my situation is I'm still on baby step two, and I owe about 25 grand. So, you know, now that we have some cash that we need to make a decision with, I know that she feels we've had discussions, and I'm on speaker right now so she can hear you too, but we've had discussions that, you know, whereas in this, even we got married, but this is more my debt. I mean, it was my stupid decision that I still got $25 left to pay.

Sorry. I'm sorry you're wrong. Your wife already wins the first argument. When you walked down the aisle and the preacher said, and now you are one, all that BS you just spouted went away. You don't have my debt and your debt anymore. You don't have my anything anymore. We have our.

Your pronouns changed. You're home from the honeymoon. And so we have a pile of debt, and we have some money, and we have an income, and we are going to develop a plan that we are going to work together, or you're going to struggle in your marriage and in your wealth building both. Data from 30 years of working on this backs up what I'm saying, David. 30 years, millions of families we've worked with. Very few people build wealth when they act like they're a joint venture instead of a marriage.

Very few people have a high-quality relationship when they act like they're a joint venture instead of a marriage. Yeah, it sounds like you're both on Baby Step 2 as a family. Is that right? Yes, sir. like you're both on Baby Step 2 as a family. Is that right? Yes, sir. Now we're talking. Okay, now we can talk numbers. We've set the table here, Dave. So let's talk about this. You've got $25K in debt. She's got this emergency fund. If you guys brought all of that down to $1,000 for that Baby Step 1 starter emergency fund, how much cash would that leave you to throw at this debt? Well, actually, me and her both have Baby Step One done. Like, we both have the $1,000 saved. Okay, so now we have $2,000.

Yes. Okay. And we have $4,000 from the wedding. So now we have $6,000. Am I right? Yes. Boom. Okay.

And you have $25,000 worth of debt that you're bringing to the table, and she's going to bring how much to the we? She has no debt. No debt. She's got an emergency fund, right? Oh, I'm sorry. Well, she's got a mortgage. Okay. She's got the mortgage on the house.

Are you all moving into the house? Yes, we moved in together. Great. So we have a mortgage now. Good. Okay, good. And so you really got to practice this. That's why I'm being so dramatic about it. It took me a few years in my marriage, David, and it was disastrous. I'll just tell you, it's very, very difficult. going to be responsible and i'll clean up my mess and i'm not going to ask my wife to clean up my mess and i appreciate the manhood of that and i appreciate the strength that that represents and the response personal responsibility that that represents but the power of a couple working on something supersedes that and so you've got to let her in it's in sickness and in health so if you get the flu she gets to make you soup that's how it works if you know in sickness and in health for richer for poorer uh and the old wedding vows david said unto thee all my worldly goods i pledge right after the said

sickness and health thing right and richer for poor and that was the final part in the book of common prayer and so uh and there was something to that this idea we're going to leave our parents the sickness and health thing, right? And richer for poorer. And that was the final part in the Book of Common Prayer. And there was something to that, this idea we're going to leave our parents, cleave to each other, cling to each other in desperation and work this stuff through. So how much do you guys make a year? I make $55, but I do have child support payments. So after after that it's about $50 a year is what I finish out. Okay. And then about $52 for my wife.

Okay, so you've got $100,000 household income, $25,000 in debt, and $6,000 in savings. And if so, if you work the baby steps the way we teach, and I understand this is all fresh and it may take you a little while to digest, but I'm force-feeding you with a fire hose right now, okay? So what we teach is $1,000 in the emergency starter emergency fund. So I'm taking five grand, throw it at the, at the 25, that leaves me 20.

How fast am I going to pay off 20 making a hundred, probably six months. I say they could do it less. If they go hard at this, they got a team. Now they could do this thing. And, and you know,

beans and rice, rice and beans, and we're going to bust this and you're going to be completely debt free and then we're going to go on start saving our fully funded emergency fund then we're going to start talking about working our way all the way through the baby steps and paying off this house or moving up in house or whatever it is you're going to do there so i think you guys are amazing and i think you're going to do great uh and i appreciate you coming on in front of 22 million people and letting me bust your chops. But that's, you know, you're not the first, brother. So it's, and you won't be the last.

But what I want to do, too, is I want to give you a wedding gift since we just spent your wedding money. I didn't spend it. You did when you borrowed that $25,000. But anyway, so I'm going to give you a Ramsey Plus for a year, which signs you up for Financial Peace University for the two of you to go through together. It puts you in the every dollar premium, the world's best budgeting app, and you'll be able to use all of this together. And, George, that's a great way to get started. I love it. And combine those accounts if you haven't already.

I'm not sure they have. It's time. Good call. Touchdown. Hang on. Kelly will pick up and give you our wedding gift. Hey, I'm Christi Wright. Do you struggle to find time to connect with God? Well, I have great news for you. Glorify is an app that makes it easy for you to have a quiet time practice that works for you. In fact, it's the number one daily worship

and wellbeing app trusted by over 1 million Christians. And the great news is the app is free to download. Just search for Glorify in your app store. You could also access their entire content library at half price by using the promo code Christy. Download the Glorify app today. George Campbell Ramsey personality is my co-host today. Open phones here at 888-825-5225.

When you're struggling with money, it is easy to tell yourself that you'll deal with it later. Or I'll start fresh after the new year. But then later rolls around and you're still out of control. Hey, listen, don't wait. Everyone that does this stuff wishes they'd started earlier. And you will too. So don't make it a bad thing. I mean, don't make it like 10 years ago.

No, go and do it right now. Right now, this is the last month you ever have to worry about money. If you do, if that's you, we're here to help. If you're ready to make the decision right now, and that's why for this month only we are knocking $30 off a 12-month membership to our most impactful and life-changing money products. See, if you want to go to Financial Peace University, you want to plug into the premium version of our budgeting tool, EveryDollar,

you do that with a Ramsey Plus membership, which for 12 months is $30 off in the month of August. See, you deserve to be free. You don't deserve to work this hard and be broke. It's time to change. And the stress, it's got to go. So start with a free trial at Ramsey Plus today by texting TRIAL to 33789. Text TRIAL to 33789. Ascene is with us in Los Angeles.

Hey, Ascene, what's up? Yes, hi. We have saved $200,000 for our children's education, and we will be needing this money seven years from now. So I'm a stay-at-home mom, and my husband works. So we want to invest somewhere where it is secure and it can maximize in seven years. So when my children want to go to undergrad and grad schools, we can pay for the tuition and they remain debt free.

Wow, that's amazing. Well done. So what's it invested in now? They're not invested. They're sitting in bank in my savings account. So I want to invest and see because I have been listening to your show and I wanted to know if I can maximize double or a little more than that. So when my kids go to college, they can just do their studies and they don't worry about this debt and all that.

Yeah. Amen. Well done. How many kids do you have? I have three kids one is already in college and um but he's on scholarship and the two of them are younger so they will take some time like seven years and nine years to be in grad school so that's what i was planning for them that uh at least um they are covered he's uh he's lucky that he got all that, but not everyone is lucky. Wow.

He's got some sharp kids. Yeah, that's amazing. Sounds like the oldest one is like his mom. So, yeah, people who make their luck, those kind of people. So here's an interesting number. If you invest $200,000 at 10%, in seven years it will about double. So it will be worth $400,000. If you don't add anything to it, it will be worth $200,000 at 10%, in seven years it will about double. So it will be worth $400,000. If you don't add anything to it, it will be worth $400,000.

If you invest it at 7%, it will take 10 years for it to double. And so this is the problem. Now, if I have that money to invest, I'm personally comfortable with, and I recommend putting it in good growth stock mutual funds. Now, that does mean you're going to see some ups and some downs along the way. But the averages are well north of 10% on the stock market's history. That's the averages. Now, some years it could be down 4%.

Other years it could be up 18%. And so, you know, it depends on the ride on how you get there. But here's the thing. If it's averaged 10%, if it does half of what it's averaged, we have one of the worst seven-year periods in history, and it does half for seven years because it went way up and then it went way down, down, down, down, down, down, and then up again. And it averages only 5%. It's still five times what you're making right now.

Okay. So there are certain mutual funds like you can go Vanguard or Fidelity, but some of them have expense ratio of 0.7, something like that. So what is a good expense ratio we should be looking at? You know, I spend 85% of my analysis on a mutual fund on its average rates of return, and I only spend about 10% of my analysis on the expense ratios. Because here's the thing if you have a fund that has a 0.2 0.002 percent higher expense ratio but it averages three percent more you just kicked its butt right and so everybody gets caught up on what they what the expense ratios are and what the costs are and they're looking at the wrong numbers you don't want to ignore that number and overpay for expenses

but uh you know you can get you can really miss out on a really great fund with a really great rate of return nickel and diming on the expense ratios so i don't spend a lot of my personal analysis on my personal selection that way uh but it's obviously obviously you've done some research on this know something about it what we teach people to do sit down with a smart investor pro. Yeah. And I'm curious to your thoughts on this, Dave. At what point does she go, let me look at an ESA or a 529 based on my income and see how much we can sock away there for tax-free growth? Going to move as much of it over there as I can. You can't move 200 in one year. Yeah. That's not available that I'm aware of

anywhere on a 529. A lot of 529s are limited to 10k a year so you can move systematically move some of it into different kids names that kind of a thing help it grow and let that you know let's say it did double let's say it went from 200 to 400 that extra 200 is completely taxable unless except to the extent you've got it in a 529 or an esa or both and then of course it's going to be uh completely tax-free on the growth so that's's a really good point you bring up, George. So, yeah, just go to RamseySolutions.com, click on SmartVestor, and sit down with a couple of different ones and interview them. Let them talk to you about how this is working, what's going on, and so forth.

And that'll, you know, once you get the education on it, I think you'll make the exact right decision. Very well done. She's amazing. Yeah. Greg's with us. Greg is in Kansas City. Hi, Greg.

How are you? I'm good. How are you? Better than we deserve, brother. What's up? Well, thank you for taking my call. I'm pretty new to listen to your show, and I'm looking for a starting point. I have about $24,000 in debt,

and I have a big spending problem. And I hear you talk about the baby steps. I don't really know what they are exactly, and I'm trying to figure out a way to get in control of my financial situation. So I want to start a business eventually. Very good. Yeah, and so I'm trying to sort through this and get a starting point on how to get this debt knocked out and move forward.

Cool. What's your income? About $65,000 a year. Okay, so we get $65,000 income, $24,000 in debt. Well, in the baby steps that we teach, if you're going all in, here's how it works. Baby step one, you need a starter $1,000 emergency fund out the gate. Okay. Once you've got that, what's that? I $1,000 emergency fund out the gate. Okay. Once you've got that, what's that? I have that.

You do? I have that. Okay. And more? I have $1,000 in savings. That's all I have. That's all you have. Okay.

Yeah. Okay. So once you've got that, we're going to move on to baby step two, which is where you're going to be at with this $24,000 in debt. We are going to use the debt snowball to attack all of this debt, which means we're listing out each debt, smallest to largest, and we're ignoring the interest rate. We do not care about interest rate. This is about behavior. This is about progress. This is about motivation. And as you do that, you're going to start shaving your expenses. You're going to start taking side jobs. You're going to go on beans and rice because we want

to get rid of this thing fast because you want to start a business. You have dreams. And so use that to fuel this debt snowball journey. And then you're going to take that starter emergency fund and turn it into a fully funded emergency fund of three to six months of expenses. And that might take you, you know, six months after you've paid off the debt. And now we're on to investing 15% of our household income into retirement. And then we can go, all right, what's it going to take to get this business off the ground? Yeah, you get started that way. So baby steps one is $1,000 to recap.

Two is the debt snowball, and that's scorched earth, man. Nothing is going on except getting rid of this debt. And the power of what we're, the reason people are all excited about this stuff, Greg, is the reason it is because it works, and the reason it works is this intense focus because you and i both know we live in a culture where no one focuses on anything for very long and if you will completely dive in and focus on with great intensity this debt you could be debt free in less than a year with your income but that means you don't have anything else going on you don't have a life beans and scorched earth man beans. Beans and rice, rice and beans, no eating out, no vacations. Stop all investing temporarily.

Any money you have other than that $1,000 that's not in a retirement account, you throw it at that debt. It's this complete unbridled intensity and focus and you punch this debt in the nose and get rid of it. Then you don't have those payments anymore. It starts to be very easy to save.

Get that emergency fund in place. Then you don't have those payments anymore. It starts to be very easy to save, get that emergency fund in place. Then you restart your investing in Baby Step 4. Hold on. I'm going to give you a copy of the Total Money Makeover. People always say, when I get this promotion, I'll be able to make a real impact. Wrong. When you make a solid plan on how you need to grow, you can become the leader you want to be. And that's why Ken Coleman, America's career coach and national bestselling author, wrote his new book, From Paycheck to Purpose, The Clear Path to Doing Work You Love. And it's available for pre-order right now. If you want to grow or create a legacy in your career,

you need this book. It's not just a concept. It's a proven, clear path that will walk anyone in any industry through a step-by-step plan to take their career to the next level. Plus, if you pre-order From Paycheck to Purpose today, you'll receive our Get get promoted bonus pack for free which includes the audio book ebook disc assessment an exclusive talk from ken and access to our live George Campbell Ramsey personality is my co-host today one of our favorite things to do is to take a debt-free scream here on the air one of our even more favorite things to do is to have a debt-free

scream on the debt-free stage in the lobby of Ramsey Solutions Live. And there's only one thing we like more than that one. It's one of our own team members. Oh, yeah. I'm pumped for this, Dave. This is some of my favorite stuff right here is when we get the team members who have been walking the talk, not going ish, but going all in on this stuff. And I'm so excited to have this wonderful couple with us today. So Matt and Jessica are with us. so matt and jessica are with

us matt macho is our executive director of data been with us about four years on our team one of our top leaders in the whole organization and uh you did it whoo yeah yeah baby i love it how much should you pay off uh just over 215 000 dav Goodness gracious. And how long did that take? 23 months and four days. Woo! Woo-hoo-hoo-hoo! Spoken like an executive director of data. Four hours and 32 minutes. Well, it was $215,920 and some odd cents.

He knows the some odd, too. He knows it. He knows it. He just didn't want to say it, Jessica. That's right. That's right. No question. So what kind of debt was this? It was our house.

You paid off your house! Baby Step 7 in the house! Woo! I love it. That's so cool. More team members with paid-for houses. It's unbelievable. This is amazing.

This is a growing trend. We were just talking in the other hour. George, he's on track to pay his off by April. This guy right beside me right here is getting ready to join you in this. Way to go, you guys. Thank you. You can do this. Thank you. Congratulations. i'm so proud of you guys thank you it's amazing i know when they announced it the other day in the staff meeting everybody went crazy and uh just cheering you on it's very very cool so uh one of the things we've done this year for those of you

listening is we've taken the whole team that back through financial peace university and uh we're tracking uh the whole team as to how much debt they've paid off, how much money they've saved, how much mortgage reduction has happened, and we're tracking every bit of that, and it's called Walk the Talk. In other words, if you're going to be in here talking about telling everybody in America they ought to do this stuff, then you ought to personally be doing it, too, otherwise you're a bit of a hypocrite, and so everybody's game on, and Matt is one of the ones who paid off their house.

Way to go, you guys! Absolutely. absolutely all right you've been here four years this took 23.4 months right 23 months four days no four days that's what it was okay and um so tell us the overall story what happened what's your whole story jessica well um several years ago i had to get a a bank statement printed out and we were budgeting but not um i wasn't paying as close to my uh spending day to day as i probably should have been and i went to get this bank statement printed out and he said he was going to give me two months um of a statement and so he's standing there with the printer and it's going it's going and it's. And he hands me this booklet when we're finally done,

and I'm looking through it, and it is just filled with these $5 to $25 charges that I just never planned to spend. Whoa. And I realized it made me feel sick. You killed trees with that. Yeah, it was ridiculous. Every time, you know, you spend the money, and it's like, well, it's just this little bit,

and I don't like spending it on myself and getting all this makeup or products. So I felt like I was being responsible with our money. But when I really looked at the sheer number of expenses that I had no idea or had no plan for spending at the beginning of the month. It was a real eye-opener. Yeah, a big epiphany. Right. And so that's kind of when I went to Matt and I was like, you know, I want to be more

responsible with our budget. There's a big difference between that like 10,000-foot view budget and that like 100-foot view budget of like, hey, we're in four, five, and six. We can take our foot off the gas. We didn't actually have to go through baby step two because we had really great backgrounds with our parents, brought us up well. We didn't, you know, we were blessed to go to college debt free. We were blessed to have a lot of, start out our marriage debt free.

But, you know, that's a blessing and a curse, right? Because we never learned how to do that really intentional focus on our money. And so when she came to me and said, hey, what would it look like if we really did this and we really pushed hard and we really got down to the nitty gritty of budgeting and going after this house? And I said, well, let me put some spreadsheets together. Let me do some analysis and figure out. Oh, good.

I get to do a spreadsheet. I was like, oh, let's do this. And it was going to be a four or five year journey, but it was something we were willing to go through. And God has blessed us be, you know, a four or five year journey, but it was something we were willing to go through. And, you know, God has blessed us through the process. So you got connected. Did you go through Financial Peace University or did you end up here first or how did that all connection?

Ended up here first and then kind of got connected to the plan and the stuff as well. I told people, I don't know that I'd get hired today with how our hiring practices are in terms of what we expect from people kind of coming in, in terms of knowing about Ramsey. But we were local, and I was like, hey, I know Dave. I know who he is. I know what he's about. And I'm in line with kind of the general concept of what it means to work the plan. I would say we were at best-ish.

But being here for a little bit of time really quickly taught me what it looked like to really walk the talk, to really do the stuff that we talk about and say, okay, let's get down into every dollar and let's do some budgeting and let's take this stuff serious. And it was amazing what a difference that made. So how do you take this four or five year journey and go, we're going to do it in under two instead? That's not an accident. We've been blessed.

I mean, you know, I've been working here for four years and through that time, I've kind of moved from being an analyst to kind of leading some of the analyst folks to leading all the analyst folks and now working in data over all the data. So God has been very faithful to us as we've tried to work this out. The government's kind of given us some money as well in COVID. Dave and the government. That's all it takes.

I told the kids that's their contribution because they're going to be paying that back someday, right? But we had 2020. We had COVID. We weren't going out. There was nothing to spend money on. So it was really easy to kind of put your foot on the gas and go hard at it.

Wow. Very cool. So what's this house worth? It depends. I mean, if we check now, it might be up another $10,000. Who knows? But somewhere in the neighborhood of $520,000. Okay.

Wow. That's not what we had to pay for it, though. Thank the Lord. Amen. And how old are you two? I am 39. And I'm 41. All right.

And you have a paid for half-million-dollar house. Yes, sir. Absolutely. How does that feel? Unbelievable. It's amazing. I still don't believe it, Dave. It's been a couple months now, and it doesn't feel real, even when I walk through the front door.

I'm so proud of you guys. Thank you. So well done matt you're not only a world-class leader and borderline savant but um but the uh but on top of that you've walked the talk i mean you you didn't try to you didn't try to break the system fix the system you just did it and uh here you sit at 41 years old with a paid for house and and jessica you guys are this is just incredible very very well done and the whole team's half the team's gathered out here not working are you paying them to come here they're just hanging out yeah productivity's gone down to watch this debt-free scream i'm just

saying well you know dave you often ask who the biggest cheerleader was and it's you can see it in the lobby it's all these folks um it's all these folks every day talking about what they're doing seeing other team members do their debt-free screams, just being encouraged over and over and over again. It's been amazing. There's a lot of positive peer pressure around this place. Yes, sir. Yeah. So very well done, you guys.

Good job. So you brought the kiddos with you. You bring them up, their names and ages. All right. This is Patrick. He's 12. This is Alexandra. She's 10.

And coming down in front down here is Eliza. She's almost 5. All right. Very cool. Very cool. And they have also been our biggest cheerleaders. Absolutely. Every time we had extra money come in, it wasn't a question of where it was going to go.

They'd start cheering. We get to put it out towards the house. And now they own their house. And now they've locked this in with this weird event today with their own camera and all this but it's sealed in their soul yeah absolutely that they this is what my mom and dad did the day that we changed our family tree i'm so proud of you guys it's powerful it's very cool all right well just for those of you listening we don't ask our own team members their incomes while all of their peers are standing around so that't make it weird. So that would be a little bit awkward. So we don't do that.

And obviously, we don't need to give him a book because he's got them all. We'll give one anyways. Yeah, you can give any book you want, Matt. I'm just saying. Excellent. Way to go, you guys. Excellent job, Matt and Jessica, Patrick, Alexandra, and Eliza. $215,000 paid off in 23 months and 4 days.

It's a half-million-dollar house. House and everything. We're looking at weird people. Count it down. Let's hear a debt-free scream. Ready? 3, 2, 1. We're debt-free!

Incredible. And the crowd goes wild. I love it. He's an incredible young leader, incredible guy, and just wonderful to see the success that he and Jessica are having. So cool. That's how you do it. This is The Ramsey personality is my co-host today. I'm Dave Ramsey.

This is The Ramsey Show, a show about your life, your money, and your life. Just that simple. Fred is with us in San Antonio. Hi, Fred. How are you? I'm good. Just a quick question. I have a house that during the divorce was given to the ex.

It's $135,000, but the loan is in my name. The divorce was three years ago. And my fiance and I, we went through the Dave Ramsey financial peace class and paid off $38,000 in 10 months. Good for you. And right now we're trying to get a house ourselves. But we are hesitant on doing that because of this other loan that's over my head. You know, we don't know. So the divorce decree was your divorce lawyer sucked because he left you without the house and with the loan. Correct.

Well, the paperwork says that each one has to pay for their debts. So I'm trying to move forward with trying to force, I don't know, forcing her hand to do that. Well, that's, you know, the mortgage should have been addressed in the divorce decree it wasn't yeah it wasn't that's weird yeah okay so basically you don't have anything from the divorce decree to help you um you you you did a quit claim deed on the house and so you gave up your ownership right correct? Correct. Okay. And that was part of the divorce decree or just part of the negotiation? Part of the divorce decree. It's on paperwork.

Okay. Then I suspect the divorce decree addresses this mortgage, but I suspect it just says you stayed on it, and it didn't ask her to refinance within a certain period of time, correct? Correct. Which is what should have happened. All right. So for those of you listening, if you go through a divorce, God help you.

But if you do, for God's sakes, get the mortgage out of your name. That's part of the settlement. Make the person keeping the house refinance it into their name so that you don't end up where he is stuck. Do you remember what the interest rate is on the mortgage? It's 4.5. Okay. Well, the current market is somewhere around 3.

Do you have any money? Fiance and I both together have about $14,000 saved up. Okay. Number one, you don't buy a house with a fiance. You wait until you're married. Okay? Okay. Because you're going to get yourself in yet a different kind of mess.

All right. But once we're past that, the only way out, how's your relationship with the ex? Are you all on speaking terms? We are on speaking terms. Okay. We are on speaking terms. Kids involved? Yes, sir.

Okay. involved yes sir okay so she does not have any reason to refinance this mortgage except that she could get a lower interest rate right so one way to settle this might be to offer to pay her refinance costs if she will go ahead and refin, that way she gets a lower interest rate. You get your name off the mortgage. Okay. Okay. Probably cost you three grand. Okay. I'm guessing.

But, I mean, if you could talk to her about that and say, listen, this is a deal for you. You get a cheaper interest rate and it doesn't cost you a thing. I'll pay the refinance costs to get my name off of it so that I can go buy a house with my new wife. Right. And that sets you free. It's a good deal for her, and it's the end of a bad deal for you, which is also called a good deal. Right. Right.

And then save up some more money. Make sure you have your emergency phone in place. You're debt-free. You have a good down payment before you talk about buying your marriage. Oh, yeah. Yeah, I don't want him paying off the ex's house for fun. That's not a good time. Let's make sure we look at the fine print in that decree.

And like you said, see if she can refinance and take that loan. And it's a good deal for everyone involved. Yeah, the decree would allow her to refinance it, but it probably doesn't require her to. So, again, it's a divorce attorney that's lazy. They mail it in, okay? And it happens every day tens of thousands of times a day. And the bottom line is, okay, we're going to split the house. Mama's going to keep the house, but we're going to put the house in her name. She gets all the equity.

And so you're going to deed the house over to her. And we forget the idea that he's still on the mortgage. So you have to require whoever's going to stay in the house, in this case Mama, to refinance. Or we sell the house, one of the two. But don't stay on the mortgage and not keep the asset as part of your divorce negotiation. That's a raw deal, man. That's tough. Well, you're out of control.

You don't control anything. Let's say that she didn't want to speak to him under any circumstances. There's nothing he can do. Man. He's stuck. Yeah. I'd fix this thing while they're on speaking terms. Yeah, exactly.

Vincent is with us in San Antonio. Hi, Vincent. How are you? Hey, Dave George. Thanks for taking my call. Sure. What's up? Hey, just before I start, I want to say thanks for everything you guys do.

I'm in the military, and I get a lot of junior guys that work for me that don't have any financial knowledge, and I kind of push them your way as a great way to get started. So thank you for doing everything you guys do. Thank you, sir. Thank you for your service. Okay. Thank you. I appreciate that.

So my question for you, gentlemen, is I've got a townhouse rental property and it's in a really hot market and I got a ton of equity in it and I don't currently have an exit strategy. So the cashflow is about 700 a month and its current equity is about 180,000. So my question is, should I have an exit strategy to capitalize on $180,000 worth of equity within the last four to five years, or should I just keep it, use the cash flow to pay down the mortgage, and just enjoy a payoff property down the road? Is this your only property, or do you have somewhere you're living right now with a mortgage? That's a good question. So the military currently has me in on-base housing,

and so this is a house I don't ever plan on coming back to. This is forever going to be a rental. And it's your only mortgage right now? Yes, sir. Okay. Well, that's good news. I mean, if you're in love with it and you like being a landlord, there's nothing wrong with keeping it as long as it's your only mortgage.

But if you're looking to maybe get your own place at some point, I don't think there's anything wrong with cashing that thing out, selling it, and investing those profits so that you're ready to move into something that you want. There's no wrong strategy in your answer. Okay. A, keep it. It's not bad. B, sell it. It's not bad. Okay. There's no end of the world here the the trick is to make sure that um that if you're going to keep it you know real estate i almost never sell real estate i just buy it and so i mean i occasionally get in a piece of real estate that something changes and i i drop out of it sell it but um but but in of investment real estate, I don't turn it. And so it sounds like this is a solid property.

It's got good equity. You're making a great cash flow on it. You plow the cash flow back in, get it paid off, and keep it if you want to be in the real estate business with paid for real estate as your investment. There's nothing wrong. That's a wonderful idea. Or you say, hey, you know, I'm kind of not that enthused about this whole landlord thing. This market's hot. It was markets hot.

It's a great time to jump out. I'm going to jump out, take my chips off the table and go home. Yeah. At some point, he may want a place for himself. And what if he could pay cash for his own place down the line? Yep. And sell this to do it at that time. That would work, too.

So it sounds like it's a solid property. Everything he used to describe it, all of his adjectives were positive. Yeah, I like that. So that gives us a hint that he's probably going to hold on to it. But again, there's a, you know, you catch a market like this once in a blue moon that's just white hot from a seller's perspective. And, you know, I mentioned in an earlier hour i've sold my home uh but it's a is a very unusual home and it and i thought i better take advantage of a very unusual market and i'm going to ride this wave and that's exactly the decision making i went through

um and now that's different than investment property because we're changing where we live uh not cities but but the actual location within this city that we live and so that's a change but it's part of dave and sharon's great adventure which is ongoing you know and so uh we just it's the whole thing's a freaking ride for us i'll just tell you so but but that but that's the thing the uh to watch the uh catch the market catch it on a wave there's nothing wrong with that and if he's living on base

you know he's in a good spot now if you're looking to sell it because the market's hot and you got nowhere to live well you're going to have to go buy something else in a hot market

so I like the position he's in like you said there's no right or wrong answer if he loves being a landlord keep it yep that's probably my tendency in this one

but I love being a landlord so there you go George Campbell my co-host this hour. James Childs is our producer. Kelly Daniels, our associate producer and phone screener. I'm Dave Ramsey, your host, and we will be back. Hey, it's Kelly, associate producer for The Ramsey Show. This episode is over, but if you heard about an event, product, or service and didn't have a chance to write it down, don't worry.

We list everything you've heard about during this episode in the podcast show notes section or head to theramseyshow.com. Thanks for listening.