The Ramsey Show - App - I Took Out a 401(k) Loan To Pay Off Debt (Hour 3)

Episode Date: January 18, 2021

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🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I am Dave Ramsey, your host. Thank you for joining us. Open phones at 888-825-5225. That's 888-825-5225. Anthony O'Neill, Ramsey Personality, is my co-host today. We're taking your calls and your questions.

Rebecca is with us in Johnson City, Tennessee. Hi, Rebecca. How are you? I'm doing good. Thank you for taking my call. Sure. What's up? Okay. My husband and I have paid off around $70,000 to $80,000 in debt. Great. We have our fund, so we have made it to step four. Good.

Congratulations. And we're sitting here trying to calculate and get ready to work our budget up so we can put money aside. So we were wondering, do I need to make that 15% out of my gross pay? Yes. Or should I be looking at my net income? Your gross. Okay, so that includes my TCRS, my 403, and all that.

Well, I mean, that's how you would spend the 15% in your retirement planning. But we're going to say, what's your annual income in your household? What is it? About $100,000. Say again? About $100,000. Okay, so it's $15,000. Okay.

Now, how are we going to get there? And the way you would get there is you first use any matches do you have match at either place your your husbands are yours not much well do you have a match or not yeah uh well it's a ten dollars is all these the 403b does ten dollars they match $10. They match at $10? Yeah. Why? Why bother? My husband's here with me, so this is Thomas. He's also talking. Okay.

Hi, Thomas. We are both school teachers. Okay. We have our TCRS, state retirement, and we have a 403B that the school has $10 a month on. So the extra comes out of that. So you're talking a school board matching $10 a month, which is insignificant. Yeah, that's an understatement.

Yes. It's insulting. Okay. So, all right. So, well, what we tell you is do match first, Roth second. So before I did a 403B, I would max out both Roths, which will get you close to your 15,000. How old are you guys? I'm 53, and she is 46.

Yeah. Okay. Well, you can do, if you're over 50, you can do can do 7 000 and so we're going to do 7 000 for you and six for her so that's 13 of the 15 and so you only need to be putting about 2 000 over into one of your 403 b's and put that in good mutual funds annually and that's how we get there we're going to go raw match first roth second traditional third is the is the way we work our way down through the $15,000 to get there.

And so we're going to do two individual Roth IRAs and good mutual funds with a SmartVestor Pro, sit down and get that started. And then above that, set up a couple hundred bucks a month going into your 403B out of one or both of your checks, a hundred bucks bucks each i don't care what it doesn't matter and pick out a good mutual fund or mutual a single mutual fund be fine on that small amount yeah in that 403b and and get going and you know 403bs are they are uh notorious for not having great investment options in them so be poking around and searching in it. A lot of them have a bunch of junk insurance products in them instead of actual investments.

And so you got to really look and poke around, figure out what your possible options are. But we're looking for good mutual funds, growth stock mutual funds that have long track records. And certainly the same thing for your Roth IRAs that we're talking about funding. That's how you calculate it. And then also too, Dave, now that's for someone who has like a stable income, someone like yourself and myself, probably more so like me, whose income is fluctuating. Some seasons I have high, some seasons I have low. I tend to do monthly. So whatever I'm getting gross monthly, then I'll do 15% of that until I've maxed out all

my other retirement accounts. Yeah, and you set a baseline on an emergence, set a baseline on an automatic draft if you want to, and then you can just add manually to it to hit your monthly 15% if you're doing that, if you've got some volatility in the income. Yes. But a couple of teachers, that's superbly predictable. Yes, yeah. I mean, you'll be able to figure out exactly what it is,

and we're dealing with $100,000. We're dealing with $15,000. And we just figure out what that is and lay it out that way. But it sounds like each of you do a Roth plus maybe $100 each in your 403B. That would be like $2,400 a year. And that would get you there. Yes, sir. That would get you to your $15,000. That's what we're after.

Brandon is with us. Brandon is in Yakima, Washington. Hi, Brandon. Welcome to the Dave Ramsey Show. Hi, Brandon. Welcome to the Dave Ramsey Show. Hi, Dave. Nice to meet you. You too. How can we help?

Well, I was one of the geniuses that thought it was a good idea to take out a loan against my 401k to pay off the higher interest credit card debt. Okay. And I am currently 31, and I wanted to know if also this would be the largest debt I currently have. And due to the loss of the gains that I would have gotten, I was wondering would it be better to move this debt up on the list and start paying it back quicker to regain those losses faster due to the type of debt it is. Yeah, nah. How much do you owe on it?

No. $12,000. Okay. And how much other debt have you got? I have about $36,000, $36,000 to $40,000 total. That's including my student loans as well. Okay. And what's your household income?

My net is around $3,600 a month. So you're making, what, $60,000 a year? I think it's closer to $54,000, $55,000. Okay. All right. That's cool. Good. All right. So you're making $55,000. How fast are you going to pay $54,000, $55,000. Okay. All right. That's cool. Good. All right.

So you're making $55,000. How fast are you going to pay $36,000 off? I'm sorry. Could you repeat that? You're making $55,000. How fast are you going to pay $36,000 worth of debt off? According to the Baby Steps app, five years. Or six years, sorry. No.

No. No. You failed. Right. Failed in the use of the baby steps app yeah uh so here's the thing 18 000 a year will be done in two years there you go that's 1500 a month and you got to get in complete attack mode yeah what you plugged into the baby steps app was minimum payments exactly and no extra payments on your debt. Right. Yeah, I mean, if you keep paying minimum payments and you get out in five years, I'd be surprised.

But you need to come out of pocket $1,500 a month in payments. And, Brown, you're single, you're young. I'm going to say it, man. Man up. Go get you an extra job. You could be out of this thing about a year, year and a half if you really want to get out of debt. Yeah. That would be good.

That would even be better. Yes. And the point being that if it's a very short period of time, then the loss of gains on your 401k loan are not going to be significant because you're not going to be out of it that long. You're going to get there really, really fast. But you need to be done in two years. And then that makes your question less pertinent because you're not going to be out of the investments for very long.

But turn up the heat, baby. Let's go. This is the Dave Ramsey Show. You know what's gone through the roof with all the working and schooling from home, besides everyone's patience? Identity theft. The threat of being hacked is at an all-time high because most people don't have strong cyber protection at home and they're using their personal devices more and more.

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all the work if you do become a victim. That's a big deal. They even cover your bank accounts if they get hacked and your kids are free on their family plan. Go to Zander.com or call 800-356-4282. The key is getting protected before you're a victim, and it's too late. Anthony O'Neill Ramsey personality is my co-host today. Open phones at 888-825-5225. Becky is with us in Pittsburgh, Pennsylvania.

Hi, Becky. Welcome to the Dave Ramsey Show. Hi, gentlemen. Thanks for taking my call. Sure. What's up? So my husband and I are currently in Baby Step number two. We've paid off about $11,000 of our $42,000 debt since August.

Good. We're planning to make a move from Pennsylvania to North Carolina in July. And my question is, should we halt Baby Step two or put money aside through the budget? Yeah. Okay. You're going to have to. It's not halt Baby Step two. It's just stop everything and pile up cash for the move yeah okay because we do plan on selling our house here to make a profit on there and then renting when we go down there

until we can make a you know substantial down payment so i didn't know if we should use some of the profit from the house or but when you sell your home and you make the move then that's got that gives you the cash to pay off all the debt, right? Correct. Yeah, you're debt-free then, and you go on and you restart your Baby Steps when you land in North Carolina. But you're probably going to need some cash to make this move, and we've got to get the house sold. Correct. And, Becky, here's a key thing, too, I really want you to do is on Baby Step 2, I want you to hear what Dave said.

He said, pause, you know, stack up cash. Now, for me, that means budget. Do the research, identify how much money you need. So if you need, let's say, for an example, $10,000 to make the move, once you get the $10,000, go ahead and go back on to baby set number two and just start attacking that debt,

because you have the cash stacked away. Yeah, and then, of course, when the house sells, you ride check and pay off everything. So that's a good move. That's fun. Good for you guys. Brian is with us. Brian's in Memphis. Hi, Brian.

Welcome to the Dave Ramsey Show. Yes, sir. Me and my wife were blessed enough to find your program back in August, and somehow I talked her on board, and we're on baby step two, rocking and rolling. We've gotten rid of 66,000 in August. Wow. Good for you, man. man yeah we're out for blood well done yes uh my next question is about we ended up uh with two mortgages um we outgrew a home bought a home before we sold our other home. And where I'm at with it is I owe $43,000 on the home, and we tried to sell it.

The realtor said it was worth about $90,000. We had it on the market for about eight months with zero interest in buying and an overwhelming interest in renting it. So we kind of just got tired of carrying the house and decided to rent it. But our renters are getting ready to leave. And my next question is, how gazelle intense should I be on getting rid of this thing without just doing something stupid as far as, you know, putting a $90,000 home up for sale for $43,000 just to get rid of it? Well, I wouldn't do that. I wouldn't do that.

You're not being foreclosed on. There's no reason to give it away. So you have one of two problems or both. Your house was priced too high or your realtor's a doofus definitely number two is true okay which may mean the house is priced too high too i don't know i mean you got zero interest of any kind i'm thinking it's not it's not it may not be a ninety thousand dollar house it might be an eighty thousand dollar house but we know it's not a forty three thousand dollar house okay so uh jump online at davramsey.com

and get in touch with one of our elps for real estate they're high octane high protein and they're going to shoot you straight one of the ways that a realtor a real estate agent is an excellent real estate agent and moves a lot of volume is they don't take listings that are overpriced. They take listings that are priced to sell, not to give away, but they're priced properly. And the seller doesn't get to decide that in the sense that you get to decide it at your house. But, I mean, you look at actual statistical evidence called a comparative market analysis, an appraisal on the property that the real estate agent does showing you comps in the area, and you look at that and go, this house does not need to be listed at 90. It needs to be listed at 82.5, and then it'll move or whatever it is. I don't know.

But I think that's what's happened to you, probably. You could be just a little bit off and just enough off that you ran off, because what happens is people give you the eye roll when they see your price. Right. But, no, I don't think you need to give it away. I would just start fresh with a good real estate agent and get good information, and let's price it right. The spring's coming, and it's going to be a great spring.

Real estate's hopping, man. It really is. I'm doing the same thing. That's what I would do, Dave. Good. Cool. I love it. Alex is with us in College Station, Texas.

Aggieland. What's up, Alex? Hey, Dave. Hey, just a quick question. Excuse me. So my wife and I, we'll be debt-free by the end of the year. It's a little bit forward-thinking, but

I kind of overthink things. But after we get debt-free, our next plan is to be saving for a house. Good. But that's not looking like for another about four years. Why? While she gets through school and while she's able to get her degree in teaching

and become a teacher. And then we're looking to buy after that. Just in case we move, I have a really flexible job. And so we're just looking to see what would be best. Should we start investing some? We're both 25, 24. Yes. Or should we hold off and just pile up money for a down payment? No, no. You're too young. And you're waiting for four years. I don't want you to go four years without investing, Alex. Now, what you can do, invest 15%. And while you're investing investing 15 going ahead and start saving a little bit now once you

all find where you are where you are i don't have a problem with you pausing a little bit to save up aggressively for a down payment but right now i want you to take advantage of your age of this season invest the 15 you can start saving some extra on the side and then when you all get there it's about 30 find your your home, your city. Then you can pause to aggressively go after your down payment. But please take advantage of your age and time and investing right now. Yeah, exactly. That's exactly.

It's well done. So what I would do, you know, Alex, that is follow that plan. But just look out there a little bit and say, OK, today it's four years. But a couple of years from now, you look up and bit and say okay today it's four years but a couple of years from now you look up and you go okay it's two years and we're kind of thinking by then we want to be over in x or y city and you start really kind of dialing in your details and you go okay two years out i might stop and pile up cash and get ready for my down payment at that point but right now i'm with anthony let's get started on the investing. You've got plenty of time here, and you can always start and stop and that kind of stuff if you need to. You may be able to save your down payment beyond the 15% and never stop it. That's a

possibility, too. I like that. And, you know, if you just keep working on it and pushing along. Now, obviously, we're doing this while she's in school, he's working, so we're on a pretty tight budget, my guess is. Probably don't have a lot of room in this, but that's not a bad plan at all. Well done. Open phones at 888-825-5225. Thank you for joining us, America. Now, how many of you guys are stressed out or you're hurting because your retirement savings took a major hit last year?

Well, it only took a major hit last year if you took it out at exactly the wrong time. Yeah, maybe you're super close to retiring and you're wondering if you should work a few more years. Maybe you're trying to figure out this overall situation and say, I don't know what to do with my investing. So you need a pro in your corner to coach you. And it's not to tell you what to do. I don't do what the ELP or the SmartVestor Pro tells me what to do with my investing. So you need a pro in your corner to coach you. And it's not to tell you what to do. I don't do what the ELP or the SmartVestor Pro tells me what to do. I learn from them, and then I make a decision. Now, they'll have a suggestion probably, but this is not a my guy

tells me what to do with my money, and I blindly follow my guy. You don't do that. So if you want to learn to invest or you've got questions about your retirement text invest to 33789 find an investment pro in your area never again face a global crisis alone text invest to 33789 invest to 33789 and dav, I want to say this too to America. When you do that, text the word back, you're going to get like three to five smart besties from us who are highly qualified individuals. But let me say this. Interview all five of them and see who works best for you and your family. Yeah. Maybe just personality.

Yeah. What do you connect up with? And what you're always looking for with financial people, whatever kind financial people it is is the heart of a teacher you're always looking for someone that's teaching you and you'll know you've got someone with the heart of a teacher because you don't feel slimed you don't feel sold you've learned something every time you have a conversation with them yes and that's what you want to do you want to be around people teaching you something so that you can make better decisions with your money this is how this works this is the dave ramsey show Anthony O'Neill Ramsey personality is my co-host today. Open phones at 888-825-5225.

Kyle and Caitlin are on the line in Reno, Nevada. It says on my screen you guys are debt-free. Congratulations. Thank you. Thank you, sir. Thank you. Well done. How much have you paid off?

About $75,000. Cool. How long did this take you? 16 months.. Thank you. Well done. How much have you paid off? About $75,000. Cool. How long did this take you? 16 months. Good for you. And your range of income during that time? About $97,000 to $106,000. Good.

What do you guys do for a living? I am a second grade teacher. And I'm a wildland firefighter. Awesome. I'm a BLM. Wow. What a year you guys have had. Yeah.

Man, COVID and fires and everything else, huh? So $75,000 worth of what kind of debt? That was a truck and then two student loans and some medical bills. So you're kind of normal. Yeah. Yeah. What happened? What got you started? Well, we were doing our taxes and we realized how much money we made and that if we actually buckled down, it would take us no time to get rid of our debt. And before we started, we were doing

days-ish and we were already putting money away, but we weren't really attacking our big debts yet. And we kind of just wanted to be in control of where our money went. And so we started to do our budgeting and got our money on track. And so you just basically did the budget and took off, huh? Yeah. Yeah, David, I've been listening to you for a little bit here and there and when she said davish i mean we were paying more towards the loans but we weren't like doing full gazelle intense and when i sat down to our taxes and i was like hey love we could we could do this pretty darn quick if we just uh sit down and go to the grind for it so right before he asked you to do something difficult, does he always call you love, Caitlin? He knows how to do it. I love it. I love it. Hey, throughout this journey, you guys,

I got to ask, you know, what was one of the hardest things, you know, going throughout this process, you know, and seeing your taxes, like, but after that, what was the most difficult part of getting out of debt? I think it would just be staying on track. I mean, you see others doing the things that you want to do or, you know, going out to eat and, and just holding each other accountable and keeping goals in mind. Because we saw, you know, we saw the end goal. And so we had to just keep reminding ourselves of that and not trying to live like everybody else was living. And I think one of the things that I had, I like doing a lot of projects and we were

kind of on a newer house to us when we moved up here and from Flagstaff, Arizona, and a lot of yard work needed to be done. And I'm a big project guy, so I definitely had to hold off my projects and do a lot of drawing and sketching of what I wanted to do after we paid everything off. Yeah, that's good. Well, it gives you a reason to push on through then. That's cool.

Yep, exactly. That's good. Very good. So how does it feel now that you're free? Oh, man. It feels great. I mean, it's just nice to, now that we're on four, we got through three, four, five, and six. I mean, money's going to the kids' college.

We're putting the 15% in and going towards the house where we have left and just being able to go out and do some things that we weren't able to do before. Amen. Wow. That's cool. So what do you tell people the key to getting out of debt is things that we weren't able to do before. Amen. Wow. That's cool. So what do you tell people the key to getting out of debt is now that you did it? What is a big way? Somebody listening to go, okay, I got 75,000.

I want to do that in 16 months. How you do it? Well, just be on the same page. And even when you're not on the same page, just communicate about it. There were definitely times that we, you know, disagreed or got on each other's nerves, but we at least talked through everything. Yeah. And we held each other accountable, like we already said. But two of the biggest things is, first of all, the budget and sticking to it and really knowing why we have money going where it's going and then celebrating small milestones.

So along the way, we kind of broke up our chunk of budget into four pieces. And every time we hit one of those pieces, we had something to celebrate. And it kind of kept us going. Those celebrations we had, honestly, it was nice it was before COVID. But when it came down to it, we had one celebration. We were going to go do a little staycation, and it didn't end up happening. It just didn't fall in the books and planning, and so that extra money we were going to spend on that went back to the debt. Boom. Here we go.

Yeah, game on. Yeah, that's a big deal. So what's next? I mean, you guys are already investing. You guys are already investing into your kids' future. What's next? How do you celebrate this? You know, now that now that you can take your feet off of the pedal, how do you really enjoy it?

Well, right now we're trying to save for a newer Suburban. And man, vehicles are expensive. Yes, they are. That's the truth. Especially Suburbans. And when you actually pay for them, you realize that more, don't you? Yes. Oh, man. Like I've been looking.

I've just been keeping my eye out and looking for the right deals. I'm always shopping around. And, man, it is impressive how expensive they are. Well, great job, you guys. Great job. We're very proud of you. And the kiddos have been involved. What are their names and ages?

We have Mia and Emmalyn, and they are almost five. They're twin girls. Oh. And then we have Watson, and he is almost nine months. Well, he's a big help. Yes. Yeah. You know it.

I love it. Well, they're cute. We got a picture of them popping up on YouTube here, so we're seeing them. It's a beautiful family. Well done, you guys. Thank you. Very, very well done excellent excellent job so all right we got a copy of chris hogan's book for you everyday millionaires and um kyle caitlin mia emelin and you too watson 75 000 paid off in 16 months, making 97 to 106. Count it down. Let's hear a debt-free scream. Three, two, one.

We're debt-free! Yeah! That's how it's done right there. Man. Wow. That's powerful. That is. Good job, you powerful that is good job you guys great job you guys open phones at 888-825-5225 thomas is in dallas hey thomas how can we help you today hey

hey dave how you doing great what's up um i just want to say this is an honor. I mean, me and my mom have been listening to you for so long, and we also learned about you in school now. Uh-huh. I'm 17. I've been trading stocks since I was in about seventh grade. I've been profitable the last two years. It took me about four years. But I'm going off to college pretty soon to play baseball on an athletic scholarship, and I don't think I'm going to have time to trade stocks to make my money.

And I've came up with the conclusion that I should open up a Roth IRA and just start feeding that a monthly while I'm in college and just have that grow and pick individual stocks and not so much conservative stuff because I am on the younger side and I still have time to grow my money. But I was just going to ask if that was a smarter way to go about it when I'm in college is just putting my money in my rock and just having it grow for me over the four years. Oh, man. I'm going to jump in before Dave jumps in, man. I like you, young man.

I can tell you're really thinking about the future. There's two things I'm going to say. One thing I think investing into a growth stock mutual fund covered by IRA is a great option. I do not want you to do individual stocks when I know you've been doing individual stocks coming up to now. But I want you to trust the growth stock mutual fund. But before you really jump into that, I really want you to step back and just really make sure that you understand you're the number one investment. I get it. This younger generation really wants to get into the money, really want to see wealth. That's great. But the

number one asset that you have is your mind. It is you. Okay. Then it's your money, which is your tool. But for yourself, make sure that you're graduating debt free. Sounds like you will, but then make sure you really understand your why behind life. You know, where are you going in the future? And then once you really have yourself established and you've invested into yourself, then, yes, we can start looking into the money. But the IRA, Growth Stop Mutual Fund, perfect route for you at this age and guaranteed where you're going, you'll be a millionaire before you even turn 45, 50 years old. Thomas, I don't buy single stocks. I've been doing it a long time. And 78% of the day traders lose money.

That's 8 out of 10. Those are not good odds, son. Stop that. This is the Dave Ramsey Show. Thank you. Our scripture of the day, Matthew 11, 28 and 30. Come to me, all who labor and are heavy laden, and I will give you rest. Take my yoke upon you and learn from me, for I am gentle and lowly in heart, and you will find rest for your souls. For my yoke is easy and my burden is light.

Martin Luther King Jr. said, If you can't fly, then run. If you can't run, then walk. If you can't walk, then crawl. But whatever you do, you have to keep moving forward. So, Anthony, I saw a better MLK quote. That's one of my favorites. I use that one all the time. But I hadn't seen the one that you posted on your Instagram.

And I just saw it a while ago when I was thumbing through here. Let me see if I can find it. You haven't memorized it, but there it is. Nope, that's not it. There's MLK quotes all over Instagram. What am I thinking? Of course there is. That one I just did is on there.

You're talking about when I just posted? You posted it earlier this morning, I think. Yeah. Let us not seek to satisfy our thirst for freedom by drinking from the cup of bitterness and hatred. That's it. Yes. And strength to love. I guess it came from that probably.

Yes. Yes. Because that book is all about his passive approach, nonviolent approach to protesting. Yes. And to anything, for that matter. He was a devout pacifist. And it's a very interesting read. If you've not read that book folks i strongly recommend it yes but the strength to love it's powerful and for somebody like me that tends to just i mean i get

i get i'm passionate i get fired up i just bust something in the nose you know and for somebody like me it's good to read something like that to offset some of that and go okay you need to calm your butt down that's me dave too i needed it yeah it was a great book just to just to remind me you can have strength but how do we turn that into love in a loving kind way and at the end of the day love speaks louder than hatred and then and then violence so there you go there you go good stuff mlk day Open phones at 888-825-5225. Anthony O'Neill, Ramsey Personality, is my co-host today. Looks like Alicia is next in Omaha, Nebraska.

Hi, Alicia. How are you? Hello. Good. How are you? Great. How can we help? So I just finished my master's degree.

Congrats. And my husband and I, thank you. Um, we were debating possibly refinancing our house and doing a cash out to pay off our student loans. No, no,

no, no, no, no, no, no, no, no,

no, no, no. How, what, um, how many, how much are you student loans?

Uh, Alicia, um, they're about 50,000 and we have 90 to $95,000 in equity in our house. Cool. I'm not worried about the equity. I don't want you to do that. What's y'all's household income?

$65,000 a year. Okay. What's your master's degree in? To be a certified nurse, midwife. Okay. So you haven't started that career yet? No, I just graduated about a month ago. Oh, okay.

Okay. So we're talking really, you've primarily been working on your education, and he's primarily been the breadwinner. Is that correct? No, he's a stay-at-home dad. I work full-time as a nurse. Oh, okay. So do you anticipate your income going up as a result of this master's?

Yes. It should go up to about 90. Okay. That's good news. Okay. Yeah, what I would do is just exactly what Anthony said. I'm just going to roll up my sleeves, and I'm going to get rid of these student loans. Here's the thing.

If you became permanently disabled, the student loans are forgiven. If you pass away, the student loans are forgiven. None of those are true if you go borrow on your house to pay them off. And it's a good thing to just work through and be done with this debt and not do damage when you move debt over onto your house you feel like you did something and the debt just stays there instead of getting it reduced and your overall net worth going up as a result so the great news is your income is getting ready to go up 30 something percent and i'm going to use all of that and any other money i can squeeze out of this budget yeah i'm going to get all of that and any other money I can squeeze out of this budget. Yeah. And I'm going to get rid of the student loan in about 18 months. So, AKA, and a different way of saying it, when you get your raise, you don't have a raise.

You know, when you get your raise, when you get the income, it's not yours. It's going all towards that debt. And you're going to live that lifestyle and live with that mindset until you pay it all off. Trust me. You do not want to put that over to your house. Yeah, because it's going to hang around forever that way. Yeah. Open phones at 888-825-5225.

Christiana is with us in Houston, Texas. Hi, Christiana. How are you? I'm fine. How are you, Mr. Ramsey? Better than I deserve. What's up? Yes. My husband and I, we are trying to decide what to do with the chunk of money that we are projecting to get. We think that we have $66,000 left on our mortgage. That's the only debt that

we have. And we believe that we can have that paid off by the end of 2022. And so we were wondering if the money that will be coming in up until that point to pay off the home, if we should go ahead and pay off our house, or if we should take that money and do something else with it. And that is something we're not sure. We don't know what would be wiser. How much are you expecting? We're expecting probably $100,000 over the course of the next two years. So you're going to be debt-free by the end of the year? Right.

No, no, no, over the course of two years. I know. I think we'll have $50,000 this year and then $50,000 next year. But you're only old 66. Right. What's your household income? It's just my husband's income. So it's $50,000 this year and then $50,000 next year. But you only owe $66,000. Right. What's your household income? It's just my husband's income, so it's $90,000. Yeah, so y'all could be debt-free by the end of the year.

If you get $50,000 and you add another, what, $16,000 on top of that, you're debt-free, right? Not sure. Didn't you say $66,000 was your mortgage? Yes. Okay. If you get $50,000 and throw it out, that leaves $66,000 was your mortgage? Yes. Okay. If you get $50,000 and throw it out, that leaves $16,000, right? Right. And if you were to cash flow the $16,000 out of your budget in 12 months,

that's a little more than $1,000 a month you'd have the house paid for. But if we're off a little bit, we'll call it 14 months, right? Right. I mean, whatever fits in the budget. But the answer is wherever you are on the baby steps is where you throw all money. And where you are is 4, 5, and 6. And 4 is 15% of your income going into retirement. I'm assuming you're doing that, correct?

Already done. Good. You have children? Are you saving for college? No, sir. None. Okay, so we skip 5. Then any other money that comes, we throw it at 6 until the house is done.

When the house is done, then we can move on. And we're at baby step seven at that point. Max out all retirement. And the point there is just to become very wealthy and outrageously generous and live and give like no one else because that's what you've done. You've done a great job, by the way. This is absolutely fabulous. But if I'm in your shoes, I mean, I'm seeing, I can see it. It's right there.

It's only $66,000. I'm just going to bop that thing, man. I'm going to hit it in the head and kill it. Just get it done. Get it done. Get it done. Dave, you want to give me a bonus of $100,000? No.

No. Anthony, your raise is just like mine. Your raise works exactly like my raise works. It's effective when you are. You're right. You are absolutely. Hey, I was trying to be effective right there and ask the question. Yeah, but it's just random.

Just a random lightning bolt right here in front of 17 million people. Oh, that's fun. That's real fun. I will give you $100,000 as soon as you sell 100,000 of them books. Hey, man, listen here. That's a done deal. Because that's kind of built into your plan. You'll probably make a little more than that. I will.

That's good. I'm grateful. So, people, we need 100,000 of you to buy a debt-free degree because Anthony wants a raise. Amen. Hallelujah. There we go. Thank you, Jesus.

You have a worship service right at the end of the show. Yes, sir. Yes, sir. Yes, sir. That's fun. That's amazing. That Thank you, Jesus. We have a worship service right at the end of the show. Yes, sir. Yes, sir. Yes, sir. That's fun. That's amazing. That's neat, though. Make a 90 and get $100,000.

Oh, it's over two years. We still get a $50,000 bonus. Yeah, I mean, that bonus is some people's salary. Well, yeah. For real. She's blessed. More than I've made in a lot of my years. I know that.

Wow. Very, very impressive. Yeah, her bonus is more than I was making as a youth pastor. That gets me upset. Yeah. Well, youth pastors are renowned for their income. Yes. Yeah.

Oh, man. That's a tough job, man. It really is. You have teenagers and no pay. Yes. Yeah. It's a tough job. I don't miss it.

I mean, I miss it, but I don't miss it. You said that out loud. I just got in trouble. You were thinking that, and you let it come out of your mouth. I don't believe you did that. That puts this hour of the Dave Ramsey Show in the books. Thanks to James Childs and Kelly Daniels in the booth taking care of business back there, making sure this show works. I'm Dave Ramsey.

That's Anthony O'Neill. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus. Hey, it's Kelly, associate producer and phone screener for The Dave Ramsey Show. If you would like to do your debt-free screen live on the show, make sure you visit DaveRamsey.com slash show and register. We would love for you to come to Nashville and tell Dave your story.