The Ramsey Show - App - I Was Scammed by the Promise of Passive Real Estate Income (Hour 1)

Episode Date: September 23, 2022

Rachel Cruze & George Kamel discuss: Getting family on board with the Ramsey plan, Getting out of the rental game, Why passive income from real estate is a myth. Moving out of your parents' house, Getting started on Baby Step 1, Leaving a stable job to find better pay. Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Девочка-пай Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studios, this is The Ramsey Show, where America hangs out to have a conversation about your life and your money. I am Ramsey personality, Rachel Cruz, hosting the show today with, next to me, fellow Ramsey Personality, Ramsey Show co-host, and Smart Money Happy Hour co-host. That's right. Of the new podcast, George Camel. Wow. What a day, Rachel. Good to be here. We launched a new podcast yesterday called Smart Money Happy Hour. George

and I are sitting down having, you know, friend-to-friend conversations about things going on in the world that revolve around money. Yes. But we thought, let's just put a microphone, have a mixed drink, and just enjoy the conversation and you all get to listen in.

It's what we would talk about off mic, but instead they're like, let's record it and see if people enjoy this. And the good news is they have they love it one person said it was like regis and kathy lee so i am like the old curmudgeonly soul and you are kathy you're not ryan seacrest you are no i'm regis which i appreciate that i'm a little more regis than ryan you have a little reach factor yeah he's a little snark i can see that that. Old soul. But the feedback's been amazing. Yeah, it's been fun.

And I just found out we are number one on the business charts on Apple Podcasts. Of all business podcasts. And out of all the podcasts, which two and a half million podcasts, we are number 33 overall. Is it 33 now? Yes. Oh, I thought it was like in the 50s. We are just climbing the charts. Thanks to all of you out there.

We are climbing the charts. So huge thank you to all of you who have listened, who have shared your feedback, who have subscribed and followed and left five-star reviews. Continue to do that. How cool would it be if we were in like the top 10 and the world was like, got to hear some of this money message that is so desperately needed out there.

I know. And that was part of our thought of doing that is here on The Ramsey Show, which we're about to do, is take calls from everyone across America and the world, really, in regards to their life and their money. And we get really tactical. But we thought, man, if someone doesn't really care about a money podcast, how do you kind of rope them into this? Because we're both very passionate about helping people.

So we're like, OK, so how do we get the people that really don't care about money, but want to hear a fun conversation just casually in their car and enjoy. And it gets you thinking. And we kind of rope them in. Yeah, it gets you laughing, gets your guard down, gets you thinking differently about money. And that's the goal of this. So we've got two episodes out right now. One is all about is convenience culture worth being broke?

And the second one is all about the TV network that brainwashed us all. And new episodes are coming out every Thursday through November. So this is season one. So if you've enjoyed it, thanks again for listening. And if you have friends or family that you're thinking, gosh, I need to rope them in to learn about money. This is a great one. They may not read the Total Money Makeover or listen to three hours of The Ramsey Show, but they might listen to 30 minutes of us yakking it up with a drinking hand.

Who knows? Who knows? But we're here on The Ramsey Show today taking your calls at 888-825-5225. So we'll start off with Kate in Philadelphia. Hey, Kate. Welcome to the show. Hi, thanks. How are you?

We're doing well. How can we help? So I'm a new listener, probably in the last, let's say, eight months, trying to kind of get a handle on how to start. Always have kind of saved money, but spent money, saved a little bit here. So I kind of feel like I'm all across the board, hand-stretched, wide open, and kind of don't really have a control on anything. But I would say that we maybe aren't in quite an alignment as far as being full in family-wise, as far as actually really following the path. So I'm trying to get some insight on how to really make that complete shift to follow the steps to make a difference in our lives.

Yeah. Well, when it comes to the family unit, you know, the biggest relationship that you really do want to talk through is your spouse. So I'm assuming you're married. Correct. Yes. And then you have kids. Two, yes.

Two. And how old are they? They're college age and high school okay okay so yeah getting a little buy-in from them would be nice not required at this point right uh but yeah but getting here don't get much of a say yeah well college and high school they will have their say for sure um but i don't know yeah having having your husband on board for sure is is the key so kate what's what's probably the biggest hesitation do you feel of just like just jumping in and just doing it all? Just putting that kind of restraint.

We've, you know, not necessarily lived beyond our means. We're kind of middle of the road on everything. But although it's going on vacation,ations, purchased things we want to move. You know, we have really done whatever we wanted because we've had the funds there, but, you know, we still have been able to save along the way. Okay, so how much debt do you guys have? About $9,500 right now.

$9,500. Okay, is that credit card debt? Is that car loans? Just a car loan. Just a car loan. So one car loan, no credit card debts, no student loans, just that one car loan of $9,500. Okay. And that's the thing. We use credit cards, but we pay them off every month. So we have switched to using debit cards solely except for certain things that we have automatically coming out every month. Okay. Okay, so, Kate, I don't know. The role gets not all in. Yeah, okay.

So, I mean, there's multiple reasons why people kind of jump all in, and one of the biggest reasons that we hear, and George, correct me if I'm wrong, is they get to this kind of I've had it moment. They get to this point that they feel like, oh, my gosh, I should have more money than I do right now, or I'm sick of living paycheck to paycheck i'm sick of having the credit card companies call and bombard me right so like that's a lot of people's stories and they get to this kind of extreme point with their lives and

they say i'm done i am done i've had it you you don't feel like that you're there there's not enough pain you don't i don't feel like you have enough pain. So here would be my encouragement. Doing the plan where you guys are at, debt-wise, I think you're still going to be able to enjoy life, Kate. Our plan is not that you... There is a sacrificial part of this, right? To get out of debt. But I'm assuming you guys have some extra savings, the way that you've been talking, and that you'll be able to throw at this $9,500, get it paid off, just get some more savings, and then fund retirement, kids college, pay off the house early. The steps that you're probably going to be transitioning into are not

the beans and rice, rice and beans. We take calls on the show with tens of thousands of dollars, hundreds of thousands of dollars of debt, and it's years of this journey of paying off debt. You guys aren't there. So I think you're still going to be able to enjoy life, Kate, even doing the Ramsey plan where you're at. But also it's like, you have to, you have to have intentionality around your money, Kate, or you're going to look up in five years and be like, man, we could have had a whole lot more in retirement, or we could have, we could have done so much more, but we kind of just, eh. There's a lukewarm kind of attitude for that kind of middle crowd who's not at this rock bottom. Which makes sense because you're not in dire pain.

Yeah. But part of that is going, we're not where we should be with retirement. We could be doing so much better. We work so hard and yet we have so little to show for it because we're doing 17 things at once. And so I think laying out a vision for the next five, 10 years, when do you guys want to retire? Could we retire early because of our decisions we start making today? What could we do with that car payment every month if we weren't sending it to the auto lender? What could we do if we're using a debit card? How would that change our spending? And start to challenge yourselves, not in a way to sacrifice just to feel some pain, but in a way to see the progress like you've never seen before. So hang on the line. I'm going to send you Financial Peace University

for you and your husband and the kids to watch. That is going to get you fired up and show you what life could look like if you went all in on this plan. So hang on the line. Jenna's going to pick up. We're going to send you guys one year of Financial Peace University. Thanks, Kate. And again, it's 888-825-5225. I'm Rachel Cruz and George Camel, and this is The Ramsey Show. welcome back america i am rachel cruz hosting the room show today with george camel and up next we have anthony from canada hey anthony welcome to the show hey thanks for taking my call how you guys doing we're doing well thanks how can we help hey so i uh i was in the passive uh income scam with real estate and like i was there's nothing passive about it so we like realized we gotta sell um some homes that we have and we had a house from hell in particular that just like had

problem after problem after problem and it was like it was like it was gonna take my life um but you know we sold that and we still made a profit um so I'm happy about that. But we have about $160,000 from this rental property. And we have our personal residence, and we have about $170,000 in there. So about $300,000 to $320,000. And we just purchased our dream home. We really like it. It was $500,000. So my question is, what do I do with

the $300,000 to $320,000? Do I put a 20% down payment and then invest the rest? Or do I pay it off as fast as I can, especially with the really high interest rates for mortgages? I just, I don't know in this situation what the right thing to do is. So let me recap here. Your personal residence, you bought for 500. Is it paid for or do you have a mortgage on it? You have 170 in equity. Sorry, we just bought it on Saturday. And so we are, we don't know exactly what we're going to put down yet, if that makes sense. Oh, you haven't closed on it?

Yeah, we're not going to close. We're very confident we'll close. But yeah, we have about $300,000 that we think we'll have, I guess. Okay. We have $160,000 from our rental for sure. Okay, so you'll probably have about $300,000 in cash that you could put down on this $500,000 home. That's right. Yeah. So why wouldn't you do that? Well, I just, I keep thinking about retirement and you know, the, the, you know, the younger you are, the better it is to have more,

uh, at the, at the beginning to, to work on that compounding, take that compound effect into play. Do you guys have nothing in retirement? Well, we have other rental properties that we do plan on selling, but the terms aren't up yet. They're about two to three years away. And we think we'll sell those as well and have about 200 to 250.

And we would want to put that into retirement. And we only have $200,000 to $250,000. And we would want to put that into retirement. And we only have really $30,000 in our RSPs or TFSAs, which is like your 401k and Roth IRA. Well, we would tell you to start investing 15% of your future income into those. How old are you two? 28. You've got plenty of time. You're going to be multimillionaires in those accounts. If you just follow these steps, 15% in there, let's pay off the primary residence. Then you can save up cash and buy rental properties in cash in full. And that will create all of the passive income if that's what you want to do. And if you don't want to be in real estate,

you can sell those, get out and use all that income and start building real wealth. Once your home is paid off, that's baby step seven. You can increase that 15% and really start to ramp up that wealth building. Yeah. Anthony, I totally hear you on the compound interest. I mean, I was taught at like seven years old to look at charts to see what would happen if you invested at 18 years old versus 38 and all of it. So like, I totally hear what you're saying. And the sentiment is great because the math for sure is on your side when you start early. So we're not saying not to start retirement. I would definitely put money in retirement.

But there's also something to be said when you don't have a house payment. And this $300,000 to a $500,000 house gives you guys a massive head start and working to pay that off while still funding retirement, like George was saying. But there's something about Anthony, when you don't have any payments, like when that when your primary residence is paid for, and you guys are get out of this whole rental thing and all of it, right, and you have no payments, your income is freed up so much that you guys then can double down and say, hey, we're going to throw even more at retirement than 15%. Or we're going to take some of that, like George is saying, and if you still love real estate, yeah, let's go find a cheap house and start there with all cash and get that

passive income going and all of it. You can start playing with all this because you actually have money and you have the freedom. And that's something else that doesn't get put into an equation or that you won't see on a chart. chart is just the mental margin that you're going to have in your life and the peace and so much when you don't owe anyone anything it just frees you up so much so so i hear what you're saying about the compound interest that's what we teach here so we still want you funding retirement 15 of your income um but man i would I would put a chunk towards the house for sure. And that's part of your retirement plan. All of it.

Right. I would put all, I mean, if you guys are out of debt with a fully funded emergency fund, every other penny I would throw into this down payment. So you could go that hardcore. And then I would say, George and I may differ a little bit on this. If you wanted to take a little bit and enjoy. I would take some and be generous with. It doesn't have to be this legalistic all 300 has to go at the house.

But I do want you guys to do the math on that side that if you did put all 300, how far ahead you would be and how quickly you would pay off your house, how much interest you would not be paying when you don't have a house payment. Play with the numbers. But I would say if you want to take a little bit and be generous maybe enjoy you know some of it too because baby steps four through seven we always say is you know your foot's off the gas you're not hardcore sacrificing you can enjoy life uh but man there's there's a gift that you guys are about to get of 300 000 that you could good spot you could throw it off. What's your income, Anthony?

Household? Well, we just had a baby. Oh, congratulations. Thank you. So when she's back to work in a year, it'll be about $180,000. Amazing. So then you go, well, how quickly could we pay off a $200,000 mortgage making $180,000 if we didn't have any other payments? And that gets you fired up

because you're focused on that one thing instead of dealing with 14 different properties and they all have mortgages on them and you're hoping the renters pay and you're hoping there's no issues. And like you mentioned, this is not passive income. So I'm glad you called that out for all of the people out there

who are trying to get into this real estate business. And we love real estate around here. It's a great investment when it's done right. But there is no such thing as passive income. It just doesn't work like that in real estate business. And we love real estate around here. It's a great investment when it's done right. But there is no such thing as passive income. It just doesn't work like that in real estate because of what you mentioned. You got to hope the renter pays. You got to go deal with the HVAC. There's always someone to have to go up to and go, all right, what's the issue? How do we fix this? And you guys are in this business. Dave has been dealing with this for years and he's been rallying against this,

this get rich quick scheme of passive income through real estate. I know. So it's a lot of work and it's a huge, huge financial endeavor. And it's a lot of work when you pay cash for it, right? So like even when you go and say, I'm going to be a landlord,

it sounds like, oh, that's so easy. You just put money in the house and then you just get money back from rent. That's so easy. No, you're dealing with people constantly. It's almost this part-time job. So it's wonderful. And I love real estate.

And I think it's amazing because there is a beautiful thing about passive income when you do it with all cash, for sure. But it's still work. It's still work, George. Yeah, it's good. But thanks, Anthony. Thanks for the call. Good reminder there.

So I love that, Anthony. They just had a baby. So sweet Yeah, it's good. But thanks, Anthony. Thanks for the call. Good reminder there. So I love that, Anthony. They just had a baby. So sweet. And it's amazing when you kind of like enter into these seasons of life, whether you just graduated college, you got married, you've had a baby, maybe you're changing jobs, like so much of this like adulting, right? Like doing this life. There's a lot of stuff.

And one thing people forget about a lot is getting a will. And so you'll hear us say it all the time that you need to get a will. It is just basic adult responsibility and there's no excuse not to have one. And so we recommend doing one just online. It's really fast, it's cost effective, and it's a way just to get it taken care of. But I also get a lot of questions asking if a simple online will is right for everyone and everyone's specific situation. So I get that. So what if you need a trust? You know, what if you need a mirror will? What about powers of attorney? What kind do you need? I mean, there's so many questions. So our team has actually built out a quiz to help you find

the right options for you when it comes to getting a will. You'll get a customized, you'll get customized results based on basic information. Like if you're married, single, where you live, even the size of your estates. And you'll know exactly what you need to do for your specific situation. So getting a will, you guys, it is so important. So to take the quiz, go to RamseySolutions.com slash willsquiz to check it out for yourself. Worth it. Go do it today.

This is The Ramsey Show. សូវាប់ពីបានប់ពីបានប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពី welcome back to the ramsey show we are taking your calls at 888-825-5225 up next we have jack Jackson in Athens, Georgia. Hey, Jackson. Welcome to the show. Hey, thank you all for having me on. Absolutely. How can we help? Hey, I just had a question about, I guess, whether or not I should look to rent or buy.

Right now, I'm 24, living with my folks, folks and wasn't not in college, no debt. And I make about 72K a year. And I was just wondering if it would be wise to stay with them a little bit longer and just go straight to buying a small house or whether it would be better to just more quickly go and try to find a rental. Yeah, it's a great question, Jackson. Do you think you'll be in Athens for a while for the foreseeable future? I think so. I think for the foreseeable future, definitely, yes. Because that's kind of how I base these decisions on. It's a long-term decision. Yes. Buy a house, for sure. Yes, versus renting.

But I would want you to be in a good financial spot before you bought a home. And it sounds like you're for sure checking off some of the boxes and not having any debt. Do you have any savings

or anything for a down payment? I have about $20,000 right now. Okay. I can probably, if I stay with them, I'm sure I can make that go up pretty quickly. Sure. And I could afford to rent in the area. Most things that I see within

a 30 minute drive of work are probably like 1200 to 1500 a month, which I could do, but it was definitely cut into my ability to save. So what's your take home pay every month? Um, I'd have to say maybe like, it's partially commission-based, so it makes it a little hard to say, but I'd say about $4,000, maybe $4,800 after taxes and health insurance and that stuff. Okay. And so we would say you want your mortgage payment to be about a quarter of your take-home pay on a 15-year fixed. And so that helps you determine how much money you need down. That helps you determine how much house you can buy. Have you looked at small homes in the Athens area to see what they're going for? Yes. Yeah. And it just ranges. I'd say most of them are probably like 250 to 300K, some maybe around 200. Yeah. That might need some work, you know,

or maybe less than that if you want to do a lot of work yeah which i wouldn't be opposed to but um i also i'm not married you know so i i guess i don't really i'm sort of hesitant to just go straight to buying a home but i know i always hear people talk about you know just throwing money away renting you know so no don't listen to them that's a crock. You're buying patience, my friend. You're making a wise decision. Yeah, and Jackson, what I would encourage you to do,

honestly, because of where you're at, yes, living at home is saving you money, but there's just not a price to being on your own. I mean, truly, like not having to walk through the front door of your parents' house and go into your childhood bedroom and go to sleep. Like there is a level of dignity that happens when you're just on your own. Like just simply that it is your life. And so a lot of people do go back home to save money, which again, I'm not, it's not like a black and white issue for me, but it gets to a point though, where I really feel like there's a,

there's a level of stunts, of stunted growth, stunted growth. Thank you. I was like, what's my, what's the word I'm looking for? Thanks,

George. We're good. I'm always here for you. That happens that you just don't quite get to that place when, until you're on your own and you're the one paying the bills. You're the one having to figure out what's in the refrigerator. I got to go to the store. I mean, it sounds so small, but it just does something. So almost, Jackson, I would, if I were you, I would leave. I would rent next month somewhere just to get out on your own, get your feet wet, and just maybe sign a six

month lease and then kind of see, okay, where's life at now? And then if you feel like you're still settled, you're in a job still in that area that you love, yeah, that you haven't met someone and those plans are changing, then I think investing in a house is great. I mean, if you can be somewhere for at least five years, buying a home is a great investment. And so yeah, the real estate market's a little wacky right now. But if you do those percentages, like what George was talking about, that formula, to know that you're not buying a house that's out of, you know, you're not going to be house poor and you can still, you know, make some equity while you have it, I think is great. But I honestly, I would move out. I'd move out and rent for about six months.

Yeah, I like that plan. And if you jump on to RamseySolutions.com, you can click on free tools. Use our mortgage calculator to help you get some real facts and figures, because that gives you some confidence and clarity. It's hard when you're just going, I think I'm ready. I don't know. When you go on paper and go, okay, I can buy a $200,000 house. If I can put, you know, 40% down, that'll leave me about, you know, 90 something thousand. And that will put me at a $1,200 payment. And that feels reasonable in my budget. That will give you some peace and freedom. And so that's what I would encourage you to do. And then go about the business of doing that. If that means side jobs and extra income to get to 100K so that you can get here in the next three

years, that's great. But don't just jump into a house because people told you that renting is a sin. That's right. That's right. Yeah. So I would rent Jackson, but it's a great question. And a lot of people are in that transition asking the same thing. So thanks for calling. All right. Next, we have Samantha in Atlantic City. Hey, Samantha, welcome to the show. Hi, thank you so much for taking my call. Absolutely. How can we help? Well, I have started listening to Total Financial Makeover. I've been listening to the podcast as well. And I am really trying to be accountable

and get started. Awesome. My question has to do with the thousand dollars, the run, don't walk to the thousand dollars versus getting caught up on everything that I have this past due. I've been sitting for quite a long time, borrowing, robbing Peter to pay Paul, doing this, doing that, and I have a good income. It's just been circumstantial. It's where I live is expensive. I have a child that I've been raising on my own, and a lot of things are coming up now, and I'm in a little bit of panic mode, And I don't want to become dramatic about this. I want to handle it. I want to do it.

But I'm a little confused about the starting process. Yeah, that's a great question. And you're not being dramatic, Samantha. I mean, when you're living paycheck to paycheck and you're behind on payments and you don't have savings, I mean, that's a scary place to be. So that fear that you're feeling is totally justified. So you're, yeah, don't, don't say to yourself, oh my gosh, I'm just being dramatic. No, you're really not. I mean, this is a, this is a really serious thing and you're feeling the weight of that. So just give yourself permission to feel that because that's, that is all justified. Getting current on those bills is going to be your A1. So what bills are you behind on?

Well, I just had a vehicle that essentially the transmission went with no emergency fund in place. I am now behind on the loan on that vehicle and it's still in the shop. So I am in another vehicle that I am renting that I am actually, I'm a traveling nurse or a home nurse, home health care nurse, and I have an on-call responsibility. So I've got the extra work part covered. But I've been paying for this additional vehicle to get me around, and, you know, it's gotten me behind on everything. There's credit cards, there's utilities, my son's swimming membership that he needs, you know,

because it's the sport that he does. I mean, I don't think I'm current on one thing right now. Wow. Well, we start with the four walls, which is food, utilities, housing, transportation. That gets covered before we pay the credit card company, before we pay the auto lender. We got to keep the swim lesson. And that comes before the swim lessons. Honestly, yeah. Making sure you're caught up on those four things. We got to keep the lights on and keep the roof over our heads. So once we're there, then we can focus on the next priority. And that might mean communicating with the credit card company and going, hey, listen,

I don't have money for you right now. What we don't want to do is just bury our head in the sand and not talk to them. And then it goes into collections and then people are coming after you. So be proactive with every single bill in your life and every single lender and explain to them the situation and go, this is what I can pay. And that might mean you give them $25 that month because that's what you can do until we can get caught up. And so that baby step one, it might take you a little longer than other people because right now we're in like baby step zero. We're trying to get current. And so that's where you're at. Yeah. So, so Samantha,

stay on the line. Jenna's going to pick up and we're going to put you through Financial Peace University and it's going to come with every dollar, which is a budgeting app. So the very first thing I want you to do is I want you to write out your budget for the month. And I want you to cut everything that is not necessary out of that to free up money. I want you to look around your house. I want you to sell stuff, get extra cash in the door, make sure you cover those four walls first, get current on that, and then look to get current on your credit cards and everything else after that. But it's going to require probably some more income or money that you can get from cutting in the budget and selling stuff. welcome back to the Ramsey show we are taking your calls at 888-825- 5225. And up next this hour, we have Kristen in San Francisco. Hey, Kristen, welcome to the show.

Kristen, are you there? Hello? There we go. Yeah. Hey, Kristen, welcome. Oh, hi. Sorry about that. I don't know. It just, there was no noise. You're good. No, you're good. Thanks for taking the time to talk with me. For sure. Yeah. What can we do for you? So I'm wondering if it's the right decision for me to change jobs. I'm in a very stable position and going to something that doesn't really offer the same stability. My situation is that I live in the greater Bay Area, and so it's very, very expensive.

And so I'm currently in a great situation but want to increase my income. And I work for the county, and I'm currently, like, capped out at where my, you know, my income will be raised. And my husband gets raises every two years. So in order for us just to, like, be able to feel like we can live in our current house and support our two young kids and all the activities, I'm just wondering if I should go to more of a self-employment situation. I'm a marriage and family therapist, so I would be going from the county to private practice. And along with increasing my income,

it would also allow me to have the flexibility to spend more time with my kids and take them to their day-to-day activities and whatnot. So I guess my question is, I guess my question is just how do I prepare for that shift when, you know, I have my current PTO and I have money going into, you know, a 401k with work, but how do I feel confident in making the shift and knowing that I'm prepared financially? Are you guys out of debt?

Yeah, besides our house. Okay, great. And we have our, probably about four months of emergency fund. Okay. And my husband works for the government he's been that for 10 years so he's in a very stable position unless there's like a huge um you know where they shut down the government again but you never know uh okay so kristin

do you is there a practice near you that you're gonna that you want to join that you're thinking I could plug in to something someone else is already doing? Are you wanting to start just from scratch, just your own, getting your name out there? Yes, I'm actually going through a certification program now where I'd be like a court-involved therapist. So the referrals are coming from the court and it's essentially mandated. So, you know, the work is there. The need in the community is there. So I'm not worried about having to like build up my practice, so to speak. But at the same time, you know, there is the anxiety about cancellations and just, it's not a consistent paycheck. It has the opportunity to bring in a lot more income than I'm making. Um, but

I guess I'm just trying to figure out how to plan for the money I need to put aside for, um, taxes and how to, you know, invest in, I'm not going to be working towards acquiring a pension anymore. So there's just... Right, right. Yeah, it just shifts from, yeah. So would this be like a 1099 that you would get instead of a W-2 as a contractor? Correct. Yeah. Okay. Well, you would need to weigh the benefits that you're missing out on and go, can I cover those now from this paycheck? How much do I need to put away with taxes?

I would definitely be working with a tax pro. You can find one of those at RamseySolutions.com to go, all right, I need to put away 35% of each paycheck. And after a few months, you're going to have a real good picture of what this normally looks like, of what your income is going to be. Is this something that you can do on the side instead of just jumping and leaving this job and going straight into it? I've thought about that, but as I'm going through the program, it really seems like it's not necessarily just a, you know, a 50-minute clinical hour where you're working with a family. You might have to go to court and be on call. And all of that is kind of built for in the sense that how somebody would be working with an attorney, um, that that's built into the contract.

But yeah, I don't think my current position would offer me the flexibility to on a Wednesday, I need Wednesday off, you know? Yeah. Well, and I feel like, you know, you have enough experience from what you're doing. I feel like you sound like you have really researched a lot on that side of kind of moving for careers. It does sound like an interesting part when you look into that therapy side of what you're saying, that it's not just like, oh, you go sit down for an hour with a therapist, Venmo them, and they leave. You're going to be with these families going through some hard things and going to court and all of that.

So I think on the money side, you guys are good. You're out of debt. You have fully funded emergency fund. Like George was saying, research some stuff with that 1099. Talk to a tax pro. Make sure you got your bases covered there

because people do this, that kind of stuff all the time. But what I would look at too, Kristen, is just to have boundaries because I know one of the reasons you're doing this is to be with your kids more, to have more flexibility. And it's easy to let fear kind of take over and think, I've got to say yes, yes, yes, yes, yes.

And you take on more than what you're even wanting and you end up working more hours and you're more stressed when you're on your own versus what you're doing now. So that would be one of my, you know, just kind of words of caution just to say, you know, hey, you know, test out one or two of these clients to know how much bandwidth of my time does that take? Because it does sound like you're going to be doing more than just that one hour a week therapy session. You're going to be in doing a lot more for these families and these people.

And I might bump up to six months for that emergency fund. Yeah. As you're not sure, there may be some irregular income. That'll give you some peace as well. And look at the other side. If it doesn't work out six months from now, and it's not what you thought it was, you can always go back. You can do private practice.

You can work somewhere else. You sound like you're a real sharp woman. So I'm not concerned about that. So I would go for it. This is what you want to do. Yep. It's awesome. You've done the right steps.

Awesome, Kristen. Well, George, you and I, we've hosted the Ramsey Show together. We now are co-hosts of Smart Money Happy Hour, our new podcast that launched yesterday. It's out into the world. And you and I together, along with Dr. John Zaloni, have put content, our hearts, our souls into the new 2023 Ramsey Goal Planner. So if you love a goal planner, if you want to know that you want to be intentional

with not just your time, but even your spiritual walk, your money, your relationships, all of that, you need to start doing things on purpose. And it's really hard because we want good results in all those areas of our lives, but that doesn't always happen because we don't have the motivation or the tools. But the Ramsey Goal Planner is all of that for you. Yeah, we cover all the areas. I mean, at least the main ones here, we got relational with Dr. John Deloney. You cover the spiritual side and I cover the financial side. And I think having one goal in each of those areas for the year is very doable. So you're going to say, hey,

I want to get out of debt. And I also want to have better relationships because we've been very isolated these last few years. We want to have deeper relationships and we want to focus on the spiritual side. And when you get those, you know, we call it a flat tire when you're not doing great in one of those areas, the car doesn't run as well. And so we want you to be well-rounded and have goals in each of these areas. And there's such power to putting it on paper. And I'm the most techie guy out there. I love putting everything in my iPhone note, but it gets lost in a sea of digital things and screens versus carrying around a goal planner wherever you go, reminding you visually of what it is, of what it is. And so this is, it's a

great gift to give someone in your life that you want to encourage, especially for the guys out there like me who never know what to get the women in your life. Yeah. No, right. This is a win-win. And it's beautiful. It's like gold foil on the front cover, all of it. It's wonderful. So they always sell out quickly, these gold planners. We only get a certain amount. That's right. Every single year. So make sure to go to ramsysolutions.com slash planner to get yours and you're right george i never thought about that but having all the important things in one spot written down that you're like it's here because the i'm the worst at the notes app i have like yes i can't i don't even want to tell you how many notes should we compare their it's here yeah it's how

many pull out your phone. Okay. Because mine get lost with my kids, and they put sushi emojis all down them. I currently have 3,030 notes in iCloud. How many do you have? I have 95. Oh, my goodness. I thought it was... You have how much?

You just threw me under the bus. I have 3,000 notes. Oh, you need the Ramsey Goal Planner, I said. I need therapy. You're making me freak out. I need beyond a goal planner. Oh, my gosh. Okay. Wellal Planner, I said. I need therapy. You're making me like freak out. I need beyond the Goal Planner. Oh my gosh. Okay.

Well, thanks to everyone in the booth. Ben, James, Jenna, Zach, Andrew, all of them back there. And thank you, America, for listening. This is The Ramsey Show. Hey, it's Rachel Cruz, co-host on The Ramsey Show. If you want to do your debt-free scream live on the show, visit ramsaysolutions.com slash debt-free scream. We'd love for you to come to Nashville and tell Dave your story. That's ramsaysolutions.com slash debt-free scream.