The Ramsey Show - App - If You're Not Financially Ready, It's Not The Right Time (Hour 3)

Episode Date: June 1, 2023

Jade Warshaw & George Kamel answer your questions and discuss:  "We're getting kicked out of my grandpa's retirement community and we don't know if we should rent or buy,"  from the blog: Should I Rent or Buy a House? Why it's important to share the same financial values with your significant other,  "Should I insure my engagement ring?",  from the blog: How to Buy an Engagement Ring: 5 Tips How to financially prepare for a layoff,  "Should we move away from family so we can afford a house?",  from the blog: How Much House Can I Afford? The best ways save for upcoming medical expenses. Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Join a Personality-led FPU class. Click here! Want a plan for your money? Find out where to start: https://bit.ly/3cEP4n6 Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Interested in advertising on The Ramsey Show? https://ter.li/s64ye3 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the pods moving in storage studio, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Not to be confused, Georgeorge with unactual we want the real thing here isn't that all of social media of course you're right about that man i'm your host jade warshaw and of course joined to my right by the the six million dollar man george camel now we're just straight up lying to the people the bionic man hey i'll take it i love aspirational yes that's right i love to find new ways to introduce george

so that people really see him in the grandeur that he demands i always wait with bated breath to see what adjective you'll use today i actually looked that one up ahead of time the six million dollar man um give us a call the number is triple eight eight two five five two two five and of course we want to talk to you about your life your money what's going on in your world what is going on in your current situation uh nothing's off limits as far as it comes to money right give us a call let's talk about it Ben? Hello. Hey, what's up? Hey, I just had a question about our rental situation. My wife and I are living in Utah, of course, and we currently are renting basically a suite where we're watching my wife's grandpa's house. Okay. We were renting from him for really cheap,

and it seemed like a sweet gig until they informed us that the HOA was 55 plus, and previously they hadn't said there would be any issues with us living there, but now they're kicking us out in about a month or two. The curmudgeons on the HOA. Right. Someone like you guys that said, I don't like these young whippersnappers around here yeah right we're throwing mad parties and they

get off my lawn just smiling and waving at all the people who want to grind up so what's this mean for you because if you are breaking the HOA guidelines I mean they do have the if it is what you say it is, they do have the right to.

Did you have anything in writing saying you could live there and for how long? No, to be honest, I don't believe there's anything like that. We were just told by our grandpa that he had talked to them and that everyone he had spoken to had shown that there wouldn't be any problem with it. But I don't think there's anything in writing. We're planning on moving. It's just now a question of whether we should rent or buy. And it's just I can't figure out which would be a better solution. So we're hoping to run it by you. How much time are they giving you before you have to vacate the premises? So they told us we have to have something figured out, which is kind of vague. They told us we have to have something figured out by the start of

July, like July 8th or something like that. That's no time. Wow. These old folks ain't playing. So what's your financial situation? Do you guys have any debt? Do you have any savings? Right. So right now we're making about $50,000 to $52,000 a year. We have, let's see, down payment of $30,000 or $25,000 saved up as well as emergency savings of above $8,000. It's roughly five months of savings. That's with your current expenses though, right? Which is very minimal. Yes. So we'll have to increase that and use some of the down payment funds to cover the emergency fund. So let's call it $25,000 for the down payment.

The rest is emergency fund and you have no debt. Yes, no debt. Okay. What are the prices in that area? I imagine, are you in the Salt Lake City area? So a little bit north of Salt Lake is kind of what we're looking at, Layden, Ogden, somewhere around there. So it's generally we're not seeing anything in the housing market

for less than $300,000 or $250,000, and it starts getting pretty rough in that range. And then on top of that, the renting market, we're not seeing anything comfortable. We checked out some apartments around here. We're not seeing anything we'd feel comfortable with below $1,300. Are you guys both working full-time? I'm working full-time and in school, but school's being covered by FAFSA.

My wife is working part-time and watching her brother, her special needs brother on the side. I'm wondering if we can increase the income if you're going to be, wife is working part-time and watching her brother, her special needs brother on the side. I'm wondering if we can increase the income if you're going to be, you have increased expenses coming up, whether it's rent or mortgage. So that needs to be part of the picture. And so I don't know who, it sounds like that would be on you to increase the income with her obligations currently. Yeah. But you're also in school, which makes it tough. How much longer do you have in school? I think another year or two. I was looking at graduating winter 2025. Okay. So at the end of the day, when you do purchase the house, we want to make sure that it's something that you can enjoy, that it's not setting you back, that you're not house poor.

And so we want to make sure whenever you do buy that you're able to put the right amount of down payment on something that's a 15-year fixed rate mortgage, right? And we don't want the payment to be any more than 25% of your take-home pay. That's taxes, HOA fees, insurances, all that factored in, right? So that's what we're aiming for. So at this point, it's really just you guys getting out there and seeing what you like, what you don't like, what you think you can afford and really putting a timeline on yourselves. Because it's not to say that you have to move directly into a house right now. If you're not ready, then it's not the right time. And in your situation, there's no shame in renting. Let me just, I mean, renting sounds like honestly, at this point, it might be the move until you can

save up some more money and keep looking in different areas i mean um when it comes to safety i want you guys to live someplace safe but this is the point of renting is to be able to save up this is it's like dave says it's camping right it's this is not the life of luxury in your rental it's it's to get you somewhere it's a vehicle to get you where you want to go ultimately, which is being a homeowner. So there's something to be said for that, right, George? Yeah. What's your take-home pay right now? Oh, he's gone. We lost him. Sorry about that, George. It's all good. Well, I'm looking at the numbers here on our mortgage calculator and I'm going, all right, if they put even 90 grand down on a $300,000 house,

that payment's going to be $2,100. And so your take-home pay has got to be close to eight grand at that point. Yeah. So that worries me because they said they're making 50. It tells me they're just not ready to be homeowners. And that's okay. Yeah. It tells me, all right, there's some things we can do now. Number one, we need to wait and save up more.

Number two, we need to get our income up. Yeah. And so if we can get our income up to 75 and put that extra 25 towards the down payment, now we're cooking with gas. Because otherwise it's going to be a slog to try to save up three, five grand a year towards the down payment. Home prices keep going up. It feels impossible. And so if you're going to live in a high cost of living area, you got to have a high income to go along with that. And that's just math. That's not me trying to be mean and say you got to move, but you might have to move further out. And again, we go back and we've talked about this before. Right now, and at all times, there's these things that we want in life,

right? We want to be the stay-at-home parent. We want to pursue home ownership. There are these milestones in life that we all want to achieve and that's perfectly fine, but you have to be able to afford it, right? People say all the time, when's the best time to buy a house? Is it when the market is like this? Is it when interest rates are like this? No, it's when you can afford it. Right? People say all the time, when's the best time to buy a house? Is it when the market is like this? Is it when interest rates are like this? No, it's when you can afford it. That's the best time to buy a house. Everyone has a different definition of afford. And some people's definition is, it's okay if I can't put food on the table as long as I live in this box that I kind of own. Yikes. Recipe for disaster. You want the home to be a blessing and not a burden. Yeah, that's exactly right. And if Ben follows the advice that George Campbell so beautifully laid out,

he too will accomplish the dream of home ownership in due time. But for him, a key component of that is getting that income up, which is probably the case for many folks listening right now. But stay in the race. Keep putting that money aside. The time is going to pass. Anyway, this is the ramsey show hey what's going on everybody you are listening to the ramsey show i'm your host today jade warshaw joined by george camel host of the

poppin youtube channel wow yeah george descriptor yeah all you got to do on youtube is go in and just google george camel right with a k with you got to do on youtube is go in and just google george camill right with a k with a k that's right and it'll show my friendly face and we're having fun jade i did some uh we did a video on travel hacks yesterday as everyone starts to travel for the summertime oh i shared my top 10 some some good goodies in there can you give us a little taste of what that of what one of them i'll tell you how it ended it and the last tip was me showing you how to fly with luxury i'm talking you got to have the the noise canceling headphones yes you got to have

one is like a little flip flap you add to the little seat yes you can put your phone up there because i see everyone struggling to watch their movie and put it somewhere where it's not falling i love that can you inflatable uh headrest that's a big one yes can you advise us on how to keep the person in the middle seat in their space instead of spilling with their feet in their bag and and in their chips onto your seat the first 30 seconds are everything that is where you you assert dominance yes so you gotta command the elbow space and let them know what's up. Yeah, I puff up like a blowfish on a Southwest flight. The other move you can do is just give a little cough.

That usually will get them to go. I'm going to keep going. Can I tell you the truth? I tried that. I did that. Old girl was really just getting into my space. Look, let it be known, if you're sitting in the middle seat, you do have access to both armrests.

That is a given. I've heard that as an unspoken rule. But if you start putting your feet over into my side, and so I started coughing, and all she did, she pulled up her blanket over her nose like a mask, but she didn't move her foot. I had one where like the woman put all of her hair

behind the chair right in front of my face. I was like, this is not okay with me. So as you can see here on the Ramsey show, we will talk about anything that we need to talk about, but we like to talk about money. That's really what the show is about. So give us a call. The number is 888-825-5225. We're talking about money. We're talking about travel hacks, apparently, and how to keep the middle seat person in their lane. Connor from Jacksonville, Florida. What do you know about it, Connor? How are you guys?

Doing good. How can we help? So the question I had is I'm trying to figure out how to get my girlfriend on board with budgeting now that we've kind of moved in together. Okay. What do you mean kind of moved in together? That's a good question. We first moved into my mom's place.

She moved in with me and then we just got an apartment back in january so finance has been like a big struggle of ours and trying to get her on board with like either every dollar or baby steps it's been almost impossible what is her is she just like no i don't think that I should have to live in what she probably feels are confines of a budget? Is that kind of where her head's at? Yeah. So she finally got like a pretty good paying job and her parents just never taught her how to budget. They never budgeted. So it's not really anything that she was ever taught or shown how to do. That makes sense. And she kind of just like, oh, as long as I pay my bills, I'm fine. Does she have debt? Yes. So right now it's about $2,000 on a credit card and then about

$24,000 in a car loan. Okay. And you have no debt? I have some debt. I have a car loan right now and then about a hundred bucks on a credit card from gas how much is your car loan by the way i just curious my car loan's about 17.5 is what i let is what i owe on it and you're done with debt at this point yeah well i just haven't spent on my budgeting for the day i just got paid but i mean like the concept of debt you're like i don't want to be debt free anymore like i or i'm sorry i don't want to take on debt anymore yeah Like, or I'm sorry, I don't want to take on debt anymore. Yeah, 100%. Okay. So it sounds like you guys have got to sit down and have some lengthy conversation because right now you guys have a different set of values. And it's not just as simple as me and George going, if you read this script, she'll say yes tomorrow to the budget.

It's you guys sitting down and saying, okay, we're living together. We're thinking about getting married or hopefully we are about to get married. And before we get married or before we get any deeper into this relationship, we've got to see that we have similar values on how to live life. Because honestly, when it comes to money,

it filters into so many areas of life. This is an exercise on how we view life. Because honestly, when it comes to money, it filters into so many areas of life. This is an exercise on how we view life, right? When it comes to money. And so you would not want to enter into marriage. And in my mind, even starting to live with somebody is very shaky ground. If you don't see how to live life eye to eye. It's religion, it's money. Those are some of the biggest factors in how well a marriage is going to play out, how you raise your kids, what are your philosophies on that. Those are the things that you need to be talking about with somebody that you're thinking about marrying and for sure somebody you've already moved in with. So what do those conversations look like? So we've talked about budgeting in the past.

Her big thing right now is just she wants to, she's trying to get her credit card paid off. Okay. So she's been putting like five, $600 a paycheck towards it. So we're trying to figure out if we should just keep putting a lot of money in savings and making like two or $300 payments. What do you mean we? Are you saying you're helping her pay this down?

I'm kind of like helping her figure out how to pay it down. With her own money yeah okay okay so we're not sharing money just to make be clear yeah we only share like grocery money and rent pretty much that's it so you're splitting the rent splitting the food yes okay and let me just say in case you were thinking of it do not split your money like don't combine your money don't pay off her debt she doesn't pay off your debt um and if yeah let's just keep that clear this we took i'm just i feel the tension building because we took a call yesterday where a couple was playing house like this they weren't married all of a sudden she can't work or doesn't work and now he's covering her bills and paying her debts.

And it was a messy, messy situation. And so I don't like this idea. Moral issues aside, I don't like the financial implications of living together before you're married. But as far as getting her, you asked about how to get her on board budgeting. And it comes down to her wanting to take control of her money. And it sounds like right now she's like, well, I pay my bills, so it's fine. But I think you showing her, here's what budgeting has done for me. Here's what mine looks like. Here's what it's allowed me to do. Here's all the things I've seen that I'm

overspending on. I found out I can save money by doing this. I feel in control because I'm giving every dollar a name. That's the stuff that makes you go, I'm excited to budget. Because the budget is not exciting. What the budget can do for me financially, that's exciting. Yeah. And I'm excited to budget because the budget's not exciting. What the budget can do for me financially, that's exciting. Yeah. And I'm going to be, I'm going to be Mama Jade for a minute because I got to say this. You can't change folks. You can lead by example, like what George is saying. You can, you know, hope that they get on board by watching what you're doing and seeing the

impact it's making on your life. But when it comes to relationships, you can't change folks. And I would advise kind of putting a little bit of time limit on this and kind of seeing like, hey, I'm going to put this out there and I'm going to see what her reaction is. But after a while, if an old girl is still not on board, you're going to have to see how that lines up with your values and what you want out of life and how you view money. And if you start, if she's like, hey, I'm fine with this. It's not important to me. It's not something I want to do. You're then going to have to decide what that means for the relationship moving forward. Because let me tell you, you don't, these are things that matter. You want to go into a relationship. You want to go into a

marriage with someone that you see eye to eye with. Money fights and money problems, one of the leading causes of divorce in America today. So we just don't want that for you, Connor. And I want you to get out of debt. And I think her seeing you actually do this stuff and be a man of your word will go a long, long way, more than you telling her, you got to do a budget.

You should really, her seeing you become debt-free a year faster than her with having more debt, she's going to go, tell me what you did. Now, what is her income? I'm curious. So my income's right about 46 to 48,000 a year, depending on what I work overtime wise. And then hers, I don't know what her yearly is because her hours are weird, but her take home every month is 4,400 after tax. Okay. Okay, good. So yeah, this is just kind of monitoring the situation, right? You're being tactful about how you're talking about it. You are having open conversation and ask direct questions, right? Don't skate around this. Be like, what's her name, by the way? You don't have to say her name. Let's call her Jennifer. Jennifer,

what do you think about debt? Jennifer, I want to make it clear. You know, in my life, I don't want a life where we're borrowing money. I want a life where we stick to the budget. I want a life where there's parameters around our spending. And that's what I'm seeking. Like, let's have very clear. And it's not an ultimatum. It's just you being very Dave. Dave Ramsey says to be unclear is to be unkind.

And that is what this is. You guys have been dating long enough. You're moving in together. It's time to have these serious conversations and make it super clear to her. This is what this is what I want out of life. Is this what you want out of life? This is The Ramsey Show. Hey, what's going on, everybody?

You are listening to The Ramsey Show. I'm your host, Jade Warshaw, joined by fellow co-host, George Camel. And listen, if you're financially ready to buy your first home in this market, it's not because of luck. It's probably because you've been putting in the hard work and kicking butt at budgeting and saving.

And we're fired up for you. We're proud of you. And we don't want your hard work to go to waste. Buying a house is the biggest purchase that you're ever going to make. So the last thing you need to do is fly solo or work with a garbage real estate agent. Even if it's your Aunt Susan, it's always the family members. Even if it's your Aunt Susan and she's a very nice lady. You know, she goes to church. You can't leave this up to an agent who's just good enough, right? You need somebody who's great.

You need somebody who's fired up. They've been doing it for a minute. They know how to make you some money. You know what I'm talking about? A Ramsey trusted agent is a great agent. They set you up for success before and after closing day by helping you find the right home, keeping you on track with your goals. Hey, timeout, because let me talk about that, because these agents that you tell them, I only want to spend this much, and then they're constantly showing you houses that are outside of your price range. It's a trap. So we need agents who are

keeping you on track with your goals, making sure that you're confident in your decision. And our Ramsey Trusted Pros or the Ramsey Trusted Pros here on our site can get our stamp of approval because we know that they work hard to serve you. And they're not to pad their own paycheck. So they're working for you guys. They're not trying to do whatever makes the most sense for them on the back end. They treat our fans right. Yes. And so you've worked hard to buy your first home and you don't want to do that with anyone but the best. Find a Ramsey trusted real estate agent by going to ramseysolutions.com slash agent.

That's ramseysolutions.com slash agent. And it must be said, my Ramsey trusted real estate agent that I used, nothing but the best. The best, George, I'm telling you. A resounding recommendation. That's right. That's what we want to do. So let's take some questions. Our question of the day is sponsored by Neighborly, your hub for home services. If you're moving, you have a long list of to-dos, but Neighborly has local pros like Housemaster or Five Star Painting or Window Genie or the Junk King to check items off that list.

Visit Neighborly.com to schedule your home service experts near you. I might call Junk King to just go to my neighbor's houses and get all that stuff out of the garage. What is people storing these days? It's crazy. It's weird. I see people, they can't even park their cars in the garage. They got to park them. It's a free storage unit. Why not? It's weird. I see people, they can't even park their cars in the garage. They got to park them. It's a free storage unit. Why not? It's craziness. Well, today's question comes from Marie in South Carolina. She writes,

I'm a huge fan. Thank you for all you do to help people. My question is that I recently got engaged and now have a beautiful ring and the jeweler said I needed to get my ring insured. Is that necessary and what's the best way to do that? Should I put it on my homeowner's plan? Great question from Marie. That is, that's different. Yeah. So I don't have a strong opinion on this. I think if it's something you're worried about and make you feel better, you have an exorbitantly expensive ring, that's a pretty big part of your world. It's not going to hurt to get insurance on that. And a lot of the times you can do that through your homeowner's or renter's policy, and it may add 1% of the value of the ring to your policy. So $5,000 ring

might be 50 bucks a year extra to insure. That's good. Now, I feel like we have to caveat this because some folks kind of go crazy on like the warranties and like, anytime I buy something, like on Amazon, even you buy one thing and they're like, do you want the protection or like Wayfair? Do you want the protection on this? And this is not like an excuse to like go out and get all the warranties and insurances on all of the things, right? We are not a fan of all these extras and warranties. And a lot of times it just makes the companies a whole lot of money. And they know statistically the chances of you needing to use that and them actually paying out and covering it. And there's always deductibles.

So you still have to pay. It's never just a free lunch here. So you got to use that and them actually paying out and covering it. And there's always deductibles. So you still have to pay. It's never just a free lunch here. So you got to look into the fine print of these. And remember the reason for insurance is to cover the things that you can't cover. Absorb that risk. Absorb. And so my rule of thumb is if that wedding ring is going to tank you guys to replace, number one, you may be getting too expensive of a ring. Facts. going to tank you guys to replace number one you may be getting too expensive of a ring that scares me uh my wife's ring is not expensive enough that is it's even worth insuring yeah and she's a beautiful ring let me just say that i believe that george i believe you have great taste i my wedding

ring that sam gave me the first or engagement ring really we insured it like the first five years because back then it would have been a big part of our world i think that if if i had lost it and let's be honest the man worked hard for it he had a paper route and everything wow so he was a grown man a grown man on a paper route for some reason i pictured him on a bike i know he was in a vehicle but him on a bike like a little mini bike makes me happy just throwing those papers like the paper boy video game on nintendo love that game i mean we were in we were in college and he was like hey i've got a paper route can i sleep on your floor because you're close to my route and i was like uh what i didn't know that's what it was for and then i found out that's what all the hard work was for all right

let's take a call we got aaron in baltimore maryland what on, Aaron? Hey, how you guys doing? Doing good. How are you? Good, good. Yeah, I was just talking to the gentleman. I'm about to be losing my job in about a year and a half. Shoot. I'm coming from a six-figure salary. That's a very specific and long time frame.

Yeah. What's the scenario surrounding this? Yes, the scenario surrounding it is, I guess, coal's under attack in the United States. So basically, long story short is, I guess, they got in bed with the Sierra Club, so now we're shutting down. And we've got about a year and a half of my salary income. And Marilyn, I think it's going to be a little bit more difficult to find a six figure

income coming from operations, which I'm in. So right now, but your skills transfer my time. Say again, your skills transfer to other areas. Yeah, that's true.

It's true. However, there's a nuclear plant down South and the most, the majority of the plants are kind of a far, probably like an over an hour drive from me. I mean, there are some smaller plants, but people are starting to move. It could mean you moving or transitioning to find the right position. yeah i mean i i really do like the area i live in um but you also got to realize a lot of these people that i'm working with we're talking about 100 people are going to be losing their jobs a lot of people are going to be jumping ships because it'd be very competitive trying to get a job in these other power plants um plus i have a family so some of these guys that i work with

are uh you know single guys so getting up and moving is is not uh not uh daunting for them so have you started have you started to prepare have you started it sounds like you've done a little bit of research let's do more because i definitely would not wait you know i would not ride this train for the next one and a half years if you got a job in six months could you just leave uh yeah so uh there's there's talks about a retention bonus at my job but but, uh, obviously they're dragging their feet on that. So, I mean, at the end of the day, they're looking out for themselves and I mean, it is what it is, business at the end of the day. But, uh, I mean, the problem

with it is if you sign that retention bonus, obviously you have to stay to the end. So, uh, that's going to be a problem. So that's essentially your severance. If you stick out for a year and a half, you'd get some kind of severance. So they're talking about a retention bonus and then standard end. Perhaps there could also be a severance package as well. But, you know, this is all question marks right now. And honestly, you know, I have two young children. I don't need question marks in my life. We don't need any buzzer beater Hail Mary situations.

So I would start doing the homework now and sharpening up that resume and going, who do I know in these areas? What skills do I need to transfer to maybe a different industry completely? That's right. If coal and power plants are going to be a tough gig for you for the next 10 years, we got to find something sustainable. And another part to that is making sure that you're in the best possible financial shape right now going into that. So right now, what's it look like? Do you have savings? Do you have debt? Can you roll that out for us briefly? Yeah, so yeah, briefly, I'll roll it out to you. So I guess savings account, I got about $15,000 checking. I got about $15,000. I did open a little business recently with junk removal. It seems like everybody's moving in that direction. Just for time, how much debt do you have?

All right, so let's see. About $80,000 in car loans, $220,000 in house loans, and $8,000 on a dump trailer, and that's it. All right, so this is what we're going to do. The game plan is to do that research to find out about work, but in the meantime, we are cleaning up the mess of this debt. We are keeping $1,000 saved for Baby Step 1. And then we're working that debt snowball to pay off as much debt as possible

so that you can feel comfortable going into this transition. And then, of course, any and all extra money you can pull in. You mentioned you had a side gig going on. Let's kick it. I'm probably selling one or both of these cars. That is way too much car for the situation you're in. Yeah, you've got some work to do, but you can do it, Aaron. We're pulling for you.

This is The Ramsey Show. What's going on, everybody? I am Jade Warshaw, your host, joined by George Camel. And you're listening to The Ramsey Show. Hey, if you want to give us a call today, the number is 888-825-5225. We'd be happy to take your call. But in the meantime, we've got our scripture and our quote of the day. This is one of my favorite parts of the hour, George.

He says, For God has not given us a spirit of fear and timidity, but of power, love, and self-discipline. One version says a sound mind, which I love that one. That's 2 Timothy 1 and 7. And then of course, we've got this one from Alanis Morissette. Happy birthday, Alanis Morissette. Courage and willingness to just go for it, whether it is conversation or spontaneous trip or trying new things that are scary. It is a really attractive quality so get out there get crazy now we're not talking about yolo alanis it's different none of that yolo business where else can you get some first timothy and alanis in one segment i mean only on the ramsay show

isn't it ironic hey got here we go got him it was really it's not ironic at all but i had to say that all right let's go to the phone lines we've got Alyssa online one what's going on Alyssa Phoenix hi yeah hi um so my husband and I have been saving for our home here in Phoenix for about the past three years through COVID we are now priced out of the market and so basically our question is, should we stay here in Phoenix and try to make it work buying a house, even if it might be some financial stress, or should we move and go out of state, even though our friends and family are still here in Phoenix? Well, I appreciate the question, but let's look at what you're saying here. Because is it really priced out of the market?

I get it. A lot of people, it's like as fast as they save, the prices just keep going up, right? And it's hard to keep up with that and outpace that so that you can actually buy. So completely valid. I get that. But what you first said to me is that, is it worth it, even though it would be basically beyond your beyond your means right you'd be strapped for cash you'd have all these issues no that's not worth it it's absolutely not worth it if you're gonna buy a house you want it to be a blessing and never a burden that's not that's no fun you'll start to resent the house you'll hate the property it'll make you dislike going to work right because nobody wants to work just to be in that rat wheel right george so that is a no-go i feel like there's other options that's

right we can't live in phoenix we're getting out of the entire state is there another option which is okay maybe we do a town home that's 30 minutes out of the city you know what i mean are there other things you guys could look at temper temper the expectations, compromise a little bit? Hey, we're going to save up for another year. Whatever we can afford at that time in whatever location in the area, we're going to go for. So where are you guys at in that regard? Well, we are currently living with his parents. We have a baby.

So my husband's working. I'm at home with the baby. We currently have about $80,000 saved for down payment. That's great. We don't have any debt. So we really want to buy. But we want to make sure that with just one income coming in that we'd be able to afford our mortgage and why is there only one income coming in i'm i'm a stay-at-home mom okay what's he make sorry before you get to that can i pause right quick george um

i just want to challenge you on this because George and I've talked about this several times. The dream is being a stay-at-home mom. So many folks have that dream, but you've got to ask yourself in this season with what you're saying you want, is it feasible? Are you able to go into the marketplace and earn more than the cost of daycare so that you can accomplish this goal of getting this down payment? I just, that's a little sidebar for you to think of because a lot of times we kind of feel like, oh, I can just do this. But then we complain about what it means on the financial implication. So just throwing that out there for you to think about. Okay, George. That's a good word. So you're saying with his income currently, it's not going to, you're not going to be able to afford a home. So like Jade's saying, what is his current income? He makes $80,000 with his 9-to-5 and then $10,000 with a side hustle.

Awesome. About $90,000. Okay. And you have $80,000 saved. What is a home, like the homes you've been looking at, how much do they cost? They're on average about $450, $460. Okay. So the take home on a 15 year fix, which is the only one I'd recommend, if you put $80,000 down on a house that's $450, that would be a $3,900 mortgage payment, which is a lot of your take home pay, right? Yeah. So just thinking about that number you're going we couldn't breathe and so that tells me we either have to temper the expectations wait another year or two and have 120 down or 150 down or we need to go we're going to get a condo or townhome because we really want it or like jade said i may have to go back to work for a season

for the next year in order to make this happen and And one day I'll be able to go back and accomplish this dream in a way where it doesn't set us back financially with our other goals. That's right. Because mathematically, you don't want to be more than 25% of your take home pay on that mortgage. Otherwise, you will feel the strain. It will be stressful. And you're going to go like, why did I do this? So these are the things that you've got, you're going to have to weigh out. out now don't get me wrong I mean John Deloney might say yeah pick a place on the map and move there you know you're free you can do what you want and if that's if that aligns with you guys's you know personality then be my guest if you're like look Phoenix peace out like y'all are too expensive we're going to Kansas then that's also up to you too. But I like what George said. Sometimes

we paint ourself into a corner and it's either we can do this or we can do that. And those are our only two options. And I'm hoping that we kind of illuminated the fact that there's a lot of options for you. You've just got to decide. The main thing here is you've got to have that boundary around. We're not going to buy a house unless we're able to buy it the right way, unless it's affordable and it fits within those parameters. 15-year fixed rate mortgage where the payment is no more than 25% of your take-home. That's what we're looking for. Great call, Alyssa. I loved that. Let's go to Taylor right quick. I think we can handle it. Taylor, we're slightly against the clock, but tell us about your situation. Hi, guys. Yeah, so my husband and I are in babysit four, so we're trying to

contribute our 15%. We're both contributing to our 401ks and we'll contribute to one Roth. We're just not hitting or meeting that goal of 15%. Um, cause we're also trying to save for a future surgery that we know is going to be about $11,000. Okay. So the question is, is that okay for us to just do what we're doing and then save the money and handle that and then move up to 15 or in this stage we'd be pushing for the 15 while also saving is there uh are you i mean not to get too personal but is the surgery elective or is it something that's like i gotta get this done it's something that we gotta get done okay i mean if you for your health if you gotta get done then you gotta save up, for your health, if you got to get done, then you got to save up for it.

Yeah. How quickly could you save up? Let's say you invested, you got to 15%. How much longer would it take? Could you delay the surgery? Or is this something that has a very specific timeline? It's a specific timeline, so it's going to be about a year's time. I think we can still do it by pushing up to the 15%, but it's just, you know, taking away

from, you know, some margin that is going towards that. If I'm in your shoes, here's what I would do personally, if this was my family, I'm going to find a way to create more income for the next year so that I can invest 15%. We have that going and I can save up 11,000 for the surgery. Cause you're talking about a thousand bucks a month to save up for the surgery from scratch. Do you guys have any money right now in the bank? Oh, yeah. We have our six months. We have $18,000 for that.

Great. That's good. That's good. And I love that you're not just going, oh, we'll just use the emergency fund to pay for it. Because in this case, it wouldn't be an emergency. You know what's coming. Yeah, it's not unexpected. So that's good. I like that you guys are doing that.

Yeah, I'm with George. If you have the ability to get your income up and to still be able to do both that's great if for i don't can't think of a reason why but if for some reason there's no option and it's you know causing you guys to do some weird things and maybe i mean i don't know if you're in if you go down to i just can't see it making a huge difference going from 15 down down to 13%. Yeah. And you can make a hundred bucks a night doing a side hustle. And if each of you did that a few nights a week, there's your thousand dollars right there. I like that, George. So that would be my personal goal. If you need to scale back and kind of call this a storm,

because this is a health situation and you need to scale back investing, we're not going to yell at you. You're going to be okay. But my personal goal would be to hit that milestone and save up on top of that. That's right. Thanks for the call, Taylor. That's a great, that's so good, George. You know, sometimes you really have to look at the dollars and cents on something and go, all right, if the difference is $200, how quickly could I make that? You know, do I really have to pull from this or can I just go out and get my fingernails dirty? That we're not thinking about. That's right. I love it. Well, guys, that does it for this hour of the show. Be sure to join us next time. And remember, you can tell me you won't do it,

but don't tell me that you can't. With God, all things are possible. Hey, what's up, guys? It's Jade. Look, if you like what you heard in this episode and want to know more about getting started on the Ramsey Baby Steps, go to ramseysolutions.com and click the Get Started button. We'll help you figure out the best next step for you based on your specific situation. That's ramseysolutions.com and click Get Started.