The Ramsey Show - App - I’m Asset Rich but Cash Poor (Hour 3)

Episode Date: May 17, 2024

Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships. I am Rachel Cruz hosting this hour and taking your calls at 888-825-5225. We'll be taking your calls on life, money, relationships, career. So give us a call again at 888-825-5225. Up next or up first, I should say, we have Carrie in Buffalo. Hi, Carrie. Is it Carrie or Kari? It's Carrie. Carrie, welcome to the show. Yeah. Well, thank you for taking my call. So I was divorced two years ago. I'm a single mom. I'm almost 49. So I'm working as a medical receptionist right now. And I do have a side hustle as an artist as well, where I'm almost 49, so I'm working as a medical receptionist right now.

And I do have a side hustle as an artist as well, where I, you know, I sell my art. Um, and I'm just really having a really hard time, um, financially right now. Like I've kind of spiraled since my divorce with keeping up and, um, I'm, I have about 20,000 in credit debt right now plus a car loan and my living situation is so i own the home um my i have a family member that is our mortgage lender though so we filed an official mortgage okay but so he's kind of put my payments on hold because he knows my situation is crazy which is not ideal now. But so your mortgage is on hold right now. Yes. Okay. Um, I'm just, but I can't keep up with my bills. My minimums are so high now because I have,

you know, some of my minimums are like $400 on my cards and then I have the house bills and my son and I'm just wondering, do I file bankruptcy? Like, what do I do? So, no, I would not say you're bankrupt right now. No, these numbers aren't impossible, okay? So how much are you making a year? I mean, I've only had this job for a few months. I was working on my own since my husband moved out, doing the art-based business, which was doing okay. I was paying my bills, but then I was spiraling and it just hasn't been great with the economy. People aren't buying as much. So I'm only working three and a half, four days a week right now and I need

to get more hours. I'm probably going to look for a full-time job within the next like few weeks. I just want to wait till my son's like, I just have to figure out what I'm going to do with my kid. It's really tough. For sure. How old is your son? I have to get him off in the morning. Yeah, I have to get him off to school every morning, which they've been really flexible with. Yeah. So it's tough because my parents are up in age and I don't want to use them anymore. No, for sure. For sure. So I think what we're going to need is just this plan because I can hear you're spiraling. You have a lot of things going on, right? I'm like, you're a single mom. And when you guys were married, did he do most of the finances? He did. And then he ran into some issues with his mental health and some other issues. And he kind

of lost his whole career and his sanity. So I don't receive any child support or alimony. I kind of just wanted him to leave the home. So I took on the marital debt, which grew a little after he left because it was only my income for so long. And, um, it's just, I'm just like at a wall now where like my cards are max. I can't make the minimum. What do I do? Um, I'm also back on my property taxes this year because they're not escrowed in my mortgage because of the private lending situation. Like I have to save and pay those every year and I didn't have the money this year. So I'm just going to have to keep making payments throughout the year. I'm just like, really, I'm just like backed up against the wall. And I'm like, what do I, I talked to a few

attorneys about bankruptcy and they recommended against it because they're like, you could lose your house. Yes. Well, yeah. Cause they're like you could lose your house yes well yeah because they're going to come and take all of your assets before and so we want to be able to keep you yes so so here's the thing carrie i think for you to feel stable i think getting your income up is number one okay and you're just starting this new this new business right you were in an industry art and selling the art which is great and wonderful but after a while it was not paying the bills so now i think you're facing that. So the upside here is that there's a lot of upside to your income, right? You can find, and I would, I would find a full-time 40-hour week job. And then

I want your first priority to be your four walls, which is food, shelter, utilities, and transportation, because this mortgage is not going to go on hold forever. So I do want you to get in a position to know if you're going to be able to keep. So I do want you to get in a position to know if you're going to be able to keep this house. Because how much would the mortgage payment be a month if you were paying it? With the taxes, it's about $1,300. So I owe about $160 on the house.

Okay, okay. So if you can paint out a picture yearly, like if you were here a year from now, if you had to guess how much do you think between still selling some art, if you're doing that at all, but also a full-time job, how much do you think you could bring in? I don't know. I mean, the job I'm working at now is only $18 an hour.

It's not much at all. And most of the positions I've been looking at, they're like twenty dollars an hour. So I would also constantly you would you recommend getting like going back to school at night to get my bachelor's because I already have an associate. No, no, no, no. I don't think education is the problem here. I think it is income and I think you're going to. Yeah, I think you'll be able to get it up. But I think I mean, honestly, Carrie, I think getting these four walls covered, making sure food before before credit cards and all of that are paid, that you and your son are taken care of on the basic level.

And you know food, shelter, utilities, transportation, you have gas in your car. Do you have a car payment? Yes, I do. I had to get a new car last year. I had like a 15-year-old car

that finally... Okay, Kara, how much is your car loan total? That car payment is $365,000. I think I owe $18,000 on it. $18,000. Okay. If you sold it today, how much could you get for it, do you think?

I think it's just about even because I did check the other day. Okay. And no money saved. It's not. I have nothing. I'm like living minute to minute. Yeah, I hear you. I hear you.

Okay. So you have the $18,000 car payment. You have about $20,000. Was that what you said in student loans i'm sorry in credit cards credit cards credit cards and is that it and that's it correct yes and then the house okay and you have no money saved none none savings okay so your first goal what i would do is to get a thousand dollars asap and again making sure that your other bills are covered, food, shelter, utilities, transportation. This is before credit cards and everything, okay? And then I would look at selling your car carry. I really would. And maybe you take out a small

$5,000 loan to go get a $5,000 car. But I would rather you have $5,000 in debt than $18,000 with this car, okay? Okay. And I think that's going to start to give you some level of footing here because I need you to get some quick wins as well. And if you stay on the line I think that's going to start to give you some level of footing here because I need you to get some quick wins as well. And if you stay on the line, Skylar is going to pick up and we're going to get you connected with a coach because as a single mom, I mean, I can, I can feel it. I can feel it on you. It's like, there's so many decisions that you have to make. But again, I think having some sort of game plan is going to be really, really important and the budget's going to help with that too. And so I'm going to give you every dollar premium. And this will be our budgeting app that's going to

walk through how to do a zero-based budget. And that's something that's going to help you to be able to say, hey, here's where my money's coming in. And I have a plan for it. But again, I think getting rid of this car and getting in other cars, that's going to free up that payment. And that's going to feel so much better. really will and then cut up the credit cards and and and start paying these off one at a time so out of the credit cards how many are there um there's four four okay i want you to list those off smallest to largest, okay? So after you get your $1,000, your next goal is to pay off that smallest credit card, okay? Okay.

And so we're going to get you with a financial coach though, because I know that there's just so many elements of this story. And I do not think you're bankrupt though, Carrie. I really think if you get your income up and you get a level of stability and consistency with these bills, you get this car out. So you're not dealing with that debt over your head and you work on getting out of this credit card debt. I mean, you really are going to get some quick wins. And I think that's going to give you a level of confidence to carry. So stay on the line.

Scholar will pick up. But I'm so sorry. I hope that I hope that gives you some level of direction and ideas to get this started, because I do see hope for you. This is The Ramsey Show. Welcome back to The Ramsey Show. I am Rachel Cruz taking your calls at this hour at 888-825-5225. And just as we came up on the air on YouTube, my new book, my kid's book, I'm glad for where I am, is out.

So you can go to ramseysolutions.com slash store or rachelcruz.com and check that out. We did a little book tour here a few weeks ago and got to travel around and meet so many of you guys at these signings and sign some books out with the great people out in the lobby, which reminds me, if you are in Nashville, Nashville's such a great place to visit. Come check us out. of you guys at these signings and sign some books out with the great people out in the lobby, which reminds me, if you are in Nashville, Nashville is such a great place to visit. Come check us out.

We're in a sweet little town, Franklin, just south of Nashville. And so we do this show every day live from one to four with different personalities. And we do it here on the glass so you can come get some coffee and cookies and hang out with us. And it's always fun to meet people from all over. So we're so glad to have you guys here today. And so come and join us. Also, if you are looking to really get control of your money, you guys, one of the best ways to do that is to budget. And budgeting is one of those things that can be really intimidating at first and it's kind of overwhelming. But it's one of the keys to winning with money. It really is to

be intentional. I am a self-proclaimed spender in a free spirit. Not great when it comes to the details always of life. But I enjoy spending. And I'm like, I want to have freedom in that. And for me, a budget was probably one of the hardest things to grasp onto financially when it comes to all of this stuff. And so I have found, though, as a spender and as a free spirit, that it gives me such freedom and such permission to spend money. And you do it on purpose with a plan. And it's more enjoyable when you know where your money's going and what's going on.

And so if you've not checked out EveryDollar, this is our budgeting app. You can go to everydollar.com slash Rachel and create your first budget for free. And this is a tool that we designed to really help you. And again, it's one of those things that when you want to tell your money what to do, it's going to go so much further. It relieves so much stress and so many questions out there with money that you actually have a plan. And EveryDollar Premium is awesome. If you upgrade to that, it connects to your bank account. And so all of your transactions will come in and you can drag and drop them in

the app. It takes like less than a minute a day and it just keeps a pulse on what's going on with your money. It is so, so key and it's awesome. So again, you can go to EveryDollar. You can download the app for free in the App Store or Google Play or go to EveryDollar.com slash Rachel. All right, let's hit the phones and we'll go to Jeremiah in Houston. Hey, Jeremiah, welcome to the show. Hey, how you doing? Doing great. How can I help? Well, my wife found this show and she's been uh kind of aggressive about implementing some of this stuff to say the least and i just don't jeremiah let me just say let me just say jeremiah i'm sorry i'm sorry sometimes we are used as a weapon in people's homes we're cuss words sometimes

so we're i'm probably more on your team jeremiah just Just know that. So I'm here for you. Okay. Yeah. All right. Well, here's the thing. We're actually, we're pretty good financially, but so I'll get straight to it. Her car is financed. The only debt we have is her car in the house. Her car is financed, but it's at 0%. And we only owe about two years on it. And she wants to just start paying it off. And I don't understand that because, like, I save the money.

You know, like, I mean, we have a pretty small budget compared to our income, and I save pretty well, and what we save is earning pretty good interest right now. And she's wanting to pull, like, money out of savings that's earning money to pay this car off early, and I can't understand that. And then she wants to start paying the house off, and the house is financed at two and a quarter. So crazy woman who she been listening to. This is madness, Jeremiah. This is madness. Oh, man. Okay. Well, this is so funny. Because I number one, I love her enthusiasm. Because I think people, personality-wise, when they get this taste of like, oh my gosh, I could have no payments. I don't have to owe anyone anything.

It is so empowering. It's emboldening, right? It's this idea of, oh my gosh, we have the money. We can pay this off. It's so great. And then for other people, more of the math nerds, Jeremiah, I'm going to put you in this category. You're crunching numbers, right? You're crunching numbers.

And you're like, oh my gosh, percentage-wise, I'm going to make more in this category. You're crunching numbers, right? You're crunching numbers. And you're like, oh my gosh, percentage wise, I'm going to make more over here. Why would I do that? Why would I pay off a 2% interest rate on a house when I could be making 10% in the market? Like that's just crazy. And so mathematically, I hear you. I really do. Mathematically, it makes sense. But here's the deal with money, Jeremiah. It's about 20% head knowledge. It's about 80% behavior. So much of money is wrapped up not just in the percentage, the APR and the rates of return, but it is so much in who we are as people and the emotional side and actually looking to see, okay, what would it feel like, number one, to be completely debt-free and don't owe anyone anything? And then we can have some fun on the math side and said, what if we take those payments that was on the car and then just go crazy for a second in the mortgage?

And what if that was freed up and we actually went back and invested that and made a rate of return? And so it's a different way of looking at it, this money stuff. But there is something about not owing anyone anything that gives you so many options, so much freedom, so much peace of mind. And I feel like that's what your wife is starting to feel, would you say? Yeah. Yeah, she is. The problem is, though, is, I planned on doing this again. Like, as soon as her car was paid off, my car is 12 years old. You know, it's getting there. And, you know, as soon as hers was paid off, I was looking at, you know,

shopping around and looking for something that was 0% and doing this again instead of just pulling, you know, $60,000 out of savings, you know, to pay cash for something. Yeah. How much do you guys have saved? How much is liquid right now that you could get to? Liquid? About probably $60,000.

Okay. And how much is left on her car? $10,000. Okay. Okay. Yeah. So, I mean, in that sense, what you have to realize too about the zero interest and cars is number one usually it's inventory that they're trying to get rid of

and you're financing with zero percent interest most of the time through the manufacturer you're not using a bank or credit union and so a lot of the terms on the loan can be and it's really up to them there's not much like negotiating or actually like looking at it. And so what we have found is there's actually some risk in it because for some, they actually have these fees and penalties that if you miss a payment, they actually will go all the way back and backcharge you interest. You'll have penalties, you'll have fees, and it ends up being this like too good to be true thing. And that's why a lot of people end up falling for the zero percent because they think oh my gosh what a kind manufacturer to do this but what they don't realize is they almost get screwed in the process if they just make one mistake so the zero percent yeah while some people feel like it's a great deal there's still risk involved there jeremiah so

i think for you guys um what i want to do i'm going to gift you guys financial peace university and i want you to watch it together i think your wife will be so excited So I think for you guys, what I want to do, I want to gift you guys Financial Peace University. And I want you to watch it together. I think your wife will be so excited. Jeremiah, you'll have a great weekend. Let me just tell you if you just say babe. Instead of Netflix, let's watch these lessons. She'll love it.

But really, these are nine lessons. And again, you could just get through three of them this weekend if you want. But we really do map out. And it's not just an argument for argument's sake of like, oh, get on our side and be debt free. But there's reason for it, Jeremiah, not just from an emotional standpoint like we talked about, but there is a financial benefit that instead of supporting Ford Motor Company, you're supporting yourself. You're putting money back. You're using your income, which is your largest wealth building tool for you and your family versus paying for everybody else. And so we've just found this weird way of thinking. It frees a lot of people in so many ways. Okay. Sounds like fun. Can't wait.

Listen, your wife's going to love me after that suggestion. She's like, thank you. Thank you, Rachel. She listens to this every day, too. So I'm sure she's going to hear this. And now there's no way out of it. So funny. Well, you know what?

I do appreciate about you, though, because we get a lot of spouses. Usually it's your wife calling the show and saying, my husband refuses to do any of this. I don't know how we're going to get on the same page. And you're stepping out in good faith, right? And extending a little bit of an olive branch to say, hey, I kind of want to learn this. I don't know how we're going to get on the same page. And you're stepping out in good faith, right? And extending a little bit of an olive branch to say, hey, I kind of want to learn this. Like I want to, I'm curious, right? And so keep that curiosity open, Jeremiah. Let me just say that as some encouragement, because I can tell you, this isn't really just theory and our opinion on stuff. I mean, millions of people have done this. They've gotten on this plan. They've gotten

in control of the money. And for the first time, they're actually seeing their money work for them. And that's what I want for you guys. Thanks for the call. Welcome back to The Ramsey Show. I'm Rachel Cruz hosting this hour and taking your calls. Up next, we have Dylan in Portland. Hey, Dylan, welcome to the show. Hi, Rachel. How are you doing? Doing great. How can I help? So my wife and I are expecting a kid soon in September. Congratulations. Thank you. Is it the first? We're kind of wondering. Sorry, say again. Is it the first? It is our first, yes. Baby number one.

That's great. Well, congratulations. Thank you. So right now we both work and we're kind of trying to figure out how we're going to afford to save for a home after she stops working, after she stops working. Yeah. Okay. So where are you guys at financially right now?

Like debt, savings So where are you guys at financially right now? Like debt savings? Where are you? We're really well off. We have probably 120 in savings. And then we have about 40,000 in debt. We bought a new car recently. So that's financed at 20,000. And then I have 20,000 in student loans. And I have the ability to pay those off, but then that would take away from my savings and like home possible home down payment in the future. Um, and then, uh, we're, we're really good off. Yeah. How much do you guys make a year? Right now we make like one 60, but after the baby comes, we'll be making, just me will be working. I'll be making 90. 90,000. Okay. Um, and I have the homes you've been looking at. What, what are the price ranges right now? A standard home, uh, is really, uh, really a lot of money. So right now we have a

home already. Um, we're looking for like a bigger one in like a single family home because I own like a condo now. And they're in like the five to $600,000 range. Okay. How much is your condo worth now? Three, three 70. And how much do you guys owe on it? 300. 300. Okay. Yeah. I mean, here's the hard thing about, here's the hard thing about money sometimes, Dylan, is the math, it doesn't have emotion. You know, it is what it is. And so when you cut your income in half, which I'm not disagreeing with you in that life decision by any means, it's going to limit your choices. It's going to slow

down your financial goals, right? And so I think one of the best things that you can do, we always say it's kind of stork mode right now while you are pregnant, where you guys are pregnant, have the baby. And once mom's home and good, baby's home and is good, then I would press play on this process. And what I would do is just walk you down the baby steps. And so you guys have, you're in a really great position in a way because you have so much money saved. And that 120, is that all liquid? Like you guys can get to that? That's not retirement? Yeah, that's all liquid. Okay. So, I mean, if I were you guys after baby comes in September, I would continue to save, because how much are you guys saving a month, would you say, and in your budget yeah we could probably save like easily 2,000 okay yeah 2,500 okay that's great so

yeah so I mean I would I would continue to do that savings mentality keep putting money away and then once baby's here good everyone's good I would take yeah i would take 40 000 of that 120 um that'll leave you with 80 grand left but i would go ahead and pay off the car i would pay off the student loan um and the car i mean you guys are going down to 90k and we always say not to have motors anything with motors and wheels more than 50 of your annual income so by you guys cutting your income in half, this may be too much car. We just bought it. Okay. It's a $30,000 car,

and we put 10 down, and we just bought it. So you could sell it for 40? No, it's worth 30. It's worth 30, but you owe 40 on it? No, so we bought it for 30. Oh, 20,000. I'm sorry.

I was looking at the wrong number on my on my notes i'm so sorry yeah yeah i hear you um put 10 down yeah finance 20 okay because i mean right now with her not working or her you guys going down this may there's there's a chance that this is um is too much but i mean you you would be able to pay it off because you have the cash so i would say keep the car but i would pay it off because you have the calf. So I would say keep the car. But I would pay it off. I would pay the car off the $20,000 and the student loans. Once the baby comes, I would be debt free. I would build up an emergency fund of probably six months worth since you have a new baby. And so I would do your monthly budget and just say, okay, what our expenses are per month. And I would do times five, times six, you know,

five to six months worth and put that just in a good high yield savings account and then see what's left because out of that 80 grand how much do you think you guys would need for an emergency fund probably probably we could put like 20 or 25 away would feel good okay for that so that leaves you 60 grand. And then by that point, that's when I would start thinking about the house then. And yeah, I mean, it is just so expensive. And your interest rate right now is what, at 2%, 3%? Yeah, I have a 2%. Yeah.

And I mean, I'm just curious, is it a two bedroom? What's the scenario? It is a two bedroom. Yeah. So it's a two bedroom, but we're looking to have like two to three more kids in the next couple of years. So that's why it's like planning now for like a larger home in the next couple of years. But again, houses are so expensive that it's really hard to afford a monthly payment on one income and to put enough down to where that monthly payment's so low.

What's your monthly payment on the condo right now? $1,500. Okay, that's great. Yeah, I mean, honestly, Dylan, if I were you guys, you're going to have so much life change with this new baby. And considering where you guys are financially and cutting that income in half, I would slow walk this. I really would. I

would continue to pay down on your mortgage on the condo, build in some equity that way, and then on the side, be saving up for another good down payment. And then maybe look up. I mean, it's going to be a slower process than probably what you want. And I know you guys want more kids in the future and all of that, but that's going to be in two, three years right down the road when that starts to happen. So I almost would say to stay where you are and then as your family continues to expand, then see where you guys are financially. But I would not be in a rush to get out of this. I think again, being in the market is great and you're at a great rate right now. And the whole thing is just the idea of wanting more room. But

I don't know. I would just say you're not going to be in a financial position to do that. Would you agree? Yeah. I think that's kind of what I'm trying to get over is like, that was our long-term plan. But it's really not going to be capable after we go down to one income. Yeah. So I'm trying to figure out still how to do it, though. But I don't want to put myself in a bad position. No, you don't. And I think the piece that making a life decision like what you guys are doing for her to be home, it's kind of one of those tradeoffs. And I think it's a beautiful tradeoff. Right. I think it's it's fantastic for your family. It's something that you guys value. And I applaud that. And so

with that decision, other decisions are going to have to shift. And I think that that's okay. And how old are you guys? I'm 24 and she's 22. Yes. Okay. Dylan, you're good. You're good. You got plenty of time. Let me just tell you, just I would enjoy this time. Do not stress yourself out trying to think of, oh my gosh, we got to upgrade houses. We're going to, and you end up making a poor decision and getting into a house that is over your head, you know, with a monthly payment. You guys are in a really great spot right now. And I would just enjoy it. Enjoy your life. And this is where some of that contentment comes in of like, I mean, bigger isn't always better, right? I mean, bigger isn't always

better, right? I mean, if it starts to really, you know, tighten up the budget and it really starts to stress you guys out, then that house, what could be, isn't worth it, right? It's not worth that peace of mind. And so there is power in saying, gosh, we can just stay where we are, enjoy where we're at, but have a long-term plan, Have a four-year goal of having a certain amount of money saved, knowing that you're going to have some great equity in this condo, and then move up and home after that. Yeah, okay. Yeah, that's what I would say.

Is your wife, how is she with all of this? Is she itching to move too? Yeah, she's more worried about when we have our next kid, which would probably be in the next two years so she's perfectly fine and like understandable that we won't have that much money and she'll probably get a part time job to like help

with that but it's still it's so much money and the interest rate of course will probably go down but it's the monthly is just absolutely insane so um yeah well I would you know, I would, you know, I think for sure, you know,

I think you guys are in a really, a great spot, seasonal life wise. You are, been really great financially. I would pay off this debt, get that out, have some breathing room, enjoy the baby,

enjoy the condo, be where you guys are. And then when the next step comes, that's what you can plan for. So have a goal, have a four year goal out there, but I think it's great. You guys are doing an awesome job. Thanks for the call. Our scripture today comes from Proverbs 21.5. The plans of the diligent lead surely to abundance,

but everyone who is hasty comes only to poverty. I like that. The diligent prosper, right? Being consistent in all this. But hastiness only leads to poverty. Franklin D. Roosevelt said, thank you, James, for this. In politics, nothing happens by accident. If it happens, you can bet it was planned that way. To a great conspiracy theorist, FDR, just really? We know. We know how all this works, y'all. We

know. Oh, so great. Okay, before we go to the calls, you can't see them in there, unless you all have the studio camera. But Austin Shelby, there he is behind James. Austin, he has been a producer, you guys, here at Ramsey for multiple years. He actually worked on my show, The Rachel Cruze Show, when he very first started. And then he moved on to, he was at Entree Leadership, the Christy Wright Show when Christy was here, and then has been here on The Ramsey Show, Behind the Glass.

He will produce when James is out of town or gone. And this is his last day, and we are just so tearful. So if you can just hear me choking up over here, the heart. But we're thankful, thankful for Austin, always thankful for a great team. There's a lot of people behind the scenes that make this show happen. And they become part of the family. You get to know people in such a great way. And so, Austin, you will be missed.

Thanks for all that you do. Last day, last segment of the show. Yes, thanks, Austin, and his Buc-ee's Hawaiian button-up shirts. God bless you. God bless you. All right, going to the phones. We have, is it Natia in Chicago? Hawaiian button-up shirts. God bless you. God bless you. All right, going to the phones, we have, is it Natia in Chicago?

Hey, welcome to the show. Hi, it's Annetta. Oh, Annetta, I'm sorry, Annetta. You know what, they phonetically spelled it out, and I think I just completely busted that. I'm so sorry. I apologize. I hate when people mispronounce names, so forgive me. But

thanks for calling. How can I help? Yeah, so I'm kind of in a situation where I'll say like I'm asset rich, but cash poor. And I've reached a point in my life where I kind of don't know which way to take to get out of that. Okay. So I just discovered the Ramsey Show maybe about, I'd say about six months ago. And this was after I had kind of built all my wealth. And I did that. I served in the military for 12 years. So I would take all my bonuses and reenlistment bonuses, put it in a brokerage account I've invested in stocks that grew amazingly um then I purchased 22 acres of land back in 2022 in New Mexico

and then um New Mexico legalized cannabis and the value of that shot up so I've made a lot of good decisions yeah but it's like but it's like when I looked at my possibly expenses I was like oh this is why I'm feeling the squeeze you know because we were doing a lot of like door dash nails and toes pedicures yeah um I have household staff, like a groundskeeper, a maid that comes, things like that. And then I do own a home. And so I'm like, I feel like I'm living paycheck to paycheck. Okay, when you were talking about pedicures and manicures, you mean they come to you and you get them done and you have like a staff at the house? Is that what you were saying for you? Well, I go and get manicures and pedicures

my daughter i hear you so you're saying i let you live great but yet it's still paycheck to paycheck but it's still paycheck to paycheck yeah and i was i was wondering what to do because i have this 22 acres of land sitting here that i really wanted to keep wanted to pass to my children, but I'm wondering, should I just go ahead and sell that to pay off my house and minimize some of my expenses? I'm just so torn about it. For sure. No, I hear you.

Yeah, I mean, I think regardless of the land, I'd want you to get in a place where your income supports your lifestyle, right? And living below your means may mean that there's a level of your income, you know, where it's at and that you possibly are living right at that cusp. And that is stressful, right?

It is stressful. And so that may mean pulling back on some of the expenses so that you don't have to door dash and all of that, right? I mean, not that you can't enjoy life, but there may be a prioritization list going on that we can kind of walk through. But the 22 acres in New Mexico, what did you buy it for and what's it worth now?

So when I originally bought it, I did seller financing. So I put about $10,000 down and then I paid it off and it came out to a total of about $30,000 in total, and it was unimproved land. And then since then, I've had it improved, had it foddered and leveled, and so that made the value of it go up. And I've had companies reach out to me to purchase it for cannabis farming and things like that. For how much? Oh, gosh. farming and things like that. For how much? Oh gosh I think I had one the latest offer I got was like like a hundred thousand for it. Okay yeah that's great so it's been yeah three times what you bought it for and did you buy I'm just confused 22 acres in New Mexico was that just

because it was a great deal or did you plan on moving there or what was the, well, I was living there at the moment and I was just kind of watching a lot of podcasts and stuff about real estate investing and this is how you can get into it. And you could start with land. And I was like,

Oh, that's kind of cool. And so then I discovered seller financing and I was able to buy it that way and I get into it yeah yeah I was able to get into it okay so so you have a hundred thousand dollars and it's paid for correct yeah that's completely so you have a hundred thousand dollars worth of land how much are in your stocks and brokerage accounts that about 200,000 um the 401k I have like 50,000 in my 401k okay um my savings I have like five thousand dollars it's not much there. Yeah. Okay. Do you have any debt? I do. So once I reached my status, I kind of got happy.

Oh, my God. So I went and purchased like a 2022 Mercedes-Benz. Yeah, you did. Yeah, you did. Okay. So how much do you owe on that? I owe, I just bought it maybe like a year ago so i owe like 40 000 left on it okay how much is that car payment a month that is i pay about 500 a month for that okay so you have that debt what

else yeah and then i have i don't have any credit card debt. I paid that off. Okay. My son has a car. I don't have any. I paid off my student loans. Your friend has a car. Did you co-sign? My son. Your son. Oh, I'm sorry.

I thought you said your friend. Okay. Yeah. And I helped him pay his car note. How much does he owe on it? I think he has like $10,000 left on his car. Is that in his name or your name? It's in his name. His name. Okay. Okay. Yeah. And how much do you make a year? I make about $70,000 a year. Okay.

All right. So we had some good news and bad news. I feel like in your situation, there's a lot of upside here. But then there's also these money habits that I need, I want you to kind of get in control of that I think is going to give you some peace of mind. So, okay, first and foremost, rule of thumb, never have anything with motors and wheels. That's more than half of your annual income. So you bought too much car. You bought too much car. Not that you can't get a Mercedes. Get a used one.

But I would look to see, yeah, I think you're going to feel that. So if I were you, because you don't have much margin right now is what you were saying. And so being able to free up a $500 car payment a month. And I would go down in car. I mean, how much could you get for it if you sold it today? Oh, I don't know. I haven't checked Kelly Buba. Okay, I would do that. I haven't checked Kelly Buba.

Okay, I would do that. That's on your list, okay? So as you end this call, and I want you to really contemplate that. And not that you can never get a great car, okay? But the thing is, what you could do if you wanted to, if you wanted to take some of this money out of your brokerage account to pay for it, but you're taking money out

that you're going to have to pay taxes on and all of that. So I don't think that that would be wise. I would get the car out, honestly. And then I would make a budget on living on less than $70,000. And that's going to change your lifestyle. But look to see, hey, if you want to cash out some of this, again, for the medium side, if you want to, you can. But I would really, really encourage you to get that lifestyle under that 70,000. I think that's gonna give you breathing room. So that may be cutting some expenses, but thanks for the call. Take care.