The Ramsey Show - App - I'm New to Investing and Confused by the Jargon (Hour 1)

Episode Date: March 22, 2021

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5 from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios. It's the Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. My co-host today, Anthony O'Neill, Ramsey personality, number one best-selling author, as we answer your questions about your life and your money. Open phones at 888-825-5225. So, Anthony, I'm wondering if our radio audience looking deeply in the radio can see the Cabo tan that I got from three weeks in Cabo. You guys looking into your radio, I'm a little darker. He is.

A little better looking than I was. Yeah. And then I was from three weeks in Cabo. Well, just do you good. I'm just saying. You look younger, too, man. I'm proud of you. Oh, there you go.

There you go. Oh, you want a raise? Oh, I'll have to get on the radio and learn how to do this again. After three weeks, it's like, you know, I got to learn how to do a lot of stuff again. Yeah, you know, but I'm here. I've been holding it down with you with the other personalities. I heard, like, you and Deloney were big hit on Friday. Hey, man, we had a blast.

You know, when we got James and Kelly in there, we got to be a big hit. Yeah, because they're hard on you afterwards. Oh, yeah. It's their taskmasters, are they? You know, there's two offices I don't want to go in. I don't want to go in your office. I don't want to go in James and Kelly's. I don't want to be mean to you in my office.

I don't want to be mean to you. I'll do it right here on the air. Oh, well. You can't do anything wrong in my office. Oh, no. Like a principal's office. Come on, man. All right, folks.

I am happy to be back. I love doing this show. I love working with you guys and helping you. And it has been an eventful couple of weeks around Ramsey while I've been gone. And a lot of new, a lot of change, a lot of things different than they were, a lot of pain in the process. But we're here. Yeah. And we're excited to help you guys and serve you.

It's what we do. It is a free call at 888-825-5225. Some say the advice is worth what you pay for it, so shut up. If you don't like my advice, you can cut my pay in half. 888-825-5225. Andrew is going to start us off in California. Hey, Andrew, how are you? Dave, I'm great.

How are you? Better than I deserve, sir. How can I help? All right. So I am on baby step seven. I'm investing now. Twenty-one years old. I'm in the military. So living in a barracks room, I have no mortgage. I have a Roth IRA open with Vanguard with $12,000 in it, but it's in a money market account and has been since I started deployment.

What should I invest in? Okay. Well, good, good. So you're in Baby Step 7 because you don't have a house, right? Exactly. Okay. What's in Baby Step 3, you don't have a house, right? Exactly. Okay. What's in Baby Step 3, Andrew, real quick? What's your fully funded emergency fund amount? I just actually came back from deployment with the USS Nimitz.

So I actually have a healthy little checking account. How much is in your healthy checking account? About $34,000 and another $12,000 savings. Good for you. Well, thank you for your service, sir. We appreciate your service. Thank you. That's quite an assignment you've been given and very, very well done.

So what we teach is to invest in good mutual funds. It's what I have done for 40 years, and what Anthony does and what all of us here do. We invest in growth stock type mutual funds. There are four categories, and we split it evenly across those, and that's what you need to get in touch with Vanguard and move into those four, or get in touch with one of our SmartVestor pros to help you with that.

They are not people that work for us, but they're people that we recommend that will do things, and they will teach you, which is really important at your stage of investing for you to start learning, because investing can be a little bit intimidating, can't it? Oh, for sure. I was looking at my account today, and I was seeing a lot of terms that I didn't really recognize. Yeah. I was looking at it. One that caught my attention was U.S. growth stock, the $3,000 investment minimum.

Mm-hmm. I was thinking about going into that one, but I didn't understand it. That's good. Don't put money in something you don't understand. Yeah. And, Andrew, I think the key thing here, what Dave is saying, what I want to tell you as a young person, too, is that I like the fact that you're saying, hey, I don't understand this.

Well, it's very important to remember what Dave said. Find a financial advisor. And I'll say this. I mean, I'm not a huge fan of certain people. I want you to go to one of our smart investor pros because they're going to spend time with you and teach you everything you need to know. I'm not going to speak negative about Vanguard, but I'm pretty sure they're not going to give you as much one-on-one training as our smart investors will. And it's important for you at your age to really get the knowledge while you're investing your money. And so ask the

good questions yeah the nervousness that you feel with anything new is wisdom like the first time you get behind the wheel of a car you've never driven a car it's you're nervous the first time you do x or y ride a bicycle whatever the metaphor we want to use is so you fact you don't know what you're doing is it makes you nervous that's that wisdom. But that also says you've got some learning. And the more you learn, the more comfortable you are, and it will become like driving a car, where initially you were nervous, but eventually you develop a level of competency, and you learn the terms, and you're very comfortable with them. The good news is if you sit down with a SmartVestor Pro with the heart of a teacher,

they're going to teach you. Now, let's start with that where you were a minute ago. Okay. A growth stock mutual fund. Now, what a mutual fund is, is think about anything that's mutual is a group of people. So a mutual fund is a group of people funded a fund. And so you put some money in, I put some money in, Anthony put some money in, right? It's a mutual fund.

Mutually funded. That's where it comes from, okay? That's a mutual fund. Instead of buying a single stock, whatever they invest that money that we mutually funded into tells us what kind of mutual fund it is. And so if they invest that money into bonds, then it's a bond mutual fund. If they invest that money into companies, stock, ownership in that company, and these are companies that are growing, we would call those growth stocks, right? And if it's a mutual fund, it would be a growth stock mutual fund. In your case, it was U.S., which tells us one more thing.

Where are all these companies, Andrew? The grand old United States of America. There you go, baby. And so if it were an international fund, it would have only funds that are not U.S., companies that are not U.S. If it's a world fund, then it's the whole world. So it's got some U.S., some foreign in it. But in your case, you're looking at American companies only that are growing, and it's multiple different companies, 90 to 200 different companies that will be bought in there, and people mutually funded this fund, including you,

and so you own a piece of, a whole bunch of pieces of, little bitty pieces of growth companies, companies that are growing, and that will grow your money like about 10 times as fast as that stupid money market account you're in. So that's your first lesson, dude. This is how you learn it. Well done. I'm proud of you.

And again, thank you for your service. Click SmartVestorPro at DaveRamsey.com, and we'll get you lined up. In an uncertain world, being a good steward of your money is more important than ever. While some circumstances can't be controlled, there are items within your budget you can take charge of, such as your health care costs. For nearly 40 years, Christian Health Care Ministries, or CHM, has provided a budget-friendly means of sharing for medical bills when our members need it. Learn more by visiting chministries.org slash budget. That's chministries.org. Personality is my co-host today here on the air. I am Dave Ramsey, your host. This is The Ramsey Show. Open phones as we talk about your life and your money. It's a free call, 888-825-5225.

Brian is in Arkansas. Hi, Brian. Welcome to The Ramsey Show. How can we help? Thanks, Dave. Welcome back. You were missed, and thank you for all you and your team does. Well, thank you, sir.

Yeah, I am 59 years old. I'm looking to retire in six years. I have a 401K, a Roth, and a traditional. I'm thinking about rolling my – it doesn't make sense to roll my traditional into a Roth. I do have the cash to pay the taxes. Or should I take that cash and invest it in real estate? Well, neither one's a dumb thing. It's just a matter of preference which one you want to do.

How much is in your Roth, or how much is in your traditional that you would convert? About $240,000. Okay. And so you're talking about, what, a $70,000 tax bill? Yes. Okay. Huh. And what other nest egg do you have?

That is it. I mean, I have the cash other than my house, which is paid for. I don't have any debt. Okay. So here's the thing. The longer you leave that alone after converting it to a Roth, the more sense it makes for it to be converted. Okay?

So if you convert it and start drawing down on it almost immediately, I would be less likely to do that. If you're going to convert it and never touch it for 10, 15, 20 years because you've got other things you're going to live on, then I'd be more likely to do that. Do you own other investment real estate? No. Okay.

And if you was to purchase real estate right now, Brian, would you pay cash for it or are you using that $70,000 and put down? No, I would pay cash for it. How much cash are you sitting on? About $220,000. Okay. So what price range of real estate are you thinking about buying well we're on a property uh where i'm at pretty tight because the university's around and so they're going around

220 to 240 just depends on what kind of deal you can get so it'd use up most of your cash if you did that deal yes and if you do that if $70,000, it takes you out of that market. You'd have to do a different kind of rental property or wait a little while. Yeah. Yeah. What I figured I would do if I went ahead and rolled the traditional into a Roth, I would then take the remaining money and put it into a low-cost stock index fund. Until you had enough to buy a house. Correct. And what's your household income? How long is that going to be? Let's see.

Right now, we're about $160,000, and that includes my wife. And she's looking to retire in two years. And when she does, it will drop our income down to about $105,000. Yeah, but we're only talking about a year to get the money back, right? Yeah, yeah. Yeah, so if you do the Roth a year to get the money back, right? Yeah, yeah. Yeah, so if you do the Roth now, buy a house a year from now, right? That's possible. Depends, you know, if real estate keeps going up in this area like it has been, it would take it longer.

Yeah, but don't get real estate fever to the point that you start paying retail for stuff or you start chasing returns or something like that. You're going to end up paying too much. The best money on a real estate that you make point that you start paying retail for stuff or you start chasing returns or something like that you're going to end up paying too much most the best money on real estate that you make is when you buy it meaning you get a good deal when you buy it that's what you're looking for and so don't don't buy into the lie oh real estate's hot real estate's hot you know you can't get a good deal there's always a deal somewhere you may have to poke around a little bit to find it or you may have to put some paint on it later if you find it or something like that but you'll find it and especially if you're sitting there with cash and you're taking your time and uh the deals are the deals are for the patient people they're not for the ones that buy off on the oh well all real estate it's a college town

is always high so yeah that's a um uh that says you're getting ready to pay too much you don't want to pay too much now when you when you uh pull it over to a Roth how long before you draw out on it Brian oh I'm looking at six years so you're less than 10 years before you start drawing on it but you would just barely start at that point and as you had the property it would change that as well yeah right yeah uh well with the rental property I I could start using the income from that right away. That's one of the things I was looking at. You know what I'd do? I would start looking for deals right now.

And if you can lay your hands on something, go ahead and do it that's really inexpensive, that's cheaper than you're thinking right now, and then use some of the rest of that and move some of the Roth money now and move some of it later. If you don't find a deal, a bargain I'm talking about, not just something that's freaking for sale that you like. I'm talking about a bargain. You're looking for you want to make some of your neighbors a little upset with you.

So that means, like, if you're looking at a house of $220, $230, you're looking at a house like $160, $175. Yeah, I'm making $180 offers on these $220s and find somebody who's a little more motivated to sell, even though it's a, quote, hot college town. So anyway, something like that, then that changes the equation. If you don't find a $180 purchase on a $220 or something like that, then go ahead and make that Roth move within six months and go ahead and make that Roth move. And in the meantime, you will have been saving up anyway.

So we're only talking about a year difference either way. But the only way I would put the real estate ahead of the Roth, even though it's only one year, is if you've got a bargain. And so start poking around and see if you can find that deal. I think you can, Dave, with patience. Look for something with a gutter hanging off, and you can put the gutter back up. they're not that hard to put up so um that's the kind of thing you're thinking of i've owned thousands of pieces of real estate my life i used to flip for a living and i currently own several hundred million dollars worth i love love love real estate

when i am buying real estate i am trying to find a deal. Yes, sir. Because an old guy taught me when I was 20-something years old buying, he said, the money is made at the buy. Yeah. Meaning what you pay for it is the thing. Yeah. The money's made at the buy. It's not location, location, location. That establishes the value.

Yeah. But the money is made at the buy. So that's a good question. Susan's with us. Susan is in Columbus, Ohio. Hi, Susan. How are you? I'm doing well, thank you. How are you? Better than I deserve, and that's for sure. What's up? Thanks so much for taking my call. I have a tax slash investing question. I'm very new to investing, so be patient with me. I was completing my taxes for 2020 with TurboTax,

and I got an alert that I had overfunded my Roth IRA, which I guess I just wasn't paying attention, and that I needed to move those funds in order to avoid a penalty. And I was wondering what you would suggest I would do to correct that before finishing my taxes. How much? Go ahead. I'm sorry.

I'm sorry, Dave. How much, Suzanne? It's not much. It's about $600. So it's not like the penalty is scaring me, but I'd like to avoid it if I can and then correct for the future. Okay. Let's make sure TurboTax is right because they're not always. So what did

you put into the Roth? So, I put in over $6,000 this year. I got a raise and I was doing a percentage of my income and so this year I put it over. I see. Okay. And you're how old? I'm 32.

Okay, then you're fine. That is correct then. So, any amount that you've overfunded You just have to move it into another investment Just get it out of that account Yeah Okay There is no penalty You're fine

You caught it in time You're not going to have anything So just, you know, get in touch with whoever you're The investor Wherever that investment is And say, I need to move $600 out of here It's overfunded And you can move it over to a money market

You can move it into your checking account Whatever Just get it back out of there Reverse the process and uh you can move it over to a money market you can move it into your checking account whatever just get it back out of there reverse the process that you use to overfund it and um and you know then you're not going to have any issue but you but they are right they've given you the correct advice that um uh that you you know you are limited to six thousand dollars of earned income and i'm assuming you had an earned income that high. So good stuff. Nice.

Thanks for the call. Nice. I love it. Yeah, it's good that you're getting it done. It's good that that's going to that level. Have you ever had that call before, Dave? I overfunded my investment accounts. It usually doesn't happen on an individual account. What can happen on, sometimes you'll hear it on a 401k, if you are a highly compensated employee with your company,

and the bottom 80% of the company does not participate in the 401k at a high enough level, they limit how much you can put in. Oh. And so you back down, and you can have overfunded your 401k because of the highly compensated rule. That happens a lot more often than this does because usually if you're doing an IRA, it's set up on a flat thing. It's $6,500 a month coming out rather than a percentage. Yes. This is The Ramsey Show. Thank you. In the lobby of Ramsey Solutions on the debt-free stage, Jeremy is with us. Hey, Jeremy, welcome to the show.

How are you, sir? Better than I deserve. How are you? Another day above ground, so I beat the odds. Anthony, how are you? Hey, I'm doing well, man. I love you. Excellent. Where do you live? Village of Los Ranchos, New Mexico.

It's right next to Albuquerque. Oh, beautiful area. Yeah, it is. It's gorgeous out there. That's fun. And all the way to Nashville to do a debt-free scream. Yes, sir. And I got paid to get here, too. I drive a semi, so it worked out well. I like this plan. Yeah, I ain't playing.

This is a drive-by debt-free scream. Parked across the street. Yes, sir. I love it. All right. How much did you pay off, Jeremy? I paid off $89,941.48. Love it. And how long did this take? I started my debt-free journey April 17th of the 11th and finished up about the 11th of February of this year.

So just short of four years. Okay. All right. Very cool. And your range of income during that time? Starting in 2018, it was $26,775. And currently, I'm about the $40,800 mark. And you did $90,000 in four years?

Well, I took you literally when you said beans and rice. Okay. I kid you not. It was not a metaphor. You just did it. Yeah, and I realized it one day about two months ago, maybe three, that you were just kind of playing it, so to speak. And I just kept doing it. Oh, well, okay.

And I just drive. I just work all the time. I love to work. I love what I do. Yeah. So I'm a happy boy. I just keep running. Yeah.

So what kind of debt was the $90,000? Let's see here. The first $87,603.48 was from a divorce property settlement. I've been more civilized bar fights than what that was. I'm not kidding. I kid you not. There's a broken beer bottle involved. I wish there was.

It would have been less painful. Jagged edge cut. Yeah. And then $23,038 was a personal loan okay all right so the property settlement is of you know four years you've been on beans and rice to get that in your rearview mirror no pun intended right yeah yeah wow well pretty cool yeah it's it's been quite the experience there's there's just no around it. Yeah, so the pain of the divorce plus all this, man, I mean, this is a real thing to be done with, isn't it? I'm going to work really hard on it getting sand in my eyes, but that's exactly right.

Yeah, it's been an experience for sure. Yeah, this is freedom times two or ten. Well, when I get to tell my story, when you're ready for me to do that. Do it. Okay. February of 2002 was when my first divorce was finalized i never thought i'd go through a divorce let alone two of them and um that's where this property settlement came in it was a thousand dollars a month for three

years spousal maintenance and then child support all the way until my son turned 18 and then at the end of that three years i was supposed to hand her a lump sum of $36,000. Right. I've never had $36,000 in my life. And so the minute you fall into arrears, it starts earning interest at 10%. And that's where the bar fight happened. And then just over five years ago, I was head over heels in love with my second wife, came home one day, and she greeted me at the door with, I'm not in love with you anymore. And I'm like, did I miss, did I not get the memo? And so I left Phoenix.

I was living in Phoenix at the time. I called my mom. I was in tears. And, you know, can I come home, blah, blah, blah. Yeah. So driving home, I called a friend of mine, Wes. And I used to, I was a bouncer for him at a bar in Tucson and told him what happened. And he said, Jeremy, drive a truck.

I said, what? And he said, you'll always have money in your pocket. You'll always have a job. And so three, four months later, I got my CDL Class A and I've been driving for five years in July and I've been doing flatbed for just over two years. I love flatbed. So, yeah. Wow. Throughout those

four years, I mean, you clearly have been through a lot, but getting out of debt, what would you say was the hardest thing throughout that journey? I think it was there are times when the wheels don't feel like they're catching, you know? It's like you're driving in the mud, and

I get to do a lot of that. And I look back at the numbers and when i hit like i was at 40 000 or 60 000 i was like woohoo and now i just you almost feel nauseous when you think about that number and maybe being in that kind of dead ever again which i will never do it will not happen but i i really feel like that that's what the hardest part was. But then when you saw the traction, I get paid direct deposit. Well, my checks would hit at midnight on Tuesday, Mondays, I beg your pardon. And I would sometimes wake up at 2 o'clock in the morning, and I lived off of X amount, and everything else, I just sliced it right off the top and sent it in.

And I would do that. Now, who were you sending it to? your ex or to a lawyer or the courts or the courts the court system of arizona yes okay all right so they're keeping track of this and they're they're ticking it off as a ghost yeah and that's where it went kind of sideways a little bit towards the end i thought i was done and then i got a i talked to my my who's an attorney, and he was telling me, he's like, well, no, you've got this and that. And I'm like, what? And they're like adding another $3,000 to it. It was for fees that they didn't count up and add on until the start of the next year kind of thing.

So it was really kind of wonky. And when I was trying to make those last payments, I'll never forget. I called him, and I was trying to do it over the phone, and it wouldn't accept it. And I'm like, this is really weird. The government is not taking my money. And I called Department of Economic Security, all of them in Arizona. I called them 15 times that day, and I called my attorney. I called my financial coach, who's endorsed by you, Karen Pennock. And they're all double-checking everything, and they said, no, you're zeroed out. I almost went off the road. I started crying. So yeah, little rock yeah it's over yes sir finally over yes so who introduced you to us um i my second wife we had actually kind of started talking about the program and then

there were some malfeasance on her part um she was a painkiller addict and for all the time we were together we were married for almost 11 years i turned a blind eye to the fact that that's what she did i'm missing money and i'd find her passed out or it was horrible um and i just kept going oh it's great so what's the future look like now? If it got any brighter, I'd be wearing sunglasses right now. So proud of you, man. Thank you, Dave. Thank you.

Well done. Anthony, thank you. Well done. You've got to feel good. I do. There's a cleanliness to your story that's pretty incredible. Well, thank you, sir. That's pretty cool.

Thank you. It's a bunch of crap, and it's all behind you. Yes. That's just a cool feeling. Yes. mean, it's a bunch of crap, and it's all behind you. Yes. That's just a cool feeling. Yes. Yeah, that's the greatest feeling for sure. Yeah. I'm so proud of you.

Thank you, sir. Well done. What do you tell people the secret to getting out of debt is? I mean, you went all in. I did. You know, I think that's just really what you've got to do. You've just got to say, what I was doing before wasn't working, and you've just got to commit. You know, it's just like, you know, I was in the military, and I taught karate for 20 years,

and if you're going to do something, you've got to just buckle down and get it done. You know, you learn to say no to yourself and just, you know, nose to the grindstone, as it were. Yeah, well, it's certainly all in, all in. Well, we've got a copy of our latest bestselling book here for you, Know Yourself, Know Your Money, by Rachel Cruz. That'll be your gift for the day. Congratulations, man. Thank you. So proud of you.

All right, it's Jeremy. I'm sorry? Dave, I'm sorry. I've got a list of people to thank. Okay, I've had it. Because otherwise I won't ever be able to. Better go fast. Yes, sir. My mom, Olivia, my sister, Debra, my son, Remy, my friends, Wes, Grant, Max, Rob, Meredith and Ray, Angie, Fernando, Jeff, my Timco family, Colton, Dan, Cooper, and Tim, my sister depra my son remy my friends wes grant max rob meredith and ray angie fernando jeff my tim co family colton dan cooper and tim uh kelly and mike my karate instructor sean and

his wife rebecca the dave ramsey baby step community as well i love it they're awesome that's a very that's a great facebook page yes it is all right ninety thousand dollars paid off in four years jeremy did it making 26 to26,000 to $40,000. It's all beans and rice, for real. Count it down. Let's hear a debt-free scream. Three, two, one. I'm debt-free!

Yeah! That's how you do it. I love it. Woo! Yeah! That was, I like that one. You know, transformation is all about new beginnings. Yes, sir.

It's all about new beginnings. Yeah. Fresh start. Yeah. And if you look into his eyes, you can see he got some sand in his eyes, Dave. You can see. Yeah, there was a little leaking going on. Yeah.

That's a good thing. It's a fresh start. There's a cleanliness there. You can just feel it in his spirit. It's awesome. Hey, guys, when are you going to do that? Those of you listening right now, you've been kind of listening and not doing this. I want you to be on here.

I want you to be free, man. Get after it. Get it, baby. Get it. This is The Ramsey Show. Anthony O'Neill, Ramsey personality, is my co-host today. This is the Ramsey Show. I'm your host, Dave Ramsey. Open phones at 888-825-5225.

Terry is in Jacksonville, Florida. Hi, Terry. How are you? Hi, Dave. I'm great. Thank you for asking. Sure. How can we help?

Well, I'm a 73-year-old married individual. This year, next month, we'll make it 53 years. Wow. Yeah. Wow. Yeah. Yeah. Blessed by God beyond measure. I had two marvelous careers, again, directed by God, a 21-year career in the Navy and then a 20-year career in aviation. Wow.

Education. 20-year career in aviation, well, education. And I currently own my own home. I have actually followed your advice for about 40 years. So my wife and I have tried to live debt-free almost our whole married lives. But I own my own home, debt-free of that. but I have a rental home that my son has been renting. And I purchased, just recently purchased another rental home that he's going to be living in. It's in a school district, actually, where I was the principal of the school, so we wanted our granddaughter to attend that same school. So my question is, the home that he's currently living in, I owe about $91,500 on it. It's probably a sale value of about, I don't know, $120,000, $125,000.

I'm wondering, should I just sell that thing or should I rent it? Current mortgage is $659,000, and I can probably rent it for $1,200. Okay. Is your son paying you market rent on the other property? On the one that he's currently living in? Well, the one he's moving into, I guess. Yeah, he's going to be paying the mortgage on that. Why didn't he just buy a house?

Well, he's got his own business, and he couldn't qualify for the home. And as you know, houses down here, how we've been looking in that area, like I said, we wanted our granddaughter to go to a school that I was a principal. And so there were hardly any houses on the market. And when that one came available, it was a nice house. And actually, the day it went up for sale, we made an offer on it. Well, let's reverse engineer your question then. Sure.

If you had $40,000 sitting in the middle of your kitchen table, or $30,000, and you did not own the property that he's moving out of that you're asking me about, would you go buy it? It's just $40,000 to do whatever with. No, I'm saying $40,000 because that's your down payment, and then you've got a $90,000 to do whatever with. No, I'm saying $40,000 because that's your down payment, and then you've got a $90,000 mortgage, right?

Oh, I see what you're saying. Because if you sell it, it's going to put $30,000 in the middle of your kitchen table. Right, but I'm going to have to pay capital gains on that, I'm sure. Yeah, there'll be a little, but it won't be. Have you been depreciating the property? Yes, sir. For how many years? Oh, about 11. Yeah, you'll have some capital gains that are pretty substantial then. The way you worded it, it sounded like you like the property

and you think it'd be good to own it. I don't see a problem with you owning it. I do want you to go back to your original philosophy and let's get these properties paid off. Do you have any cash, Terry, to pay them off? I'd have to liquidate some mutual funds. How much do you have in mutual funds? Well, I've got two IRAs in a mutual fund. I've got about $310,000.

Okay. What other nest egg do you have other than that? I've got a stock in a company that Square Incorporated that I bought at like $9 a share. Last time I looked, it was like $4 a share. What's it worth? What's your total portfolio worth? Oh, probably not counting the house. No, I'm saying that stock.

What's that stock, the value of that account? Oh, probably about $35,000. Okay. I would use that towards that mortgage, and let's get that mortgage paid off as quick as you can with that other $60,000. I would not liquidate your mutual funds. I'd just start doing it out of the budget and clean it up as fast as you can. If you're going to keep it, let's have a plan to get it paid off.

Yeah. Otherwise, I'd sell it. Okay. Yeah, my only thought process with keeping it was, you know, where else can I invest the money and probably make about $400 a month net? Well, you're not making $400 a month because you're going to have expenses on that. You're going to have vacancy. You're going to have everything else.

You're probably making $200 a month. Yeah. So you're not, and it could end up actually being a cash drain as long as you leave that stupid debt on it. So the only way I would do it if I were in your shoes is get rid of the debts very soon, if not immediately. Yep. And I would not use your $300,000 to do that. I would use $35,000 in your shoes is get rid of the debts very soon if not immediately yep and i would not use your 300 grand to do that i would use 35 000 in stock to do that so um i don't know yeah i'm right there with you dave that's why i was asking

and then too i don't really like the fact that he's renting a house out to his son at just mortgage in a neighborhood that the son can't afford to buy in. Exactly. That's a potential liability that's going to come back and bite you. Exactly. So a boy child needs to get his own mortgage and get that thing paid off, get it out of your name as soon as possible, too. Yeah. And so it's not just about where your kid goes to school.

You don't go hundreds of thousands of dollars in debt to get a school district. Thank you for saying that, Dave. Yeah, that's... That's not smart. Yeah, well, you're going to get bit. Yeah. That's what's going to happen. And we're using the love of grandbaby to justify all this.

So, and I love my grandbabies. Absolutely. Absolutely. That's not the issue. Absolutely. Open phones at 888-825-5225. Amy is in Muncie, Indiana. Hi, Amy.

Welcome to the Ramsey Show. Hi. Hi. Thank you. How are you? Sure. Better than I deserve. How can we help?

Okay, my question is, my husband and I just opened a business together. It's so far been very successful. It's only been five weeks. But we also still have our own business. I have one. He has one. My question is, how do we combine everything together and like pay deals out of one account? So like my business, I just use it for business only and then i have a separate checking account

that i pay for all of our house bills he uses his business account for all for everything um and then our new account i don't think we should use it at all because at this point we don't even know actually what we're making from it. All right, let's try this. So how do we combine? These are three separate businesses that operate independent of each other, correct? Correct. Okay.

Each of those should have their own checking account. Yes. And you should not do any personal business out of those checking accounts. Right. Then you should have a household. Okay, that's what I thought. Then you should have a household account that is your home account. And that's where you buy groceries and pay the light bill and eat and do all these other, you know, save for the kids, college, all these kinds of things that you're going to do.

The profits come out of the three checking accounts from the business to hold out some money for taxes so you don't get bit on your quarterly estimates, and then roll the money into your personal account. Both of your names ought to be on all of these accounts. Yes, both of our names is on all of them. But, however, we've only been married a year and a half, and I don't write anything out of his. He doesn't write anything out of his, he doesn't write anything out of mine, even though our names are on all of them, we still use it like it's separate,

and I think it's causing problems. Yeah, you need to have a plan where you're all in agreement about all the money. Yeah. On how the businesses are run, and how much money comes out of those businesses, what expenses those businesses are doing, and then when it comes home, and it goes into that home account, you're certainly in agreement on everything there. And it sounds like you all are still separate a little bit. I mean, combine the mindset.

This is our businesses as a couple, as a family. I mean, do things jointly, not separately. Yeah. What happens when I'm working with these Entree Leadership guys is they'll use their business account to buy crap that they can't get away with if they bring the money home. That's exactly what's going down right here. I can just tell it. Yeah, you're not going to buy that out of the personal account, so I'm just going to

sneak it out. That's my business over there. I don't think so, Bubba. That's not how it works. This is The Ramsey Show. Have a friend or family member that needs a daily dose of Ramsey advice in their life? Let them know about the Ramsey Call of the Day podcast. It's a quick hit of advice about life and money in under 10 minutes. Check out the Ramsey Call of the Day podcast wherever you listen to podcasts.