The Ramsey Show - App - Insight on Long-Term Disability Insurance (Hour 2)

Episode Date: March 21, 2019

The show about you

Live from the headquarters of Ramsey Solutions Broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. Thanks for joining us. Open phones this hour at 888-825-5225. That's 888-825-5225. Well, one of the things we teach you around here is you pay a price to win. Live like no one else so that later you can live and give like no one else.

I want you to be outrageously generous. I want you to get into a position with wealth that you can give away every year more than you used to make. How would that be? Well, I've got to tell you, it will make your face smile. When you give that much, you'll just be smiling all the time. Because some of the happiest people you'll ever meet are generous people. And some of the saddest people you'll ever meet are selfish people

that never give anything. But you get yourself in a position. You got $10 million. You got $5 million. You got $2 million. And you start giving serious amounts of money. I mean, you give a $1,000 car to a single mom that needs a car, changes her life, and you don't even notice

because you got enough that that doesn't change your life. You could do 10 of them. It'd only be $10,000. And if you got $5 million, what's $10,000? Nothing. You have 10 people smiling, and you have a story in your heart. That's what generosity does. That's where I want you to get to.

And I want you to get to where after you've sacrificed and driven junky cars that you get a good car. Your Dave car, when you get on the other side of this, needs to be your good car. Don't buy a junky car and call that your Dave car. That's not your Dave car, when you get on the other side of this, needs to be your good car. Don't buy a junkie car and call that your Dave car. That's not your Dave car. That's your you car. I'm never driving like this again car. I'm going to drive like no one else so later I can drive like no one else, right? I was with a friend this morning.

He just bought a tractor for his farm. Spent $30,000 bought a tractor for his farm spent 30 000 bucks on a tractor interesting thing was is very very very small percentage of his income and of his life and it's a nice big old tractor we were having a guy moment looking at a tractor and all boys like tractors it's just part of life a lot of girls like them too so there you go but anyway it's pretty cool i was looking at the pictures. I mean, some people sit at breakfast and show pictures of other things. This guy, me and him, are looking at tractors.

So that's okay. I might be a redneck, so shut up. But, yeah, enjoy your money. Oh, by the way, we announced today a way for you to enjoy your money. If you have lived like no one else and now you're ready to live and give like no one else you've gotten past baby step three you're out of debt you have your emergency fund in place we've announced today the live like no one else cruise yeah upscale high-end cruise line holland america next march we're going on a cruise baby all the ramsey personalities, me, Rachel Cruz, Ken Coleman, Chris Hogan, Anthony O'Neill, Christy Wright.

Oh, and we're going to have a couple friends go with us. Jeff Foxworthy is going to go with us and do a routine or two. He's fairly funny, I hear. He's a great guy. And, of course, we're also going to have a Grammy Award winner. Our friend Stephen Curtis Chapman is going to come. And Christian Music Icon is going to hang out with us and do some of the events. Manette Shahan, I never pronounced.

Did I get close? I got close. Okay. She's like a Food Network star chef, celebrity chef, James Beard Award winning chef, owns several restaurants here in Nashville. She's a friend of ours, and she's going to go. And some of the country music songwriters that have written some of the biggest hits. Pastor Darren Whitehead is going to go.

He's our pastor at my church. He's going to do devotionals in the mornings. And it's going to be a blast. It's the live like no one else cruise, baby. We're going to have so much fun. We're going to Turks and Caicos. We're going to St. Thomas, Puerto Rico, Bahamas. And it's a seven- brand new ship this is not one of the cheesy cheap things this is going to be a

little more expensive but it's not for those of you that can't afford to go on vacation this is for the those that are you that have lived like no one else now you're ready to live and give like no one else now we're not going to check on you and make sure that you're abiding by being baby step four through seven, but that's where you should be. I don't want you going on this if you're still trying to get out of debt. You can go on the next one when you're out of debt. And I suspect there will be a next one. This one's wildly popular already.

So, RamseyCruise.com for more information or DaveRamsey.com. RamseyCruise.com or DaveR Ramsey dot com. Ramsey Cruz dot com or Dave Ramsey dot com. And we're just we're fans of you. We love seeing you celebrate your wins. We like the debt free screams. We like the millionaires, everyday millionaires that come up to us and tell us how they've worked this stuff for 15 years. And now they're an everyday millionaire. I love hearing these stories our team loves hearing these stories and we love hanging out and giving you a place where you can celebrate with other people who have that same value system

by the way and this will all be clean there's not gonna be a bunch of filth on this cruise this is all you know we're christians and so it's not you know we have fun we're gonna party we're gonna blast but uh there's not gonna be a bunch of craziness in you know involved on this thing or something like that and some of these cruises they do stuff like that i know but not with us so i would have set you off the bus next time we pull up at the stop if you do that stuff but none of the entertainment or anything like that's going to be anything you're embarrassed of or something like that. I hope, unless you're just somebody that's over-saved or something. But anyway, yeah, come on out.

Have fun with us. We'd love to have you. Again, go to RamseyCruise.com. You can start saving today. You can reserve the cabin for only $250 and get it held. And this thing's blowing up, man. We just announced it last hour, and it's going to be sold out so fast. But it is.

It's the live like no one else cruise, and I want you guys to hear me loud and clear. This is not inconsistent with what we teach. It is deadly consistent with what we teach. Now, if you do it and you go into debt to do this, then you're being inconsistent. You're being the hypocrite. We're not suggesting you do that. I do not want you you go into debt to do this, then you're being inconsistent. You're being the hypocrite. We're not suggesting you do that. I do not want you to go into debt to do this. I do not want you to do this if you're under baby step four.

If you're four and on, that's fine. Then you're in a place to start saving and have a nice vacation like this. This is a seven-day cruise on Holland America. This is not the cheap cruise line. This is the good stuff. The food quality, the delivery of everything is primo, just primo. So, you know, Sharon and I have been on, I was trying to count the other day. I don't know.

We've been on probably close to between 30 and 50 cruises. I've lost count somewhere in there over the years. We love it. We love going on a cruise because it's just like everything. I don't have to pack my bags every three days and move someplace else. I just sit there and I can just and I can just do the thing. And I don't have to do any of the stuff, or I can do all the stuff, whatever I want to do. And get off and see the sights and jump back on.

And it's a great way to travel. And we've cruised all over the world, literally. So we know all the different lines. And actually, when our guys brought this in, they were trying to do a budget thing. And I'm like, we're not doing a budget thing. If you've got to do a budget thing, we don't need to go. I'm not going on that cheap, cheesy one. No, this is Holland Freak in America.

This is a nice, nice line. It's a primo. So check it out, RamseyCruise.com or DaveRamsey.com. It's going to be March of 2020, one year from now. And it goes on sale today. And you don't want to miss out on this. If you are in those baby steps, this is a lineup of lineups. I mean, did you hear how I told you it was coming?

Pretty amazing. Jeff Foxworthy is going to be there. I'm so impressed with myself that I got him to come. This is the Dave Ramsey Show. offers smarter wireless with unlimited plans starting as low as $20 per month. You never pay data overage fees, and we never turn off your data. No contracts, no hidden fees, and if you're thinking our low cost means less coverage, think again. Our voice and data service covers 99% of Americans, and our 4G LTE network provides the fastest internet speeds like more expensive carriers. We operate on the largest GSM network in the U.S. to ensure you receive reliable coverage virtually anytime, anywhere.

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Hi, how are you? Better than I deserve. What's up? Oh, that's good. I have a question for you. I'm hoping you can confirm the direction that I think I need to go in. I am recently widowed. My husband passed away in his 50s, and I'm in my 50s also.

I'm sorry. When did he pass? In 2016. 16. Okay, two years ago. Yes. Okay, three years ago. Yeah, almost three years, yes.

Okay, I'm sorry. 2016. Thank you. I appreciate that. And we've been able to raise two wonderful kids. Right before he passed away, we were in the middle of building our dream home where we were planning on staying for the rest of our lives. He passed away, and I ended up finishing the project, and my kids moved in with me. Now they no longer live with me, and I am ready to sell my house.

I'm also in real estate and I have my house on the market. The good news is that we have a lot of equity in the house and I would like to take the proceeds from the sale of the house and put it into something else, either a double or I guess that's really my question.

You know, what would be your best advice with what to do with the money that I get once I go through the act of sale? Okay. So where would you like to end up when you're 70? That's a great question. Well, I certainly am striving to be debt-free. I have a mortgage right now on this house. So how much equity will you get out of this house?

When I go to the active sale, I'll probably be able to take out about $400,000, maybe a little bit more, $400,000 or a little bit more. And what is this house worth, the one you're selling? It's worth in the high eights, definitely. So if you move from an $800,000 house to a $400,000 house in paid cash, that would be a pretty substantial move down. Is that something you'd want to do? What I want to do is not be in debt, and I want to be wise, and I really ultimately want to leave something to my children because I know that's what their father would want, if at all possible.

That's the last thing on the list, not the first thing. The first thing is for you to be wise and create a sustainable situation that you can go forward without huge amounts of financial stress and be able to build some wealth. The result of that will be an inheritance to your kids. But we're not going to make the moves. We're going to make wise moves for you that will result in wealth that gives you the ability to leave an inheritance. We're not going to say, I've got to do this because of an inheritance. Okay.

Okay. So what are you making a year selling real estate? Well, I'm a new realtor, so I'm not making a whole lot yet. A whole lot yet. What are you living on? Well, that's what I was going to say. I'm getting, as my husband's cases are settling, I'm getting revenue from that. And so, for example, last year I probably made, from his cases, almost $200,000. And I've got another couple years.

I don't understand. His cases. He was an attorney? He was an attorney. And his law firm is honoring his split on the case settlements. The law firm that we are now associated with has been honoring that, yes. Okay, good. So I have another couple of years where that's going to happen.

But the situation is I don't know, I don't have a guarantee on what's coming in per year. I don't have that. How much other money do you have? So I've got about $50,000 on the side, $50,000 in reserve that I'm trying very hard not to touch. And how much do you have in retirement savings? That is it. That's my retirement savings is that $50,000. You don't have it. And then whatever I get from this house.

Not an old 401K from him, no life insurance proceeds from him that are available, nothing else we're talking about. Very minimal life insurance, and that is correct. Nothing else that we're talking about other than the proceeds from his law practice and the house that I have. Yeah. I would buy a $400,000 house or less and pay cash for it. And I would get your career, and I'd get your career up and running before the income from these cases run out.

Okay. And if you're making $100,000 a year selling real estate, which I kind of think you can do after talking to you for a few minutes, if you do that, then you're 52, 53, 54 years old, and your only income is your real estate income, and you're making really good money, and you could do that for the following 20 years and invest and have a paid-for house and almost no personal overhead,

that puts you in a very, very good position. Okay. I'm glad to hear that. I mean, so let's say you make $100,000 a year starting at age 55, and you do that to age 75 because lots of people sell real estate up into their 70s and 80s, okay? Right. Not unusual at all, because it's a fun business, and they get energy. It is.

I'm having a lot of fun. Yeah, you get energy from it. So it's not like, I've got to quit my job. I hate my job. You know, it's not that kind of thing. So you're probably going to work for 20 years, right? Yeah. If you save $15,000 a year for 20 years, I mean, you're going to have millions of dollars in that account.

Okay. And that doesn't count, you know, the fact that you can probably do more than that, given that you don't have any personal overhead. We just got rid of your house payment. Yeah, that's true. And thank God we don't have any credit card debt or any car debt, nothing like that, thank God. Yeah, you're in great shape.

The thing that I need to get rid of is the house note. Yep, yep, I agree. And there's nothing to panic about. You're okay. You've got the money to pay the house note. We're not going to give this house away. But I would take my time in repurchasing because the money's made at the buy, and I would try to take my 400k cash

and get a steal of a deal somewhere because you can you can you can make an offer um on monday and close on friday when you're sitting on cash right right that gives you that gives you buyer buyer power because your power is a buyer and you'll you you'll you'll experience that as you represent cash buyers later on too. But in other words, I think you might slip up on a half-million-dollar house for $400,000. Yeah, that would be wonderful. And so a couple of people have advised me that maybe take not all of the money but take most of the money and put it down and carry a small note.

But you're saying that that is not your advice. Nope, nope. I'd be debt-free. I'd be debt-free. I like that idea very much. and put it down and carry a small note. But you're saying that that is not your advice. Nope. Nope. I'd be debt-free. I'd be debt-free. I like that idea very much. If you can find a house that suits your needs in that price range, I'd be debt-free. And I think you can. The only problem for you is not a $400,000 home in the New Orleans area.

The only problem is you've been used to living in an $800,000 home. Well, you're right. You're absolutely right. But you know what it's okay um my kids are well taken care of and it's just me living in this house so i'm happy to move on i've got a deal in me to work and to develop my my career and um i'd like to probably buy something like a double where i could get that that income on the side i wouldn't i wouldn't i wouldn't want to rent her next door today. That might be your next move. But right now, let's just get your career going.

If you have a steady stream of income because you've raised your competency in the real estate business and you're actually making some bucks doing that, you're going to have the money to buy some other rentals and even pay cash and move up in-house later if you want to. You're going to have the money to do all of that. If you'll just stay super conservative like we're talking about, you've got no personal overhead, no payments, your life is in a really, really good position.

So very, very well done. Good question. Hey, thanks for the call. Your outlook is positive and amazing. Very well done. Good question. Hey, thanks for the call. Your outlook is positive and amazing. Very well done. You know, your outlook does matter. Henry Ford used to say, if you think you can or you think you can't, you're right. And I meet people in her exact numbers who think that their world has come to an end.

Consequently, it has. In her case, she's dealt with the grief. Obviously, there's sadness and grief around the loss of her husband two, three years ago. But that lady's looking out the windshield. She's not completely focused on the rearview mirror. The rearview mirror is full of regrets and full of pain and sadness and some happy memories too. But your life is out the windshield.

And if you notice, the windshield's bigger. Mm-hmm. Yeah, your belief in this stuff matters a lot. This is The Dave Ramsey Show. Thank you. In the lobby of Ramsey Solutions, Marco and Vanessa are with us. Hey, guys, how are you? Good. How are you doing, Dave? Good. How are you? Welcome. Where do you guys live?

El Paso, Texas. Wow. Wonderful. Welcome? Welcome. Where do you guys live? El Paso, Texas. Wow. Wonderful. Welcome to Nashville. Thank you. Bit of a trip to Nashville all the way up here to do a debt-free scream, huh? Yes, sir. We've been looking forward to this. I love it. How much have you paid off? $253,927 with 65 cents. Wow. How long did this take? Five years and three months. Good. And your range of income during that time? So we started off with $65,000, and then we finished off with $285,000. That's a bit of a jump.

It was. Tell me about the career. What in the world happened to go from $65,000 to $285,000? So Marco was a nurse when we first got married i was uh finishing off medical school while i was already done with medical school then um we started i started my residency program and then finished residency and became a pediatrician so you went from unemployed to doc exactly and then marco went from being a registered nurse to a pediatric gastroenterologist, but nurse practitioner.

Oh, okay. Wow. Wow. So the $254,000 was student loans? $209,000 of that was student loans. Medical school debt? About $160,000 medical school debt, and then the other $50,000, like about $50,000 was Marco's master.

School and car, right? No, that was school. School. Okay. Well done. So how long have you guys been married? It'll be six years. Six years.

In April the 13th. So you got married and immediately you started looking at this pile of debt and saying, as our income comes up, and it's going to in the future, the first order of business is to attack it. Tell me your story. What happened? So, actually, Mark was a fan of yours before we got married. I hadn't heard of you, so he introduced me to you.

I didn't. So, actually, before we got married, that was our plan of starting to pay off debt as soon as we got there. So, once we got married, we decided that, yes, we had those big student loans to go through. And the way I discovered you, Dave, was actually through my older brother. We were just both in college, broke. And he was stumbling across trying to find ESPN on AM radio in Albuquerque. And we found yours, and I believe it's 1600 AM in Albuquerque. Yeah, wow.

And ever since that day, we didn't have enough money for CD players, so that's why we were checking the radio stations. I love it. We found a plan. Wow. Changed our lives. So, Vanessa, you know that you're weird, right? You know this is not normal, that docs usually keep this debt around for a decade

and go buy a bunch of stuff they can't afford instead of getting out of debt and you guys have used almost all of your new income as it's come up to clear this i can see the math in and i know that's what you've done but i mean all of your contemporaries all of your peers must look at you like you've lost your mind right and and we did get made fun of because our friends would say well get the credit cards they give you points and we'd be like no i'm following following Dave Ramsey. And everyone's like, who's this Dave Ramsey? And then we had some people that would tell us Dave Ramsey is not for everyone and works

for certain people. Doesn't work for y'all. Doesn't work for doctors. We got rid of our Instagram account because her newly graduated friends were showing pictures of them on vacation, buying new houses and stuff like that. So we did have to hold on.

So definitely, that was our plan. Live on my residency salary as soon as I started in my job. And that's what we did to use that money to pay off our debt. So in 18 months, we've pretty much paid like $170,000 of it. Yeah, most of it in the last 18. Right. So the first part of the five years was just living on a budget, hanging on, not adding problems. Right, and paying for Marco's master cash, so we didn't get any further student loans.

Yeah, that's good. Very good. Very well done. How old are you two? I'm 36. 38. Okay. And you're making a quarter million dollars a year over that, and you don't have any debt.

We don't. I mean, you're going to have so much money. It's going to be unbelievable. How does it feel? Oh, it feels relieving. Definitely. And what I've always said, Dave, is that we're here to glorify God. We're not here to glorify ourselves.

And definitely he's had a great, I mean, we owe it all to God that he's gotten us through this. We started tithing in the midst of this, having doubt of, you know, are we going to have enough money? Should we tithe or not? But great things have happened since we've started tithing. Right. So we would be, we were thinking, should we tithe or not? Because if we would, we felt it was going to hold us behind. We had a timeline where it's going to hold us behind. But then at church, we kept on talking about tithing.

I was like, no, we need to tithe. And then I know you have a say that we need to tithe also. So we started tithing. And seriously, we tithing and seriously like we tithe two weeks later like a bonus appeared in our bank account it was so praise god it was it was so that bonus went there and then three months later another bonus and then a sudden i got called and you're like you've been qualified for um like a student lowering payment that only 2% of people get it. And so that was like the last $15,000 that we had left to pay got paid.

Wow. Awesome. Wow. Amazing. Praise God. That was awesome. God is good. God is good. Amen.

You guys were impressive. Thank you. Very, very well done. What do you tell people the key to getting out of debt is? Teamwork. Teamwork. There's definitely going to be one that's going to be thework. There's definitely, there's going to be one that's going to be the saver,

the other one that's going to be resistant. So I think it's teamwork. If one of us is, you know, like losing focus to have the other one to hold each other accountable, transparency mostly,

like that's to be transparent in terms of, you know, where the money goes to, not to be getting out of the envelope system or spending more than what we're supposed to. That was in their budget. So I think that's the main thing, to be a team.

And then cutting your own hair, Dave. That helps as well, and that saved us some money too. We can afford haircuts now. You did a pretty good job. It doesn't look too bad. It doesn't look like a bowl cut to me. This covers my bald spot, actually. I cut my own hair. It's no big deal.

That's very good, guys. Very good. That's fun. You guys are great. And along the way, you had a couple kiddos. We did. And their names and ages? So Mateo's four and a half.

And then Lucas is 11 months. Okay. So is that mom and dad holding them there? Grandma and grandpa? Yes. Okay. Very good. So who were your biggest cheerleaders outside the two of you?

I know the Instagram people were telling you it couldn't be done. And that you're crazy. Doctors don't do this. What's wrong with you? Dave Ramsey's not for everyone. But who were the people telling you you could do it? Touchdown. They were cheering you on. I think

Kind of rare in between. I think it was, yeah. I want to say it was more of our church family. Our church friends. Actually one of my fellow residency friends, Mohammed said that he listens to you. So he was one of the ones like, I understand where you're

going at. But I think it was really hard to get cheerleaders really. Muhammad said that he listens to Jung. So he was one of the ones like, I understand where you're going at. So him. But I think it was really hard to get cheerleaders really on board. I think we found it hard. You run in a peer group that loses their brain. Doctors are notorious. They're like music people or something for making a lot of money and having none. Yeah.

Right. And it's almost a stereotype. And so, yeah, the last people you want to take financial advice from is a doctor. Most of them are broke. I mean, you're the exception. You're wonderfully weird. We love it. Thank you.

You guys are incredible. I'm so proud of you. We've got a copy of Chris Hogan's Everyday Millionaires book for you, number one bestseller. And, of course, you're going to be that in about 20 seconds, the way you guys are going. You are well underway. Congratulations. Very, very well done.

We're proud of you. Thank you. Thank you so much. Thank you for making the trip up here. No, thank you. So Marco and Vanessa from El Paso, Texas, $254,000 paid off in five years, making $65,000 to $285,000. Docs that are debt-free, baby. Count it down.

Let's hear a debt-free scream. Three, two, one. We're debt-free. I love it. I love it. That is fabulous. Very, very well done, you guys. Wow.

This is the Dave Ramsey Show. Thank you. laura is with us in los angeles welcome to the dave ramsey show laura hi dave how are Pleasure speaking with you. You too. What's up? Well, I was giving you a call because I was just accepted into Physician Assisting School. Yay!

Yes, thank you. This particular program is three years. The total program costs about $178,000. My husband and I make about $130,000 a year gross income. He makes close to $100,000 on his own. So far, we have about an $18,000 emergency fund, about $60,000 saved up in retirement, $62,000 in mutual funds. We have about $100,000 that we have saved up for school, and we also have about $25,000 in a house down payment that we have started saving for, which we're thinking of combining with our school fund to make that a total of $125,000.

I was just calling, I had a question regarding the service-based scholarship. There's a scholarship I'm looking into that would pretty much cover everything that's needed for school in return for working in medically underserved areas after graduation for the number of years that they pay tuition for. I heard you say that you had a couple stipulations regarding those scholarships. I was just wondering what your advice was for us in the position that we're in. Should I try applying for the scholarship or should we just try to fund the school on our own? So is this the federal program that's the underserved or is this a private program?

It's like a federal program. Okay, and are they giving you the money up front? No, it's a scholarship that you apply for. I know, but I'm saying it's a scholarship, meaning that if you are approved, they're going to give you the money to go to school, and then you work it off later. Yes, correct. So after graduation, I would con in a contract with them depending on the number of years they pay my tuition for i would be working in a medically underserved area but

being in los angeles there's a lot of you told me that you're gonna um you told me that you're gonna work uh it's gonna take you two years to go through school or three three three okay and what would if you don't do this deal and you just went into the open market, what would be your income? Average salary here in California for PAs is about 110. Okay, and what would it be in an underserved area? It really depends.

There's a lot of federal clinics, things like that, that still have a very competitive salary. I'm guessing maybe around $80,000, $85,000, $90,000. Okay. And so basically you'd get $170,000 free over three years and make slightly less money. Yeah. I'm doing that. Okay. For sure. yeah i'm doing that okay for sure you got a three-year contract to repay the three years you went to school and you make 90 instead of making 110 yeah and it repays 170 grand

yeah i'm definitely doing that okay you know but i i get i want everything dialed out in writing i don't want this to be a general program on a website somewhere. I want an actual contract, an actual deal that's laid out. But, yeah, I mean, that's $140,000 worth of value. Mm-hmm. You know, it's like instead of making $110,000, you'd have to make $150,150 to break even on this deal. Okay.

In the open market. You see what I'm saying? Yeah. And so it makes a lot of sense to do this, especially if you can get something that's competitive. Now, underserved market typically means rural or inner city struggling areas. So the only thing you want to do is you just want to make sure you're safe. Oh, yeah.

Yeah, of course. We're not going to put you in a position where your physical safety is at risk. That's not what I'm talking about. But if you can go in and you're doing some good and the federal government is going to forgive student loans at that kind of a rate, that's wonderful. It's the 10-year program that's awful. But this is three years. And then, boom, you're free. You can do whatever you want to do.

And so you land something where the salary is as close to competitive as open market as you can get. I wouldn't take some big steep cut. I mean, if you took $50,000 a year instead of $110,000, now it doesn't make sense because that's $180,000 over three years' loss, and you could have just paid for it, right? So, yeah, I'm definitely going to go that route if you can do it. I think it's a wonderful program in that regard. Thanks for the call.

Open phones at 888-825-5225. Our question of the day comes from Blinds.com. Find out for yourself why Blinds.com is the number one online retailer of custom window coverings, free samples, free shipping, new promos, promo codes Ramsey. Today's question is from Mason in Iowa. Dave, my wife and I have $40,000 in car debt. My employer pays for $1 million in whole life coverage for my wife and I. Surrender value is at $60,000 right now. Do I wait until it grows enough to pay off my house or surrender it now

and start moving into the next baby step? Ooh, that's gross. Well, I'd do a couple things. Depending on, you know, if you have a smaller employer where you can actually have a conversation about this, what they are paying for that, I would rather have them put into your 401k as a match or give you some other kind of a benefit or just a bonus rather than this, and then surrender. Because if you surrender it, they no longer have the cost of the policy, and I'd like for you to receive the income, somehow receive that benefit,

what they're spending for this. But I'd spend it on almost anything rather than whole life. So, yeah, I'm cashing it in, but I'm having a discussion with my employer, is there a different benefit that you would spend that same amount of money on, costing you nothing more but giving me something that I have more of a desire to have rather than a rip-off whole life policy. I mean, a free whole life policy is better than nothing, but the employer could use that money and benefit you much more.

Kim is in Miami. Hi, Kim. Welcome to the Dave Ramsey Show. Hi, Dave. Thank you for taking my call. Sure. What's up? I've just been going to be receiving a lump sum for disability for my children,

and I was wondering if that money that they receive is going to be taxed. Your children are disabled? No, I am, and they receive money under me. From SSI? The Social Security Disability. Yeah, yeah. And no, that is not taxable. Okay.

Double check with your tax person because I'm not one, but my understanding is SSI is not taxable, and Social Security Disability is not taxable. And it's not taxable to your kids. They're giving it to their to your minor children because their breadwinner is you has is facing a disability sorry you're facing that but no the answer is no it's not taxable a little side note for the rest of you on long-term disability insurance which is different than social security disability but long-term disability insurance, if you receive that insurance as a benefit from your employer and then become disabled,

that income is taxable. Or if you purchase it with pre-tax dollars as a benefit, your income in the event of disability is taxable. If you can purchase it from your employer with after-tax dollars, not pre-tax dollars, obviously it costs you some taxes, not much, but it costs you a little bit. Then in the event you are ever disabled, then the income would be tax-free. And, you know, of course we never know what we're going to face, but long-term disability is one of the bigger threats to your finances. That and death, obviously.

Life insurance and long-term disability insurance, two hugely negative things, obviously, that can happen to someone. You know, these are the things you really have to protect against. It's an essential part of insurance. Life insurance doesn't matter. It's not taxable, period. But disability insurance income from your disability insurance is taxable if it's a pre-tax purchase or an employer benefit.

Just something to keep in mind. That puts this hour of the Dave Ramsey Show in the books. We'll be back with you before you know it. This is James Childs, producer of the Dave Ramsey Show. Did you know you can now listen to the Dave Ramsey Show on Pandora and Spotify? For all the ways to watch and listen, check out our show page at Dave Ramsey.com slash show.