The Ramsey Show - App - Invite Your Spouse Into Your Dream - Don't Make Mandates! (Hour 1)

Episode Date: September 30, 2020

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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, my co-host on the air today, Chris Hogan, number one best-selling author, Ramsey personality. We are here to answer your questions about life and about money open phones at 888-825-5225 that's 888-825-5225 jim is with us in tampa florida to kick off this hour hey jim how are you how are you guys doing great how can we help wonderful well dave the first thing that i'm

going to ask for you is to uh not yell at me for making a stupid financial decision that i'm about to tell you i have a rule the first caller of the hour i never yell at them so you're you're in luck uh dave you know i have been following following your financial principles for a while now. And right now we're on baby step six. So we're almost done paying off our home. We're actually, you know, probably by either the end of this year or the beginning of next year, we'll be paying off our home. So we're really good on that wonderful um i am very upset because um uh we puzzled into a timeshare you what and you already

know where this is going you want into a timeshare we got well okay so we got invited to one of the timeshare presentations and you know i'll be honest with you i wasn't really um i was just really ready to say no my wife was with me and they were painting a picture to her that i'm not trying to blame this on my wife by the way but you know they were painting a picture to her that i was like oh goodness you know i mean it's kind of hard to say no here's my point um you've all the time this was last year this was this was last year and we said well okay i And we said, well, okay, I guess we're going to get one. So we got one. And, I mean, we actually already paid it in full.

And, you know, my question is, should I still try to get rid of it? Because, honestly, I'm just upset at the fact that I even got it. Or should we, you know, since we already paid for it, and I know we still have the maintenance fees and all that kind of stuff, should I maybe try to take a little bit of advantage of it before I decide to get rid of it? You probably don't hear that, you know, hey, I have a paid-for timeshare. Yeah, we do, but I don't hear people pay off their house to go and buy a timeshare very often. I know, no, and that's the part I'm really upset about.

Jim, did you initially say that you got hustled into buying one? Well, yes. That's okay. So when we got into the presentation, really nice people, by the way, but, you know, they were like, you you know they won't take no for an answer and so because and so and so because of that it was like well okay you know and then we're just like okay you're trying to be nice but at the same time you don't want to get ripped off so you know i mean with uh jim jim you're rambling listen do you and your wife use this thing? Well, they just got it.

You know, we just got it. Okay. I mean, it's completely up to you, brother, whatever you want to do. I think that what you're going to discover is what 97% of the people discover, that timeshares suck, and the fees are going to go up, and you're going to feel trapped into using that unit you're all the stuff they promised you about being able to trade points with somebody else is not going to happen and the industry is scummy scammy and bad news and you're not going to get

you're going to discover you're not going to get delivered what you were promised and told by those sweet people who were pressuring the crap out of you which is kind of an oxymoron if you think about it. But the, so, I mean, you know, if you want to play with it for a year or two and discover all this for yourself, you do whatever you want to, man. It's your money. I mean, but I think you're going to get not only increasingly disgusted with yourself for having bought it, but increasingly disgusted with the whole process. Yeah. And I think that's what you'll discover. But it's okay if you wait until you get there before you pay time to your exit team to get you out, you know.

Right, right, right. Well, initially I was hoping, oh, man, you know, maybe I can get like a refund, especially during these times that I know that that's not realistic. Not from those people, no. Yeah. that I know that's not realistic. Not from those people, no. Yeah, and so I would give anything to go back in the past and not do that. They don't let fish off the hook once they got one. I think you're just going to wallow in it until you get disgusted enough to pay somebody to get out of it,

but you're not only going to lose the fee you pay Timeshare Exit Team to get out of it, you've lost all the money you put into it. So, you know, given all of that, you may want to, like Chris said, you may want to play with it for a year or two and just see. But I think what you're going to find is you're going to get increasingly disappointed in the organization because they're scummy and scammy. Yeah. And I would say this, Dave.

I think we all have to go through our stupid tax phases. We all have to. And I think the learning thing from that is, alright, a couple of things. I tell people, you want to make two-year decisions. You want to make a decision that you look back on in two years and you're glad that you made it. And if it sounds too good to be true, my

friends, then it is. It truly is. You know, there's the industry, timeshare industry, is widely known for putting you into a room and pressuring you like no one else, like no other business does, and lying and cheating and making promises that they don't keep. They've had hundreds of thousands of dollars of fines.

They've settled lawsuit after lawsuit for fraud. It's a known scummy business. Most people kind of know that. Jim knew that. And then if you know that, then there's another part you need to know, and do you know yourself well enough to know that you have trouble saying no? Now, me, I mean, I do talk radio. I eat conflict for breakfast.

Yeah, you don't have a problem saying no. I don't have a problem saying no. No, you don't. No, Chris, no. I've heard that a lot. I can just say no. I mean, I've gotten real comfortable in my own skin, real comfortable. So I'm not even going to be in the room to start with because I don't want to be in a room where people have to take a shower after I'm in a room with them.

But, Dave, it's a free dinner. And so it's a free vacation for the weekend in a crappy butt little dumpy hotel room. And so just go buy you a crappy butt little dumpy hotel room. You'll come out much better off. Cheaper. If you know about yourself, like I know about myself that I don't have any trouble saying no. I'm still not going to enter it just because I don't like being around that kind of people. They're just gross.

Right. But then, in addition to that, if you're just a person who says, you know, my wife is that way. She can say no, but she wants to avoid conflict. Let's everybody be happy. Everybody's not going to be happy. And so she would be in there. If she knows that about herself, she knows if she goes in that room, she's about to get tattooed. It's going to come off bad.

That's right. And so if you know about yourself that you have trouble saying no. That's right. For God's sake, stay out of those rooms. Yep. Because you're going to come out of there owning a freaking timeshare. Hey, Dave, it's like my buddy. Every year, at the beginning of the year, he would go look at trucks.

Yeah. And I told him. One of them is going to jump. The I told him, just go get it. One of them is going to jump. The keys are going to jump in your pocket. Go get the payment. He didn't hear from him for two weeks. I said, what happened?

We made a bet. He goes, I got the truck. I said, you got that payment, didn't you? I said, stop looking, dummy. Go home. People will read Consumer Reports and study for 73 hours on which $600 phone to buy, and then they impulse an $80,000 Porsche. The same dadgum guy. It's a problem.

It's a problem. If you know this about yourself, protect yourself from yourself. That's a good rule, because otherwise you get to have these problems. Oh, I'm so sorry, Jim. Sorry you got this mess, man. But you'll figure it out. You'll get through it. This is the Dave Ramsey Show.

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To be a part of Christian Healthcare Ministries, visit chministries.org. That's chministries.org. CHM is a proud sponsor of Dave Ramsey personality Chris Hogan, number one best-selling author, is my co-host today here on The Dave Ramsey Show. Travis is up in Missouri. Hey, Travis, how are you? Uncle Dave, thanks so much for taking my call, man.

How are you doing? Better than I deserve. How can we help? Great, great. Chris, good to talk to you, too. Well, thank you, sir. Hey, guys. Yeah, yeah, big fan.

So my wife and I have been working on paying off our debt over about the past year, and we've paid off somewhere around about $130,000. Wow, good for you. Yeah, yeah, yeah. There's a cattle loan and vehicles and credit cards. Yeah, we're down to baby steps four, five, and six. And I was wanting to make sure the other day that we had enough money in our emergency budget. So I created sort of a rock-bottom budget of what it took, you know, for us to live for six months.

And I did that, and I figured out that we had enough money put back in our emergency budget. And we were good there. We also carried about $15,000 in our checking account. But it got me to thinking, you know, what if we stayed with a conservative budget like that and we lived like that for four years? And we took that money and we got the house paid off and we really kind of supercharged our retirement fund, which currently has about $65,000 in it. But I'm 35 and that's not quite where I want to be at. So I approached my wife and she's a stay-at-home mom.

She's been in quarantine for five years. Yeah. Because we live in the middle of nowhere and she's a stay-at-home mom. So I told her, you know, what do you think about, you know, going to this conservative budget and let's live off of, you know, $4,500 a month, which isn't, you know, we're fortunate to have that to live off of, you know, $4,500 a month, which isn't, you know, we're fortunate to have that to live off of, you know, and, but it, but it leaves us with an extra $4,000 every month that

we can put towards paying the house off early and, uh, putting money back for our, for our two children's, uh, college fund and our retirement. And we lived like that, you know, for four or five years. And she instantly she instantly um got really defensive uh she's a good woman she's i love her to death she's the best mom i could ask for you're a good man i love you to death but you screwed this up did i yeah did i say it wrong to her well yeah you know you're a tightwad dude yeah i hear you squeaking through the phone oh and she god let you marry her so you would have a life right because you would live in a cave and collect lint eating vienna sausages i'm just trying to get there man

i'm just giving you a hard time brother that's the nerve you touched okay and uh she's like we worked our butts off to get out of debt and have the emergency fund in place we're on baby steps four five and six and uh the ramsey bunch says let your foot off the gas a little bit and have some enjoyment in that budget and you just took all the joy out as far as she was concerned right yeah you you mandated listen to me buddy you mandated to her the budget and the numbers you didn't invite her into your dream and so what i want you to do is backtrack now and talk from your heart you're talking from the numbers no how about listening instead and ask her about hers too yeah yeah lead with the heart i'm gonna tell you because i gotta tell you she listen she paid she was on this trip where you

paid off 130 grand that's the same woman you didn't change women i mean this is the same chick so she didn't change she's committed to living a financially wise life yeah she's not a spin thrift she's not a princess and so you know i i i'm with chris i think if you'll just listen and say okay i like the idea of paying a bunch of this stuff off obviously i dialed it back too far and you're calling me on that i pick up the flag i'm out of bounds i got it so i know you want to get the house paid off too, honey. What do you think we ought to do? And let her monkey with your little budget. Okay. Then it'll become our budget and our plan, not your plan.

And I'll give you a prediction. You want a prediction? Yeah. Based on her track record and how she behaved before, I'll bet that instead of $4,000 at all this stuff, she's going to only lighten up your budget about a grand. I think you're still going to have $2,500 to $3,000 a month to throw at these things because she shares those goals. She just knows that she doesn't want to do that for another four years because you've been on beans and rice.

Right, yeah, we have. That's all it is. And she wants to travel and she wants yeah yeah you know like i said we live in the middle of nowhere she wants our kids to see the world and i do too and you know what and it's not that you know it's not that expensive thousand bucks a month coming off this thing's twelve thousand dollars a year you can do all everything she wants to do for 12 grand a year that's my prediction in other words i don't think she's going to say we blow all four grand because it's inconsistent with her having participated in the other process

y'all went through right right right so i i think you just you just overplayed your hand man yeah and travis she knows you too i may have pushed too hard. Yeah, and she knows you. She knows that this round, this is the number you're saying, but probably in three months you're going to want to ratchet it down again. She knows you. But as Dave is saying, talk about it. Have her plan a trip. Listen to her heart. Invite her to be a participant in this.

You all knocked out $130,000. You're not doing stuff by accident. You're on the ball. You're busting it. You're going to get to do everything you want to do and everything she wants to do because you're goal oriented you just got to get on the same page and it's just a matter of speed that by which we get to these things and the more stuff we more money we spend on these trips the longer it's going to be before we take even better trips yeah no that's a good point but you know so you're gonna she's gonna dial back she's not a

problem she's not a problem so um you just you just played it wrong and and you you know you took it down too far you need to lighten it up a little bit and have a family and have a life through the next so instead of paying off everything in four years you're maybe gonna do it in six oh well you're gonna get there you're gonna be going doing good you're doing so good i'm so proud travis so proud of you thanks for letting us pick on you, brother. Open phones at 888-825-5225. Edgar is next in Texas. Hi, Edgar.

How are you? Hey, hello, Dave. Hi, Chris. How's it going, you guys? Good. How can we help? I'm doing a good day staying safe. Well, I have a little bit of a decision here coming up and making and

I want to see what you guys thought about it. Unfortunately, I'm going through the wars and I have a little bit of a 401k plan I guess saved up around $29,000 I think last week. Unfortunately, as you might know,

I'm going to have to give some of that up. Or the other solution or the other option, basically, is to negotiate that other half in terms of child support. My wife is supposed to be paying child support, and she's behind for about a year. And so my attorney is thinking maybe we can just allow you to keep all that money, which I'm not sure for a whole lot of, but by negotiating child support. So that means that you will probably won't pay child support for the next three years, maybe four. I don't know. So what do you guys think? So $14,500 is half of your 401K.

How many years of child support does $14,000 represent? Well, you know, right now she had a small amount. I think she's supposed to be paying like $500 a month. How much a month? $500. $500. Okay, so $6,000 a year. So $14,500 is a little over two years.

And how much is she into you for? Well, right now she owes a year by now. She owes a year. Okay, so it'll offset this year and next year and a little bit of the next year, right? Yeah. If it's a dollar for dollar trade, I would do it. Sure. Especially if you can feed the kids.

You got custody, obviously. Yeah, yeah, yeah. I do have custody. Yeah, you just want to make sure you're getting good legal guidance and understanding the numbers. And don't be emotional. This is business. See the numbers. They need to make sense before you agree to it or don't.

But look at it, understand it, and know, are you okay with this long term? Yeah. Sounds like the divorce isn't final. No, it doesn't. Yeah, you've got to finish the negotiation too as a part of this. So that's the plan.

This is The Dave Ramsey Show. We'll be right back. In the lobby of Ramsey Solutions on the debt-free stage, Jackson and Carly are with us. Hey, guys, how are you? Hi. Hey. Thank you for having us. Yes. We're honored to have you. Where do you guys live?

We're from Bedford, Indiana. Oh, cool. Welcome to Nashville. And all the way down here to do a debt-free screen. Yep. How much have you paid off? We have paid off $38,000 in 13 months. And actually, before that, I paid off $9,000 on my own.

Okay. Cool. And what's your household income during that 13 months range? We started at $90,000 and we went down to about $84,000. Okay. Cool. So what happened 13 months ago? You got married, it sounds

like. So I graduated college a year before she did. Had some student loan debt and knew that we needed to get that knocked out. We had some dreams and some goals and different things we wanted to accomplish. And in order to do that, we needed to get rid of our debt. So how long have you been married? Just two years, a week ago okay so two years but the last 13 months you got after the debt and knocked it out yes okay so how did all this start get started that you decide okay because i mean most people don't do that you just go okay we've been married a year we're getting out of debt so how did that happen well early on we're very blessed by our parents um both follow you and kind of got myself hooked on it.

I read Total Money Makeover. We got involved with FPU at our church. Oh, wow. I've also read Everyday Millionaire. Okay. So just a lot of different things. So you're a couple of financial peace babies getting married. You can't help but do this.

Right. I love it. I love it. And we saw Chris Hogan live in Indianapolis before we got married. Well, that did it. Oh, there we go. There's the breakthrough. We get to the root of the motivation, Dave. That's the big breakthrough right there.

I know I like these people. Mr. Skincare himself. This is fantastic. So what was this debt you paid off? It was all student loans. All of it. Yeah. You had- I had a total of 28 when I loans. All of it? Yeah. You had 20?

I had a total of 28 when I graduated. And I had about 18. Okay. Wow. Very cool. What are your degrees in? I'm elementary education. And I'm a dietician.

Okay. All right. Are you teaching in elementary? Yes. I teach fourth grade and coach basketball as well. Very neat. Good for you. That's so fun.

Do you all realize what you've done? Has it sunk in seriously i mean this is like a generational thing that just happened right here you brought the whole posse to cheer for you mom and dad are on both are over here everybody's here to scream i mean this is pretty incredible yeah yeah we're it yeah i think the first week when the paycheck went into the savings account and it didn't go to the student loan and it started piling up, that was kind of when it sunk in. So we actually paid off in November. So we have our emergency fund completed and we are saving now for a house. Wow.

Yeah. So we actually, before we got married, we knew we wanted to pay off our student loans. We didn't want to do that forever. And you know, when you get married, people are like, when you're buying a house, when you're buying a house. And we thought about it. But before we got married, we have these great friends. We've been so blessed. They had this tiny home and it's 380 square feet and they are letting us rent it. And so we've been there for the past two years. Oh, wow. How big is it?

380 square feet. Oh. So it's like a one-car garage, and it has 380 square feet above it, and that's where we live and our 80-pound dog. Wow. I love it. Yeah. And now you can do anything you want to do for the rest of your life.

That's right. We have some goals. How old are you right now? I'm 24. I'm 26. Wow. So you're going to pay cash for a house then, right? Pretty quick.

Or almost. Yeah. I mean, you're going to be really close. We don't know yet. We're getting there. You're going to be really close. You just need to be real smart about that purchase. Yes.

Right? Yes. Yeah. We're already saving for that. We're just kind of waiting for the right thing and the right price and the right location. So how much was the rent on this above the garage? We paid $250 a month. Woo!

That is. Yeah. That's how we've been able to pay off about half of our monthly income went to student loans. So when you're old and you've got grandbabies on your knee, and you're living in this super huge luxurious house, like a $5 or $10 million house, and the grandbabies are on your knee, I want you to get the pictures out. Take lots of pictures and go, Yeah, back in the day, Granny lived in 380 square feet.

By God, that's how we got here. Oh, yeah. We've made great memories. And honestly, like people say, how do you do it? How have you lived in that area? Oh, you poor little thing. And we're just like, you know, we didn't live together before we were married. And this is all we know. And we've come to love it. And we hope just like, you know, we didn't live together before we were married, and this is all we know.

And we've come to love it, and we hope to not stay there too much longer. Well, you get a big old place. You won't even see each other. It's going to take away the whole thing. You'll need an intercom. You guys got to go outside to change your mind right now. Yeah. But you know what?

You sacrificed. And I'm going to tell you something. I'm so proud of you. This is a perfect example of what to do. Because it was a short period of time. And now you've lived like no one else. Now you can live and give like no one else. That's right.

No discipline seems pleasant at the time. But it yields a harvest of righteousness. And that's where you guys are. I'm so proud of you. You're heroes. Thank you. You set a standard that's fabulous. And it's just very, very well done.

You can do it. And what you're doing is just by the way you've lived, you're yelling out there, folks, you can do this. Yeah, for sure. Thanks for this testimony of your lives and the way you've lived. I know your mom and dad are super proud of you. Who were your biggest cheerleaders? Well, we brought most of them. Half of Bedford, Indiana.

That's right. Them and we did FPU, and so that grew. Yeah. The leaders. Yeah, they were great. Yeah, I mean, most people who know us know where we live and know why we live there. So we've been able to talk about it, and we've just been so blessed. We have good jobs, and, you know, God's just been so good.

Like, we plan to pay off $2,000 every month towards our student loans. And if you do the math, God was just so good. And I wish I would have wrote down all the months that we were able to pay more. And I think it's just blessing us because we decided to move into 380 square feet. But it's been good. Our first two years of marriage, I guess, are supposed to be the hardest. And they've just been great. We decided early on that we're young and we didn't want to sacrifice fun. So we did sacrifice space. But we went on trips

and we went to concerts. And we just did fun things along the way that we save for. It's a good trade-off. We budgeted in all that and um so worth it so what is your number one key now you're teaching financial peace university at the ripe old age of 24 and 23 and people say how did you do this how'd you pay off 38,000 in 13 months what are you telling the number one thing number two thing they need to do about getting out of debt is the budget i was the free spirit she was the nerd and she mentioned going and doing things we got to go to a couple basketball games um and that's what kind of hooked me was we were on the budget but we

were still able to do the the fun stuff because we planned for it um and that was big for me yeah um the budget and we did the envelope system and he jackson loves to eat out and that's kind of our joke and so it's like we we had an-eat envelope because that was something we couldn't sacrifice. And so because we went on the budget, it was like, you know, here's $20. We've got to pick a restaurant where we can go for $20. And you just have to stick to it, you know. If there's not money there and he's a visual and it's not there, you just don't do it. But you both have to be on board.

Because if you're not, then you're not. And because we're both on board and we're doing this, and gosh, it's been so good, we don't fight about money. If there's not money, we don't do it. I just want to get a bottle of this right here. I think I could just put it on the shelf and people would drink it. This is unbelievable. Y'all are incredible.

Y'all are absolute heroes. I'm so proud of you. And listen, I'd give you a copy of Chris's book, but you already got one. This is unbelievable. Y'all are incredible. Y'all are absolute heroes. I'm so proud of you. And listen, I'd give you a copy of Chris's book, but you already got one. So you just pick out anything over there you want. The bookstore will give you one. And we appreciate you guys so much. Thank you.

All right. It is Jackson and Carly from Bloomington, Indiana. Bedford, Indiana area. $38,000 paid off at 24 and 26. No debt. 380 square foot garage apartment. Pulled this off. $38,000 paid off at 24 and 26. No debt. 380 square foot garage apartment. Pulled this off. This is what you do for a little while.

You live like no one else so that later you can live and give like no one else. You guys are incredible. I'm so proud of you. $38,000 in 13 months. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free!

I started this, I had no idea I was going to be doing debt-free screams with the kids of the people I taught. I mean, that's amazing, Dave. If I keep it up long enough, there'll be great grandbabies down there. That's it. That's amazing. This is the Dave Ramsey Show, Ramsey personality, Chris Hogan, the voice of retirement and millionaires. That's pretty good. I like that. I might change that around.

All right, John. John is with us in Detroit. Hey, John, how are you? Mr. Ramsey, thanks for taking my call, sir. Sure, what's up? Well, I got a question for you. Due to a combination of many different things, my wife and I found ourselves in about $140,000 in debt.

We owe approximately $140,000 on our house, and I know we could turn around and sell it today for about $300,000, maybe a little bit more than that. My question to you is, would that be a smart move to sell the home, pay off our debt where we would be debt-free, and possibly rent for a year where we would be able to save up. We probably would be able to save up about as much money that we have in equity right now over the course of the next year. Why don't you just pay off the debt over the course of the next year?

Yeah, that's kind of what I've been juggling. So what is your household income? Uh, yeah, that's, I'm trying, that's kind of what I've been juggling. Um, I, I... So what is your household income? Um, well, between the two of us, I would say, uh, right now it's about $10,000. Now, it varies due to my job. Uh, sometimes... Okay, $10,000 a month, which is $120,000 a year. So you're going to pay taxes on $120,000 next year?

Yes. And you're not going to pay off $140,000 in one year then, or save $140,000 in one year either? You only made $120,000. That's mathematically impossible. Right. Right. No, I understand that. What were the unfortunate events, John, that caused you all to take on $140,000 in debt?

About six years ago, I started a business, made some very stupid decisions that I've learned from. I tried signing the business over to my partner a few years back, he ran the business down. And in the process, I was stuck with about $65,000 in loans that I had personally financed for the business. And I went to work for him during that time. And I didn't get paid in about $35,000 worth of work. And before I went back to work for them, after I sold the business, I had an emergency back surgery where I was off work for 11 months with no income. So it kind of spiraled very quickly. So number one, do you like your house?

We do like our house, and we love the area. And number two, let's sit down with $120,000 income and say how fast could you pay off $140,000. My guess is the quickest would be about two years. That would be $70,000 out of $120,000, leaving you $50,000 to live on. Okay. Does that sound about right? Well, right now we're paying out about $6,800 a month in debt.

Okay, but listen to me. If you make $120,000 and you live on $50,000, that leaves $70,000. $70,000 a year for two years is $140,000. Right. And that includes what you're paying out in debt and so forth. If you move, you don't have a house payment, you have rent, it would be about the same as your house payment, wouldn't it? Correct. Yeah, so there's no gain in your cash flow by moving except paying off these debts

really quickly. And so if you like your house, unless you hate your house, I would fight and live on beans and rice for two years and pay off your debts by living on a very tight budget. Otherwise, you have to look at your wife and say, these stupid butt business decisions I made caused us to lose our home. Right. And you will continue to hear that for years. No, not necessarily. No, potentially. But here's the other thing, John, that concerns me. I want you to revisit what caused you to get there because I've had people that have sold the house and cleaned up the mess only to repeat the mess because it was the habit that caused them to get into that situation. So psychologically, I think you can stay in this house. I think you guys can get serious on paying this off, but you're going to have to make these sacrifices and they're not going to come easy. You right now have sell the house as the quick fix.

That might not be the best overall fix for you and your family. Yeah, I agree. The one thing that helps me make these kinds of decisions with folks or myself, for that matter, John, is I ask myself 10 years from today which of these was the best decision financially. Was it keeping the home and fighting my way through the debt, or was it selling the home and getting my way through the debt or was it selling the home getting rid of the debt and then using that the fact that the debt is gone to pile up some cash and buy another house typically keeping the home will lead you to a bigger pile of money

than moving all the costs involved all the another potential screw up because you make a mistake on a real estate deal oh you have a real mistake tiffany is with us. Tiffany's in Seattle. Hi, Tiffany. How are you? Good, Dave. Hi, Chris. Hi, Dave. How are you? Great. How can we help? So my husband and I are having a hard time getting to the 15% for retirement. And so my husband, his company lets him put up to $18,000 a year in there and then I, for myself, for work, they take 12% of my income but we still don't get to the 15% because we make about $250,000 a year and so we're wondering if my husband is not very comfortable putting money in the stock market. And I don't know why he doesn't want to do a Roth IRA because he feels

he thinks it's connected to the market. What's he putting his 401k in? Well, that's the thing. His 401k is connected in that he feels that that is enough since he's putting technically $18,000 in there a year. I'm so confused. You can put $18,000 in, but if you put $26,000 in, all of a sudden the market's a bad idea. It's completely illogical. Exactly. I completely agree, but he doesn't feel comfortable putting money in, and so I'm thinking that maybe if he doesn't want to do that,

can we buy investment property instead, and technically we're still investing that money, but it's not through the market. Would that still be okay? No, because your decision-making skills are broken. Okay. And if you can't make good, solid, critical thinking skill decisions on your investing, you're going to use the same broken system to buy real estate with. And, I mean, so at what point does real estate become risky?

Past $500,000? Past $1 million? Or just short of $10 million? Where is real estate risky? And so, you know, you have to be able to look at things logically and work your way through them so no i i think you need i think you guys need to talk this through and uh but and figure out what it is that makes uh 26 000 by the way you can do 19 000 this year not just 18 000 is his max but um at what point does it become risky uh that putting in 19 000 versus putting in 25 000 and i'm going to tell

you this you know just a reminder tiffany you know for us if you go to invest in real estate we're talking about you're doing 100 down honey right and, right? You gotta have money. You gotta have money to be able to do that. So he's got something going on, and I think talking about it and figuring it out, the goal is, again, to you all to have enough money to be able to live your dreams later. And so I would talk about those high-definition dreams all over again, about what it is you all wanna do,

the charities you wanna give to, the things you wanna go do as a family, and then try to re-engineer, reverse-engineer that and look to see, does this get you closer to where it is you want to be? Yeah. As far as the market goes, what helps me a lot with investing in stock market and mutual funds is to understand and know the history. So sit down with a smart investor pro and let them look and show you, let them walk you

through like with this mutual fund, it's 80 years old. Here's what has happened when the market did this and the market did that. Here's what happened in 2008. Here's what happened when the, in 1957, when the Russians launched Sputnik and the stock market went down, uh, they beat us into space, right? So the stock market went down. There's all these little events in history, global events that cause the stock market to go down. Then there's other events in history, global events, that caused the stock market to go down. Then there's other events that caused it to go up. And so you can look at that, and the more you understand, okay, here was the actual mathematical variance, not the emotions.

But here was the mathematical variance, and here's exactly what really occurred. And the more you understand that, the more you're really analyzing the risk then. And then if he's not comfortable, then it would be logical only to not put any money in. That would be the thing. And if you can say that, then, okay, I hate the stock market. I only want to do real estate. Okay, I can go with that. But $18,000 is all the risk I can stand, but

$25,000 isn't. That's just, when I make $250 a year, it's flawed math, Dave. Completely illogical. This is The Dave Ramsey Show. Hey, it's Kelly, associate producer and phone screener for The Dave Ramsey Show. This episode is over, but if you heard about an event, product, or service

and didn't have a chance to write it down, don't worry. We list everything you've heard about during this episode in the podcast show notes section, or head over to DaveRamsey.com and click Dave Recommends. Thanks for listening.