The Ramsey Show - App - Is My $1000 Emergency Fund Enough? (Hour 1)

Episode Date: September 21, 2022

George Kamel & Ken Coleman discuss: The best way to invest in your future, Why college isn't necessarily the best choice for everyone, Whether or not $1000 emergency fund is enough, Pausing retirement to prepare for a career move. Paying off student loans, Saving for retirement only vs. also saving for a condo.   Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6   Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Девочка-пай Live from the headquarters of Ramsey Solutions, broadcasting from the pods moving in storage studios, this is The Ramsey Show, where America hangs out to have a conversation about your life and your money. I'm Ramsey personality, George Campbell, joined today by my colleague and good friend, Mr. Ken Coleman, bestselling author and host of The Ken Coleman Show. And we're here for you, America. We're taking your calls about life, money, career, toxic bosses, moving across the country, switching jobs, paying off some debt. Let's go. 888-825-5225 is the number to call. That's 888-825-5225. We're getting started with Chloe in Idaho. That's where she is. Chloe, how are you? I'm doing great. Thank you so much for taking my call. It's so great to talk to you guys. You're such great mentors to me. Oh, we appreciate that. How can we help today? Ken is very flattered.

Yes, very nice. Thank you. So I just wanted to give a little background on myself before I ask my question. So I'm 18 years old, and I recently graduated high school in May, and I'm currently in my first semester of college, and I'm raising money through scholarships and doing that for college. And I want to be not getting in debt. I'm trying to save as much money as I can so I can prevent myself from getting in debt. And my question is, I want to start saving now for my future. And what do you think is the best option for me as an 18 year old? Well, Chloe, you are wise beyond your years. Where did you even pick up all this stuff? Well, my family loves you guys in the Dave Ramsey show. My grandpa absolutely

loves you. He's a great mentor to me. He would sit each of us down, us grandkids, and teaches about budgeting and the importance of not being in debt. And yeah, way to go. Well, I love that you're studying. You're going to college. What are you studying there? For my undergrad, I'm doing communication sciences and disorders, and I'm trying to get my master's degree after that in speech-language pathology, and hopefully a doctor's degree if I'm feeling up to it. Wow. Taking it all the way. What do you want to do with that? Do you want to be a speech pathologist? Yes, yes.

Cool. So this sounds to me like you've got a lot of school ahead of you, which means you have a lot to cash flow. Yes. Cool. So this sounds to me like you've got a lot of school ahead of you, which means you have a lot to cash flow. Yes. And guess what else that means. It might mean we are not investing until we are done with school. Okay. It's hard to focus on three things at once, because what happens is you start to cash flow school,

but now you're investing, but now you don't have the money to cash flow school, so then we go into student loan debt, and then we can't invest later in life because we have student loan debt. Do you see how you're kind of the dog's wagging the tail here? Right. Yes, definitely. So I can feel in your heart that you want to get started investing and you're young and you want to make the most of the time. We're always preaching about getting started early with investing, but you have a lot of time ahead of you. And I have no worries that you're going to be a multi-millionaire if you follow this path. If you

wait, cashflow college, once we have a full-time job, then we can go hard investing 15% and focus on paying off our house and giving generously. All right. How does that sit with you? Appreciate all of it. Is that not what you wanted to hear? It's pretty well. I mean, I would have loved to start now and just keep pushing at that goal, but if I have to wait, then I will wait. Once you've got it all cash flowed, then you can start looking at that. But right now, are you working full-time while you're in school? Where's your income coming from?

It's part-time. I'm working at Taco Bell currently right now, and I'm also babysitting as well. Awesome. Well, I would focus all of that energy on cash-flowing school. Would you agree, Ken? Yes, and I would also caution you, Chloe, to not just assume that getting a doctorate or a graduate-level degree is the best move. Now, it depends on which direction you're going. And you have a pretty clear, it sounds like a general direction. But I really want you to be patient and be diligent. Patient to, number one, get through the stage that you're in now. Diligent to look into, okay, what is the best path for me to go forward? And if I've got to have that graduate level degree, I have to, meaning there's no way to do what I want to do

without it, then I'm going to do it. But do you always have to, you know, go from four year to graduate level right away? Just, you know, I literally spoke to doctoral students at Vanderbilt recently. And honestly, I thought it was a mistake that they asked me to come speak to him because I'm Mr. Education isn't the only way. If it's not the only way or the best way, don't do it. I'm Mr. College is an experience just makes me want to throw up. If you got to do it, go for it. But just, I want to go to college. I think it's a complete waste of time and money. I know. I know. Freak some people out. But I'm an efficient guy.

But they asked me to come and speak to them, Chloe, because these doctoral students at Vanderbilt, these are smart people. By the way, it was in the area of sciences and all this kind of stuff. You know why they had me speak to them? Why is that? Because they had no freaking idea what they wanted to do with their career. But they're getting doctorates.

They just kept going to one more school. So they bring in the simple guy who doesn't even have a degree, period. And they want me talking to all the smart eggheads. Why? They're just getting a degree to keep staying in school and there is a growing movement here.

So that's a big, long speech to say, hey, you're 18. You're extremely young. Your entire life is ahead of you. George's financial advice is absolutely spot on. But I would just add, hey, you're 18. You're extremely young. Your entire life is ahead of you. George's financial advice is absolutely spot on. But I would just add, hey, let's continue to keep our eyes up, head on a swivel. Where do we really want to go? Why do we want to go there? What's the best way to get there? Is there only one way to get there? And then you make those financial decisions based on what is going to allow me to get where I want to go.

So the investing will take care of itself. But don't overcommit and don't assume that you've got to go get all this high education. That's all I want you to hear. That's like my little dad speech because I've got kids your age. All right? All right. Thank you so much for that advice. I appreciate it.

You bet. Thanks for that soapbox. I enjoyed that. But it's so true because you hear, I'm going to get my master's, I'm going to get my PhD, and you go, Sloat, can we get a job for a little bit and get some experience while we're at it? It's a lot of time and it's a lot of freaking money. And yet we tend to remove logic from education conversations. But every parent I know would go, now wait a second, if they were going to spend $100,000 on a car, and they come home and go,

hey, I want to buy that new Tesla that George is driving, and it's $100,000. Your parents would go, wait a second, whoa, slow your roll. Terrible idea. But you come home and go, I want to go to college. I'm going to spend four years, and I'm going to come out of debt, and $125,000. They go, attaboy, dad's so proud of you.

There's an assumption that it's always a great investment. You know why? Because it's a great status symbol, George. We throw logic out the window because, well, it's a status symbol. You can't go wrong with a degree you can't use and you can't afford. Are you saying that parents use this to improve their own reputation by going, well, my daughter, she she got a phd ken i don't think it's as insidious as that that's the cultural message that parents have now taken on as the norm

meaning we've digested it we go oh well i mean you got to go from high school to college we look down our nose at the trades how many parents are excited to go to the block party and go hey we're really excited for buster jr he decided to skip four-year college and go to the local plumber trade school. But you should be that proud if that's what Buster Jr. Junior's making $70,000 straight out of trade school, no doubt. Forget about the money for a second. What if Buster Jr. likes working with his hands and serving people and fixing problems, and it gives him great joy?

And Lord knows we need plumbers, Ken. I can't turn a wrench to save my life. Neither can I. So there's dignity in all types of work, and college is not always the answer, and student loan debt is never the answer. So let's make some wise decisions here. Let's move slowly and talk to your kids about this stuff.

Don't let them wander into this. That's how you create the nightmare we're in today. This is The Ramsey Show. Give us a call, 888-825-5225. last week we were in phoenix arizona for two completely sold-out events on our Building Wealth Tour. It was hot. Energy in the room was palpable. It was hot outside. It was hot inside, George.

Cut it with a hot knife through butter, my friend. So if you're thinking about joining us for one of these events, do not miss your chance. The events in Sacramento and San Antonio are completely sold out, so we just have a few seats left for Building Wealth Minneapolis on November 10th. So if you want tickets, you got to buy them now. Don't be mad at me when it's sold out because you waited too long. Prices go up this Friday for the events. You can still get your early bird discount before it's too late.

It's going to be Rachel Cruz, myself, Dr. John Deloney, Ken Coleman, Dave Ramsey. We'll all be there. It has been an awesome, awesome tour. We're going to talk about building wealth in this current economy and show you how you can get on the path to building wealth. So we've been to Phoenix. We're headed to Sacramento November 1st, Minneapolis on the 10th, and San Antonio to finish it out on November 15th.

And tickets just start at $25. That's amazing in today's economy. I would charge more. I've told Dave this on the air. I think he's giving people too good a deal. It's too good of an event. Well, and the four-pack is $60. That brings it down to $20 a ticket.

By the way, John Deloney and I do a bonus session before the main event starts, and that thing has been going like crazy. There were some powerful moments in the room, Ken. A lot of tears shed, a lot of powerful stories shared, and a lot of breakthrough. Yeah, so basically what John and I do for that, we just literally open it up to questions. It's the John Deloney Show and the Ken Coleman Show combined. And it's been powerful.

The early birds come, and we just open it up to questions, and we never get to everybody. There are people standing in the aisles. I love it. Well, join us. $25, or if you do the four-pack, it goes down to $15 a ticket. So go to ramseysolutions.com slash events to reserve your seats now. Bring some friends. Borrow some if you have to.

It's worth it. Borrow friends, not money. Definitely never borrow money. But I could borrow some friends, Ken. George, you have so many friends. On Instagram. But when it comes down to real friendships, it's just me and you, buddy. Just holding down the fort. Alright, open phones this hour.

888-825-5225. Cheetah joins us in Orlando. Cheetah, welcome to the Ramsey Show. Hey, thank you guys. Thank you for taking my call. Sure. So basically, I have kind of like a two-part question. So I found y'all because I was so stressed out. My refrigerator

broke down. I didn't know how I was going to afford it. All my credit cards were maxed out. And so I started looking at loans on YouTube, and then I came across Dave Ramsey. So I've been looking at y'all. I've been watching your videos. I've been looking at the baby steps,

and so right now I'm on baby step one. I saved up $1,000, but I don't know. Should I save up more just in case my refrigerator breaks down? Is the refrigerator running? Yeah, right now it is running again. I almost want to hit the punchline, Ken. I won't do it. Why? You should go catch it. There it is. Oh, geez. Well, Cheetah, first of all, thank you for being one of our new listeners. When was the last time you just took a deep breath?

Has it been a while? Has life been stressful? It has. Hmm. Well, we teach the baby steps in order it hasn't changed in 30 years and that's for a good reason they work every time you work it and regardless of what inflation is doing and what what life is happening you need these quick wins so i love that you already have that thousand dollars and you're worried because you've had something happen in the past that's triggering you going what if it's not enough what if it's not enough? What if it's not enough? That's where this is coming from? Yeah.

How much debt do you have? I have 15 on credit cards and 7,000 in my car. 15,000 on the credit cards? Yes. And then 7,000 on the car. What's your interest rate on those credit cards? 26% on each one. All right. Now, I asked you on purpose. I knew it was going to be a crazy number like that. And even you had a hard time getting that out of your mouth because it's so painful. The reason I asked you that question is because that's the answer to your

first question. The reason you only put a thousand dollars in that emergency fund is just to cover something like a fridge going out and you could be able to cover a repair to that. But what we've got to do is we've got to put every extra dollar, not into the emergency fund, but to paying off the $15,000 in credit cards. My goodness, 26% on that. You ought to just do the math on that, on what you're paying, just an interest alone, and that'll get you to the point where you're throwing up in your mouth. Now, it's a rather graphic reference, but that's what this needs to be it is i know i found y'all yeah so hey here's the good news you can knock this out okay but that's why you don't put a thousand and five dollars or a thousand and two hundred dollars it's a thousand dollars now move

everything else into the baby steps that george is George is going to walk you through. So how many credit cards do you have? I have... Oh, boy. She had to pause to remember. Eight. Eight? Okay. Eight credit cards?

What's the smallest balance? Well, I've been working on the Baby Steps, so the smallest is $35, and I got that paid off today. Lovely. Then the next one is $106. And I'm going to have two more paid off by the end of October. Nice. Do you feel the excitement that you just had in your voice?

Yeah. You see what happened there? Yeah. That was the happiest you've been on this whole call. There was a physiological change in the way you begin to talk about paying off debt. So what's your income? It is $2,400 a month, but I'm starting to pick up overtime. Boom.

Overtime. And listen, part-time jobs right now are at an all-time premium in this economy. Yeah, I have a part-time job as well. What are you making in that part-time job per hour? $15. Not enough. I keep doing that, but I'd look for something that's paying you $20 to $22 an hour. You got it?

I mean, we're going after every extra nickel that we can get in the door yeah on top of that have you cut all your expenses i'm taking up at least at least 20 hours of overtime at my current job that pays me already 40 hours of work awesome oh i like that. And you're not investing right now? No. Well, they both automatically already take 401KL. It's automatic? Like you can't stop that? I have no idea. I haven't looked into that yet. Let's look into that and see if they can pause that temporarily so that you can take whatever amount that is and be throwing that at the debt.

Because at 26%, this thing is going to be a cycle that will never end if we don't stomp this thing fast. Yeah. Have you cut up those eight cards, like cut them up into itsy bitsy pieces? Well, some of them I lost. And then the other ones I was looking at yesterday with the scissors. Well, that's more reason to shut that thing down. What if someone's using it right now? Mm-hmm. Okay.

No, no, no, no, no, no, no, no, not mm-hmm. Like as soon as this call is over i would report it all of those companies saying hey i lost my card i lost my credit card i want to close this account as soon as i'm paying it off yeah i have a little heartburn myself right now on the lost credit cards i need a mate some malox you need some tums again tums there, there it is. She remembered the Tums, Ken. Oh, you remember. You were watching the show when I ate Tums live on the air. Yeah, the citrus Tums. Wow. I love. She's a great listener.

I saw you last week, and I've been watching every day. You are awesome. I don't watch anything else but Dave Ramsey. Every moment. The frivolous ones are helpful ones. Sponsorship, Briz Brewing. We need a Tums sponsorship. Somebody get on the phone with Tums, please.

I'm a perfect spokesperson for that. Well, Cheetah, is there anything we can do to help? Have you been through Financial Peace University? No, I haven't. We're going to take care of you. You're about to today. Tell her what she's won, George. She's won one year of Financial Peace University.

She's had nine lessons that will change the way you handle your money, Cheetah. So hang on the line. Austin's going to pick up. We're also going to throw in every dollar, the premium version, to connect to your bank account and help you track every single one of those overtime dollars coming in.

You are going to crush this thing. Yes. I cannot wait to hear your debt-free scream. Yes. This is what I'm here for, Ken. Yeah. A new listener who's going,

I had eight cards and I thought I was winning and I started them going, I'll never pay a dime in interest. I'm going to get rewards and cash back. And then it becomes the emergency fund. I was just on Fox and Friends this morning and they were talking about the crazy amounts of credit card debt soaring like wildfire. Yeah, here we are.

And all those people opened to thinking, I'm going to pay it off every month. Sure. And it's wise because you get the cash back and the rewards. And here we are, $887 billion in credit card debt as a nation. That's where we are right now? Yes. Listen, I did not know. Well, I knew the rate was going to be high, the interest rate on a credit card. When she told me 26%, I almost spit into the mic. I really held it back. It was 26%.

These companies are predatory. They're not your friend. They're not sending you on vacation for free. They are winning the game, George. And it's on the backs of struggling Americans, like Cheetah, who are paying 26% interest so that you can brag about your free vacation you got on credit card points. This is sad. George, I think we need to organize a protest in front of all these corporate credit card buildings.

I'm here for it. American distress, we're coming for you. Ooh. Yeah. I like that. I was one of them, Ken. I used to think that way, and then I cut up the Discover card, cut up my Amex SkyMiles, and now I just pay for my vacations myself.

Yeah, and you saved me money. You saved me money with your hacks. Southwest hack. Good stuff. $160 you saved me. Feels good to take control. And you can too, America. We're here for you.

888-825-5225. I'm George Campbell joined by Ken Coleman this hour you're listening to the Ramsey show and there's a lot of places to listen these days we are of course on Apple Podcasts, Google Podcasts, Spotify, YouTube, Sirius XM, iHeart, Amazon Music. You can listen to your smart speaker if you're tech savvy. And, of course, radio. Yeah. The GOAT. Over 600 stations now.

And can we get reviews on occasion on some of these platforms? Yeah. And producer James sent us one that I thought was very interesting, and it pertains to you. Do you want to hear it? It pertains to us, as I recall. That's right. To us as a combo. So this is a review.

Yeah. When George Camel and Ken Coleman work the phones together, it's like putting root beer and ice cream together. Both good-tasting products separately, but pure bliss when combined. Don't waste your time listening to all the mushy junk out there. If you have some spare time, highly recommend this podcast. You know, I've been called a lot of things. Pure bliss is not one of them. Pure bliss is not one of them. I promise you I've never been referred to as pure bliss, but I just want to know, do you think you're

the root beer or the vanilla ice cream? I think you're the vanilla ice cream for obvious reasons. Is that right? Milky complexion and very smooth. Oh, I see. Yeah. Interesting. I get some zip and zang to me on occasion. Is that what you call it? Zang? Zang. So I don't know who's who. Nobody knows. Well, that's a very nice review.

Thank you for that. Thank you very much. We like being... So we are your root beer float this hour. And we've been called worse things. Yes. Both publicly and privately. So we appreciate that.

I don't know about that because I don't read the comments. Because it gives power to keyboard cowards. Ooh. George, on the other way, I don't know about that because I don't read the comments because it gives power to keyboard cowards. Ooh. George, on the other hand, likes to hang out in the dark corners of the internet. That's what I called it.

See all the awful things people say. Well, Ken, you know, if you only read the good stuff, your head explodes. Not true. If you only read the bad stuff, you crumble. No, no, no.

I don't read any comments. Oh, okay. Neither good nor bad. No. All right. That's fair. Yeah. That's why you're so healthy.

Yeah. I really don't have to worry about it when I go to bed at night. That's fair. Yeah. That's why you're so healthy. Yeah. I really don't have to worry about it when I go to bed at night. I feel fantastic about myself. It fuels me. But you know, here's what I have found. You're too neurotic. A lot of people deal with the haters out there, but the haters, they're drinking their own poison.

Right. They hurt people, and they're trying to throw a grenade over at us. Right. So I don't want to give them any power. I want to give them no credibility. There's actually a bigger lesson here. What's that? The critics don't count.

There it is. The critics don't count. They're on the bleachers of life. They're the keyboard warriors. They never say this stuff to my face. Well, there's too many people to help out there to be worrying about the critics. That's the other thing. Let's help some people.

888-825-5225. Natalie joins us next in Pensacola. Natalie, welcome to the show. Hi, Ken and George. How are you guys? Doing great. How can we help? Perfect. So my husband and I are on steps four, five, and six. He is actually leaving active duty military and transitioning to the airlines. He was hired by several of the major airlines. I feel super lucky. And yes, we just have some choices. But my question is, a couple months ago, we temporarily stopped investing

to beef up our emergency fund for this career switch. And now we got it to where we want it to be. So I'm wondering, do we continue investing in our Roth IRAs or pause it as we kind of navigate these different waters of like paycheck? I know he'll have a lower paycheck while he's in training. So yeah, I'm not really sure how to navigate this career transition and the money is he is he getting a steady paycheck uh he is right now with the military up until december that'll be his final paycheck and then after that he will be uh receiving pay through one of the airlines and they have i think it's like half of what he makes right now while he's in training how long long will that be? About four months.

Okay, so starting in December, there's going to be a four-month period where he's making less money. Are you making any money in that time? I'm not. I stay home with my kids. Great. Fantastic. Okay, so can you guys, have you already talked about what that budget's going to look like in those four months? I presume you have since you're on baby steps four, five, and six. You've done this well.

Yeah, honestly, we really haven't. Well, let's start there. Okay. Here's why. We don't need to make a decision that is up high until we focus on where we are right now. So pausing the retirement and all that stuff, George, that's all baby steps stuff. I'll let him address that. But I just want to make sure you understand that we don't create a reality based on feeling instead of fact. So let's look at what he's going to actually bring in from December to let's call it April or whatever that four-month season is, and then what our budget needs to look like. Let's start there. Then we decide on pausing or re-upping. And I'll just ask since I'm already talking to you,

when you paused the retirement 15% baby step four, were you not at a three to six months, or did you do that to add additional months to the three to six months emergency fund? We were more at the three months, and we added it up. Now we're at like a six-month emergency just to kind of, again, for this career transition, just to make me feel better, really. Sure. So we're at the six months now. Yeah, what I sense is happening is the security gland is flaring, and the emergency sirens are going off,

and you're saying, I'm not sure we're going to be okay when the income goes in half. And so that's what Ken said is let's make a budget and put this on paper and go, can we actually afford all of our bills? And if so, then we need to continue investing. We don't need to stay out of the market while these stocks are on sale. So I would get back into it. And if the paycheck's 2000, we do 15% of 2000. If the paycheck's 5,000, we do 15% of $2,000. If the paycheck's $5,000, we do 15% of $5,000. So I would continue on to make that a habit that you do no matter what, unless there's a true storm where he actually loses his job. That's when we go, okay, we're going to pause investing. Okay, perfect. Thanks so much for the call. Appreciate it. All right, we're going to

move on to Mary in Providence, Rhode Island. Mary, welcome to the show. Hello, nice to talk to you guys. Great to talk to you. How can we help? So I, well, me and my husband, because I am married, we have about $35,000 in student loans, but it's all from me getting my bachelor's. And I mentioned to him, like, I just want to get really intense about paying it off. But he, what I mentioned for myself, getting a second job, he really wasn't for that. Because, you know, he's worried about our daughter with child care. How is that going to work out with child care? But I'm trying to think of ways that I can add extra income into our family. Because I want to feel like I'm contributing to paying it off.

And I want it to go as quick as possible. So that's like where my question is, like, how can I help cut where we can cut and bring in income without, you know, raising our childcare costs? Are you a full-time caretaker right now for the kids? No, we have one daughter. I mean, I take care of her, but she goes to daycare, which is already taking up a lot of our money there. Okay, so you are working outside of the home currently? Yeah. Okay, what's your income? So our income together, both of our incomes are about $6,600 a month.

It can flux because my husband's a carpenter. Okay, is that take-home pay? Yeah, that's take-home pay. Okay, so you're taking home $80,000. And so the question is, how much of that $80,000 can we throw at this $35,000 and get this thing gone really fast? And what you're saying is, hey, what if we could take that to $90,000? What would that do for the day?

Yeah. Now, as far as child care, how does that affect the daycare? Is he just saying, hey, if you're going to be gone tonight, I've got to take care of her? Yeah, that's his thing is that, you know, like even if I ask families to watch her, my family's still expecting some kind of compensation because I had family watching her before

and it didn't really make that much of a bit into our child care costs. So it's just a matter of he feels like he can earn more doing carpentry work versus me trying to go out and... Well, is he willing to bust it and do some extra work? I feel like he is, but I don't know if he's as intense about getting out of the debt as I am. So you're not really on the same page about your goals here. Yeah. So that feels like the A1.

Yeah. Does he not feel the urgency around these student loans? Is that all of your debt or is there more? No, that's all of it. It's all my student loans. That's it. I mean, it's outside of our mortgage. Well, it's his student loans too.

Y'all are married, right? Yeah. So it's our student loans. And he has said that. He said that. He's like, you know, it's ours now because we are married. But I guess I feel like I have that charge of like, I want to go tackle it and be quick about it.

And I feel like more relaxed with it. Yeah, you're energized about this. Well, how about this? I'll put you guys through Financial Peace University if he's willing to go through it. You think he'd be willing to do it? I think he would be. Well, you tell him, this is my vision. I want you on board.

I want you just as excited as I am. So hang on the line. Austin's going to pick up. We're going to hook you guys up with Financial Peace University. If he's not fired up by the second lesson, I don't know what's going to get through to him. But that's going to help you guys decide on what's next and what these side hustles look like and what child care looks like. But this debt is gone within a year, maybe a year and a half. Oh, that'd be nice. You got this, Mary. We're cheering you on. This is The Ramsey show I'm Ramsey personality George Camel host of the fine print

and entree leadership podcast joined by the host of The Ken Coleman Show, you guessed it, Ken Coleman himself. There it is. We spent a lot of time and money on that show name. We got there. Very creative. Hours and hours of brainstorming to come up with The Ken Coleman Show. Landed in a good place. Yeah, yeah.

Well, if you didn't know, folks, you can visit us right here at our headquarters south of Nashville, Tennessee, and we love to have visitors. Yes. And occasionally, a visitor has a question, and so we put them on the debt-free stage, and they get to ask their question live right in front of us. We like that. For guys like us with ADHD, it's a mix in the rhythm. To see the caller.

Yeah, so who do we have on the stage? Well, today we have Lisa, and you're from Honolulu, Hawaii. I am. Can you tell with the tan? The tan is what sold me on it. You're glowing. I know. What is tell with the tan? The tan is what sold me on it. You're glowing. I know. What is your question today, Lisa? So I'm 54 and debt-free and in a situation where, thanks to Ken,

doing very well on a new job. Awesome. Very nice. It's been wonderful. But I want to make the wisest of what I'm making right now. So my question is, should I be just fully funding my retirement because I am behind? Or can I simultaneously fund my retirement at this age of 54 and still save for possible purchasing a condo in Hawaii, which of course, Hawaii is very expensive. And that's probably what I could afford. And I'm thinking initially purchasing it and then having it as maybe a rental until I can take over and maybe it be my retirement place. Or do I just throw everything into retirement? How much is in retirement? About a 120.

Okay. And that's it? You don't have any pensions or anything else going on? No. Is it a 401k situation? 401k and Roth. And Roth. Okay.

Are you renting right now? I am, but it's a situation with family. So I have the lowest expenses that I've had in my lifetime. So I want to make the best of it because I've been given a lot of kindness from the family, which is great, and do the wisest thing. So if that situation changes, I'm ready to move into a possible place that could be my retirement place. Does that make sense?

Yeah. Well, I would want you to have a paid for primary residence before we jumped into investment property. How much cash do you have? Just enough for a six month, my emergency fund. Okay. So I'm really starting from scratch with the new job. And so I'm just looking for that. So this would be, yeah. So that's my question. Like I can stay where I am for quite a long time to either save for, and it's not necessarily an investment property that I want it for, but I want it to be my primary property when the time comes. Yeah. Well, I don't think an investment property is a necessary part of your future right now, but what I do think is

necessary is catching up on retirement because I don't want you working till 70 because you don't have enough in retirement and you've got this mortgage on this investment property that we're hoping is cash flowing. We're hoping that the renter pays and all of these variables in there. So I would want you maxing out all you can on retirement. Anything beyond that, I would want you to save up and get your own place. Okay. So I guess my question would be if I'm getting my own place, that would be my primary residence basically at some point. Okay. Yeah. So I think the investment property is a further down the road dream.

Yeah, and I'm not thinking it as an investment property. I'm just like primarily when getting a property right now would be too much. It would be 50% of my income. Oh, yeah. So I would have to- What does a condo in Hawaii cost? Yeah. A half a million easily?

No, a small, simple condo is now up to, let's say, three. 300. 800 square feet. But you're in a new job and I just wonder, and I know it's early on, but do you see a path for promotion

and a ladder to where you can grow your income as well over the next two, three, five, seven years? Yes. So your income increasing is a big part of this. Yes. Right. So if we get caught up on the investing into retirement, as you grow, right, and I know it's not fun maybe to not have your own place, but in this situation, George, I think as you look to increase your income through promotion and growing professionally, that's when we can save on a down payment. But getting yourself back into that retirement rhythm and getting that caught up is the better move right now. Okay. Because I guess my concern is that I'll get to

retirement and the only thing I could end up, let's say worst case scenario, I have to go into a senior citizen home. I mean, not senior, but senior housing where they take your income into play and then they look and they go, oh my goodness, she's got a great retirement. She doesn't qualify for there and I don't have a place of residence. Okay, so let's put some rules. Does that make sense? Yes, and I think it makes sense, but you're basing that question on the emotion of fear. True.

It's the worst case scenario you just hit us with. Yeah. Okay. So let's just put some real numbers at play. 20% down payment on a $300,000 condo is? 60. 60 grand. Yep.

So how long would it take you if you get back on your retirement schedule and you're investing there with increases in your income? Maybe you're taking on a side hustle. Already doing that, thanks to you. There you go. So my point is, how long would it take you realistically to get $60,000 saved up? Two years. Okay, then. You know that for a fact. Pretty sure.

You could save $30,000 a year while funding retirement. At 15%. Okay. Great. So that's the thing. Do I stay at 15% with the Smart Investor Pro? Yeah, that's the question, George. Are you recommending she go above and beyond the 15%? No, I would still do 15%. And based on your income, that might mean you get some of those catch-up contributions. You're going to be fine.

Past 50. So now let's reset this. Okay. All right? Two years from now, you've got your 20% down payment and you have your own place. You're not going to an old person's home. I don't want you planning for that. planning for trying to set you free in there like that's why i'm trying to plan better yeah but it's like you you gave the absolute worst case scenario and that's not even realistic what's realistic is uh you're gonna have a down payment for a condo and maybe even a

nicer condo than you even think in the next two to three years is it worth two or three years of waiting and being diligent absolutely yeah okay i'm thinking that the uh actual monthly payment though would be not uh 25 of my income that's where the catch is because what has to change so what has to be true for that to be different oh increase in income increase in income and increase in down payment. Oh, okay. Which means you may have to wait three years. Maybe three, four, five year journey to get there. Again, none of this has you as an old person going into a home where they're going, well, you can only afford this. Well, and I don't think that the investment property is going to be the savior that you think it is. Yeah. And I guess I probably worded it wrong. I wasn't looking at it

as an investment but initially moving into it wouldn't be realistic for me at the income i'm at so having someone rent it until i either also dump money into it on top of what they can cover for the mortgage does that make sense i mean you see what you're asking you understand what she's asking but no it doesn't make sense you're better off to do what george said the 15 okay busted at work okay save save save yeah you're fine biggest down payment bring down the actual the goal is for you to have no house payment whatsoever in retirement and then that is an investment but it's something you live in and then now you have options but you also have a really great retirement account over here where you've done very very well you've been very very

diligent and then you've got a great home situation that is also going to pay you. You got this. I literally just turned 54 a couple of days ago. So happy birthday. I need to find this out. You're good though. You got a lot of life ahead of you. Yeah. It's not too late. Okay. Good. You're good. All right. Well, thank you so much. I appreciate you visiting guys. Congrats, by the way, on the new gig. Thank you. Yeah, that's fantastic. All right. Yeah, you're a rock star. I appreciate you visiting. Thank you, guys. Congrats, by the way, on the new gig. Thank you. Yeah, that's fantastic. All right. Ken, this is a big one.

I was speaking at a church this Sunday, and a guy came up to me during a break, and he was in tears. Because I'd mentioned on the stage, I said, hey, and if you're older, it's never too late. Some of the most inspiring stories are the ones who are 70 years old, and for the first time in their life, they're debt-free. Yeah. And a lot of people think, well, I'm 46. I learned this stuff. I'm 52. It's never too late.

As long as you can fog a mirror, there is hope for you yet. Yeah, I agree with that. And I think that I love this question because this is a very accomplished professional, all right? And she's sitting there and she's going, I'm worried that I'm going to have the government tell me what kind of retirement condo I can live in because I'm going to have nothing and that's real fear fear is debilitating and so what we did in that little exercise I I want to make sure the audience a lot of new people listening and watching the show what we deal with on this show are facts we look at real numbers and we go what's real not what is the boogeyman underneath the bed.

And it's really important to go, all right, let me step back and see based on my desired future, what must be true for me to get there. And when we begin to deal with facts, we begin to do two things. Number one, we're really clear and that makes us confident, right? And then when that confidence takes place and we go, oh, it can be done. Now I can walk the path that the Ramsey Show gives us. And then it's up to you to decide, am I going to do it? That's right. But it's a lot easier to do when you're confident that it can be done.

And that's the social proof. That's the debt-free screams. All the success stories. Love it. That puts this hour of the Ramsey Show in the books. My thanks to all the folks in the booth keeping the show afloat and to our listeners out there. And of course, to my stellar co-host, Ken Coleman. We'll be back with you before you know it. Do you love a good day, Brandt? Want to see the latest Ramsey Show videos going viral? Check out your favorite moments from the Ramsey Show on YouTube. Go watch and subscribe to the Ramsey Show channel on YouTube.