The Ramsey Show - App - No More Excuses, You CAN Build Wealth! (Hour 1)

Episode Date: January 12, 2023

Join the free Building Wealth Livestream Event on January 12th! Ken Coleman & George Kamel answer your questions and discuss: "Should I buy a house right now or keep renting?" from the blog: Should I Rent or Buy a House? "What are guidelines about moving to a different states?" from the blog: How to Move to Another State Buc-ee’s is paying six-figures with no experience necessary, Whether or not to buy a fixer-upper, from the blog: Buying a Fixer-Upper Home: What to Know Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET 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

🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studio. This is The Ramsey Show. It's where America hangs out to have a conversation about life, specifically your money, your relationships, your work. They're all tied together, and we're thrilled that you are here i'm ken coleman joined by george camel we're ramsey personalities and we are your guides this hour the phone number to jump in is 888-825-5225 that's toll free 888-825-5225

george are you warmed up i'm ready to go you're You're ready to go. We got a big day today. A big night. We'll talk about that later, but you've done your vocal exercises. I didn't do that, but is that how you do it? I think you're ready now. I'm good. Let's go to Elena in Grand Rapids, Michigan. Elena, how can we help?

Yes, hi. I am a big fan of the show. I just finished the proximity principle, and that was super helpful. Oh, thank you. Good read. Whoever wrote that book is a genius. Yeah. It basically met me exactly where I was at the moment, and so I really appreciate that. And my question is, I am a single, a single lady. I am debt free. I have a four month, I have a four month emergency fund and I just relocated to Grand Rapids about two years ago. So I kind of reestablished myself, uh, and got a new job last year. I made about $35,000 last year. It will be a little more this year. My question is, since I'm single right now,

I am renting a basement apartment and it's meeting my needs right now as far as just relocated and getting back on my feet. I was just curious what your thoughts are. I would love, I'm torn to whether if I should move into a more functional apartment and or put a down payment on a house. And I guess the reason why I'm going back and forth is just because I am single and I really don't have anybody in the picture or plan on getting married to really like help me maintain a house. Uh, but I also know that a house can be an asset for you. And so I'm kind of torn of making monthly rent payments or maybe start out making, uh, getting an apartment and working towards until I find something that I'm looking for or a house payment. Cool. So what are you paying for that basement room right now? So the basement rent right now is $475,000.

That's hard to beat in today's America. All right. And what would rent be? Probably closer to $900,000 to $1,000 for a one-bedroom? Yeah, between $800,000 to $1,200,000. Okay. And do you know your monthly take-home pay out of that $35,000? It's about close to about $2,500, $3,000. Okay. That helps me. Yeah, I absolutely want you to be a homeowner, Elena, and it may be a little further out.

You've got that emergency fund, so your next step would be to start saving up a down payment. I would aim for 10%. 20% is even better to avoid that private mortgage insurance. But that would be my next goal. And it may not be a year or two from now. And you may say, hey, you know what? I'd like to have a little more of my own space. I'm going to move into an apartment. That might mean getting your income up a little bit. What are you doing for work right now? I work in customer service at a bank here in the Grand Rapids area. And I'm also, I just am starting my own virtual assistant business, which is very much an infant stage. So I obviously want to do that full time but I need that to I need to get that up to where it matches or surpasses my current income before I walk away or you know get to a point to where I

can maybe just go part-time so are you wanting to be a virtual assistant yes so you could go do that tomorrow and probably make more than you're making in customer service, right? I am. And like I said, I'm just now starting my business. So I'm just now starting to get up and running to where I can't really, I mean, I am applying for virtual assistant gigs, but right now it's not to the point where I can step away or go part-time from my full-time job. Okay. Well, as far as getting your income up, that would help with the rent. I would like that rent to be no more than a quarter of your take home pay. So that would be my goal. Stay in the basement until we get the income up. Once we get it up and it's about 800 bucks, turns into a quarter of our take home pay, let's go rent.

And in the meantime, let's start saving up that down payment and have a goal. Look at maybe a condo or townhome. You don't need to get a giant home right now, but even a condo or townhome could be a good future goal in the area that you live in and figure out, all right, it's $250,000. I want to put down 10%. That's $25,000. How can I get my income up in order to save that up in the next few years? Okay, that sounds good. I am looking at seeing what townhomes would be, and that's kind of the route I would kind of like to go, but what I've found so far, the townhomes are only renting right now, and so if I did go the townhome route, I would kind of like to buy it. Does that make sense? Oh, sure. Absolutely. And that was my first two homes were townhomes. And it's a great option. You do have to consider a slightly higher HOA fee. But it's not a bad time to get in touch with a real estate pro. You can do that at RamseySolutions.com.

And they can help you navigate the search and dial that in to at least give you a picture financially of what this looks like for the next few years. Right. I am in contact with an agent with Churchill Mortgage. They have a couple of offices located up here, so I am in contact with an agent through them. So I am in process of working with one of the Churchill Mortgage agents. Cool. And check out our friends at Belay. They're a company that specializes in virtual assistants, and they can connect you to an employer,

and you may not need to wait to start a business to jump into virtual assisting. So that's why I encourage you to not wait for that, but go after it if you're ready to make that jump. Yeah. And the only thing I would add to- Yeah, I'm ready. And I would add to, George has given you the money answer and you need that. You need to understand that formula. But I would just really encourage you to kind of dig a little bit. And there's this natural desire that humans have for progress, right? We want to make the move and keep moving. But really just dive in and say, what's driving my impatience?

And I need to get control of that. And again, you're not out of control. But the idea here is for you to go, this is really a temptation for me, and I kind of see this, I want this, I hear this, I watch this, and it's kind of driving me, and it's like you want to stay within the formula of the numbers. Yes, those are your guardrails, but also just be content. Contentment is not complacency, and I think sometimes that's the temptation. You're doing great, Elena. You're an absolute rock star. You got a brilliant future ahead of you.

Be patient. Be patient. Wait. Wait. Wait. You know, it's always worth it, George, on the other side of that. Yeah, we live in a culture that just wants to go, go, go, go, go. When we slow down, we make better decisions. Yeah, absolutely true. Elena, thank you so much for the call. Hey, George and I are here for you. We've got to take a quick break. The phone number, 888-825-5225. Don't move. More of the Ramsey Show coming up. Thank you. welcome back america you have joined the conversation here on the ramsey show a conversation about your money your work and your relationships so excited that you're with us. The phone number to jump in is 888-825-5225. George Camel, my co-host, colleague, distinguished gentleman. Wow. Keep going, Ken. Yeah, I ran out. I need to have a list next time.

Friend? That would have been a good one. Oh, yeah, absolutely. We've been known to do dinner with the wives. That's true. It's largely for them. It's, yes. We don't talk to each other. We're just the eye candy at the table, wives. That's true. It's largely for them. It's, yes. We don't talk to each other. We're just the eye candy at the table, Ken. That's all we're there for.

Well, I've never been called that and never will again. But we are here for you. George is going to take your specific money questions, and I'm here to answer any work-related questions. Your income is your greatest wealth-building tool. How do we do work that we're really good at, work that we enjoy, that yields a whole lot of great results, including income and impact? I'm here to take any of those questions today. We're here for you, 888-255-225. Rachel joins us in Knoxville, Tennessee. Rachel, how can we help?

Hi, guys. Can you hear me? I can, loud and clear. What's up? All right. So me and my husband were just talking about possibly living in a different state. And the one that we both kind of were interested in living in was Alaska. And where we live is New Jersey. That's a huge move. So we were just wondering if that sounds crazy. Is there any financial guidelines that you have for that? Anything against it for it?

Any unbiased advice you could give us? Well, George, I want to jump in before we even get to the money recommendations on moving, because I'm sure we both get some opinions on that. Done that a lot. Why do you think it's crazy? Or are you wondering if anyone else thinks it's crazy that was really the first question absolutely both of our families would think it was crazy all right so they think it's crazy but you and your husband don't think it's crazy in fact you probably have a different adjective i want you to pick the adjective just for fun. You're not locked into this.

What's the adjective that you would use for moving to Alaska? If it's not crazy, it is? Fun. Exciting. Yes. Potential. Wow. That's great.

I think that's fantastic. So the reason your family doesn't like it is because they're sad. Because they're scared. Maybe they're sad, because they're scared. Maybe they're confused. Because you pursuing this fun, exciting journey is filtered to them as you're leaving us. You are abandoning us. You are robbing us of time to see you and the kids and everybody else. Do you see how it's a completely different translation for them when they hear this? Yes. Yeah. All right. But here's the deal.

Would you rather disappoint them by moving to Alaska and having this awesome, fun journey that you and your husband feel that you guys are meant to do? Or would you rather resent them by not leaving and always wondering what could have been? What would you rather choose? When you put it like that, that's eye-opening. Yeah, that changes the narrative completely. There we go. I'm glad our opinions won't sway you then.

You want to do this. I think people who run marathons are crazy. They love it, and they enjoy it. And so it's a great analogy of what's right for you may not be right for someone else. So I'm all for this move. You asked about the financial details. There are a few steps you can take to step into this without a bunch of fear, but instead excitement. You've done the homework.

So are you guys debt-free? We are debt-free, yes. Yeah, we do have about $10,000 in investments, $14,000 in emergency funds, $4,000 in the bank for business thinking funds. That gives me great peace about this move. Now, there are going to be moving expenses, so make sure that's set aside. It's not an emergency, so let's set that aside as well and begin researching. What's the quality of life going to be like? What do we need to know about the weather, commutes, schools, you know, areas of crime? What's the cost of living going to be? Have you looked into all that?

No, that is exactly why I called you. We didn't consider that at all other than just where do we want to live and where can we find a job. Great. And another resource for that, of course, is people who actually have lived in Alaska or currently live in Alaska. So that would also be something I can talk with someone face-to-face versus just reading a blog about Alaska is going to be more helpful, especially in the city that you plan on moving to. So do you have jobs lined up there or are you working remote? That's what we are looking into is where we could find a job. So that would be the first step.

Absolutely. Okay, so let's start there. Let's start with what we currently have skill and experience in, right? So we're going to start the search there. This is what we are doing. This is what we can do. And we begin to look and see because you just, I've been to Alaska. I spent six months there one time working on a campaign and it's a very spread out,

remote. So things are very concentrated. If you're in the Anchorage area, you know, you're going to have a pretty good representation of just most mid-sized cities. That's what that job economy looks like in Anchorage. It is very, very different in the outskirts of Alaska. Do you understand what I'm saying? Are you guys thinking Anchorage, suburbia of Anchorage? Are you thinking like outskirts, these smaller towns where we're flying a plane just to get anywhere? Where we don't know the area at all, we were thinking Anchorage

and then figuring out once we got there. All right. This is not related to job, but this is related to this whole decision. You guys need to probably go spend more time there just on vacation, like scouting trips before we make this move. I love that you're thinking about this adventure and you're taking this season of life. You're debt-free, so you can do it. But I got to tell you something. This needs to be, let's go spend a week there. Let's go see three cities. Let's look at the list that I just told you to create and let's dive deep and

begin to maybe apply and just go through some interviews just to see. We've got to get our feet wet on this deal. This is not a jump in all the way. I don't like that at all. Because this dream could become a nightmare pretty quickly. So we're looking at what is it really like there? And what is the job opportunity so we're sustaining ourselves and able to fund our adventure? That's first and foremost. And then we begin to put the plan together, George. Boy, I don't like just going, wee! It feels like... No, no, no. We wouldn't do that. We wouldn't do that. That's why we called to ask for the guidelines. What should we be looking for? I know, but I want to challenge

you on that. Let's get ourselves very informed. This is the stage that we call uninformed optimism. When you start something new, you're just so excited about it and you don't have enough research to even be pessimistic about it. And the next stage is informed pessimism, where you start to feel a little overwhelmed because you started doing the research and like, oh, this is a lot. And so there's going to be a journey of ups and downs and a lot of emotion around this. And you may end up not moving. You may go visit and say, it's a fun place. We love to visit there once or twice a year. We're going to stay planted in Knoxville for now. That might happen. Are you guys homeowners right

now? No, no, we're not. Okay. You're renting. So consider, do we have to break a lease? Is there a fee involved with that? Should we wait until the lease is up? So there's some logistical pieces when it comes to housing you want to think about here too. What do you guys do for a living? Electrician and dietician. Okay. Well, I like the electrician play. I think that's going to probably be very much, excuse me, there'll be a lot of opportunity there, but you've got some work to do on dietitian and what that may or may not look like there. But an electrician in the trades in Alaska, I like this. I like this a lot. That's what I told my husband. I was like, he probably would be able to find a job before me.

Yeah, yeah. All right. Well, we've got a great resource for you at ramseysolutions.com, how to move to another state. It's got all the stuff I've been mentioning. I'll make sure Austin gets you a link to that. You can also just search for that on your favorite search engine, but that will start to give you a checklist of the things you need to do, the homework ahead of you in research, and make sure you've got a job lined up before you make this move.

The last thing you want is for this to turn into a real stressful situation. George, I want to get them off to a head start. Let's check one thing off the list. I got to talk to our friends at Pods Moving and Storage. Yes. How do you even think about going from Knoxville, Tennessee to Alaska without calling my friends in Pods? Huh Storage. Yes. How do you even think about going from Knoxville, Tennessee to Alaska

without calling my friends in Pods? Huh? One less thing to worry about. They got the storage. They got the moving. In other words, they take care of your headache. That was good, Ken. Nice.

So smooth. Well, I'm excited about this Alaskan adventure. Hope it works out, Rachel. Yeah, send us some salmon. Can you do that? I don't think so. Just on ice. Maybe on ice.

I don't know how long it keeps. But I know what does keep. The Ramsey Show after this quick break. Don't move. The Welcome back to The Ramsey Show, where America hangs out to have a conversation about your life, specifically your money, your work, your relationships. All of those areas of our lives are completely connected, and we want to give you hope to be able to win in all three areas. And George Camel is my co-host.

I'm Ken Coleman with Ramsey Personalities. And big night tonight, folks. The lobby is a zoo out there, Ken. I don't know what you're doing wherever you are, what big show you got, T-Vote, or what you're watching on Netflix. Maybe a Dixie Stampede, a little dinner and entertainment. Maybe. I don't even know what that is. Feels like that's something you do in Pigeon Forge. Before people out there understand. Okay, great. But tonight, if you don't have any big plans, you need to join us for our live stream event. It's called Building Wealth

and it's happening tonight at 7 p.m. We're going to show you how you can still make progress on your goals, build wealth, and have peace with money even in this nutty economy. So you don't have to live with money being tight. You don't have to settle for that. During this event, you're going to hear from Dave Ramsey, Rachel Cruz, George Camel, John Deloney, and me. We're going to help you set goals and create margins so you can begin building wealth this year. Don't miss the live stream again. It's tonight at 7 p.m. Central. George, that means 8 p.m. Eastern if you're keeping score.

7 p.m. Central. You know, Mountain Time Pacific, they never get any love. They never get a mention. It's always Central and Central. Mountain Time Pacific. They never get any love. They never get a message. It's always Central and Eastern. You know, it's a very good point. Well, Pacific gets it. Eastern, Pacific. But anyway, we've got 7 p.m. Central, 8 Eastern.

You can register for free at RamseySolutions.com slash wealth. That's the website. RamseySolutions.com slash wealth. RamseySolutions.com slash wealth. You don't want to miss it. It's going to be a lot of fun. And we've got a bunch of people in the lobby today that are here early. These are what we would call the early birds.

Yeah, they're real excited. They are excited. They get bonus points. Do they? All right, George will hand those out on the next commercial break. You had one guy go, yes! He's excited. Yeah, he's excited.

All right, George, so you're on the social media yes you do the social media i do that and uh you had a post recently that i that i think is very interesting so it's very relevant recently for the very first time in my in my life went to bucky's now if you've heard about bucky's it is a gas station chain that's been regional they're spreading now and. And I went to one in Athens, Alabama for the first time. Heard a lot of buzz about it. People are freaking out. And I'm going, I don't understand. It's a gas station.

Like, how could this be life-changing? Yeah, before we go any further, I want people to fully understand the hype around this. Because we have a lot of people listening from a lot of places, watching from a lot of places. This thing, certainly in the South, Southeast, has taken on taken on like this crazy thing. Kids are buying my kid. I have three teenagers. All right. Their friends are showing up at my house with Bucky backpacks, Bucky sweatshirts. I mean, it is now they have won the brand war. Oh yeah. Like it is no longer a roadside convenience store gas station. This is an experience for people. Well, in Christmas time, there was all these inflatable Bucky Beavers out in yards. Yeah. Santa's out. Bucky's is in. Yeah.

Something about Bucky and the Beaver, but really it's about the culture of the entire place. Now, full disclosure, I've not been in one, but everybody else in my family has. And so I've heard firsthand how unbelievable it is from the way it looks the way it feels the stuff on the shelves i mean uh one of our co-workers here got introduced me to a bag of beaver nuggets oh legendary i didn't know what a beaver nugget was caramel coated corn pop snack there it is that's what it is so ken i had a bad attitude going into this yeah you were a little snarky weren't you yeah it was. That's what it is. So, Ken, I had a bad attitude going into this. Yeah, you were a little snarky, weren't you? Yeah, I was like, let's see what's so special about this.

It was special, Ken. I walked in there. What was special about it? First of all, the employees are incredible. They're happy to be there. They're doing a great job. The place is clean. It's amazingly stocked.

They're cooking up fresh brisket. They have the most amazing selection. They've got Bucky's branded snacks that I'm just learning about for the first time. It was like an adult Disney World. And even better, Ken, here's where you come into this. On my way out, I see a sign that they're hiring. And it was amazing. Let's put that sign up that they've got out there.

And here's what's amazing. No experience necessary. The lowest paying job at Buc-ee's is $17. The general managers make $150 to $225,000. Yeah, I heard you. Wow. No experience necessary. They got a 401k, 100% match up to 6%.

Three weeks paid time off immediately. You can use it, cash it, roll it. Healthcare. They've got part-time jobs. You get an extra $2 for the overnight shift. And it just made me go, there is hope for the job economy in America today. Well, I'm glad you're bringing this up because first of all, folks, the job economy is really hot. Unemployment's back down to 3.5%. Wages at an all-time high. I just looked at the sign. It said the car wash manager makes $125,000 to be the car wash manager at Buc-ee's.

Stop griping. I can't get ahead. Go to Buc-ee's and be a car wash manager. Well, Ken, there's a lot of that. That's the lesson. Well, there's an anti-work mentality out there. There's very pessimistic, very cynical towards the idea of employment in general. And when I walked in there, I went, these people are excited to be here.

They've got a great culture, number one. That's right. And great pay, great benefits, and they're doing work that matters. That's exactly right. By the way, let's talk about that. When we say work that matters, and I talk about this all the time with the Ken Coleman Show, I'm the work guy here at Ramsey, right? And I just believe that you were created to contribute to your work. In other words, what's the difference that you want to make in the world?

What were you born to do? You're just hardwired with talent. You got a heart. There's a type of work function you love to do. You care about making a difference in the world. And we've made success and work this unicorn with wings. And it's like, how can I join this? And the fact of the matter is some of those people are really in their dream job. And it's not because it's sexy or that it pays a million dollars. It's just, they really enjoy showing up every day and they enjoy it while they're there and they can see a result that they care about and no experience necessary means i didn't need to go get a four-year degree because of the pressure from parents and society to then have to get a job that pays 30 grand that i'm miserable in this is the trend of 2023 right here. What's that? Companies are now hiring for skill, not for qualification.

In other words, they're going to hire you based on, can I train you to be the car wash manager at Buc-ee's, not I have a degree in automobile cleansing. It's less about the degree. Companies are dropping degree requirements, and they're going, we're going to hire for skill. In other words, what they're really saying is if we feel you have the raw talent and you get some good character, we're going to train you to have the skills you need.

This is the new trend, folks. And it should be encouraging for those of you out there who feel like you're dealing with imposter syndrome. You got some doubt because you go, I can't make the kind of money I want to make because I didn't go to a steak and sizzle school. I didn't go to an Ivy League school. I didn't go to the biggest school. I don't even have a degree at all, Ken. Well, guess what? The playing field is being leveled. Companies are saying, we just want good people. We'll train them how to do the job. And Bucky's is an example. They're saying it in their ads. They're going, no experience required. Isn't that lovely?

Well, I think companies are now hiring for character, competency. That's it. And they're going, we can hire. Yeah, we can teach you how to do the job. That's fine. But do you have the people skills? Do you have the soft skills, the hard skills? All those pieces coming together to then create a job.

Did you get your car washed, by the way? I didn't. We were in a rush. It was in and out. I got some brisket, got out of there. But man, I wish I could have stayed for hours, to be honest. Well, and what people need to understand is what a quality company looks like and sounds like and feels like, and this is it. The people are happy. The environment is nice. There's a direct correlation between happy, excited, enthusiastic people and a clean, energetic environment. You could have ate a meal off that bathroom floor, Ken.

It says a lot to me that George Camel, the George Camel that I've known for quite some time, bought brisket at Buc-ee's. In fact, that's my biggest surprise of 2023 so far. And I dare say at the end of 2023, you'll still be at the top of the list. I've been described as bougie, you know? And so people go, you're going to get brisket from a gas station? No, don't look at it like that. This was the highest quality brisket known to man.

You're persnickety. I don't know if you're bougie. And it was cut to perfection. The barbecue sauce, Ken, was rich, flavorful. I got to tell you, this is not a free ad for Buc-ee's, but it's from another one. It really is because, folks, George walking into any gas station off of any interstate exit is like the doctor walking into surgery. He's got more anti-back on him than a human should be allowed. Wow. Way to go, Buc-ee's.

I love some anti-back. What's the lesson? There's a whole lot of opportunity in America today for you to make the money you want to make. You just got to go get it. Speaking of money, we got to pay some bills. We'll be right back. This is the Ramsey Show. America, I'm Ken Coleman, joined by my colleague George Camel.

Thrilled that you are with us. And, boy, it's a big, big, big night. I did mention this, but we're really excited. We've got a Building Wealth live stream tonight. RamseySolutions.com slash wealth. If you want to join us on that, it's going to be fun. Live studio audience. And man, it is fun times when we have people in the building, George. And a lot of new listeners coming in, by the way, all the time. I want to say welcome to you. And the phone number to jump in is 888-825-5225.

That's 888-825-5225. Wheeling, West Virginia is where we're going to go now. Luke is there. Luke, how can we help? Hey, how we doing, guys? We are having a blast. What's going on with you? Oh, I'm doing very well too. I'm working on, um, getting out of debt. And basically I was talking to my dad

about that during Christmas. And my dad tried to tell me being debt free, the pipe dream will never exist. And I said, Oh, why do you say that? He tried to convince me that electric bills, water bills, utility bills, car insurance are debts. And I don't believe that to be true. Wow, man, this guy needs a hug. Is your dad doing okay? Yeah, he's fine. He had a stroke a few years ago, but he's recovered well now. And him and I, you know, we spend a lot of time together when I visit and we get along great. But for some reason, his perception of money's not great. He lives with my grandparents, his parents, and I just bought my first house this last year. So maybe he's a little jealous. I don't know.

Well, I think truthfully there's something underneath that where he's been hurt when it comes to money and he feels like he's never going to get ahead. And that's where that attitude comes from. I remember I did my debt-free scream on the show. And, you know, we uploaded to YouTube and all the comments were just like your dad's. Well, you're not really debt-free. You'll always have bills to pay. You'll never be. It's a pipe dream, man.

And so I know that feeling because it's been told to me before. And the truth is your utility bills are not debt. No. It's just an expense. That's right. It's a purchase. I'm purchasing electricity this month. I am purchasing water, George, this month.

I mean, you have to think about- You're not borrowing money in order to get the electricity. You're not borrowing money. You're simply purchasing those utilities. Does that help you philosophically? You get that? Yeah. Kind of like if I pay cash for a car, it's not debt I had to pay for it, but it's not a debt. It's paying cash. That's correct. That's correct. When you go to the restaurant and you order a meal, you didn't borrow money. You went ahead and ate it. Then you go to the restaurant and you order a meal, you didn't borrow money. You went ahead and ate it.

Then they brought you the bill. And that's how utilities work. You had light the entire month and now you have to pay for it. You don't have to live off the grid to live a debt-free lifestyle. That doesn't mean you'll never have any expenses again. It means you'll never have payments to make for borrowing money with interest again, which makes your life better. The whole goal is to minimize expenses, to create as much margin as possible, to create the life that we want. And you are doing that. And so say, hey, thanks, Dad. Appreciate the kind word, but I'm

going to keep living my life. Yeah, change the conversation. That's the way to do it. Did you hear about the black bear that got loose? Move on. We're going to change the conversation. It's not an argument or debate that's really worth having. Indianapolis, Indiana is where we go next. Emily is there. Emily, how can we help? Hi. I'm calling to see if I should buy my dad's fixer-upper.

All right. Tell us more. Why do you want to buy it? Okay. Well, my landlord is putting my rent up to $1,200 a month. I used to pay $800. And my dad's like, well, why don't you just buy my rental property? Because he doesn't live in the state anymore.

And you could just pay me for that. The thing about it is that it needs to be fixed up because the renters kind of destroyed it. Are you debt-free? No. How much debt do you have? $20,000. What kind of debt is that? I have $9,000 on the car and the rest is my student loan.

Okay. And how much money do you have in savings? $1,000. Okay. And how much money do you have in savings? $1,000. Okay. So that would put you at baby step two in the Ramsey baby steps. And the spot where you would become a homeowner, buy a house, would be baby step 3B, where you'd save up that down payment. So the goal right now is to become completely debt-free, have a fully funded emergency fund of three to six months. Then we can start saving up a down

payment. But right now, we don't have the money to invest into this fixer-upper and buy it from him, and it sounds like it's going to be more of a curse than a blessing in your life. And so I would just go, where else can I rent that's cheaper? Or do I need to get a roommate? Would that be an option? Yeah, well, he said, hey, I can rent it to you for what I'm paying for the mortgage for it or whatever. He said, I can rent it to you. And then the money you would be kind of saving on rent, you could just use it to fix it. What would the mortgage be? And what would your rent be then? $650,000. Okay. But then you still need the money to fix it up. Yeah. Yeah. But let's run the math on that. So you're

saving $150 if I heard you right. Your current rent's $800? Yeah, but she's putting it up now to $1,200. No, no, no. I know. But I'm saying if you take your dad's deal, okay, and so now you're paying $650 to your dad, you've saved $150. And his proposal was you take what you're saving on on rent now going from 800 a year yeah and so that's not going to go very far you can't do a whole lot of fixing on $150 a month or $1,800 a year and I just want you to understand that that could get frustrating pretty quickly what are the repairs needed mostly cosmetic like the carpet on these on the carpet paint and um like bathroom stuff why isn't he paying for that because he just because he's like well since it's going to be yours and you need to pay for it

yeah i don't like the spirit of this discussion if you you're going to be a renter, it's not yours. Right? Right. And so I don't want you sinking money into an asset that you don't even own. You're not going to see any of the appreciation on that. Now, long term, you may own it one day. Yeah. But right now, you don't.

And so I don't want you sinking money into this thing. And all of a sudden, he goes, hey, I could charge $900 rent. You're out. And I'm not going to sell it to you because I need the money because I'm retired and don't have enough. And so I need this rental income money. And now this deal you thought was going to happen doesn't, and it creates resentment. Okay. And so I want to protect the relationship. And when you start to mix the finances with family and the deal was going to happen, and if you do anything, you got to be working with a real estate attorney, get all of this written down with a contract. Not because you don't trust him, but because it's a way you say, I love you to family.

Okay. And so if he wants to do the renovations and you pay him 800 bucks once it's renovated, I would take that deal. But I wouldn't cover these on your own. Yeah. Yeah. Okay. So here's what we're trying to help you avoid. To get in a sticky, ugly family situation with your dad, all because your rent's going to go up 400 bucks a month.

So really what we're saying is, what is the best solve for that? Right? I mean, it stinks when your rent goes up, right? That's real. But what is the best solve for that? I mean, it stinks when your rent goes up. That's real. But what's the best solution for that? And this one feels like it's got a whole lot of variables that George has already pointed out. And unless you get clarity on those variables, so now they're no longer variables, there's like, this is what's going on.

Don't make a bad family decision to save 400 bucks. What's your income, Emily? Between me and my husband, we make 60 a year. Okay. And so your husband's living there as well? Yeah. So what's your take-home pay every month? About $4,000. Okay. So if you're looking at about 25% of take-home pay, your goal would be to be paying $1,000 a month in rent. And another question is, can we get the income up to where we could afford the $1,200 at around 25% of our take-home pay and still have margin left over to get out of debt, get the emergency fund, start saving it down payment so that we can be future homeowners. Are you both working full-time?

Yeah. Yeah. Yeah. Feels like you're hanging on. He's also going to school. That's the thing. What's that? School?

Yeah. He's going to school as well, so it's just hard to him to get like a second job. Okay. Are you guys cash flowing that? Yeah. Okay, good. The goal is to not get into any more debt and to start paying the debt we have off to put ourselves in a better financial position. Hopefully going to school will help him increase that income as well. Yeah. And George, I think you did a really good job of helping her see, you know what, there's no guarantee

that even dad, good old pop, well, things can sound good. Isn't going to change his mind and create tension for you because all of a sudden it got better for him financially. Yeah, my heart rate went up just hearing all that. I didn't like that. Made me nervous. Yeah, a little scary.

Good stuff. Thank you, George. Always good to be with you, my friend. Thanks to James and the team in the booth to keep us on the air. And most importantly, we want to thank you, America. This is your show. This is The Ramsey Show. Hey, folks.

Ken Coleman here. Did you know The Ramsey Show is one of the most popular podcasts in the world? Get your daily dose of advice on life and money. Check out all of our shows from The Ramsey Network wherever you listen to podcasts.