The Ramsey Show - App - Planning Your Impulsiveness Is Key to Becoming Debt-Free (Hour 1)

Episode Date: February 8, 2022

Dave Ramsey & Ken Coleman As heard on this episode: Sign Up for a FREE trial of Ramsey+ TODAY: https://bit.ly/3rZTUAx Tools to get you started:  Debt Calculator: https://bit.ly/2Q64HME Insurance Coverage Checkup: https://bit.ly/3sXwUn5 Complete Guide to Budgeting: https://bit.ly/3utmVXi Check out more Ramsey Network podcasts: https://bit.ly/3fHhbVE

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. Ken Coleman, Ramsey personality, number one best-selling author of the book Paycheck to Purpose and host of the Ken Coleman Show, is my co-host today. As we talk about your relationships, your careers, your jobs, your work, your money, and your life, it's what we do here at Ramsey. We talk to you about all of these things, and we're going to talk to you about them right in front of you.

Open phones at 888-825-5225. The call is free, and some say the advice is worth exactly what you pay for it. Greg is with us in Frederick, Maryland, to start off this hour. Hi, Greg. Welcome to the Ramsey Show. Hey, Dave. How's everything going? I know I asked you how you're doing, but you, like me, are better than we need to be, right? That's exactly right, sir. What's up? Yes. I have a question for you. I've been pondering this to exactly what I should do.

I'm retired, been retired for a couple years. Financially, God has blessed us. I have one portfolio that I've been saving over the years to pay the house off. We have a house that we've got about $80,000 left. And I can take that money, pay it off, or continue to pay the monthly premium. So my question to you, Dave, is what should I do? Should I worry about the bite I'm going to get from taxes, but the comfort and relief I have of owning my house? I'm 71, so I'm on the end of the investment spectrum. Yeah.

So what's your total nest egg? Well, counting the house. Everything. No, your total nest egg in your retirement accounts or in your stock portfolios or whatever. About 800, give or take then on the market okay so um you know enough you knew enough about me to be able to know how i was going to answer the question how are you doing so you already know i'm going to answer this

okay don't you i think i do but i'm not positive that's okay well i'm calling that's okay okay if you add eighty thousand dollars to your name i would question whether you pay off your house or not because i don't want to be broke with a paid off house okay yeah well you got eight hundred thousand dollars and you use 80 grand to pay off the house i think you're still gonna be okay so i pay off my house uh about two years ago right right actually you know we've had a financial advisor most of our lives actually getting ready to go talk to one of your recommendations here next week okay about switching okay switching why are you switching well because i've been listening to you, and you raised a good point.

And I always knew it but never really followed through with it as far as it's my money. They should be teaching me. And the guy that we have, we've been making good money with him for years. But looking back on it, it's like, well, I've made recommendations. Why aren't you taking them or at least telling me what's going on? So I'm thinking. Okay, so he's a bit arrogant and a bit controlling, and you want to be away from that. Is that what you're saying?

I would say to some extent, yeah. That's probably true. A lot of people in that business are, so that's not that unusual. It's kind of one of the ways that those of us that come out of that business are taught. We're taught to drop the glasses down on the end of our nose and talk down to you. And you're the one that's a millionaire. Well, I'm upset because I didn't find out about you 20 years ago, but be that as it may, I got you now, and I just need your input.

You know, I'd take a big hit on taxes. You're not going to take a big hit on taxes. You're going to take a little hit on taxes. You're not going to take a big hit on taxes. You're going to take a little hit on taxes. Pay off your house today. Thanks for your call, man. I appreciate you listening. We're honored to have you. Ken, it's just essential that in any area of our lives, career coaching,

even what Dr. Deloney does, even with therapy, so to speak, that the person you're involved with is not dropping their glasses on the end of their nose. That's right. Yeah, you said it for years, the heart of the teacher. You know, when we talk about our SmartVestor Pros, we've told people, go sit with multiple, interview them, because we want them to have the heart of the teacher, not just in how they treat you, but more importantly, that they will teach you until you get it. Because it is your money.

We don't want somebody telling me what to do. We want someone going, okay, here's where we see a strategy, whether it be mental health or in your job and trying to grow professionally. It's always good to have a coach, but a coach who doesn't just tell you what to do but shows you how to do it. There's a big difference. And, you know, you understand why and what, not just follow my directions without thinking. You don't want to be sheeple. That's right. That's right.

You don't want to be in any area of your life because it's not going to end well for you. So I question everything until you give me a reason not to. That's right. Do I understand why we're doing this? And it's okay, by the way, to keep asking why. You know what else is interesting, too, is the psychology behind Greg's call. And I actually totally see myself in that call in that I hate taxes so much. And for good reason.

And Greg also has great reasons. But in that case, it's like the taxes, you've got to pay them. And so don't miss out on the bigger play, the bigger wealth building, the bigger benefit of paying the house off because we hate that tax burden. We hate that, oh, I've got to pay that. I get that. I certainly see that. Yeah, well, and here's the thing.

At 70 and a half, you have to begin pulling money out systematically anyway. That's right. You're required minimum distributions. And so you don't have a choice. It's not enough to pay off the house, but you're going to have some taxes anyway. Yeah, you've got to deal with it. If you've got everything in traditional, or whatever you've got in traditional, it's going to have to begin to systematically be moved out.

And so, yeah, but I agree. I've found myself doing things for tax reasons only if i'm not careful and they're not good economic reasons but they're good tax reasons that's right and boy that just that just comes from this whole thing of hating taxes and hating how stupidly the government handles our money that's right so on open phones here at 888-825-5225 bethany on instagram says i want to break out on my own and do my own thing before i turn 30 but i'm not sure yet what i want to do and how to figure it out can you give me a little advice ken yeah so what we want to do is we want to look at the easiest way to find clues to this big question

what do i want to do with my life? And we start with talent, Dave. We're all given talent by our creator. And he gave us these talents to use. And what we can do is begin to say, wait a second, these are the areas, and let's just think of hard skills and soft skills. And you can start, if you're having a hard time identifying them for yourself, number one, there's nothing wrong with you.

But there are others in our lives, people who have coached us, people who have taught us, people who have done life with us that can help us see ourselves as the world sees us. So what do you really do well? It's always come easy for you. This is the idea of talent. We can take talent and then with practice and diligence and training turn it into a skill. So think of it as a power tool. Start with talent because when we know we're good at it, then we begin to ask the question, I'm good at this.

How can I use this to do something I really enjoy? Then we begin to say, what makes me come alive? What do I enjoy when I do this type of task? See, I was in class. I always got in trouble for talking. Well, it turns out it's a good thing. And it's a good thing they invented talk radio, huh? You love communicating.

And so just look at those clues. But for the greater audience who's going, hey, I got the same question, go to Ramsey Solutions and get the Get Clear Career Assessment. 20 minutes or less, you're going to get more answers than you've ever had in your life. People all over the country are discovering a faith-based and budget-friendly way of meeting health care costs through Christian Health Care Ministries. Christian healthcare ministries or CHM is a nonprofit organization that helps members carry one another's burdens with healthcare expenses. And they have successfully shared each other's medical bills for nearly 40 years.

See if CHM is right for you by visiting chministries.org. CHM is a proud sponsor of Dave Ramsey Personality, is my co-host. Over the last 30 years, I've walked with tens of thousands of people and their families to help them overcome their stresses. And we found that money stress is just one of all kinds of ways we experience stress. People struggle with stress, anxiety, loneliness all the time. We all have some sort of crazy out there, right? We've all had lies told about us by well-meaning people or not so well-meaning people. And the list of hurts, they go on and on.

Unfortunately, you can't change your past, but you can change your future. And here's the great news. Dr. John Deloney has a brand-new book out. We are putting it in pre-sale yesterday, and it has sold a record number. It's doing very well. Called Own Your Past, Change Your Future. He'll walk you through a not-so-complicated approach to relationships, mental health, and wellness. Through his personal stories, decades of experience and research.

Dr. Deloney shows us how to transform hurt into healing and move from hopelessness to hopefulness. It's available for pre-order right now. He'll show you how to deal with different kinds of trauma, how to get connected to a community and make friends as an adult, and the steps you can take to change your thoughts and actions. It's possible. And here's why you need a preorder. You're going to get over $300 worth of bonus items with a preorder, which includes an entire month free of one-on-one counseling with BetterHelp, one of Dr. Deloney's sponsors.

So preorder your copy of Own Your Past, Change Your Future for only $20. Get $300 worth of stuff. Do it at ramseysolutions.com and do it today. Dr. John's book came out of the chute hot, Ken. Yeah, well, I mean, a lot of pain out there, and we're seeing that, and it's only been, you know, exacerbated by a two-year period of tremendous uncertainty, changing the rhythms and the locations of how we interact with people. You mentioned this in staff meeting Monday.

You know, we think there's going to be a real revolution was the word you used, you know, of people returning to the humanness. And, you know, we're relational human beings. And when that's broken, when it's been changed, I mean, there's just a lot of pain out there, and it's the right time for this. Yep. It's needed. Very needed.

Sonny is with us in Dallas, Texas. Hi, Son welcome to the ramsey show how can we help hey guys how y'all doing today thank you for taking my call um i'm just real brief i'm 27 years old my wife is 27 as well we have three kids that are all under the age of five um we're just we're stuck i mean living paycheck to paycheck i work in the oil field and luckily now i'm in the position where they're trying to train me up to to a higher position with better pay uh my wife is a uh she just took a job uh being a christian principal at a christian school um what do you guys make a pretty significant pay cut no more than probably about 60 70 000 a year that was pretty vague you don't know what you make no more than probably about $60,000, $70,000 a year. That was pretty vague.

You don't know what you make? I mean, from working in the oil field out here, it fluctuates quite a bit. Oh, it varies. I got you. Okay. So why did your wife take a significant pay cut if you have money problems? The church is real small, and the Christian academy that she became the principal at is very small as well. She's working to get more students in.

Why did she take a pay cut? Why did she take a job when you all are broke? It wasn't a pay cut. From our discussion, she said it felt like it was God's calling. I mean, we're very strong in our faith, and, I mean, anytime God calls on us, I mean, we jump to it. What was she doing before she moved into this role? She was an assistant director at the Boys and Girls Club, making about $20,000 a year. And now she's making less than $20,000? She makes about $600 every two weeks.

Take home about $550 after taxes. Well, does she feel called into education or Christian education specifically? Christian education specifically. Is that true? Well, I want to challenge an assumption here that that's the only way she can do that. I certainly understand the passion here, but this has financial implications to it. So, listen, we're both strong in our faith, too, and we believe God calls you to things just like you guys do. Yeah.

But let me tell you what. He also says you need to take care of your own household first or you're worse than an unbeliever. He doesn't call you to do things that are perpendicular to Scripture. Yes, sir. And so I'm going to challenge that straight up. I mean, I'm not saying she needs to go quit her job, but you can't just throw the God card down on something that mathematically doesn't work and now all of a sudden makes it work.

Yes, sir. Sometimes God tells us to do that. I'm open to that idea but that's the exception rather than the rule in the way that he interacts with us um and that's me walking with him for 50 years so uh anyway all right so now you guys have got a 60 70 000 income and you're living paycheck to paycheck and you're sick of that and you're getting a raise you think on the oil field yes sir how much your raise much is your raise going to be? Right now I'm making $20 an hour,

and I could be jumping up to anywhere from $75,000 to $85,000 a year. I'll be put on salary. Well, that'd make a lot of difference. Yes, it would. Because that puts you guys at $100K instead of $70K. Yes, sir. Yee-haw. Okay.

So how much debt do you have? How much debt do you have, Sonny? Combined with the vehicle, it's probably about maybe $30,000. With the vehicle, how much is the vehicle debt? About $17,000, $18,000. Okay. All right. Well, what we'll do is I'm going to put you guys into Financial Peace University in Ramsey Plus, okay?

I want you to go through the class. Do what? I said thank you, sir. Sure. We're going to pay for it because I've been broke and scared and not knowing what to do, just like you guys are. I know how it feels. So I want you guys to get in there and get on the written budget on the EveryDollar app, and both of you working together on that app,

I want you to attack this debt with every dollar you can squeeze out of your life. No eating out, no vacations, you're broke people. You've got to get out of not being broke people before you start goofing off with money again. And we're going to get you out because it's not a forever thing, and it doesn't necessarily depend on your raise, but raise will help yes sir okay so we're not going out to eat we're not going on vacations and if you can't turn the corner pretty quick on doing the budget and start actually making some progress paying off some of your smaller debts you may need to sell that car i don't think you do though i think you guys getting in control and working together and sacrificing

and having a written plan which will make you feel like you've got a raise, I think you can turn the corner with what you've got without selling the car. But if you have to sell the car to get where you can balance this out, her job pay cut may have cost you the car. Yes, sir. It may mean you can't afford it. I don't think so, though. may mean you can't afford it i don't think so though i think you can make it and i want you guys to slow down and um and look at the total picture of your life

when god starts calling you to something and and is he calling you to a specific thing like that particular school or is he calling you to christian ed instead of boys or girls club or is he calling you to Christian Ed instead of Boys or Girls Club? Or is he calling you to help out over at the church where you go that's a small church and really can't afford a principal because they're not paying a principal enough to stay above the poverty level? So maybe they need to have a layperson that's a volunteer, and your wife does this as her volunteer ministry on the side while she keeps her other job or a different job. That's another way you guys could have gotten at fulfilling that same burden that the Holy Spirit was putting on her.

And I'm not doubting that God spoke to you guys about this. I'm just doubting the way it's played out and the timing of it because it's left you guys in a lurch. And my Heavenly Father is crazy about me, and he doesn't lead me into a canyon to get killed. Yeah, I think there's a couple things. I would look at seasons. If she were, she's got a commitment now,

so if there's two or three months left in the school year, I don't know what it is in Texas, but she can fulfill her commitment but also find a Christian education job that pays way more than what she's getting, which I think is about $1,200 a month, which will help you all. And then there may be a season of life where she does work for way less as a true ministry, but that may be a season much further down the road. I think you've got to really discern and really look into that situation. Be careful how you bring it up to her.

We want to honor her heart, but also go, hey, what are some other options to do what you feel called to do, but also allow us to thrive financially? Because it's there. It's definitely there. Yep. Absolutely. It can just be timing. It can be process.

It can be structure. And you still fulfill the calling within a little bit of different guidelines instead of an all or nothing thing. But for today, you're there. So here's how we're going to help you hang on. Kelly's going to help you sign up. We're going to walk with you on this and want to see how God plays his hand. In the lobby of Ramsey Solutions on the Dead Free Stage, Dennis and Christy are with us. Hey, guys, how are you? Doing well.

How are you? Welcome, welcome. Where do you guys live? Madison, Alabama. Oh, down next to Huntsville. Yes. Just down the road a little ways here. Yep.

So welcome to Nashville. Thank you. And apparently you're a house divided with an auburn fan and an alabama house united house united house united what are you united in football exactly yeah we watch each other's teams play and when they play each other we don't hold it against each other if they if his team wins i don't and if my team wins he doesn't hold it against me so oh that she's happy, I'm happy. As an Alabama or Auburn fan goes, they're pretty sweet people.

Yeah. Yeah. Thank you. There's a lot of maturity as well. They're going to sell. I don't know. I don't know if that will work in my place. You're saying no trash talk at all during the game or before the game? Well, very little.

Yeah. Very little. When we first got married married there was a lot more of it but we've gotten more accustomed to reading each other's teams on so there you go you guys are great thank you that's unusual i love it so how much debt have you guys paid off ninety-three thousand ninety-two thousand how long did that take over seven years good for you and your range of income during that seven years? $90,000 to $120,000. $90,000 to $120,000.

What do you guys do for a living? I'm a software engineer. I'm a homemaker. All right. Very good. What kind of debt was the $92,000? All house. Paid off your house?

Yes. Look at that word, people. Yep. I love it. Way to go, you two. Very good. Excellent job. What's that house worth?

Right now, according to Zillow, as accurate as that can be, $287,000. All right. Very good. How's that feel? I have a paid for everything. Very nice. Excellent. The day we paid it off, we went walking in the backyard, and yes, it does feel different.

You did what I said. You walk through the backyard with no shoes. The grass feels different when it's yours. It does. Absolutely. I love it. Yep, yep, yep, yep. The grass feels different when it's yours. It does. Absolutely. I love it. Yep, yep, yep, yep.

That's good. Way to go, you guys. So what started you on this journey seven years ago? Tell us the story. Well, I had a car repair that needed to be done. They were telling me it needed some maintenance. But it was like after Christmas. I had some credit cards at the time.

And I just realized that I told him I couldn't really afford it, and that's what told me that I was doing things wrong. That's when I looked into, got your book, read it, and realized that, yeah, there is a better way to do things. Oh, wow. Okay. So, Christy, he comes home and goes, we can't fix the car. I'm going to read a book. We're done with this. What did you say?

I actually was, before we got married, I was in debt as well. And about a third of the debt was late charges and over-limit fees. And sometimes over-limit fees would then push me into having late charges because I couldn't afford to pay. What the minimum was, they wanted me to pay. So I was on board. Been there. So you were sick of that, too. Oh, yes.

So whatever we got to do, we got to do. And you sat down together and started putting a plan together. Absolutely. Wow. So impressive. And here you stand seven years later with a paid-off house. Yes. Wow.

Way to go. Thank you. So how long did it take to begin to you saw momentum? You're reading this book, right? And you're going, okay, I'm reading, and I'm beginning to make some changes. Do you remember back when it began to catch hold and you both were going, okay, not only do we agree with it, but now we're seeing this and we get excited. It was about six months. Six months? Yeah.

Yeah. That's when we started seeing the balances going down further. Yeah. Wow. And you get control. You get a sense of power over the money, over the numbers. Yeah. Good for you guys.

I'm so proud of you. Very, very well done. What was the hardest part of this process for you? For me, I think it was he is very much the budgeting nerd in our family. And there were times that I was impatient and wanting to buy things and he's very stick with the budget it's it's not in the budget we don't have the money you know very so you're telling me that a software engineer might be a little bit nerdy and yes absolutely yeah he's very much a software engineer you know and i'm like but but here's something and and sometimes it was just a hundred or two

dollars worth of maybe like a storm door or things like that but he was he's very much okay well here's the rules follow the rules yes he's very by the book i like it yeah no huh he said no all the time but then finally there were some things he said, oh, I didn't realize how inexpensive this was. And then if we had it in the budget left over, then we could do it. Then we did it. So that works. Just had to build the plan. Yeah.

The plan. Build the plan. Work the plan. Build the plan. That's the software. Oh, yeah. That's why you're successful. I like it.

Exactly. Build the plan. Work the plan. All right. What do you tell people the key to getting out of debt is? Build the plan. Work the plan. What else. What do you tell people the key to getting out of debt is? Build the plan, work the plan. What else? That's it.

Stay away from debt. Be intentional with your money. Plan your impulses. Stay focused. Plan your impulses. That's a good word. What does that mean to you? I like that.

Well, you can be just plan. You know, when you want to just buy something, just make sure you have enough line item in your budget for impulsive spending. Yeah, nice. So you take the impulse out of impulse. We feel that we want it, but then you put a plan in place. That's pretty good. Yeah, you plan even like vacations and different things. You know, try to build them as much as you can into the plan. Although some things that are unplanned do come up,

but you do your best to try to make sure that each item in your budget has a monetary amount and fits within your income. Yeah. Way to go, you guys. Thank you. So proud of you. Who cheered you on the most outside the two of you? Family.

Yeah. Okay. So your family knew what you're working on and they said go get it exactly good very cool very good good job y'all well we've got a copy of baby steps millionaires and that's definitely the next chapter in your story you're going to move on to that if you hadn't already you might be there already and uh well i'm sorry. Oh, you did it! All right! Yeah!

I talked to you in 2019. I just barely crossed the line. And then a pandemic happened, a pestilence. Yeah. I dropped out of it and then came after that fall back with vengeance. Okay. All right. So your investments are up over $700,000 then?

Yeah. With a $300,000 paid for house. Touchdown! Wow, there it is. How old are you guys? I turned 53 days ago. All right. I'm 56.

All right. You're the perfect Baby Steps Millionaires. Well done. Thank you. Ha ha. How much of this money did you inherit? We had $10,000 from an inheritance. $10,000. Yes. I don't think you're millionaires because of that

i think you're millionaires because of the people i'm looking at in front of me they're the secret sauce in that equation well we'll give you a copy of that you'll read about the equivalent of yourself in there as you go along well done and a copy of total money makeover for you to give away and get somebody else disrupted and get them moving along like they need to so very well done dennis and christy from madison alabama 92 000 paid off in seven years making 90 to 120 count it down let's hear a debt-free scream three two one we're debt-free free! Yeah! That's how it's done. And so, let that be a lesson to you. If you want to be a millionaire, be nice to your spouse about opposing football

teams. I think that's a key thing. That had to be that factor about them had to really help in the debt-free journey, too. Getting on the same page about a budget. If you can get along during an Alabama-Auburn iron bowl. I know family members that haven't spoken in years that are opposite because the kid chose to go to the wrong school.

It's a hateful situation. That's a hateful thing. It is. Yeah, it's just, you know, I don't know of another in-state rivalry around here anyway that's quite as rough and tough as that one is and they're just so sweet yeah they're sweet people i wonder if the six-month process of getting on the same page as a nerd and as the kind of the party personality helped him uh maybe bridge the gap with uh the football game i don't know i think it was the other way around the other way around i think if you if you can get along about football you can get along about anything well that's the truth

you know what that's a good point i fully expected during their debt-free scream to hear a little roll tide and war eagle but we didn't hear it well we'll go out here during the break and see if we can get that recorded right well done dennis and christy baby step millionaires debt free house and everything so hey folks you can do this stuff they proved it lots of people prove it every day it's all about you baby it's all about you this is the ramsey show Thank you. Ken Coleman Ramsey personality is my co-host today as we talk about your careers, your relationships, your money, and your life. It's a free call at 888-825-5225. 888-825-5225. Connie is with us in South Bend.

Hi, Connie. Welcome to the Ramsey Show. Good afternoon. Me and my husband, we're in our mid-50s. We have no debt. We bring in about $150,000 a year. We currently have about $766,000 in investments, $165,000 in profit sharing. He'll have something from Teamsters, hopefully. And then we also have two Reynolds homes. They're $150,000 value each.

And then our current house is about $250 000 in value why'd it go we have a thank you we have about 150 000 in cash uh we have really nobody to leave anything to um and what we're looking about doing is um i would like to we would like to buy some land, and we can get it at a fairly good price. We're thinking about $50,000. We want to put a pole barn on it first before we build a house. The pole barn is going to be about $150,000, and I'm guessing the house, once I get it priced out, is going to be about $600,000 to $700,000. So my whole quandary is because, you know, most of this stuff is in investments and properties

and things like that. What's the best way to go about doing everything without... The only thing I was thinking was like, if we sell one of the rental houses this year and then sell one next year so we can split the capital gains on them and then use that money to build the pole barn. But then for the house construction, rather than doing anything with the investments, would I take a temporary mortgage out on my current home in order to build the new home? And then also, should I stop putting investments in Roth if there's really no point of keep building so much money when we really have nobody to leave anything to?

The Roth's not about leaving it to someone. The Roth's about you having it tax-free. So, yeah, you would keep putting money into the Roth. That's the last question first. So how much money in investments do you have that's not in retirement accounts? Um, only probably about, um, 150,000. No, I'm sorry. That's grown.

That's about 300,000. Okay. Let's use that first. Okay. Unless you don't like the rentals. I definitely want to get rid of the rentals because the only reason we bought them is they're next next to the house we currently own and we wanted to like control our neighbors and i'm too nice of a landlady i don't hardly charge anything for them so they're not really

bringing anything in well then dump them i'm with you okay yep and they're going to bring $300, and you've already got $300. That's $600, and it sounds like you need $800. At least, yes. That's pretty accurate. You need $150 for a pole barn, $50 to buy the land. That's $200, and $600 to build the house is $800. Yes, as long as prices don't keep going up on this building. Well, I mean, the numbers you're giving me that we're working with, that's the numbers we have. Does that include the $150,000 in cash?

No, that's separate. Okay. Oh, so now you're only $150,000 off. Yeah. Right. Yeah, and so I think you can get really deep into this before you have to sell your house. Okay. All right. Or even take a mortgage out on it. I'm before you have to sell your house. Okay. All right.

Or even take a mortgage out on it. I'm not taking out a mortgage on it. Okay. I don't want to either. Not going to do it. So what I would do, and you said you're in your 50s? Yep. I am 53.

My husband is 55. Okay. All right. I mean, if he gets to 59 and a half, you can access some of the retirement accounts. Here's the other thing. This is going to take a while, and so you're going to be able to, with your income, cash flow the rest of it probably. So if you take the 150 cash, the 300 in non-retirement investments, and the 300 from the rentals, you're within 150, and you can probably cash flow that 150 out of your income between now and the time you need it and then move into the

new house and sell the old house okay no mortgage that money to invest we invest yeah no mortgage excellent and you're not you're probably not going to touch your retirement at all okay yeah good yeah and you're going to going to touch your retirement at all. Okay. All right. Good. Yeah, and you're going to end up with a $2 million net worth and a piece of property that's worth probably half of that. By then, your net worth will probably be two and a half to three. So, yeah, the way you're going.

So, you're doing really good. Well done. Well done. It's just a matter of laying these things out and developing kind of a flow chart, a Gantt chart, we would call it, a logistical game plan. Oh, nice. I've never heard that. It's a new one. I'm going to drop that in conversation to look extra smart this weekend.

Like Gantt, a Gantt chart. You know, just drop it in there. Just leave it in there like you knew what it was. Then you have to go look it up. You know what my favorite part of the call was is they bought the two rental properties not because of investments. They just don't want to control their neighbors people next to them yeah i love that i bought i have bought vacant lots next to me for this reason i thought you would connect and i have made a lot of money on vacant lots next

to my house i just saw one the other day for this is a really did really well old house i used to own yeah yeah that's that's a good buffer lots are not a bad thing buffer buffer rentals i've not done but yeah lots are not a bad thing it'ser rentals I've not done, but buffer lots are not a bad thing. It's not a bad thing at all. Don's in Kansas City. Hey, Don, welcome to the Ramsey Show. Hey, love you guys and love the show. Thanks for having me on.

Sure. How can we help? Well, I've got a question for you. I'm 60 years old. I had to restart everything. I was at age 50. I'm getting close to being debt-free. I still have a student loan, $42,500 and some change.

Currently, I'm putting 30% of my salary into a Roth. And as soft as the market has become I was wondering if I would be better off cutting that back a little bit to save 15% of my salary and just attacking that student loan so 1500 months at it and knock it out in 30 months and just be totally debt-free or How much is in your retirement nest egg? Like I said, I started over. But you've been hitting it hard. Yeah, it's $100,000 right now.

But in the past 10 years, I've paid off $172,000 worth of debt. Good for you. What's your income, sir? I've been, right now, 55. In that period of time, between 40 and 55. Okay. So I've been eating a lot of beans. Yeah, you have.

So, yeah. You've been in recovery mode. Good for you. You're a strong guy. Well, here's what we teach, Don. The shortest path to wealth is to get clear of debt first, build an emergency fund second, and then start retirement. So we would teach you to temporarily stop all investing and dump everything you can squeeze out of your entire life

on that stupid student loan and get rid of it finally because it's going to go away and then once it's gone we take everything in the budget make sure you have an emergency fund of three to six months of expenses how much is in your emergency fund now about seventy eight hundred dollars okay i'm going to bring that down to one thousand dollars as baby step one is what we teach and so that's going to give us sixty6,800 to throw through the $42,000. And then we're going to put everything, entire budget focus on that remaining $35,000. And you're going to be able to knock that out very, very quickly. It's going to be about nine months probably, something like that.

You'll be working extra. You'll be beans and rice, rice and beans. When the student loan's gone, then go back to the $1,000 account, raise it up to a fully funded emergency fund of three to six months of expenses. And then with not a payment in the world and that nice buffer, you restart your retirement and you hit it hard. And you start building, building, building, building there. And you're going to be able to hit it even harder. Right now, you've got things going about six different directions and they're not giving you the power that they need to give you.

Hold on. I'm going to send you a copy of the book, The Total Money Makeover, to help you out. This is The Ramsey Show. Have a friend or family member that needs a daily dose of Ramsey advice in their life? Let them know about the Ramsey Call of the Day podcast. It's a quick hit of advice about life and money in under 10 minutes. Check out the Ramsey Call of the Day podcast wherever you listen to podcasts.