The Ramsey Show - App - Protecting Your Family With Term Life Insurance (Hour 3)

Episode Date: March 26, 2019

The show about you

Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studio, it's the Dave Ramsey Show, where your money and your life are the focus. Sitting in for Dave, I'm Chris Hogan, and I'm so excited to be with you here, America, and ready to talk about money. I know you have real questions. I know you've got some things on your mind and you want to know what to do. Well, we want to hear from you. If you would give us a call at 888-825-5225. Again, that's 888-825-5225. We'd love to hear from you. Well, I'm excited to be here with you,

America. This is where we take your calls and we talk about money. We want to talk about the things that are on your mind and give you real practical guidance right where you need it. And so I'm jumping to the phones. I've got Christopher on the line here in Raleigh, North Carolina. Christopher, how are you? I'm good. How are you doing? Oh, buddy, I'm focused and not finished. How can I help you? So I was just wondering about, so I saw the news a couple of days ago about the yield curve inverting for the bond market. Uh-huh. And I'm about $80,000 in debt, and I was wondering if it's better to save up more than just $1,000 before paying off the debt first. Okay, gotcha.

Due to an impending recession. Okay. So tell me this. Tell me about the debt you have. What does the $80,000 consist of? It's $50,000 in student loans and $30,000 in a car. Okay. And $30,000 in a car.

How long ago did you buy this car? Last January. So not 2019, but 2018. Okay. And what's the payment on this vehicle? It's about just shy of $600,000. Just shy of $600,000. Okay. What kind of car did you Just shy of $600. Okay.

What kind of car did you buy? Dodge Challenger. Okay. And so this payment, is this stressing you out? No, I was just wondering more about if I should build up my savings first before paying all this down. Because I make $105 a year. All right. Why do you want to bulk up your savings? Talk to paying all this down because I make 105 a year. All right. Why would you want it?

Why do you want to bulk up your savings? Talk to me. What are you looking at? Just in case there's like a recession, I get laid off or something because the news is, you know, talking about it. Okay. Well, I would tell you this, Christopher, we lay out those baby steps for a reason. And here's the goal.

You want to first things first, get $1,000 in place. And you want to have that there just so you don't have to fall back into debt and don't have to reach for a credit card or call family and friends to help bail you out. But once you get the thousand dollars in place, what I want you to do is focus all your time, effort and energy on attacking the debt. Now you've got some bigger debts. You've got the $30,000 car and you've got the $50,000 in student loans. I'm going to tell you this, the chall30,000 car and you've got the $50,000 in student loans. I'm going to tell you this, the challenger, I would challenge you to let that thing go. I would check out the value on Kelly Blue Book and figure out what it could sell it for

based on what your payoff is on that loan and get that $600 payment out of your life. You know, the impending recession, I hear this stuff all the time. Dave does as well. Everyone's trying to be a fortune teller. Everyone's trying to tell us what's going to happen. Well, I'm going to tell you this. I don't know what's going to happen, but I'm going to be prepared. That means being intentional, getting myself out of debt, being focused and having an emergency fund. So, no, the $1,000 first, then attack debt.

Once you get yourself out of debt, you'll move to baby step number three, which is building a three to six month emergency fund. So again, the baby steps are in order for a reason. It's like a recipe. Don't try to tweak the recipe. Don't try to have your own thing. You do what you want, but I'm going to go with the plan that's helped millions of people fall through the process to be able to get themselves out of debt and to start to build

wealth. So that's the goal. And Christopher, I want to encourage able to get themselves out of debt and to start to build wealth. So that's the goal. And Christopher, I want to encourage you to follow that plan. Don't overthink it. Don't try to get cute with it. Just follow the process and stay very, very focused. Thank you very much for your call, my friend. I appreciate it.

All right. I'm going back to the phones. I've got Patricia on the line. Patricia, how can I help you? Hello. How are you, Chris? Oh, I'm focused and not finished. Young lady, how can I help you? Hello. How are you, Chris? Oh, I'm focused and not finished, young lady. How can I help you? Oh, let's see. I have

a student loan of $15,000 and I have a home mortgage of $117,000. I would like to pay the home mortgage off first. I'm trying to see if I can find a job so that I can tackle that. Would you suggest paying that first or just going on with the student loan?

Because it's like $162 for the student loan. It's not a whole lot, but what my concern is is that I'm 56 years old. Okay. And I'm just worried about that I want to have my house paid off, and then I can start just living the way I want to live, being able to give back and that sort of thing. Okay. So you're really intentional, Patricia, on attacking the house to be able to free up some income because you want to be able to give and live. Is that correct?

That's correct. Okay. How long has this student loan been hanging around with you? This student loan has been hanging around probably since 2011 after my husband and I separated. Okay. They deferred it, and then it was only like $46 a month. This time it's about $162 a month. Okay.

And now we finally settled on it. But I'm thinking that if I could just throw $2,000 a month into that, that I could actually go ahead and knock that off quickly. But here's the thing. I only make about $45,000. And by the time I pay for my utilities and I pay my mortgage and then that student loan, you know, I don't have a whole lot left. I don't have any other debts. I don't have any other credit cards or anything like that. Well, Patricia, I'm going to tell you this.

Number one, I'm proud of you that you had some life happen, but you're staying focused and you're following a process. I want to encourage you to use EveryDollar. This is the best budgeting tool out there on the planet. Just go to EveryDollar.com and really look at tightening up your budget. Something tells me some of the living expenses may be getting out of whack, and that could be food, eating out, groceries, things of that nature. You want to figure out how to be able to tighten that down a little bit. But I'm going to tell you something.

Just like I was talking to Christopher just a little bit ago, you want to be intentional and you want to follow the debt snowball, smallest to biggest. That means your attention needs to go to this $15,000 student loan, attack that thing. And then while you're paying extra on the house, right? But then once you get that student loan paid off, now you can take everything that you were paying toward the student loan and then apply that toward the house. You 56 years old, you've got time. You can, you can do this. Now it may require you looking to figure out, are there ways you can bring in some extra income?

Can you have a side hustle on the weekend, do some things in the evening, and then really start to think differently about it? But I would never tell you to shift and focus on $117,000 debt when you've got this $15,000 student loan sitting right there. Get that thing out of there. Getting out of debt has nothing to do with math, has nothing to do with interest rate. It has to do with momentum. And when you believe you can and you start doing it and seeing progress, I'm going to tell you, stuff is going to change. And the next thing you know, you're going to look up and that $15,000 student loan is going to look

like $13,000 and then down to $10,000. And I firmly believe, I know without a shadow of a doubt, you can get that student loan out of your life this year in 2019. Now, how soon? Well, it depends on how motivated you are. And it depends on how focused you are to really get moving so you can do what you just said. You said you want to be able to live more and to be able to give more. Matter of fact, you said give first. So that tells me where your heart is and what you're wanting to focus on. Let's get started with it. Sit down, brainstorm three to five ways you could earn some extra money. And I'm telling you, sit down, list it out. Don't judge it. Just write them down, brainstorm and think about what could you do to bring in some extra money? And I'll tell you this, that student loan is going to start to shrink, shrivel, and it'll eventually disappear.

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Again, that's 888-825-5225. Again, that's 888-825-5225. And so I'm going back to the phones. We've got people on the line that have questions that I want to hear from you. We're starting off with Carrie here in Columbia, Missouri. Carrie, how are you? Fine, thank you. I can't believe I'm talking to you. Oh, well, I'm glad you are.

I'm here for you. How can I help you today? I have a quick question about a life insurance policy. Okay. Knowing Dave's aversion to life insurance policy. Okay. Knowing Dave's aversion to whole life insurance. Okay. Which is, this is a whole life policy that my grandparents purchased for all their grandchildren when we were young.

And paid the premiums. And then when my grandparents passed away, my parents paid the premiums for several years. Okay. And so I have only been paying on it really a couple of years now. Mm-hmm. And so it's a $25,000 base policy with $8,600 of paid-up dividend additions. Okay. The cash-out value would be $6,200, and the annual premium is $151. Mm-hmm. and the annual premium is $151. And again, I just don't know what they would say to keep it

or to get rid of it since it's whole life. Okay. And Carrie, what is the goal of life insurance? To cover your funeral costs, I would say. Right. And it's also cover funeral costs is exactly one of the things, but the other side of it is you want to be able to provide for your loved ones and your family in the event of your passing or your death to provide them income. So, right now, are you married?

I am. Okay. And are you and your husband both work outside of the home? We own our own business, yes. Okay, you're self-employed. Do you have dependent children? Almost not, but yes okay how old is the child or young adult 18 20 and 22 okay 18 20 and 22 and so you know in in that scenario the main thing is you want to make sure that you have enough money to be able

to take care of final expenses but also with with young adults, let's call them that, not children, and you and your husband in business together, you guys are looking at this and you understand you're going to need money to keep the business moving as well as the family moving. And so what we tell people, Kerry, is that you want to get 12 times your income in term life insurance. All right? Now, the goal of term life insurance is to protect you for a set period of time. And you can buy that in different year increments to be able to cover yourself.

Now, you've heard Dave and I talk about Zander Insurance is the place to go for that life insurance quote. You can go to ZanderINS.com or go to DaveRamsey.com and be able to get a free quote and be able to see where you are and what you need. Too many of Americans out there, almost 75% of Americans are underinsured, which means if something were to happen to one of them, they're going to have a financial crisis. And so it's important. So as regard to that whole life insurance policy that you have, I'm going to guide you and tell you you need to go sit down and talk to a life insurance ELP and really be able to an insurance ELP, excuse me,

to be able to walk through it or talk it through with Xander as well. Looking at this, you know, the premium amount, the $150 that you're paying for the coverage that you're getting, it's typically not going to be adequate. And, you know, people talk about this and they want to get coverage on young people. And, you know, they're thinking this and they want to get coverage on young people. And, you know, they're thinking longer term. The problem is, is you'd be better off if you're thinking longer term to have put that money into a growth stock mutual fund to allow it to be able to grow. So I want insurance to be insurance. I want it to be something that protects me. I want my savings account to be a savings account and I want my investments to be investments.

And so I want to guide you to get the right information. You also want to find out, Carrie, about what the surrender charge would be on that if you were to let that go. Now, I want to encourage you to do this. And anyone else out there in America that might have a whole life insurance policy or something in place, and you hear Dave and I talk about term, that the natural tendency is the knee-jerk reaction to hurry up and cancel what you have. No, hear me.

OK, and those of you watching on the Dave Ramsey show YouTube channel, you see my face. No, don't cancel anything until you get your term policy full and in effect. That means you have that in place. That's so important. I don't want people going without having coverage. So it's very important to protect yourself and want people going without having coverage. So it's very important to protect yourself and to know where you are, what you're doing, and more importantly, what do you have in protecting your family? So Carrie, thank you so much for that call

and I wish you well as you reach out to Xander and to start to walk through this so you can make a wise decision for you and your family. All right, next up, I'm going to Kentucky. I've got Nora from Louisville. Nora, how are you? I'm focused but not finished, Chris. How about you? Oh, I like that. That's somebody that's listened to the Chris Hogan show right there. I'm proud of you.

How can I help you? Yes, sir. I've kind of got a three-part question for you today, actually. All right. Okay. I'm ready. All right. So it centers around a down payment on a house. Okay.

And essentially, long story short, my fiancé and I are getting married this upcoming October, and we are both in baby step 3B. Okay. So my first question is, should we wait one to two years to purchase? And if we do, is it okay to do less than 20%? And then the other question is, how much would we probably keep for an emergency fund?

Because I'm salaried, but my soon-to-be husband works on commission. So that's a little bit iffy to me. And then my third one is while we're saving up, is it still okay to not contribute to our retirement? Because with our companies, we both receive a 6% match. And that just seems like a lot to not be taking advantage of that for like one to two years. All right. Nora, how old are you? We're about 24. 24 years old. I've got a millennial on the line hitting me with a 14-part question.

I love that. That means you're plugged into money and you are seriously focused and not finished. Okay, let's dive into this. First and foremost, Baby Step 3B, for those that are listening out there, this is where you have gotten a $1,000 emergency fund. You've attacked your debt with Baby Step 2, smallest to biggest. Then in Baby Step 3, you built up a fully funded emergency fund of three to six months of expenses. Now, once you have that in place, as people are talking about or interested in buying a home, Baby Step 3B is saving up for a down payment. So let me tell you this. I would love for you to go into a home with 20% down to avoid PMI, okay?

Now, Nora, all that is is private mortgage insurance. This is insurance that banks and mortgage companies make a mint off of. You can pay $150 to $300 a month just on that insurance, and it doesn't protect you at all. It only protects the bank. So the 20% is a good thing to help you avoid PMI, but at minimum, I want you to go into it with at least 10% down, okay? Okay. I'd love for you to do 20, but 10%, something a little bit less than 20 is fine. So like 15 to 20 range would be perfect.

Yes, absolutely. Now, the other side of this is the emergency fund. With you being salaried and your fiance, soon-to-be husband, is now commissioned, I would encourage you guys to probably look at at least a six-month emergency fund. What is his income right now? His income right now, he just had a job relocation. His pension is set to be about anywhere from $ to 60, and then mine is at 70. Okay.

Now, and I'm saying this as you all, when are you all, you're getting married when? In October. In October. Okay. So right now, you're going to hear me talking about you all individually, because until you're married, we're not talking about things jointly. Does that make sense? Yes.

But I like the idea of the six-month emergency fund. That's going to give you some cushion. Now, the big question, you said, is it okay for us not to contribute to retirement while we're saving up for a home down payment and i would say for a small short period of time yes and that's because you don't want to we don't want to take four years to save up this money for this home down payment and so i want you guys to get intentional, know the timeframe that you're working with. And like you said, each of your companies are offering up to a 6% match. So you all know how to do math. You know, that's extra money that's sitting there ready to help you build for your future. But at 24 years old, you guys are ahead of the game and I'm proud of you.

And I just want to encourage you to go slow. Slow down. Don't get in a rush. Take your time and make wise decisions like you are right now. You guys are thinking long term. And I'm telling you, you're going to put yourself on a path to become everyday millionaires. I have no doubt at all about that. Now, those of you out there that are listening, I want to let you know I've got a brand new tool out. It's called the Net Worth Calculator. You can get this by going to ChrisHogan360.com slash net worth and find out exactly where you are right now. You see, I know the American dream is alive and I know it's

available. What we have to do is make a decision and then have those daily actions to keep us on the path. This is the Dave Ramsey Show. One Dental is a company I've been telling my listeners about because I know these guys will save you money at the dentist. One Dental is a dental savings program that allows you to go to one of over 158,000 dental practice locations nationwide and save on things like cleanings, dentures, root canals, crowns, and even orthodontics. Here's the really cool part. You can join One Dental right now and you don't have to worry about high deductibles,

waiting periods, or pre-existing conditions. Just find your highly qualified dentist in the network, make the appointment, and start saving every time you go to the dentist. This is a great cost-saving alternative to expensive dental services and a great alternative to costly dental insurance. It really is that simple. And unless you want to blow your emergency fund, everyone needs to go to the dentist. Folks, this is a no-brainer. Join today at OneDental.com. That's OneDental.com. We've got a special treat for you. I actually have two rock stars here in the lobby here to talk about Financial Peace University. Those of you that were listening, you know Financial Peace University is a flagship program

that has helped change millions of people's lives. And I've got Judy and Katie joining me. Hello, ladies. Hello, Chris. How are you? Good. Good. How are you?

Excited. Well, excited to have you. Now, you all are joining us here from where? San Antonio, Texas. Texas. Things are big in Texas. Yes, absolutely. And so is you all's momentum. Judy, you have been a coordinator for how long now? Well, I have been a coordinator for over 10 years. Over 10 years. And about how many Financial Peace University classes have you coordinated? Actually, 10 classes. Currently leading my 10th class right now at Epic Life Church in New Braunfels. That is fantastic. So you are focused on helping other people reach their goals. What caused you to get plugged into Financial Peace University? So I always want to, as a business owner at RBK Architects, I just like finding ways to provide greater benefits for our employees and our team members.

And so brought financial peace. Years ago, I came to Nashville and got my official certification to be a workplace trainer. Yes. Haven't stopped since. So it's been great leading through the workplace and now through churches in Spring Branch and San Antonio. Judy, that's fantastic. Now, to do it a couple of times means you enjoy helping people. But coming on 10 years now, there's something that keeps motivating you.

What is it? You know what? The program sparks a fire. And so it's that fire inside. Because what if you can make a difference for just one person? That's right. So every class, I just see it as an opportunity to help provide hope for just one person, one family, or one young student.

Well, that's who I'm getting ready to go to because Katie, how old are you first and foremost? I'm 25 years old. You are 25 years old. What caused you to get plugged into Financial Peace University? It was this young lady right here. She heard about my debt and urged me to get into financial peace. And I did it at our office and was hooked from there. Wow. So you all work together? Yes. Okay. So this is a unique situation, right? Okay. Now we'll come back to

that. But how much debt did you have at the time when you started? When I started, I had $20,800 in debt. Oh, you're down to the penny. Yeah. What was the debt on? I had a few hundred dollars in credit cards. Okay. And about $5,000 in my car. Okay.

And then the rest was student loan. Wow. So was the first time that you heard about Financial Peace University, was it from Judy? Yes. Was it really? Yes. Wow. So you hear her talk about it.

What caused you to get plugged in? To be honest, she didn't really give me a choice. She said, you have debt, you're doing this. And it didn't take long. As soon as Financial Peace started and we started watching the videos and really going through it, I knew I was on to something good. And so how long did it take for you to start to make some progress once you plugged in? Not long at all. The dumping debt lesson really got to me.

The passion that Dave had in that video just really sparked hope in my eye and made me realize that, yes, it is possible. It's not normal to have debt. And yeah, just from there, I was hooked. I was committed. And I, yeah, I just stayed dedicated to the process. That is fantastic. Now, I know along the way, anytime you choose to make progress, you make some sacrifices. Yes. Right? What were some of the sacrifices you made throughout your journey? I think the most frequent sacrifice was going out to eat. I have a lot of friends, coworkers that were like, hey, come to lunch, come to dinner. And if that was not in my budget, then I had to say no. Right.

And I also love shopping, so that was also another sacrifice. So hold on a second. So as a millennial, you had friends that were talking about going out to hang out and you're saying you would look at your budget and if you didn't have the money, you'd say, I can't go. Yes. Wow. Makes me a nerd, but yes. No, what it makes you is smart, right? Because what you did was you started to take back kind of responsibility, but also the opportunity to make progress. Yes. I'm so proud of you.

Thank you, Chris. Yes, that is fantastic. So has Judy impacted your life? Absolutely. About $20,800 worth. Isn't that amazing? Isn't that amazing? Yes.

You know, that she took the time to care enough to come talk with you about this and really not take no for an answer because she knew the benefit it was going to have on you and your life. What would you tell Judy for all the help she's given you? I just want to say thank you. Your passion and your encouraging encouragement and the constant support every time I had questions, every time I hit a milestone, you were always there to be excited with me, to cheer me on. So, yeah, I just want to say thank you. That is fantastic. Judy, when you hear that, how does that make you feel?

To do another class. I want to do more. That's right. Because there's more Katie's out there. That's right. And so it's awesome. Well, I think you all have a unique, unique, obviously, work relationship, but also friendship where you're caring about each other.

And in the workplace where you are, you're caring enough about your team members to tell them about something that's going to help them, not something that you hope that will help them, not something that you think you know. And, Katie, I'm proud of you for plugging in and being open to the message, but also making the sacrifices. You guys are an absolute testament to Financial Peace University and what we stand for, because we want more young people living their dreams. I want more people, regardless of their age or stage, living their dream. And I just want to tell you guys, thank you so much. It's been a pleasure to talk with you, and thank you for joining us. Thank you, Chris. I do.

Yes, thank you. Now, listen, America, I know you're listening out there, you think well katie's special well she is all right and you're thinking well judy's special well yep she is too but i'm going to tell you something you know what they are they're people that made a decision they made a decision that they were going to take back their progress for themselves they're not going to keep growing the credit card company they're making enough money they're doing well what they're going to do is get serious. So I want you to hear this. If you're like Judy and you've got the heart to want to help people, I want you to know that anybody can lead a group.

Anybody. Gen X, millennial, if you're married, single, absolutely anyone can lead the class. And get this. You don't have to be debt-free to lead a class. You don't even have to be a money expert or already have taken Financial Peace University. You've got an opportunity to make an impact on the people in your community or even help yourself by being able to guide other people and to show them where hope is. So here's the deal.

If you're interested in leading a Financial Peace University group, I want you to do this. Text the word LEADER to 33789. Again, all you have to do, if you're interested in leading a Financial Peace group, text the word LEADER to 33789. And oh, by the way, the first 50 people that text in will get a free Financial Peace University membership. So you've got an opportunity to get serious, not only about your own financial future, but helping other people. I want you to hear me, America. Where you are right now financially does not have to be where you end up unless you stop. What we get to do is make a decision.

I've been going across the country telling people about my new book, Everyday Millionaires, how ordinary people built extraordinary wealth. And I can tell you this, Financial Peace University is that foundational piece where you start to learn to take control of your money, to get intentional, to get yourself out of debt so you can build wealth. I had someone tell me not long ago that the American dream wasn't available anymore. And I'm telling you, I got fired up. My one hair on my head stood up because I only have one, right? But I got serious because. My one hair on my head stood up because I only have one.

Right. But I got serious because if you tell that lie loud enough, long enough, people start believing it. And it's not true. The American dream is alive and available, and it's just waiting on us to make a decision to pursue it. And we can do this. I'm seeing people all across the country that are making a decision to change their

financial future. And if you've got young people running around the house or grandkids, I know every parent or grandparent wants better for their kid or their grandchild. Well, I'm going to tell you something. Financial Peace University is that way. It's the path. And so parents talk to your young people and parents, if your kids are not so young, help them with this stuff. Money is not something you just automatically get better at. You have to grow your knowledge, which means you have to go to a source that's been successful.

Millions of families have changed their destinies with Financial Peace University, and we're waiting on you to join. I know you can do this. I know you can. I believe in you. What you have to do is make a decision. So again, if you want to lead a class, text the word leader to 33789. If you want more information about Financial Peace University, go to DaveRamsey.com slash

FPU. Again, that's DaveRamsey.com slash FPU. This is The Dave Ramsey Show. Hello, America. You are listening to The Dave Ramsey Show. I am Chris Hogan, filling in for Dave. And we have had an absolute blast talking to you about money. And most recently, we were just visiting with a Financial Peace University coordinator, Judy, and one of her group members, Katie, who were just people that are just plugged in and engaged, really being able to see the ripple effect of Judy caring enough about a team member to talk with her about this money stuff and Katie being willing enough to listen.

And that's fantastic. And you see this ripple effect that can happen when you do good stuff with good people with good intentions. So proud of them. And America, I want you to hear me. I'm not speculating about if Financial Peace University will help you. I know it will. So I want you to get plugged in. So, America, if you've got questions, call us. 888-825-5225. Again, that's 888-825-5225. I'd love to hear from you. I'm going back to the phones.

I've got Diana on the line from Texas. Diana, how are you? Good. How are you? Oh, I'm focused and not finished. What can I do for you today? I have a question. Okay.

We're currently trying to get out of car debt. Okay. And I was wondering your take on refinancing a car. Okay. And I was wondering your take on refinancing a car. Okay. We have negative equity of about $10,000, and we aren't able to get any personal loans. Okay. Negative equity. So tell me about this car.

What kind of car is it that you have? It's a 2014 Dodge Durango. Okay. 2014 Dodge Durango. And how much did you finance this car for? Originally $30,000. Okay. Did you roll over other debt with that?

Yes. Okay, how much? About $10,000, close to $10,000. Okay, all right. And so they did a loan for $40,000 for you, correct? No, I'm sorry. It was $30,000 total. $30,000 total.

Okay, gotcha. And do you know the interest rate that you got on this loan? Like 19%. Excuse me? 19%. Oh, my. How long ago did you get this loan? A year.

Okay. Is this one of those buy here, pay here places? Are they financing it for you, or did you go through a bank? Through a bank. Okay. 19% is absolutely highway robbery, Diana. And because of that interest and the charges on that, what you've got is a situation that's going to require you guys to get frustrated and mad.

You know, trying to refinance it right now with a negative equity, as you would detail, nobody's going to really touch that vehicle or do that loan. But I'm going to tell you something. If I'm in your shoes, I'm going to go talk to a credit union. I'm going to go talk to every bank that I can to see what can be done. The interest rate that you're being charged on this is absolutely absurd. This is tantamount to being robbed. And, you know, the interest rates on a vehicle, it's nowhere near this.

And so I really want you to get plugged in. Go talk to a credit union. Have a conversation with someone that's in the banking industry that you're close to, connected to in your community. Show them the loan documents. If you don't have a copy of the loan papers, contact the lender, get a full copy of it. There's no telling what other fees and things are associated with this thing and this thing that they've got you connected to. So 19% is ridiculous. And that frustrates me because that means people are being taken

advantage of for no good reason. And this is another lesson for us, right, that we've got to slow down. We've got to look and understand what we're signing on. And it's so easy to go looking at vehicles, and we end up coming home with a payment. And so, again, Diana, get the copy of your paperwork. Get connected with someone that's in the lending industry that can look at this and help guide you. And push come to shove, you guys may have to get focused on paying extra to pay this thing down to find out what this car is worth. What I mean by that is go to kellybluebook.com, kbb.com. Look at what this car is worth right now. You know how much was rolled into it, but again,

taking on a few extra jobs, you guys could sacrifice, I mean, for the next four to six months to be able to pay this down where you could refinance it. So there may not be a quick fix right now, but it doesn't mean there's not a solution down the road. So, Diana, I want to encourage you, get connected, have a conversation, and find out where you can get some help. I'm sorry you all are in this situation, but the only way out is through. That means getting focused, getting intentional, and getting on a plan to help prepare yourself for your future. Thank you for your call. Next up, I've got Margaret in Houston, Texas. Margaret, how are you?

I'm great. How are you? Oh, I'm focused and not finished. How can I help you today? Well, I was wondering if you might be able to answer a quick question about paying off a mortgage. Okay, I can try. My husband and I currently have a home that we only owe about $47,000 on it. And at this point, we do have the money to pay it off. Like we could pay it off like, you know, now. The only thing we're considering is whether or not that's a good idea because we have kind of talked about maybe moving and only because the community in which we're living is it seems like the surrounding is kind

of starting to you know decline a little bit we're a little bit concerned about what our values on our home will be like and then that you know in the next few years and and we'd like to try to move into a different community that might be a little bit you know a little bit better but we really don't want to move into you know like have to borrow a lot of money to do it and we try to move into a different community that might be a little bit better, but we really don't want to have to borrow a lot of money to do it, and we try to find something lateral, like something that's comparable, but it's a little bit tight. It's kind of hard to do. So we're not really sure if we should use the money that we have now to pay the mortgage and then sell the house and just get all profit,

or if we should just try to sell it like it is and then use the money we make and the money that we've got in cash to supplement to put towards a down payment on a new place. Okay. Well, you guys have put yourself in a position where you get a chance to make some decisions. This $47,000 that you have, where did that come from? We sold a property that my father-in-law gave to my husband and his brothers several years ago. Gotcha. So this is not your emergency fund.

This is extra money. Right. No, it's not our emergency fund. And do you all have a history? How well do you all do with money? What I mean by this is if it's sitting around, do you all leave it alone or do you end up spending it? We're pretty good about leaving it alone. Okay.

You know, yes. We're doing much better than we were like several years ago. You're right. No. Yeah, we all learn to improve. You know why I was asking that, right? Because if you burn through it and it's sitting around, then we got to hurry up and give this money a place to go. You know?

But the other side of this is I don't have a problem with you being able to stroke a check and pay off this home because, I mean, I want you to get that deed in that they send to you that shows that you all have paid this thing off. But here's the other side of it. You all have been living in this home for how long? 15 years. 15 years. You have worked hard, right? Not just to

buy the home, but to own it. And so now as you approach this opportunity, you've got a chance to really make a statement for yourself. Now, as you said, if you guys decide to sell this, you can reach out to a real estate ELP and get some guidance on the comps and the value of this home. But you hit on something very, very important, Margaret, and that's this. If you all do decide to sell this next home that you buy, I want you to find something as close to what you're in right now as far as dollar wise to be able to get in it and not have another 15 year mortgage. You guys are here at the at the front of owning this home outright 100%.

So I want you to be very careful, very intentional. Right about now, this is where people make that decision about what they feel like they deserve, what they feel like they want. And you can end up making a mortgage decision or a home buying decision that could set you back 12 to 15 years. So we want to be careful. We want to be intentional and we want to make decisions now that we're going to look back on and be glad you made them. So I want to encourage you, take your time, go into this with your eyes wide open and be very, very intentional about the decision you make.

Buying a home shouldn't be emotional. This is a business decision. This is your largest monetary physical asset that you have. So you want to be very intentional and very, very careful. Speaking of home buying and refinancing, a lot of people out there have questions and they wonder, Chris, you know, are we doing the right thing? Are we on track? I want to encourage you. You want to understand where you are, what you're in, and the decisions you're making. You know, you might be out there and you may have bought a home on a 30-year fixed-rate mortgage because that's what the bank was pushing you toward.

Well, I want to encourage you, look at refinancing into a 15-year. You can reach out to Churchill Mortgage, talk with them, be able to get the guidance you need because little decisions can lead to big gains. Well, listen, I want to thank my producer, James Childs, associate producer, Kelly Daniel, and all of you, America. Thank you for tuning in. Thank you for calling in. And I want you to understand something.

Where you are right now doesn't have to be where you end up unless you stop. You can push forward, and you can grow forward, and I wish you well. This is The Dave Ramsey Show. This is James Child, producer of The Dave Ramsey Show. Once again, you made The Dave Ramsey Show one of the top five most downloaded podcasts last year to get your daily dose of motivation and inspiration subscribe today