The Ramsey Show - App - Put the Cars On the Table Before You Hit the Wall (Hour 2)

Episode Date: September 28, 2018

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Live from the headquarters of Ramsey Solutions, it's the Dave Ramsey Show, where debt is dumped, 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. Thank you for joining us. Open phones at 888-825-5225. That's 888-825-5225. Mike starts off this hour in Omaha, Nebraska. Hey, Mike, how are you? Good. Thank you for taking my call, Dave.

Sure. What's up? Well, I probably did something dumb a long time ago. When I went into service, I heard that something was going to happen to me at that time. And back in 1989, before I went into service, I got a whole life policy. So did I. I did that in 1982. That's when I was stupid. I did it in 1989, and I've been putting $88.10 into it every month. Oh, Lord, you kept it.

Yeah. Oh, that's worse. Okay. I know. So I'm turning 60. Yeah, I know. I said I did something stupid, so I'm turning 60 in August, and it's paid up at 65. No, it's not.

Do I get out of it now in August, or do I hold on to it and let it go to 65? It never is paid up. Paid up is a marketing term of theirs. Let me explain it to you, okay? If you take your cash value and put it into a mutual fund, it would buy you a term insurance policy and lots of steak dinners. Right? Okay. So what it amounts to is the fact that that cash value is earning almost nothing,

but they're giving you a, quote, free life insurance policy is a bit of a joke. It's not free. You're losing more than the cost of buying a policy by having that amount of money invested poorly. Do you follow me? I do. So we're going to take that money out and invest it. Now, do you need life insurance? I do not now.

I actually didn't want to leave any debt for anyone else, especially my family. Right. And now I'm single again, and I just was a caretaker for my folks since 2012. But I followed your other debt. I have an emergency fund that is huge. How much? $50,000. Okay. And how much is in your savings nest egg, your retirement nest egg?

Right now is about $120,000. Okay. And how much is the cash value on this whole trash policy? Whole trash policy? I think right now it's $63,748. And if you die, the face value of the

policy is paid, the insurance is paid, but they keep the cash value, and you've paid for both all these years. So I'd get that out of there before you die, meaning I'd cash it out. You're right. You don't need life insurance. There's no one that's going to go hungry if you're not there earning an income for them, right?

Right. And so all of this wealth will simply be left to an heir or heirs of your choosing, and so your need for life insurance has gone away. It has. Yeah. Let's just cash this out and put it into a mutual fund is what I'd do with it. At the same time I did that, I also bought a small, what's called a five-unit apartment complex in Omaha. And I kept it all those years.

And then when I came out of the service from an incident, I'm disabled. But I still was able to take care of other family members. So I moved into one of the apartments in this building. And it's paid for. That building's paid for? What's it worth? Yes. It depends because, you know, when you look at the website assessors,

it jumps in value from anywhere between $60,000 to $120,000. It just depends on the market. Per unit or the total building? No, the total building. Okay. I mean, if you put it on the market, what would it sell for? Well... I'm not saying to.

I'm just curious. Well, a house down the street just sold for $219. Okay. Same size. But this is five units. Yes. Is it a house that's broken up into five units or five legitimate? It is.

Okay. It was a house that was built in 1880. Oh. And somewhere in the 30s and 40s it was converted into apartments gotcha okay so it's grandfathered into the neighborhood i gotcha okay cool cool well yeah so it's probably worth 300 200 300 000 right uh i you know yeah so you're probably worth half a million dollars is my point with the money you got saved and putting this cash value aside and so forth, right? Yeah, I probably have about that.

Okay. Cool. Well done. Very well done. I listened to what you said, and it's like live like nobody else so you can actually live like nobody else. And now I'm trying to figure out how to live like nobody else because I'm a saver. Yeah, well, you're in good shape. I mean, you probably need to dial up the, you need to do something nice for you that you enjoy.

You don't need to go too crazy. You haven't got $10 million, but you got a little money. You've done a good job. Very well done. Yes, I would cash that cash value, trash value policy out. Absolutely would do that. Anna is in Dallas, Texas. Hi, Anna. How are you Dallas, Texas. Hi, Anna.

How are you? I'm doing good, Dave. Thank you so much. So I need some guidance from you. So right now is really when I'm starting for the first time my financial life. I'm a single mom. I have four kids. I had to file bankruptcy about two months ago.

I don't get child support, and I will never get... My ex-husband relinquished his parental rights. Say that again. Your phone broke up. Why don't you get child support? Because my ex-husband relinquished his parental rights. I still didn't understand you. Say that again. My ex-husband relinquished his parental rights. I still didn't understand you. Say that again.

My ex-husband gave up his parental rights. Oh, he gave up his parental rights. Okay. Yes. And in return, you let him go. Okay. All right, so what do you make a year? I make about $75 with two jobs.

How old are you? I'm 35. Okay. You came out of a Chapter 7 bankruptcy? Yes. Okay. Did you have any student loans or IRS that survived the bankruptcy? I don't have any student loans or any IRS. Did you reaffirm any of the debt? Did you keep any of the debt? Just the house. I have a home. Okay. How much is your house payment? $1,900 a month. And your income is what?

About $75 a year. Yeah. Your house payment's eating up a lot of your take-home pay, isn't it? I know. I know. I'm not sure you're going to be able to stay there unless you get your income up. I don't know. We'll work on it together, okay?

Listen, I remember starting over. It's real scary, but you can do it, and I'll walk with you, okay? I want to put you in our membership called Financial Peace University. It includes going to nine lessons at a local group as well as one year's worth of access to all the lessons online, showing you exactly what to do and you'll be part of a group that'll be cheering you on they'll be cheering for you and helping you and so if you'll hold on i'll have kelly pick up and we'll get you signed up for that also put you in every dollar plus which means you're connected to your bank on the budgeting app

the world's best budgeting app very easy for you to do you're gonna love this you call me back as you walk through this. Hey, Spencer here from Smile Love. At Smile Love, we'll straighten your teeth and help you love your smile. That's what we do, and we do it for less than you'll find anywhere else. I guarantee it. I'm serious. We're talking about paying thousands of dollars less without sacrificing any dental expertise. We are hands down the most affordable way to straighten your teeth. It's easy to get started. You just go online to smilelove.com and use the promo code Dave to get an additional $100 off.

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get started today at smilelove.com and remember to use promo code Dave to take an additional $100 off. smilelove.com, promo code Dave. Brittany's in Houston, Texas. Welcome to the Dave Ramsey Show, Brittany. Hi, Dave. Thank you so much for taking my call.

Sure. What's up? So we're in Baby Step 2. Me and my husband, he's 31, I'm 30. and we just moved from Wyoming and then Pennsylvania into Texas. So we're currently trying to sell our house, but outside of the house, we're about $98,000 in debt between our car loans and our credit card debt. And so we're renting our house while we're trying to sell, but we're kind of drowning in our budget. So we looked at trying to sell our car, but we're upside down on them. And so we're not sure how to sell our cars exactly. But in order to try to get out of out of the... How much do you owe on car number one?

So car number one is $33,000. What's it worth? Well, Kelly Blue Book says, you know, it's around $28,000. But when we went in, he said the most he could offer is $26,000. That would be a dealer. Correct. Well, dealers don't pay retail for cars. They pay wholesale for cars because they resell them at retail.

So it's probably worth about $28 if you put it on Craigslist. Okay, what's the second car owed on what? So the second car, I'm actually not sure exactly because that really wasn't on the table for my husband. But it was like, you know, somewhere between the same range. So maybe like $35,000. Okay, I'm sorry. It's not on the table for your husband. What the crap does that mean?

You guys are starving today. I agree. But he gets an allowance from work. What? I'm sorry? He gets an allowance for work for his truck. So what? He's broke.

I understand. Getting an allowance from work does not make owning a car you can't afford work. Right. You don't have enough coming in. I'm sorry. Go ahead. My car is $650 a month, and his is a little bit over that. Okay.

What is your household income um so take home we we came up with like about 70 000 a year um so your gross is about 90 and your cars are both absolutely asinine insane they both need to be sold right so it goes on the table okay A grown-up will look at this and say, you cannot afford these cars. So your husband's going to have to be a grown-up. Okay. This is ridiculous. I mean, now, who do you owe the money to on these cars? So one is a lending tree.

Is that correct? I don't think they're any longer in business. And the other one I'm not sure of either. But they're banks. I'm pretty sure about that. Okay. Is your credit, has it survived this debacle? Mine probably hasn't, but I think his has.

I think his is pretty different. We're not, like, delinquent on any payments or anything but i mean we're doing that every dollar budget and we got your course so we're about two weeks into your course okay good well you're gonna need you're gonna need to look you're gonna need to talk to a credit union or small local bank about getting a small unsecured loan to get both of these cars sold and you're both are going to have to get in some much, much less expensive cars, like $5,000 cars, and get this mess cleaned up. Because these cars are destroying your life. Yeah.

They were ridiculous. Yeah, and then we have our house that we're trying to sell. Yeah, the house is not the issue. A mortgage as well. Yeah. Okay. The house is not the issue. These cars are, as a percentage of your income, they're insanity.

I'm serious. You are going, you're heading towards the wall. You're going to hit the wall. Your life is going to disintegrate. And you're never going to know what happened if you don't get rid of these cars. They are really, really, really a problem. I hope I've not been unclear because I really want to help you guys, but I don't know if I can help your husband.

It sounds like he's a hardhead right now. So I've been a hardhead too, and the problem with being a hardhead is it causes you to hit the wall that much harder if you don't wake up. And so this stuff is ridiculous. They're out of control. You made really, really bad decisions with these cars. The good news is you can undo the decision. You're going to have to amputate this crap out of your life

so you can get your life back. Think about what if you had no car payments. Just think about that. If you just can swallow that into your spirit right now i mean you guys have probably 1400 1500 in car payments i mean that's just nuts there's no other way to describe it so i'm not picking on you i'm trying to make sure i get through to my old hard head over there so everything gets back on the table because everything's gonna get get on the table and it's going to get off the table because we're selling them if you don't do that i predict years of problems in your future and i'm right minette is in baton rouge hi minette how are you hey dave

how are you better than i deserve what's up um i have a question. My husband, I'm 57. My husband is 60. We just built a house. This is the second marriage for both of us. We've been together for eight years. With this house that we're just building, my husband, his retirement is only, what he has in retirement is $85,000. And we have a choice with this house that we built to either pay $2,200 every month and be finished paying for it in 12 years or to pay $1,200 a month and pay for it in 30 years. And since the amount that I feel that is in his retirement is not what it should be, and will probably won't live another 30 years,

should we focus more on putting the money in his retirement and just pay the lowest amount on the house? Okay. What is your household income? Our household income gross is about $142. And how much is owed on this home? $250. Okay. All right. And you really, in seven years, you're going to be at retirement age? Yeah, he's 60. Yeah, he's 61 right now. He'll be 67 and you'll be 65. Yes.

I'm actually on disability. I'm an RN and I had two surgeries. Okay. How much is in his nest egg? $85,000? Yes. How much is in your nest egg? I don't have one.

Okay. So you have no money. All right. You need to be saving 15% of your income into retirement, household income going into retirement. And you need to be putting everything else that you can squeeze out on this house. And if you cannot get this house on a 10-year schedule or less, I mean, you can put it on a 15. But if you can't pay on it to where it's going to be gone in 10 years, you built too much house. Because you do not want to go into retirement with a house mortgage.

Okay. So I think you probably built, but I think you built too much house, but too much debt on this house. What's the house worth? $250. And you owe $250 on it? Well, we just moved in about four months ago. You owe $250 and you paid $250. And you owe $250 on it? Well, we just moved in about four months ago. You owe $250 and you paid $250. You didn't have any equity to put down on it?

Oh, yeah, yeah. I'm sorry. It's worth about $278. So you put down $20,000. No, we put more than that on it. Okay, 20 20 down okay all right so you put 50 grand down okay yeah 50 but that's all you had okay yes you bought a lot of house for how late you are in life with no money saved so um you're gonna have to roll up your sleeves and knock that mortgage out, or you're going to have to rethink this house. And I doubt since you just bought it and built

it and moved into it, you're going to rethink it. I doubt that's going to happen on one radio call. But you're going to struggle if you get into retirement and you've got a $2,000 a month house payment and you have $8,000, $80,000. But if if you'll save 15 of your income for the next seven years while you're attacking this debt um you probably can knock it out but it's gonna be it's gonna be tough be tough it's really gonna be the only thing you do you're not gonna be traveling the world and you're not gonna be buying purses with letters on them you're gonna be paying off a house hope Hope that helps. This is the Dave Ramsey Show. Did you know, statistically, when it comes to life insurance and protecting your family, that women are more likely to be uninsured or underinsured than men? This doesn't make any sense.

Women make up half the workforce, contribute mightily to family incomes, and in many cases are the breadwinners and take care of their families 24 hours a day. This is one of the most overlooked areas when it comes to financial planning. Maybe it's a relic of the past, but a loss of income or the need to replace family care is equally important for women as it is for men. Single moms, working moms, and stay-at-home moms all need term life insurance. Rates are actually lower for women, which is why I send you to Zander Insurance. They shop the top term life companies to find the lowest rates available. You can compare rates online at zander.com or call 800-356-4282.

This is something every family has to deal with. That's zander.com or 800-356-4282. In the lobby of Ramsey Solutions, Brian and Hillary are with us. Hey, guys, how are you? Hey, Dave, how are you? Welcome, welcome. Good to have you. Where do you guys live? Covington, Tennessee.

Memphis area. That's right. Welcome to Nashville. Good to have you come up the road. Here to do a debt-free scream, how much have you paid off? We paid off $124,698. Good for you. And how long did that take?

38 months. Good. And your range of income during that time? We started at $126,000, and last year we were at $165,000. What do you all do for a living? Hillary's an attorney, and I work in the railroad industry. Good. Very cool.

Good for you guys. What kind of debt was this $125,000? Law school in there? Oh, yeah. $75,000 were law school loans. $30,000 was a stupid truck and a stupid car. We had a couple of thousand in credit card debt and some miscellaneous other debt in there, too. Okay, cool.

So did you sell anything big like a stupid car or a stupid truck, or did you pay them off? We traded her car in for a cheaper one, so that knocked like $6,000. Not that much cheaper. We should have gone a little lower. Yeah, we definitely could have. Okay, but then you just plowed through the rest of it. We did. Very cool.

And your income went up $40,000 during that time, too. So very nice. Very, very nice. Good. Good careers. Things are going good for you. So how long you two been married? Four years.

I should have let him answer that. Okay. So four years, but three years and a little bit of it. So you kind of come home from the honeymoon, that first year of marriage. Tell me how this all started. Shortly after we were married, my job sent us down to Florida. So we were at one income for a little while, and we realized how many bills we had. And we had good income, but we never got to see it.

Everything we were making was going out each month in payments, and we didn't understand why we weren't able to increase our savings. So I was traveling a lot for work and I was listening to podcasts in the car and I stumbled across your podcast. And we'd been talking about, oh, we need to get on a budget. We need to get our finances under control. But we didn't do anything about it. So after we heard your podcast, we realized this is what we've got to do. And we listed all of our debts, smallest to largest, and we just started plowing through

them. We never looked back. Just from the podcast info? Yes. Then I ordered your book, I'm an overachiever. We did the financial piece online because his work schedule wouldn't really allow us to go to a class. Gotcha.

And we've been all in ever since then wow so you did you did do everything then you got all the way in but the podcast was a startup it was and we still listen to the podcast every time we're in the car together wow always yeah every road trip thank you very much we appreciate that very cool you guys i'm proud of you way to go i mean you're like four years into marriage three years into doing this and you pay off everything how's that feel it feels amazing you guys are weird yeah we are very weird um you know it's such there's such a piece that comes with not having any debt not having any bills we know that no matter what happens we're going to be okay if he loses his job if i

lose my job if something happens we're going to be okay. If he loses his job, if I lose my job, if something happens, we're going to make it. For example, this week our dryer went out, and all we did was just write a check and bought a new dryer. No stress, no worries. Well, you got money. It's not all going to somebody else. Make $165,000, you don't have any debt. That's a pretty good place to be. Way to go, y'all.

Thank you. So who was your biggest cheerleaders um probably each other you know our family knew it was a good idea um but they didn't understand when we would back out of family trips um we told him it wasn't in the budget and you know they didn't believe you yeah you know it's just a strange concept to you know pay cash for everything and a lot of people didn't really understand. But through all of this, our marriage has become so strong. We've worked together. We've achieved something I think is pretty incredible.

And I think we were each other's biggest cheerleaders. I mean, people supported us and thought it was a good idea. But a lot of people, you know, they don't like to talk about money or they think it's kind of strange. And it is a foreign concept. So I'd say we were each other's biggest cheerleaders. Good. What do you tell people the key to getting out of debt is if they ask? Holding yourself accountable.

I don't think anyone likes to tell their spouse no. But, you know, when it comes to money, you either have it or you don't. You can afford it or you can't. So if you just keep it simple it's it's easy to do and i'd say paying attention to your money um prior to learning about you we just bought whatever we want we didn't pay attention to if we could afford it or not um but we literally check our bank accounts every single day we use the every dollar budget i think that came out the month we got started with this um

about three and a half years ago and i mean we just pay attention to every penny we spend and i think that is so important to to know what's going on and also i'd say having an idea of what is a want versus what is a need before we started this program i thought everything was a need um you know and if my friends had it if i saw someone on social media that had it, then I needed it too. And I've learned through this process that you really don't need a lot of things. Right. Yeah. We often describe things as needs that aren't.

Most of us have very few needs. We do. We use that word a lot, but most of us in America, we don't have many needs. We have a lot of wants that we call needs, but you're exactly right. Identifying that is a big deal. Yeah, we cut off so much for a while. I mean, we were really weird. We didn't even have a TV for several months.

We only got one when family would come to visit, and they'd say, all right, what are we doing? We've got to watch some TV. So we finally got a cheap one, but, I mean, we just cut out everything. Very cool. Very cool. Well, you can do this. You can do anything. You've set yourself up for a lifetime of working together and pulling off any goal you decide

to pull off. So very, very well done. Good job. And a couple of babies come along the way. Oh, yeah. Names and ages. They're with you, right? We have Ellison is two, and we have Will, who is ten months.

All right. Fun stuff. We've got a copy of Chris Hogan's retire-inspired book for you. We want that to be the next chapter in your story to be not only debt-free, but now be millionaires and outrageously generous. Beautiful kiddos. Thank you. Fun stuff.

Fun stuff. Brian, Hillary, Ellison, and Will from the Memphis, Tennessee area. $125,000 paid off in 38 months, making $126,000 to $165,000. Count it down. Let's hear a debt-free scream. Three, two, one.

We're debt-free! Love it. Well done. Well done. Well done. Oh, man, that's fabulous. Open phones this hour at 888-825-5225. Is your house payment the only thing standing between you and debt freedom? Did you know that we offer a free mortgage payoff calculator on our website?

Just go to DaveRamsey.com, click on the Tools button. One of the tools is a mortgage payoff calculator. You can enter the info about your loan, how much extra you want to plan to pay on your mortgage, and it'll show you how quick you can pay it off. Pretty simple. If you've got too much house and you're looking to downsize, well, our endorsed local providers are some of the top high-octane, high-protein real estate agents in the nation. If you sell more houses than anybody else you'll run into, I can tell you that, they

can help you sell your current home. And in this current environment, you might get more than one offer even. You know how that stuff works. And you definitely need a pro in your corner helping you fight through and maximize what's going on there right now. So very, very, very cool stuff. Congratulations, you. Man, that's incredible. That's absolutely incredible.

You're going to get your house paid off. Yeah, you. Just go get the free mortgage calculator, mortgage payoff calculator, DaveRamsey.com, and click tools, and that'll get you there. That's fun stuff. You know, a lot of people think they're going to have payments their whole life. That's hopelessness. Lack of hope. And if you actually sit down and do the math

and you just decided to say, we make too much money to be this broke. We're going to change our lives. We're going to change our family tree. Brian and Hillary changed Ellison and Will's family tree before Ellison and Will were born. Or as they were being born. During that 38 months, they had two babies. I mean, and they paid off $125,000.

So I really don't want to hear you whine. You can do this stuff. I'll help you. You can do this stuff. I'll help you. You can do it. But this belief that you're always going to be stuck, that's just being a victim. You're not a victim. This is the Dave Ramsey Show. We'll be right back. Carlos is with us in San Francisco. Welcome to the Dave Ramsey Show, Carlos.

Hi, Mr. Ramsey. Thank you for taking my call. Sure. What's up? My question is regarding my mom. Bless her heart. She gave me $25,000 to help me out with the down payment for a home. I just started recently listening to your podcast, and my income is my thing that I need to fix.

So I've just kind of set that money aside for now. It's in a savings account. The thing about it is that I'm kind of worried that she's going to get in trouble or myself with the IRS. Yeah. Because I heard you talking about how there's a gift tax and it can't be more than $14,000. Exactly. So now I just, like, I don't know what to do. Should I give it back and then have her give me $14,000?

Are you married? No, sir. I'm single. Is she married? No, she's divorced. Okay. Yeah, she needs to give you $14,000 this year and January 1st give you another $14,000 or give you the difference.

Okay. That's the easiest way to do this. Right. How about if that happened last year, in November of last year? You would need to see a tax professional. It's actually $15,000 now you can do in this calendar year, but you did it in 2017. Yes, and I did my taxes last year. It's not on you.

It's going to be on her. She's the one who's going to have to pay the gift tax. But you guys need to go see a tax pro and see if you can file an amended return and maybe set it up to where, you know, like half of that came in November and half of it came in January and show it that way. If you can pull that off, you'll be okay. But you need to – actually, you'll be okay unless they audit you. But if they audit you, they might tax her on $10,000 of that at 55%.

It could cost her $5,000 in taxes. Right. So instead of gambling, might as well do it the proper way. Exactly. Go to one of our endorsed local providers for taxes in your area. They're on our website at DaveRamsey.com, ELP for tax prep or tax work. And you can get your taxes done right and you can get some help with this. And there may be a way to file an admitted return or to file a late gift tax or return

or something and just show half of it coming one year, half of it coming another, something like that. I think you'll probably be okay, but you're right. If I were in your shoes, that's how I would do it. Marshall's with us in Denver. Hey, Marshall, welcome to the Dave Ramsey Show. Hi, sir. Thank you so much for taking my call.

Sure. What's up? I'm helping out a friend with their finances because they were just totally out of control and didn't know what to do. And I've done everything that I know to do, and her budget just still is not leaving enough for her to survive. So I'm hoping to pick your brain for some options. Okay. Is it income or outgo?

I think her problem is income, ultimately. She has about $131,000 in combined debt between student loans and credit card debt, and her income is $30,000, and she's already working between 60 and 70 hours a week. Yeah, she needs some different career choices on the short term and on the long term. Yeah. Her part-time job sucks. Her regular job sucks.

It's all her regular job. She's working a salaried position for a startup, so it's kind of... She needs a new job. ...right now. She needs a new job. She's working 60 hours a week for $30,000? Come on, man. That's ridiculous. Agreed.

Let's get something else. Either we're working 40 hours for $30,000 and we can do something really cool in our part-time job and make almost that much again or something else. Startups make the guy that owns it rich not the gal making $30,000. Right.

Yeah, so, you know, no. Is she in Denver? She is. Okay, yeah. This is an income thing. So, I mean, it's the only way to solve it. I mean, can you make it on $30,000? Yeah, people make it on $30,000 all the time, but not with $130,000 in debt.

Right. So, yeah, you've identified what's going on, and you've probably done the best you can do mathematically with what she's got to work with. But she needs to talk to her current boss about backing her hours down to a normal set of hours or doubling her income one of the two which i doubt he's can or will do and uh then she's gonna have to pick up some really great part-time gig of some kind and um you know a great part-time gig you can make you can make 30 a year you know if you get a good one uh depending on what you're doing and how you're not much you're doing it and all that kind of a thing. So, hey, thanks for the call. Open phones at 888-825-5225. Ryan is in Japan. Hi, Ryan.

How are you? Good. How are you? Thank you, Dave, for taking my call. Sure. How can I help? So I'm currently active duty military, and in about three years total, I'll be transitioning out and going

to college. The Army would pay absolutely free for my college, but I also get a stipend for housing as long as I go full-time. So I'll get about $2,000 a month, and I guess my projected household income annually would be about $60,000. And I was wondering if it would be smarter to buy a home. No. No. Not while you're in school.

Because you're not going to stay in the place that you go to school, probably. What are you going to study and where? I'm going to study electrical engineering at UCF. Okay, very cool. Good for you. University of Central Florida? Yes, sir. Okay, awesome.

Great school. And, okay, are you married? Yes, sir. I just had a daughter. Awesome. Will your wife be working during that time? Yes, sir. I just had a daughter. Awesome. Will your wife be working during that time? Yes, sir. That's the plan. What will she make? Annually, it's between $36,000 and $39,000, depending on where she works.

Gotcha. Okay. And do you intend to stay in Orlando? Yes, sir. Okay. Well, maybe you do buy, but I mean, you're going to be buying based on your income, which is her income, and your income is going to more than triple when you come out of school. So I don't think it's bad to rent for a couple years until you finish up this school, because your income is going to be substantially different when you come out, right? Yes, sir.

So you're likely moving, because the little old house that you can afford on her income, you're probably going to move up in-house when your income triples or quadruples. Do you see what I'm saying? So I think it's okay to rent for a little while while you're in school and just concentrate on getting through school with no debt. I mean, make sure you're living on her income on the stipend and the fact that tuition and everything is covered by your benefits package, which is awesome.

I'm glad it is. Thank you for your service. How long have you been serving? Four years. Almost five years come next April. Cool what are you doing the army uh i'm missile warning okay cool well that's perfect for uh setting you up to move into what you're talking about moving up so where your brain works now yeah good i can see that very neat thank you for your service, Ryan. I wouldn't, I mean, because I think you're going to turn around and buy again. If you want to, you can.

But I think you're going to sell that house and move up in-house as quickly as you get out of school. So that's the way I would look at it. Open phones at 888-825-5225. Jesse is on Instagram at Dave Ramsey. You can follow us there. Is insurance coverage something I should lower to cut costs and save money? Well, no. You might have some types of insurance that you don't need.

If you've got a bunch of these gimmick policies and things floating around, a lot of people cut those out. But, you know, if you build your emergency fund up, you can raise your deductible on your homeowners and on your car, and that can cause your premiums to go down. But I don't suggest you lower coverage in those situations. I certainly wouldn't lower it on my disability. I wouldn't lower my life insurance. I wouldn't lower the coverage of my homeowners or my

car insurance. So, usually not. But again, there may be some types of insurance you need to drop and there may be some deductibles you can raise, which will help get your premiums down. So, appreciate you being one of the almost 1 million people following us on Instagram, Jesse. Thank you.

This is the Dave Ramsey Show. Hey, it's Kelly Daniel, associate producer and phone screener for The Dave Ramsey Show. Did you know that in 2017, Dave Ramsey Show listeners paid off $50 million of debt? That's pretty impressive. And it could be you this year. Keep listening for more inspiration.