The Ramsey Show - App - Should I Buy My Dream Car? (Hour 2)

Episode Date: March 6, 2023

Dave Ramsey & Jade Warshaw answer your questions and discuss: "I lost my dream car on a game show. Can I afford to buy it?" Investing in company stocks, A debt-free scream AND wedding proposal! "Should we sell our house to invest the mortgage payment?" What to do with an old 401(k). Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Want a plan for your money? Take our FREE 3 minute assessment: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Live from the headquarters of Ramsey Solutions, broadcasting from the pods moving in storage studios, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Jade Warshaw, Ramsey personality, is my co-host today. Thank you for joining us. Open phones here at 888-825-5225. That's 888-825-5225.

Ana is with us in San Francisco. Hey, Ana, how are you? I'm good. Thank you so much for taking my call. Sure. What's up? Okay. So I recently went on a game show and I had the opportunity to play for my dream car.

I got so close, but I lost. And it's just killing me. I'm so sad about losing and not getting this car. So my husband and I talked it over and we want to know, A, can we maybe afford to buy this car so my husband and I talked it over and um we want to know a can we maybe afford to buy this car and b if we can is it a wise thing for us to do because sometimes dream cars are just dream cars right I I am sorry I'm trying to recover from all of this in the moment um what is the car and how much does it cost you know the answer to all of this by the way it's a bmw x3 and it's fifty thousand dollars on the money how much money do you make your personal income oh well to get combined because

i don't work right now is about 175 a year okay and a year. Okay, and the car is $50,000? Yes. What is it? Brand new. It's a BMW X3. Oh, you said that. Okay, all right. So do you currently have debt? No debt. No debt. Do you currently have savings? We have just over $100,000 in savings, yes. And what do you drive right now? A minivan. What does he drive? We just have the minivan. That's it.

You have one car to your name. We have one car to our name. We do have another car that we are kind of borrowing on and off. It's like a little tiny um like a what do you call like a honda crv we're borrowing it on and off if we occasionally need a second car from my mother-in-law i'm assuming you're not to a million dollar net worth yet or am i wrong um actually we are we are because of our house okay we have some 401k is now here's here's our rule of thumb we would normally say that if you're a millionaire you could purchase a brand new vehicle but we also

say that we don't want more than you know you don't want more than 50 of your annual income tied up in vehicles so that's why i was asking what else you have you checked both boxes oh when you got to pay cash. You checked all three boxes. When was the game show episode? When were you on it? About a month ago. And you got the $50,000 to pay cash for it, right? We do, but then it just drops our savings to about $50,000. Yeah, I got that.

But which is still, $50,000 is still three to six months expenses for you, right? Mm-hmm. Yeah, you're still in good shape. So just walk me through. I'll be honest with you. Starting out this call, I was like, this call is crazy. But you do check all the boxes, but you still sound like, I don't know. Like at first you sounded really excited about it,

and now it's almost like as I walked you through it, you you're feeling more sobered about it. And now you're feeling like you don't want to. So explain that to me. Well, so before I went on the show, we had sat in this car, we had driven this car and we had said to ourselves, Hey, if someone gave us this car for free, absolutely. We'll take it.

Is it wise? We weren't sure if it was wise. And so we walked away from the lot several times not buying this car. But then I go on this show and it's right there and I play all these rounds and I'm like 50, 50 percent away from it and I lose it. And I'm like, oh, maybe I do really want this car. Well, the game show, the game show aside, I'm sorry you lost. maybe I do really want this card. Well, the game show aside, I'm sorry you lost.

But what game show was it? Can you just say it? Or are you not allowed to? Price is right. Price is right. I love it. Game show aside, I feel like because it was offered to you for free, you were like, yes, I want it. And now that it's not free anymore, you're realizing, man, $50 lot of money here's the thing you can afford it you get sounds like you guys have

sacrificed to win you've been driving an old minivan if you can afford it and here's the thing if you can't afford that one what if you got a year or two used would that scratch the itch and and still make you feel like you're being responsible? Because here's the thing, you would be being responsible even if you bought it outright. But right now it sounds like you're dealing in emotion and it doesn't feel responsible. Would it feel responsible if you bought it two years used? I think that would feel better. I think what feels irresponsible is cutting my savings in half. It feels kind of scary to do that. You guys have done a great job with money to get where you are.

And so you have good instincts. And this is bothering you. I used to have a friend on investments. He would say, when in doubt, don't. And you have so much doubt around this. I don't think it's going to bring you as much thrill as it is going to bring you loss of peace. Just you. Again, you've checked every box.

You're not violating a single thing that we teach by buying the car. But you've got to sleep at night. You've got to pay cash for it. Okay? But if you're not going to, I'm a little bit afraid just listening to you that it's going to take more from you than it adds to you. You know what I'm saying? I just wanted the car for free.

That's what it was. She had the opportunity to have it for free. I'm not the host. I can't help you with that. I'm on the Dave Ramsey show, the Ramsey show, not the Price is Right. Otherwise, I would just give you the car. But, yeah. I get that, though.

I would go get, I think i'm with jade because of the hesitation not because of anything else because it's bothering you i think i would go buy a thirty thousand dollar version of this x3 which is a great car by the way they're very cool um drive that for a while if you guys continue making 175 000 a year and you continue saving money and you continue you'll be able to drive anything you want to drive. The truck I drove over here today, I would never have dreamed I would buy a truck like that, you know, like 10 years ago. And now it's like, oh yeah, it's okay. You know, but I never dreamed, even though I had the money 10 years ago i would never but emotionally

you weren't ready to buy it is that emotionally i'm in a different place i had you know there was no angst i went yeah sharon sharon you okay with this yeah let's do it okay kind of a five minute conversation i'm like oh i love it order the dadgum thing you know so but but but the first time i moved up i remember the angst yeah she's feeling i remember this sense of am i being dumb i don't want to be dumb that's a good that's a good thing to have those breaks on you way to go i think that's part of honestly i think that's part of this process when you buckle down and you're saying no to yourself a lot even if you're saying not now when you finally get to the time that it's now it feels weird

i think a lot of people struggle with that actually spending their money yeah oh they do it's uh it's hard and you know if if you call me up and you made eight hundred thousand dollars a year five hundred thousand dollars a year and you had a five million dollar net worth i would tell you to just go do it now i would tell you go do it but this is a it's 50 of your liquid savings that does get kind of gives you a little bit a moment there and you're catching the throat. And I think it depends also how your net worth is distributed. If all of it's in the house. Most of it is, she said.

So. Yeah, that's a good point too. You know, so. You're okay to do it if you want to do it. But you don't feel good about it. That's what we're observing. This is the Ramsey Show. Question coming in about taxes.

Oh, we get it. Taxes are confusing. But to help you get a better handle on them, let's unpack a question from one of our listeners. Can you explain how capital gains tax works? Yes. There are two types of income tax mainly in America, a classic what we call ordinary income, which is your income tax, and then there's a gain on an asset like a share of stock, a piece of real estate. Your gain is what it goes up in value over what you paid for it with a few adjustments, but that's basically it. That is a capital gain. You've gained capital on this. So you buy a

piece of land for $100,000 and you sell it for $150,000 after expenses. You net $50,000. That is your capital gain. If you make under $450,000 married filing that is your capital gain if you make under four hundred fifty thousand dollars married filing jointly your capital gains tax rate is only fifteen percent it's even less if you have a small income and it's twenty percent if you make over 450 but it's still less than ordinary income uh well can be less than ordinary income so um generally is so uh if you you know certain assets can be exempt from capital gains taxes altogether for instance your personal residence you can make up to a half a million dollars married filing jointly 250 as a single on that if you've owned the property for two years or longer you have zero taxes on that

so i recently sold a home uh 18 months ago and the half a million dollar gain was tax free you don't have to buy another house with it it's just free you can buy another house with it but you don't have to in the old days you had to buy another house even on your personal residence but that's all changed now so for online software that includes all major federal forms with low upfront pricing and no hidden fees, check out Ramsey Smart Tax. For additional support, if you've got a complicated return, check out Ramsey Trusted Tax Pros, like one of our endorsed local providers. Go to RamseySolutions.com slash tax, and you can learn more.

RamseySolutions.com slash tax and you can learn more ramseysolutions.com slash tax all right connor's in cincinnati hey connor welcome to the ramsey show hi how are you better than i deserve what's up great yeah so my wife and i are recently uh debt free outside of our mortgage and my question is yeah thank you my question is regarding my company's employee stock purchase plan and whether it would be wise to invest in that as part of the 15% that goes into retirement or possibly even like a shorter term around seven to eight years.

I wouldn't do it. I would invest the 15% into mutual funds because single stock and your company stock, I don't know what company you work for, but it's more risk to put basically all of your eggs in one basket as opposed to spreading them around like you would do in mutual funds. Yeah, if you're going to buy company stock or any single stock, I would only do it after your home is paid for. And that would be maybe step seven activity. Now, let's say we're over there and let's look at your situation. Okay. By law, they are discounting the stock in an employee purchase 15%, correct?

Correct. Yeah. And so let's say you're putting 15% of your income into retirement, baby step four, you're taking care of your kid's college, five. You paid off your house, six. So now we're sitting at baby step seven. Do I want to play with this stock since I'm getting a 15% discount? You might. You might. You don't want more than 10% of your net worth total in single stocks because single stocks are a lot more risk.

And to prove that, Connor, here's what would be interesting. I don't even know your company name, okay, and I want to know so i might in a minute we'll see but right now i don't to make this statement i don't need to know you know your company name go back and look you pull it up pull up your company stock on the internet and look at a chart that shows the 52 week high and 52 week low you likely will see a swing greater than 15 between the two in the last in the last year right now i'm sorry yeah it's a pretty large drop right now in the last year yeah okay and so um they sometimes they shoot up sometimes they shoot down but even a very stable name brand uh company like a a Home Depot that we all know the name of or something, it's not unusual. It would be unusual for it to not vacillate as your possible high or your possible low.

So my point being is the 15 percent discount might just be enough to cover your losses. That's a good point in the coming year. And so the volatility of the single stock is represented there and tells you why we don't play single stocks i don't own any i don't own one uh and so that that's you know jade's right i'm gonna stay away from it until you get to baby step seven and even then don't think that the 15 is special it's all company stock is that way every everybody that has a company stock purchase plan it's 15 discount and uh unless it's a small closely held company they've got a different thing we're talking about publicly traded big board uh new york you know new york stock exchange

type stocks that's what it's going to be and you're probably going to find your 52 week high and low to be the distance between those two to be greater than 15 yeah i wouldn't do it yeah and then if you're so you know it's just if you got a real itch there you want to scratch put a little money in it after you're in baby step seven but you're really not it's not knocking it out of the park oh i got a 15 discount i made money before i started no that's my point you didn't probably all right ryan is with us in mayfield kent. Ryan, what's up? Hey, Noah. Good afternoon, Jayden, Dave. Thanks for taking my call.

Sure. How can we help? So I have a question about the budget. I've changed, it's been about two years now, from teaching. I taught for nine years and got a monthly check. It was easy to figure out monthly expenses and plan. But now I'm farming, and I get paid five times a year. It's regular. It's kind of predictable five times a year but i'm having trouble it's about 70 days

i think per paycheck or something like that and i'm having trouble planning when i write myself a check now you know from the farm what how to figure out what expenses to cover. Do I kind of do a budget for every, what, two and a half months? I'm trying to figure out logistically the best way to plan for that. The first thing is farming is a business, and so you're running a business as a separate checking account. Now, once you've paid your expenses at the business, your net profit is what you can take home. So when you get a crop that comes in, you've got to clear your stuff, right?

And then what's left and what you don't need to replant and so on is what you can take home. Now, once you take that home, then you say, we need X number of dollars, $5,000 a thousand dollars a month whatever it is to to be exist and then you just pay you know you just pay yourself five thousand dollars a month out of the business account okay well so yeah so i have how much we need and what our expenses are and we're good on as far as um it's about five times a year but we do about maybe uh twelve thousand dollars each time and we're good on the farm and that pays our bills but it's it's the planning ahead of time for 70 days like using the app like the logistics of saying because we pay ourselves so it's a poultry plot keep the money yeah keep the money in the business account and pay yourself a monthly pay check yeah just give yourself the five thousand

dollars once a month okay okay yeah so instead of paying at the end of the flock when the farm gets paid just go ahead and divide that monthly and pay myself 12 times a year instead of a five times a year that's what i would do it's easier to keep up with yeah that that's probably because otherwise i mean because you're controlling you're controlling 100% of both accounts. There's no other players, right? Well, I do have a business partner, 25% on the farm, but I'm still controlling. I just cut him that disbursement. Then you may want to just set aside a separate personal account

and chunk 70 days' worth of monthly rate in there. Let's just call it 90 days worth put three months in there yeah and then pay your and then just divide it but you know take out a third a third a third and then do it again yeah because looking at the monthly bills it's like well okay we it's about three thousand a month it's kind of what we need but it's like well if it's two and a half months it's like do i write myself you know nine thousand dollars you know that's where i was having trouble with the logistics on planning that like with the budget yeah it helps to have a separate account i probably would open a third account i probably

open a third account separate from the business is separate from your checking and say okay i'm going to move this money because it helps me to visually go i just got paid for the month of march i just got paid for the month of april yeah and i'm for the month of April. Yeah. And I'm taking it out of there. He doesn't need to move three months of money into his personal checking account and try to... Keep from spending it. Keep from spending it

for three months. That's a terrible idea. That's a problem, yeah. Good question, man. Thank you for joining us. This is The Ramsey Show. Jade Warshaw, Ramsey Personality personality is my co-host today in the lobby of ramsey solutions and by the way you should be there's always uh 50 to 200 folks hanging out with us while we do the show uh it's on the glass and free coffee and free homemade cookies come by and see us when you're

in nashville anyway on the debt free stage andrew is with us hey andrew us when you're in Nashville. Anyway, on the debt-free stage, Andrew is with us. Hey, Andrew, how are you? I am good. I'm very excited to do this screen with you. Well, we're honored to have you. Where do you live, sir? I live in Milwaukee. Milwaukee, cool. And how much debt have you paid off? $155,000. All right. And how long did this take you? Just about 24 months. Cool. And your range of income during that time? Started off a little slow, a new grad physical therapist right around the start of COVID at $39,000. But then at the peak of my

intensity, I got it up to $185,000. Wow. Wow. PT. Yeah. Wow. So I'm guessing $155,000 was PT student debt? 100%. Oh, man. Oh, man. What inspired you to do this 24 months ago? How did you get to do the Ramsey way? Yeah, so it goes a little further back than that. Sometime in college, I learned that I should be a little better with my money. And I knew my older brother was doing better with that at the time. So I reached out to him.

I'm like, hey, what can I be doing? And he said, there's this guy. He has these steps. Step one, save $1,000. So I turned around. I did that. And I went back to my brother and I said, all right, done. What's step two?

And he said, you have to pay off all of your debt. And I was just like, well, that just can't be right. I need to get this guy's name, figure out what he's really about. Talk to him. He's wrong. Right. Yeah. I thought i was the

exception so then i that's when i got immersed in all of your teachings and then um throughout the rest of my schooling i applied everything you were suggesting to try and limit how much more debt i was going into and then once i graduated i was able to hit the ground running once i got my big boy job yeah how's it feel to be free? It feels amazing. So, so freeing. Yeah. I'm so proud of you, man. Thank you.

Thank you so much. So proud of you. Well done. So now that you're debt free, what are your big plans? So, yeah, now that this part of my life is over, the next big thing I want to work on is like building a family. And I have Colleen here with me today. And that actually leads me into my next question. And I have Colleen here with me today and that actually leads me into my next question and I know I know Colleen likes surprises so um Colleen I love you so much and

your support in the last two and a half years has meant so much to me and I really want the next part of my life with you to be um uh to start a family so he wouldn't he did marry me of course that free screen he clicked that closed pretty quick let her look at it so i was like all right trust me i know what it looks like she said i picked it out, I picked it out. Oh, you picked it out. Yeah, actually, Dave, I called you about a year ago to the day to ask you about how do I budget for this in the middle of like my debt-free journey.

And I talked to you about a year ago with John Deloney. So this is a full circle. Oh, wow. Love it. Yeah. So we help pick out the ring too. Basically, yeah, pretty much. Wow.

I love it. Did you put it on? Did she put it on? No, she didn't put it on. Oh, yeah. Put it on. Put it on. She didn't put it on me. Oh, is that how it works? Yeah. Oh, yeah. This is. Wow. I love it. Did you put it on? Did she put it on? No, she didn't put it on. Oh, yeah. Put it on. Put it on. She didn't put it on me.

Oh, is that how it works? Yeah. Oh, yeah. This is how this works, dude. Babe, how dare you? Wow. The microphones are in the way of the kiss. Okay.

I love it. A debt-free scream engagement all in one fell swoop. You're fairly efficient, dude. Yeah, thank you. I appreciate it. A debt-free scream engagement all in one fell swoop. You're fairly efficient, dude. Yeah, thank you. I appreciate it. Congratulations. Thank you so much. So we don't usually let the extended girlfriend be a part of the debt-free scream.

He or she, boyfriend, girlfriend is off to the side cheering you on until they're not. But he asked to do this, and so that's why we got you up on the stage so we're all in on this we completely tricked you you can blame us too congratulations you two thank you very very proud of you how long have y'all been dating about two and a half years oh wow okay well it's time i mean come on man right yeah yeah you're you're working on this you're getting you've been working all the time though right yeah so it's been tough but now we've got a solid foundation to uh bring the family on and that's exciting it sounds like how did y'all meet uh we met on bumble okay yeah very good connection we were both in school at the time and then yeah just worked out after the first day i

knew i wanted to want her to be my girlfriend i asked her the very next time i saw her so wow yeah wow you had no idea this was coming, did you? Not today. No. I, no. I didn't, I can't believe it, actually. I did a pretty good job of just, yeah. Yeah, you're a pretty cool hand Luke up there. You are.

Yeah, you are. Some people would have been sweating into their socks. I don't know. Yeah. That's exciting, exciting stuff. So it sounds like you kind of, you knew this. Do you guys have a date in mind or is this totally new? We don't.

We've talked about it. We've talked about future plans, but we have an idea of what we want to do as far as getting married. We want to kind of do our own vacation sort of thing. But as far as setting a date and all that, that's our drive out of here. That's going to be the fun conversation we look forward to. That's exciting. I have a question to ask.

This is controversial. So are you on board with all of this, Colleen, all this debt-free stuff? Too late now. Oh, yeah. I mean, I wouldn't be here if I were not on board with it. And I'm also debt-free, and I also pay off my student loans during our relationship together. And I probably wouldn't have if it weren't for dating him and hearing a lot of Dave Ramsey all the time. This is how it's done. I like it. I like it. Well done you two. How old are you guys? I just turned 27 yesterday. And I'm 28. All right and

so you're going to have a wonderful household income north of $200,000. I don't even know what you make Colleen but I'm pretty sure that's where you all will be and uh zero student loan debt and wow what a great way to start you guys got a great launching pad I'm so proud of you both of you thank you and thank you for honoring us and letting us be a little part of this whole thing and letting you show off in front of about 15 or 20 million people yeah pretty cool not many people get engaged in front of 15 million people right I was not expecting that yeah you handled it good. You guys did good.

Yeah. And they're not even weird like on The Bachelor or something. These are like normal people. Normal people. Yeah. I love it. You didn't have to go get trapped in a house somewhere or something to do it. Wow.

Look at you guys. Very, very cool. So proud of y'all. Way to go. Well, I think, Colleen, you paid off your student loans too. So I think we're debt free. Oh, yeah. I love it. It's appropriate for the debt free scream. What of y'all. Way to go. Well, I think, Colleen, you paid off your student loans, too, so I think we're debt-free. Oh, yeah. I love it. It's appropriate for the debt-free scream.

What do y'all think? Oh, yeah. Absolutely. I didn't practice, though. Andrew and Colleen recently engaged, like three minutes ago. I love it. Congratulations, you two, from Milwaukee, Wisconsin. He paid off $155,024 months, and she paid off her student loans while they were dating, Wisconsin. He paid off $155,024 months,

and she paid off her student loans while they were dating, too. And now, boy, they got a bright future. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free! We're debt-free!

Wow! Well played, dude. Well played i love it very cool i think that is the third or fourth maybe fifth over the years engagements on the air but it's been a while i don't i think it's the first one in this building i've never seen one that is special yeah very cool he got her too she had no idea oh yeah no she had no idea well she said she picked out the ring but that must have been just well just discussing what i like yeah i like one like that yeah yeah that kind of thing so yeah very very fun i tell you what they had the right conversations early on you can tell that it's set up it's set up if you can be in agreement on money in-lawslaws, religion, and kids before you're engaged and

married, you got a real shot at it. That's a big thing. Way to go, you two. That's great. Very, very cool. They're fun to watch, too. That's great. So 27 years old, he made $39,000 up to $185,000.

That right there. And so you can start putting some numbers with that, boys and girls. I mean, I don't even know what she does. I didn't ask. But let's just say she made $50,000 or $60,000 or $70,000 or whatever. Then they're going to be up over $200,000, $2. mean, I don't even know what she does. I didn't ask. But let's just say she made 50 or 60 or 70 or whatever. Then they're going to be up over 200, two and a quarter, two and a half, something like that, at 27 years old, a quarter million dollar household income and no payments of any kind. Nope.

Investing 15%. If they'll keep doing the stuff we teach, they're going to be really rich. Really rich, really fast. Really rich. That's what I'm talking about what that's a good thing and be in a position to not only take care of them their future children uh change your family tree but also be in a position to uh be outrageously outlandishly generous in their community and be a help uh rather than a hindrance to those around them what a cool cool way to start life. That is it right there.

That's what they did as a blueprint for folks to follow. They did that right. Man, if I had only been so smart. I know. I'm looking back thinking, well. You start out a half million in debt. I did. At least we paid cash for the wedding.

That's one thing we did right. Hopefully they do as well. I'm sure they will. Oh, no question with these two. I love it. This is The Ramsey Show. thing we did right hopefully they do as well i'm sure they will oh no question with these two i love it this is the ramsey show jade warshaw ramsey personality is my co-host today well i don't know if it gets much more fun than to have an engagement on the air. No, that's pretty, that's as good as it gets right there, Dave. Fun times.

Yeah. Fun times. Thomas is with us in Arlington, Texas. Hey, Thomas, welcome to the Ramsey Show. Mr. Ramsey, it's an honor to be on here, and I will be praying for Andrew and Colleen. Thank you, sir. That's a good thing. I love it.

How can we help? Okay, so no debt other than my house or our house let's just say i'm very happily married um credit card everything's gone student loans gone everything no debt other than that okay so i wanted to go over my and then please like make adjustments for me because you have way more money than i do. And I would like to be like you for my family. Okay. Okay. So my three to five year plan is,

uh, sell the house. We owe $129,000 on it. It's a, it's over a $500,000 house. Um, It's over a $500,000 house. Move into a house to where we owe no debt, and then use the money that I was going to be paying on the mortgage for that house to give it to a smart investor for 15 years and become the first millionaire in my family.

Okay. Mathematically, that will work. Let's explore other options. You said you're married. The house is worth $500,000. What's your household income? $71,000. Okay.

If we keep the house, you're on baby steps four, five, six, it sounds like. You're investing and trying to get the house paid off. Making $75,000 and doing those other things, you owe $129,000. If you found $25,000 a year, you'd be debt-free, house and everything, in five years. If you found less than that, it'd take six or seven years and oh by then the house is going to be worth a lot more even um does your wife like the house my wife loves it but my wife is she me, I trust you wherever you lead us. That's sweet. So I'm getting advice from people much smarter than me before I make a decision.

How old are you? Wait, how old am I? 34. That's how old I am. I feel like you're in a little bit of a rush to make this happen. Am I wrong? Do you feel rushed? I'm just trying to figure out the smartest way to do it.

Yeah, I just want to, that's why I said three to five year plan. Yeah, if I said three to five seconds, yeah, like right now. But this is later on down the road. Yeah. What do you do for a living? I am a welder. Okay. All right.

Yes. Hmm. What we normally teach is that we don't sell the house to move forward unless we don't like the house or it's a pinch. It's neither here. So I am going to say it is just as good an investment into your family, your marriage, and other things to keep this. And systematically, everybody, if we're going to keep it, we want to be intentional about how quickly we can pay it off. So let's lay that out and lay out a five-year plan, a seven-year plan, whatever it is, and just take $130,000, $129,000 and divide it into that, right, and say I'm going to throw extra at it.

And so if we're going to stay, the price I'm going to pay is I'm going to work overtime this many months a year, three months a year, and that will enable us to pay X on this. Because the good news about being a welder is you can make serious bank in OT or doing some side gigs, either one, some side hustles. I'm probably staying in the house and paying it off gradually. I think you're going to end up in fairly close to the same place if you do that. That's my guess. That sounds about right. the two arguments that are playing in my head is the only reason on my side of this that I would

not do that that I would sell the house take the money and buy something less expensive is if he wasn't if it wasn't worth it to him to work more hours and kind of go into that sacrifice to win mentality if he's saying you know what like i like my job i like my flow i like my pace i don't want to do that intensity in order to get this house paid then neither one is a bad yeah neither one is a bad selling it and moving it into a four hundred thousand dollar paid for house is not a bad answer okay keeping it and systematically paying it off in the next five to seven years with plus or minus some sacrifices to do that is not a bad answer yeah both of those are going to land you 15 years from now in a fairly similar place right

there's not a huge difference in these two you're just going to be if you keep the house you're going to be heavier in real estate than you are in your mutual funds if you go the other way you're going to be heavier in mutual funds than you are in real estate so that's the it's the balance of which way you want to be there um and i appreciate your wife uh saying i'll go along with whatever i trust you that's very sweet um that's a good indicator that you're a good man true that um and uh but i have also learned over 40 years of marriage that some of the best investments i make are into our lives. That's true. Into our marriage, into, you know, this is a trip she really wants to do.

This is a, she doesn't like cars, but this is a car she really likes, okay? I buy her, I'm the kid with the Tonka truck, buying his mama a Tonka truck. I buy her cars that I want. If she has no dog in the hunt. Happy wife, happy life thing. It's not that she's a princess or that his wife's a princess at all. That's not the point. But the point is there is a value to all the hard work that we do

to get a quality of life out of that. Absolutely. Yeah, good stuff. Good question. Dan is in Denver. Hi, Dan. Welcome to the Ramsey Show. Hey, Dave.

How are you guys doing today? Better than we deserve. What's up? Hey, I just recently changed jobs. I mean, in May of last year. We have no debt other than our house. We do maintain a $3,000 balance on our credit card, only because we're told that showing the activity of paying something off helps improve our credit score, which

we don't really need, but we just do it just because that's what we're told. When I changed jobs, my 401k, I stopped contributing because the new employer was not associated with the company I was using. With the new company I have, I do have a 401k and I do have my 15% going in there contributing to that, but they don't match. My question is, on the first older 401k, I have about 245 in there. What do I do with that to get to earn interest or to make it grow or do something? I feel like I'm just sitting here. Yeah, just click on SmartVestor at RamseySolutions.com and find one of the brokers that we endorse, that we have vetted, that you're comfortable working with. They'll have the heart of a teacher. And here's the phrase you need to remember, a direct transfer

rollover to an IRA. That means that the money is not coming to you. It's coming straight into the mutual fund, into the IRA. There's zero taxes on that. If you have a traditional IRA now, you direct transfer it to a traditional. If you have a Roth 401k now, you direct transfer it to a Roth, whatever it is. But they're going to move the money from the 401k directly into the mutual funds that you purchase, and they'll send them the send the notice for you over to your old company and cause that to happen if you lay your paws on it they have to withhold 20 you don't want them to do that so the direct transfer is the key thing

and i always take my 401k with me yeah i would because a lot of the stats on the amount of 401ks that people forget about and they're just left floating in the air is crazy. Yeah. I'm probably not going to forget about $245,000. Not that much, but you would be surprised, Dave. Just the same. You're right. I wouldn't be surprised.

It's crazy. And the other thing is you'll get a better rate of return if you watch your own investments and manage them actively with your SmartVestor Pro, then you will just leaving it behind as a memory back there. And that's a lot of money to just be floating out there in la-la land, so to speak. Absolutely. And cut up that credit card, please. Yes, that's a bunch of crap.

You're chasing dollars. Get rid of it. Worshiping at the altar of the FICO is a bad idea. This is The Ramsey Show. Dave here. You can find all of our shows with the Ramsey Network app on your smartphone. It's the only place to listen to the entire back catalog of episodes. Download the Ramsey Network app in your favorite app store today.