The Ramsey Show - App - Should I Cash Out My 401(k) To Pay Off Debt? (Hour 3)

Episode Date: September 12, 2022

Take our Audience Survey & Enter to Win a $500 Visa Gift Card: Click here to take the survey   Dave Ramsey & Ken Coleman discuss: Encouraging a spouse to start a business, Why Dave keeps working despite his net worth, Cashing out a 401(k) to pay off debt, Investing an inheritance vs. paying off debt.   Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6   Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studio, it's the Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. We help people build wealth, do work that they love, and create actual amazing relationships. Thank you for being with us, America. Ken Coleman, Ramsey personality, number one best-selling author, is my co-host today.

The phone number is 888-825-5225. That's 888-825- 5-2-2-5. Up first this hour is going to be Teresa in San Diego. Hi, Teresa. Welcome to The Ramsey Show. Yay. Hi, Dave. Hi, Ken. Hey, what's up? Hi. Thank you for all you've done

for our family. You've been such a blessing, Dave. Sure. How can we help? Yay. Okay, so I have a husband who loves business, loves people and people love him back. He has a gift. He's gifted in strategy. He's able to see big picture, recognize that's needed for people to be successful. Currently has a great job, 15 years of experience in the restaurant industry, but he's always expressed a desire to be self-employed ultimately. I need to know what I should do as his partner to encourage him to go out on his own. He really, if unleashed, could

just be such a blessing to so many people. So I don't know what that should look like or how or you know how where do we start um does he have an actual idea or two or three uh ken it's it's unbelievable like just living our daily lives just going out and going on vacation he's came back from california um visiting family within that week's time he had three different people um asked for him to look at their numbers and actually be a board member on some of these businesses. So it's like, does that answer your question? No, no, you're right. What kind of business? Yeah, like does he have an actual idea or two that he's talked with you about

that he hasn't pulled the trigger on, a specific business idea? I would say consulting. I mean, he loves business. He loves helping people succeed. So currently he's in the restaurant industry and is loving it. He has a passion for industry, but he has a passion for people. Sure. What did he say to the board offers?

Did he say yes or I'll get back to you or I want to talk it over with the wife? Well, he would always talk things over with the wife well it's correct he would always talk things over with me very wise but uh yes but um it's that's why i'm kind of calling because he he enjoys the job he has but it would be you know do i okay so if i were talking yes he should he should absolutely explore those board opportunities, specifically if they're paid. But even if they're not, if it gets him an opportunity to come in, even as a board member, and begin to practice advising outside of what he already knows, it's a wonderful way to get his feet wet and kind of ease into what could my future look like.

I would absolutely explore those. So I'd go home and go, hey, when he comes home, I said, I think you should explore these things and look into these things as an opportunity. The second thing is, is I would ask him point blank, just in your normal conversation, what would need to be true for him to start his own consulting business? Begin just having conversations the two of you, not high pressure. I really want you to do this but just begin to hear his heart and he's going to begin to share with you what could hold him back or what is holding him back and as he's oh good tell me what is what's holding him back it's financial stability so as I said currently has a great job and he doesn't know what that would look like because his first and foremost concern is to be a great provider for his family.

Sure. So what if, so here's what you say to him, what if you were to do this on the side? You can consult on the side. He knows about how many hours or days based on his other responsibilities. He already is kind of doing that. Great. Well, he needs to do more of it. What do you mean kind of? Okay. What's kind of? Having conversations. He has signed some NDAs so that he can- That of? Okay. What's kind of? Having conversations. He has signed some NDAs. That's not consulting.

That's having coffee. Is he getting paid? No, and that's why I'm asking. Okay, then that's not consulting. So he has to get paid. And so here's how you help him with this provider gap. I'm going to tell you. First of all, he talks to these people that want him as a board member, and he finds out, is it a paid board opportunity?

I've got several friends who are paid board members. They show up a couple meetings a year, they're on call, and they make a nice, decent chunk of side money. The other thing is he may not be a good board member, but maybe he's a consultant for them. So if he's on vacation and he's running into these opportunities, opportunity is not his issue. What he needs to understand is I can walk before I run.

And so we want to just start his consulting business today. And he starts getting paid. And then he stacks that money up. You understand where I'm going with this? He keeps stacking the consulting money up until he's got two things in play. Six months would be my advice. Six months of his current income in the bank of the consulting business would be the start and the second thing is a pipeline of

business and then he's ready to walk yeah dave you were going to say something ken and i have more than two friends that are mutual friends of ours um that make north of a half million dollars a year on retainer with businesses, handful, 50 business, less than 50 businesses, less than 20 businesses probably on the list. And they're on an annual retainer plus hourly to help them with strategy, to help them with people problems, to business coach them. Okay. They're great business coach them. Okay. They're great business minds, good guys, they hustle, and they're both making north of a half million dollars a year.

So on a part-time basis, your husband could get enough of that kind of thing going on if he finally decided he was actually going to get paid for it instead of doing it as a favor for everybody. Yes, that's where my frustration is. That's where my frustration was. That's why I said he's not going to get paid for it instead of doing it as a favor for everybody that's how yes that's what my frustration that's what i was what my frustration was that's why i said he's not got a business coffee buying coffee for people is not it that's not the thing so um and so if it's a paid board gig that's advising and you can use that in your resume to also land some of these retainers but it's not unusual in that business consulting space business coaching space for you to get an annual retainer and um then you know and he doesn't want to work with

somebody that wants to give him five grand one time to fix one single problem because business is never one problem right that's a joke can i ask can i ask you something else dave um some of these businesses that have come up to him are, like I said, one of them offered the board membership, you know, but the other ones are small businesses. And I know that you talked about when you were starting out, you would offer equity as an incentive to help. Is that, I think he feels uncomfortable.

I don't want equity. I want money. Okay. Okay. Some of these, equity. I want money. Okay. Okay. If I'm him. Some of these business. Okay. Equity can come later.

Let's get him to a half million a year in cash. Okay. And then he's not got any barriers, right? He quits the restaurant. That's how I feel. Yeah, the restaurant job goes away instantly as soon as that becomes a reality. And by the way, Teresa, if they can't pay cash for his time, they're not the right client. Yeah. And they're not. And even in the early stages. Yes. I mean, some of these. Okay. I don't. Okay. Listen, we're not, we're not that you can, other people can dream right now. We

want to do business. Right. I love it. Okay. And so, yeah, I can, I don't know if you know this or not, but I have a rare position. I get paid to not be on people's boards that is correct that's where y'all want to be by the way that's where we're all trying to get to i serve on precisely zero boards non-profit or otherwise and there is a reason because you don't do well on boards if you're always right that's correct. Thank you for joining us, America. Every week on our show, we hear from callers who are in the wrong career or not using their talents it's happening in the kin it is a lot and uh so we as a organization dave a couple years ago we got together we have some smart people in this building like really smart people and we we try not to let them on the air though right and so we said we said to developers what if we could

help people identify what they do best that's their talent uh their top passions that's work they really enjoy doing and then a sense of mission meaning what motivates them what results do you want to put out into the world and uh so we put it together it's called the get clear career assessment and it is a wonderful tool that takes about 20 minutes and in about 20 minutes you're going to get a very specific report in those three areas what are your top areas of talent what are the top areas of passion work you love to do and then what results motivate you and you talk a lot about motivation you've always said you can't motivate wet wood you know and this is the idea that if

you're in work that you're good at that you love and that produces results that get you up in the morning get you fired up uh then you got a great chance of not just making great money but making great impact so we created the assessment and tens of thousands of people have taken it it's a 30 price point at ramsey solutions.com pretty simple if you do the get clear assessment i can make you one promise you will be clearer yeah and that leads to confidence you know and you can make you one promise. You will be clearer. Yeah, and that leads to confidence, you know, and you can make the right decision. Because a lot of people, Earl Nightingale used to say, people spend more time picking out a suit of clothes than they do their career.

Isn't that true? And it's like they fret. And, you know, you're getting ready to buy a piece of electronics. You read all the Consumer Reports data. You do everything else. You do all this research to buy a freaking stereo or a tv or whatever but and then you just go why'd you take that job my buddy said they were hiring okay tell me times i first say i fell into it i just fell into it it was the first thing offered after college here i am 38 years later and i've been miserable the whole time that's the majority of

america workers yeah yeah and no reason to be that way. No. No. Because here's what happens. Your income and your impact rise together when you're doing what you were created to do. And so that's what the assessment does. Great way for those of you that need a bigger shovel. The reality is, is to make more money to get out of debt faster, you're going to do it by getting promoted or having to pivot. And this will help you. Good stuff. Blinds.com gives us our question of the day. They have a 100% guarantee. That means if you mess up, and I have, if you mismeasure, and I have, or you pick the wrong color, and I do, they'll remake your window blinds for free. You get free samples, free shipping, and with the new promos they run every month,

you'll save even more. Always use the magic word. The promo code is Ramsey. Today's question comes from Tom in illinois and this may be my favorite blinds.com question of all time i listen to the show every day he says i appreciate how you advise people about money but i'd like to ask dave given your net worth dave why are you still working it makes the assumption that i was working for money. That's right. It's true. And I quit working for money a long time ago.

I make money, and I use it for keeping score because I want to know if I won the game. But am I actually serving? Because if you serve people, they'll give you certificates of appreciation with president's faces on them. My friend Rabbi Lappin says that. And so I like keeping score. But no, you're right. I'm not working because of my net worth. I'm not working because of that.

I'm working because of the impact, what you said earlier. Yeah. I mean, honestly, let's just be real. Okay, a couple guys. I like this. Okay, you ready? Yeah. Who wouldn't like a job who, for three hours every day,

people call and ask your opinion about something? That's a very good where else would you get that so true you don't get that at home no you know where else do you get this yeah it's a it's a freaking ego stroke but i mean you speak in front of thousands and thousands of people you know millions here on the air yeah and you know people actually ask my opinion and some of them care about it and And there's the thing, your name's splashed all over the building. That can't be bad walking in every day. That don't do it.

That don't do it. No, I'm kidding. That gets boring fast. But, I mean, really, it's a great job. Well, it is. And, you know, you talk about this all the time. I mean, when we look at the problems in our culture. You know, I've never run into anybody in 30 years in a restaurant that came up to me and goes,

you know, Ramsey, you got me out of debt. My life sucks. I hate you. Right. That has never been said to me. Doesn't happen. I've had people mad at me about other things. Like, you don't need to talk so much about politics.

You're mean on the radio. I hear that kind of stuff. Yeah. But nobody ever said, you know, you got me out of debt and I hate you. It's true. It's absolutely true. I just never got that in 30 years. So, no, it's fun.

It's a good question. Everybody loves to give their opinion.'s why that whole uh remember jay leno our friend you know these social media is people their opinion they'll tell you anything yeah yeah social media is a wreck for that very reason oh yeah there's a bunch of people in opinion that shouldn't have one you know it's just crazy so um that's why you do. I like stirring up a ruckus. Yes. All right. Julie's with us in Atlanta. Hi, Julie.

Welcome to the Ramsey show. Hello. How are you? Better than I deserve. What's up? Um, I am currently, um, changing employers. So I'm leaving my current company and, um, I'm over 55. Um, my husband and I are fairly new to Baby Steps.

We're only three months in, so we're in Baby Step number two. It's my understanding that I can cash out the 401K that's with my current employer since I'm 55 or older without penalty other than the taxes that I owe. So I'm wondering if that would be a good idea to put towards our debt snowball and then the best way to break up that snowball to have more of an effect. What do you do for a living currently? I'm a physical therapist. Most all 401ks are 59 1⁄2.

I have run into one or two particular occupations that are 55, and I don't think you're one of them. I think you might have bad info. I don't think you can cash it out to 59 and a half. Even if you can, I'm going to tell you not to, because I have a sense that you have the income to go ahead and clean up your debt now that you've decided to without destroying your retirement to do it. How much is in the 401K?

This one is only like $17,000. Okay. I've changed jobs over the years. My husband's a football coach, so we've moved around. So I have a lot of them that I could roll in together, and I just haven't done that. I would get with a SmartVestor Pro and roll them all and get them in one place so that you can manage them in good mutual funds.

And then I think you're going to find that this 17 is going to be taxed and penalized. If it is, that means it's going to be like a 30 or 35 percent hit. Right. And you wouldn't borrow money at 35 percent interest to pay off this debt. Right, right. So in that reason, I would roll it over. Yeah, I think it was Clark Howard or something said you could do it at 55, but that, again, it might be bad info.

Who did? Who told you that? Clark Howard didn't tell me that. I mean, I heard on one of his radio shows. Clark, he may have been addressing one of the particular occupations, and there's a few of them, and I'm pretty sure you're not yet. Okay. It's usually some kind of a special school district thing or maybe a railroad person, something in those areas.

It's not a mainline corporate job like you've been having. So, you know, Clark's a friend of mine. He's very smart. And so probably who he was addressing at that moment was in that area. But most all of them are 59 and a half. So I'm going to tell you to roll it with the others, with the SmartVestor Pro, not into your new 401K, but into mutual funds, into a good rollover IRA, into good mutual funds.

Alex is in Boston. Hey, Alex, what's up? Hey, not much, Dave. How are you doing today? Better than I deserve. How can I help? All right, excellent. Well, Dave, so I'm on Baby Steps 4, 5, and 6. I'm holding no debt except for my mortgage. I pay approximately $2,600 per month.

I'm contributing 15% to my 401k. I make about $150,000 per year working as an outside sales rep. I drive approximately 30,000 miles a year for work. Now, my employer provides me with a company car. I've had it for about 10 years, a couple cars over 10 years, and I just received word that that benefit will no longer be available come July 30th. Wow. No notice, huh? No notice. It came as a shocker to me actually this morning. My question is, I have a large commission check coming at the end of the month.

How large? Give it $21,000. Okay. Yeah, that's probably just buy a car with it. That's what you're going to need to do. You don't want to drive too expensive a car because whatever you drive with the miles you put on it, you're destroying its value. You're a road warrior.

And so this is a cost of doing business so they just gave you a pretty substantial pay cut even if they're giving you a car allowance they're doing this because it's good for them mathematically so pay cash for something that you can wear out and that is reasonably comfortable and reliable but you're going to wear it out and you're going to destroy its value so yeah yeah, 20 grand is probably max. This is the Ramsey personality, number one bestselling author, is my co-host today in the lobby of Ramsey Solutions on the debt-free stage. Chris and Caitlin are with us. Hey, guys, how are you? Hi. Hey, how are you? Good to have you guys. Where do you live? We are from a small town in Ohio, Belleville. Okay, what's that near? It's about 20 minutes south of Mansfield. Got it. Okay, cool. Welcome to Nashville. And how much debt did you guys pay off? We paid off $56,081.70 in 17 months.

Way to go. And your range of income during that time? We pretty much stayed right about $90,000. Cool. What do you all do for a living? I do quality control for a pharmaceutical company. And I own and operate a construction business with my brother. Excellent. Very cool. Very cool. What kind of debt was the 56 000 a little bit of everything dave we had student loans uh a truck payment tractor payment uh credit cards medical you you name it we had what was the biggest debt? Student loans. Okay.

How much was that? Right around $25,000. Okay. So almost half of it was student loan debt. Yes, sir. And who did that? Oh. All right, Caitlin.

All right. Cool. Because he did the truck and the tractor, so we know what happened there, right? I doubt neither one of those were you. All right. Good. So it sounds like we're about even here. How long have y'all been married? Two years.

We're going on two years. Okay, so just shortly after marriage, you come home and you say, we're going to get out of debt. Tell us how that happened and how you got connected to us. Yeah, so really I think she came home and she said, you know, I heard of this guy, Dave Ramsey, and I said, okay, who is that? We just got married. I don't want to hear about another guy right so she continued on saying uh well let's just take a chance listen to his podcast

hear him out and and i did and and we were already so broke at the time i said we have nothing else to lose let's let's try it why not yeah why not we're not going anywhere but down might as well give old ramsey a shot that's great i like it so what was the first thing you did after that started paying off the credit cards stopped using the credit cards so you got you got a game plan together you said we're going to work the baby steps yep yep and did the debt snowball and the little list was the credit card yep okay good it was just a force to be reckoned with from there it just kept tumbling and tumbling okay so once you saw it happen and then and it's game on you know then it starts what was the craziest sacrifice you did to get out

thing where people kind of rolled their eyes at you yeah i think uh you know it's one of those things where you keep got to keep your nose on the grindstone, keep pushing because you're going to hit a point where you're like, man, is this really – this is tough. And, you know, that's where the teamwork comes into play. And, you know, without Kaitlin, we couldn't have did this without her. So – and I was out 8, 9, not getting home until sometimes 10 o'clock at night trying to sell jobs and – Hanging drywall.

Hanging drywall. You name it. Just out there hustling trying to get this paid hanging drywall hanging drop you name it just out there hustling trying to trying to get this paid off yeah just whatever it took right whatever it took all the way through was that outside of your company with your brother you're doing handyman any kind of odd construction job you could find pretty much yeah wow good for you guys how's it feel to be free amazing feels great who were your biggest cheerleaders outside the two of you? I think, honestly, it would be my younger brother and sister, Autumn and Aiden.

They've been with this journey from before the beginning. They were our reason why. They were our first reason why. At 19 years old, get a phone call. I go pick my brother and sister up. We didn't know what that was going to turn into, but I think it's the greatest thing that happened to the both of us. It turned us into mature adults at a very young age. Uh, we ended up taking over custody of them. Oh, wow. And they were

right around 10 and 14 at the time. Uh, we were 19, 19. So we have two kids here now. We're like, what the heck do we do? And we're broke. Two kids don't know what to do. We're broke. So we got to figure out a game plan, and we got to figure out something fast because you look at the generations before you and the generations growing up with you, and you say, is this what I want? And if the answer is no, then you've got to do something about it.

You've got to make the change and create your own destiny. Yeah, so when you're wearing shirts that say Change Our Family Tree, it means a lot. It means a lot. Yeah, because you really had to step into a broken situation and man up at a very, very early age. I'm so proud of you guys. You're amazing people. Thank you. Amazing people. And along the way, you had a baby we did all right and so how old's the baby she's

11 months now awesome and what's her name reagan rose okay and she's got some built-in babysitters and they do a great job that's great that's awesome very very cool well i you know i gotta ask you know you're you're in the midst of you know a life-changing relational situation and then you decide okay we're gonna make some life changes financially was there a point where it got to be like this is so overwhelming how are we gonna do this i see you're shaking your head take us there um i think when we were eating, what's that dollar dinner? Hamburger helper. Hamburger helper three times a week.

And the electric got shut off because somebody didn't pay it. That was pretty stressful. And kids always need food, always need clothes, always want to do stuff. And we were the ones there. So that was really the I had it moment when we didn't have any money. We didn't have anything. There was nothing left over for us. And you guys are how old now?

24. Wow. Wow. It's pretty powerful stuff. When you're 34, where you're going to be sitting, it's going to be amazing. The honor and the nobility that you have shown in your life overall for your whole family, it's breathtaking, number one. But number two, where that's going to take you to,

if you continue to live your life with that kind of character, where you're going to go is going to be amazing. Just this little bit of $56,000 worth of debt is a big hurdle, but it ain't nothing compared to what's coming. Your future is so bright. It's true. Yeah, I want you all to know that the strength that you have acquired during this struggle, I don't even think we can possibly define it. I don't even know if you know how strong you all really are now with what you've had to overcome. It's truly inspiring. It really is. Well done, y'all. You're amazing. We're so proud of you.

Thank you. Proud to know you. Very well done. Very, very well done. What advice do you have for somebody trying to get out of debt? You did it. I think faith, or we think it's faith and commitment. Number one, faith in God, and then faith in each other, and then faith in your budget, and stay committed to your budget, and stay committed to one another. And if you can do that, you can do anything. Amen.

Amen. What about you, Kaylin? What do you tell people the secret is? I would definitely say the same thing. I'd also say even when you don't like the budget the budget is there to help you that's right that's i agree with that one agree with that one very well done all right let's get the whole gang up here the new baby the brothers and sisters that are now part of the family everything this is a family tree that has been changed by so much

but most of all by the incredible character and nobility this young couple very very well done oh she's so cute oh my gosh unbelievable beautiful beautiful beautiful all right it's chris and caitlin autumn aiden and reagan from ohio what an incredible story 56 000 paid off in 17 months, making $90,000. We got a copy of Baby Steps Millionaires, Total Money Makeover, and Financial Peace for you to say we're proud of you and to take you into the next part of the journey.

Count it down! Let's hear a debt-free scream! One, two, three. We're debt-free! Yeah! Yeah! Wow! three we're dead free yeah wow wow you're 19 years old and you take custody of your 10 year old little brother and your little sister unbelievable and then we get married have a baby and let's get out of debt

oh there we go. While we're at it. Oh, my gosh. That's just enough to take it on. But this is how lives are changed when people like that step up. And you don't have to be 104, and you don't have to have a PhD, and you don't have to have a million dollars. You just got to have character.

Man, that's impressive. This is The Ramsey Show. Kanskje vi kan ta utsikt på det? our scripture of the day first peter 4 88, Above all, love each other deeply, because love covers over a multitude of sins. Oliver Wendell Holmes says, Sin has many tools, but a lie is the handle which fits them all. Ooh! I've never seen that. I haven't either. I'm a big fan of Oliver Wendell Holmes. That is a great quote sin has many tools but a lie

is the handle which fits them all yeah brilliant brilliant metaphor there i gotta chill that's just there's so much going on in that little quote that's uh that's um the oliver wendell holmes that's how you do that right there if you're him. Wow, amazing. Rebecca is in Detroit. Hey, Rebecca, welcome to The Ramsey Show. Hi, Dave. Hi, Ken. How are you guys? Great.

How can we help? Good. I just wanted to give you guys both a shout-out. I've been such a big fan, Dave, growing up, listening to you driving home with my dad in the car. Like, from a young age, I've just been so impacted by your ministry. And then 10 later on, my college years, I found you and I've just been like a huge, huge fan. So thank you both for all that you guys have done. And thanks for taking my call. Sure. Thank you. How can we help? Yeah. So I'll give you a little bit of stats here, and then I'll kind of ask my question.

So I have been married for two years. My husband and I take home about $155,000 a year. Last month, we paid off the last student loan debt, so we are officially debt-free. Yay! How old are you? Yeah. So I am 28,. My husband is 29. Good.

Way to go. Yeah. Thank you so much. Currently, we have about $60,000 in liquid cash, $100,000 in our 401k, and we net about $4,000 to $5,000 that we can put in savings. So my question to you guys is, my husband's mom unfortunately passed last year, and we're going to be inheriting about a third of her paid-for home. So it's looking to be about $80,000 to $90,000 that we would be inheriting. And we're in the process of figuring out if we want to just pay cash outright and save for our first home

or if we, you know, would take on a mortgage and, you know, finance a portion of it as time goes on. But we're comfortable right now. We live in like a two-bedroom, two-bath. But we're just trying to make the most wise decision. We are renting right now. Okay. And so you've got $60,000 cash. Some of that's your emergency fund. How much do you think that is your emergency fund? That's about $20,000, Dave. Okay. So $40,000 is available cash plus the $90,000

you're going to get from the house, right? That's correct. So $130,000. Correct. And then the one thing I just want to add, and I'd love to hear Ken's insight too, is I'm actually thinking about doing a career change down the road here with starting my own spa business for massages and facials. So we're just trying to figure out if it makes more sense for us to just, like, wait, you know, and save so that we can just pay cash for a first home or you know um our income might change down the road so we're just trying to make the best decision i assume your income's going up down the road yeah yeah why would you make a career change where your income went down

oh i was just we were just considering down the road if we come to the decision when we want to have children, if I were to stay home and focus on growing, you know, my business, you know, it's just down the road if our income changes by one of us staying home. That's not a career change. That's you deciding to go home okay a career change as you move into massage therapy

yeah yeah so i would i would actually you're wandering all over the place you need to decide what you're going to do and then that'll help you decide what you're going to do if you want to own your own massage therapy business or whatever, you can get that to a point, build that up to a point to where you can go home and run the business, be the founder, CEO, and have people replace you. It gives you a lot of options, but you don't need to be too worried about that as it relates to this question about the house. Buying a house.

That's kind of down the road of the only question is this do you want to buy a house with 130 000 down now or do you want to wait and save up the entire amount that's the only question all the career crap you decide later yeah for sure no thanks for that i would say we're just so like focused on being debt free obviously okay so I would say we're just so, like, focused on being debt-free, obviously. Okay. So we're just thinking that, you know, we want to just wait and save. Okay, and wait and save. So we can just purchase. Yeah.

So what is the target? What are we saving? How much is the purchase price of the house that you're going to pay cash for? Yeah, I mean, it probably would be between 220 to 50 so we would want to so you got 130 so you need another hundred thousand right so how fast we're going to have another hundred thousand making 155 with no payments pretty fast two years two years yeah do it two years yeah you're gonna be 30 and you're gonna pay cash for a 225 230 000 house you got two years yeah budget it do it lay it out as a goal break it down attack it

i love it and you're comfortable it's not like your life is uncomfortable you're comfortable absolutely do it you're gonna pay cash for a quarter million dollar house when you turn 30 years old and your mom helped you with a little bit of that or his mom helped you with a little bit of that and that's honoring to her it's honoring to her memory it's very cool yes do all of that and then decide what you're gonna do with the massage therapist staying home with a kid that's not even here yet so you know you can't, okay, we don't plan, when you plan a career change, you plan it to make more money or make as much money unless you're just simply going to quit and go home. Right. Right? That's right.

And even then, you plan, can we live on his income then? That's right. And have our dreams come true. So what's happening here is, Dave, is we hear this a lot, is that people are following the baby steps, which is the best plan for financial wealth. And what happens, though, is you start to go, wait a second. Do I keep following the financial plan? But what about my professional decision?

No. The financial plan works in lockstep with any decision that you would make, but you stay on the financial plan. So in this case, you focus completely on what is the best financial decision that we want to make. If they want to buy a house, cash. Then do that. And that doesn't change what you might want to do down the line. You make your career and professional decisions within the context of financial peace.

And by the way, it always works out better. Within the context of our financial goals. That's right. So you make X today with your current career, and you need to start doing massage therapy and building the business on the side hustle. That's correct. That will add money to your house fund while you're building this other business up and then when it gets big enough that the step is not a very big step you take the step that's right

to doing it full time and or you adjust the way you do the business so you can stay home and manage the business from home that's the new kiddo which is what you said earlier that was a brilliant insight well it's what we do with entree Leadership. Entree Leadership is why we help people go from entrepreneur, and then they begin to have to hire. And so they got to now grow the business. And that's what we do over there. And so if you're going to start something, I want you to start something and keep it and take that season to be a stay-at-home mom. Oh, by the way, you're a founder and a CEO, and you've got a great team in place. And so you have the option that when the kid goes to middle school team in place. And so you have the option that when the kid goes to middle school or whatever that looks like, you have the option to continue to go back

into that role and keep that business as a vibrant organism that continues to spin off wealth because we're debt free in every other area of our life. That's what we want you to do ideally. Don't give up the business necessarily unless you're going, you know what? It's not a passion play. So here's the play though. Here's what I want folks to hear out of it. The essence of underlying on this call. There's two things that are mythology.

If I do what I love, I make less. Correct. If I do good work, that's a spiritual calling. I make less. Both of If I do good work that's a spiritual calling, I make less. Both of those are mythology. Yep. If I transition to being self-employed, I make less. Also mythology, assuming you choose to do those steps properly following the Ken Coleman method. Right.

And then you're going to be there. That puts us out of the Ramsey Show and the books. Thanks to Austin, Ben, Zach, Andrew, and James in the booth. I am Dave Ramsey, your host. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus. Dave here.

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