The Ramsey Show - App - Should I Focus on Investing or Paying Off Debt? (Hour 2)

Episode Date: February 2, 2024

🎵 Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, other host, Rachel Cruz, and we are taking your calls for the next couple of hours on your life, your money, whatever it is that's going on in your financial situation. We'd like to help you with that. So give us a call. The number is 888-825-5225, and we'd be happy to give our two cents. All right, let's go straight to the phone lines. We've got Trevor in Tacoma, Washington. What's going on, Trevor?

Hey, thanks for taking my call. You bet. Yes, I had a question. Me and my wife have been paying off debt for the past seven years slowly, but we have two items left, which is our house and my student debt. Last year, I started investing through Fidelity and within six months, I've put in about $10,000 pretty much from side hustles. Okay. And my student debt is around that same amount, $10,000. It's the last debt I have. I feel like I know the answer, but I'm wondering

if I should pull that and pay off the student debt. I haven't made really any money in the stock market, only being in there for six months. Is it just a brokerage account or is it a retirement account? I have two. I maxed out last year and then I've started this year. So in the Roth, I have about $7,500. And in a just normal brokerage, it's about $1,800. I would not touch the Roth. It's retirement. And I do not want you to start the habit of, if I need money, I pull it out of my retirement. Now, if you had single stocks laying around, listen, what's in the brokerage is technically up for grabs. It's not a whole lot of money, but it's some money. What I really want to hammer home, though, is the idea of just stay the course.

Like, it sounds like you understood that the plan is for you to pause retirement until you finish paying off debt. But it sounds like, and I relate to this because when you said seven years, everything in my body went, I know about that because it took my husband and I seven and a half years. And it sounds like you kind of got a little bit weary and maybe felt like you were getting behind. And so maybe you started investing. And I just want to encourage you from this point on, listen, I would stop investing and finish paying off this debt. Like I said, don't touch your retirement, what you've put in there already. If you want to encourage you from this point on, listen, I would stop investing and finish paying off this debt. Like I said, don't touch your retirement, what you've put in there already. If you want to

pull what's in the brokerage, you can. There's no penalty on that other than maybe a little bit of tax on it. How much do you guys make a year, Trevor? We're a single home income. I stay at home and homeschool two kids, and she makes about $70,000. So you guys have been paying off debt for seven years. What was the debt you guys paid off, and how much was it? It was actually my side. We got married a few years ago, and it was all my side debt. And it was, oh, gee, the whole story of me being in the military overseas and my other significant other not paying off that and it just stacked up racked up and it was horrible gotcha gotcha okay

i was talking about credit cards repossessed cars yeah so you guys have been through it trevor i mean to jade's point i'm like seven years but but honestly um so i get the you know there's a weariness there we're just like oh my gosh but yeah but what you've done though so far which is one of the biggest obstacles for people is to change what you believe about money right there was one set of beliefs that you had overseas in the military that got you you know those choices created an outcome that you said, I don't like this outcome. So you have been working your way right out of this. So I think that one of the biggest, again, hurdles you've overcome that is, hey, I'm going to look at money

differently. But then you get into the details, into the kind of the nitpicky stuff, like we are here at Ramsey, where we're like, pause retirement, like, there's certain things you do for a reason. This isn't just for the heck of it. It's because of what we've seen over time. And this last bit, Trevor, I mean, this is like- Home stretch. I know, I hate to even like relate it to this, but I just watched a video.

It was on Instagram real and there was a- Yeah, I mean, the cars are paid off now. Is there a way I can do both? Maybe make a higher payment on my student debt? No, I think you just pause it you're going to be okay for a year yeah for a year and and you guys make 70,000 and I would even Trevor I'm like if there's anything like at night that you can go do if you can make a side gig of you know with a thousand bucks a month like that's going to add to this I mean anything

just where my money came from with side gigs. There you go. What about the 70? Do you have anything that you guys, from just a lifestyle standpoint, that you can cut? We've been cutting the past two months subscription. Okay, good, good. So you're kind of back in it. It's that fuel, but it's almost like you're limping a little bit to that finish line, and I want you to sprint.

I just want you to get there, and you're going to be okay if it pauses for a year. How old are you guys? 33., I just want you to get there. And you're going to be okay if it pauses for a year. How old are you guys? 33. Oh, yeah. You guys are fine. Jade's got, yeah. Jade, give us the math.

I love walking you through this. Okay. You said you're investing a little bit now. What percentage are you investing? How much a month? Again, it's not from our actual account. It's from me doing side hustles. Still.

It's around $1,000 a month. Okay. You're investing $1,000 a month, which month which means obviously when you have this debt clear you'll have that and more to invest right so let's just pretend that you said right now there's 75 in your roth i'll just put it at 5 000 just to be i'm gonna make this like so foolproof and let's say that every month you do an additional thousand dollars every single month. This is after you're out of debt. This is after you're out of debt.

And this is I'm going to do like a super conservative rate of return. I'm going to say 8% just for all the hater aides out there to just calm down. And let's say you retire at 33, right? Let's see how much money that would be for you. Oh, shoot. No, not retire at 33. He has 33. Oh, he has.

He's I'm saying for 33 years, for 30 years. In okay i'm sorry i'm sorry yeah yeah wait rachel keep the conversation going because my computer's being yeah yeah so he's 33 and let's say in 30 years you decide that yeah i'm going to retire at 63 yeah 64 uh the beautiful thing is that you'll see what the decisions you've already made with the roth which again would not um completely agree with because you still have debts but the proof is is that even if you waited one more year didn't contribute anything to investments or retirement paid off this debt went back to investing in retirement and put money away in 30, 33 years. Dude, $1.5 million in 30 years. And just pause this year. Yeah, you're still good.

My point is you're still going to be just fine. Sorry for the delay. My computer was not doing what I wanted it to do. But that's starting at $7,000, which you said you have 75 in your Roth right now. That's a 30-year term. You're in your 30s now. You're going to invest.

You're going to retire in your 60s. It's a very conservative rate of return that i put in here you're going to do better than that rate of return i'm just letting you know and this is a thousand bucks a month like come on now and then 15 of your income to you with that 70 000 i would push you guys to say yeah instead of that going you know to debt that's going to be now going to investing and this is assuming nothing changes like you're going to earn more money you're going to have more opportunities like i just want you to see worst case scenario is 1.5 million dollars yeah come on rachel cruz oh my goodness i'm so excited i feel like people need to do this more people need to run out the numbers and stop letting it circle above their head

and cause them- And the fear that's out there. Yeah. It's like you're over here getting a stomach ulcer because you're like, I'm getting too old. And I used to feel that way. My husband and I didn't start investing until our mid thirties.

And now I see like, we're going to be just fine. And you're going to be just fine too. Work the plan as planned. It works every time. This is The Ramsey Show. You are listening to The Ramsey Show. And by the way, thank you for listening to The Ramsey Show. We're just so grateful that each and every day you guys choose to log in or go onto YouTube or go to your podcaster and pick our show to listen to. That's great. We're

here because of you all. And we just want to encourage you to keep doing that, keep liking, keep subscribing, and really keep sharing it with people that you think will enjoy the content that we give to you guys every single day. It doesn't cost you anything, and it really is beneficial for us and for the people around you because they get this wonderful resource but it also helps us because it just helps the algorithm favor us a little bit more above some of the other things that are out there so if you like this tell other folks about it you know they might have their crime podcasts that they like but like tell them about the Ramsey show it's me it's not listen these crime podcasts I don't Rachel I don't get it but i'll send you one

i don't know if i can watch it i feel like no it's a listening you listen listen okay yeah you don't want to yeah there's nothing scary you see you just listen to ready i got i got you something oh rachel cruz loves her a crime podcast jade warsh your other host, is fearful of them. But, you know, listen, as long as we're part of your daily routine and you listen to a little bit of The Ramsey Show, then go listen to a little bit of your other podcast. So, so funny. Well, anyway, my point was to tell you that we appreciate you and keep doing what you do. We're going to go to the phone lines where there's Tony in Rochester, New York. What's going on, Tony? Hi. Hey. So I'm calling because I am quite a bit in debt. It's gotten to a point where after I pay my bills and subscriptions and things that I got going on, it's the amount of credit card that I got, it's pretty much takes over the rest of the paycheck.

And we're trying to manage it. I'm looking at options. I sold a car, considering maybe selling a house. A house? Do you have more than one? No, the house. The house, okay. Yep, selling the house. And maybe using that to bring them down.

I make about $100,000 a year. Is that including your wife? I know about... What's that? Is the $100,000 including your wife? No, it's just me. Just you? Does she work outside the house?

Well, that's our household. She's at home. Okay. I'm the one that's working outside. How much credit card debt do you guys have? We got about 126, 126,000 in credit card debt. Yeah. And what's the Tony?

So, yeah, no, no, it's okay. I can hear it in your voice, Tony. I mean, it's, um, that's hard. That's really hard. What caused, what was the reason for that? Well, um, I was out of work for a year trying to figure out different things i attempted uh some things on my own as well i wasn't able to make enough uh to to get us uh out of you know to be able to sustain us for a long time start getting that uh starting getting

uh credit cards to be able to manage uh uh you know until i finally got a job and then it's grown because once once i guess there's a point of you have enough debt the payment get it to uh get you to a point where you can't make it's it's what's left is not enough so you gotta continue getting more and more and more and more we haven't been able to manage reducing the expenditures enough. Yeah. So how long have you been in this job that you're in now?

How long has it been? About a year. Okay. So when did you decide, when was the point for you that you were like, I got to do something different. This isn't working.

Well, as soon as, I'm looking at the numbers. I mean, two years ago, a year, well, for a while while we've been wanting to do something but it's uh just become quite urgent now so we're trying to figure out how much are you paying every month how much are you paying every month towards these credit cards probably 3,500 a little more 1,500 3,500 oh 3,500 okay. And is that... That's the minimum payments. That's the minimum payments.

Wow. Yeah. And you mentioned a car. Yeah. Tell me about the car situation. So we have two cars. One of them, I ended up having to spend quite a bit in repairs and things like that. And I said, well, you know what?

I got it fairly nice, but I didn't want to continue. And so I have another car that's newer and it's in good shape. I don't, I mean, I own loans on them. So can I, sorry, just to clarify. I only have the one car right now at this point. Okay. So there's one car, the car that you said you didn't want to you know continue with what did you do with it do you still own it does it just need the repairs you sold it sold it okay so now you're a

one car family there's one car family for now yeah okay and the car that you have what do you owe on it and what's it worth it's it's uh i owe about 30 000 on it it's probably worth the same amount maybe a little more. It's fairly newer, so it's kind of... Okay. The loan's a little over what that car is worth, so if I were to sell it, I don't know that I'll get my money back. Yeah, you'd be underwater in it.

And there's no... You have no savings, I'm assuming. Nothing saved anywhere. Not... Well, just a little bit, and I... Very little. Okay, that's off limits. What I want to ask about, sorry, I'm going to pry, like I'm putting my crowbar in and I'm prying out.

Your wife's a stay-at-home mom? Yeah. How many kids do you have? She's actually online too, she's hearing us. Oh, hey girl. Hi. Hi. Hi.

Hey, so you're staying at home. You're doing, you know, you're doing some heavy lifting. How many kids are you watching and taking care of? Three. Three. And what's their ages? We're already, our oldest one is 11. Uh-huh.

Andrea's eight. And the youngest one is six. Okay. So when I'm listening to that, I'm hearing school-aged kids, which is great because that daycare bill is not a thing. So my question is, and I'm going around this delicately, but I think there's room that you can work as well because right now the most money that you can bring in

is what's going to break this cycle. Yes, yes, yes. I'm just trying to make smart choices. Like I was telling him, it's just difficult to sit down and search, you know, like a search for a job that is prudent terms of uh knowing the the hours minimum per hour and yeah just with one car right now we uh are managing so he takes the car for the most part right now or or if not the bus it is a bit difficult but yeah that that is my main goal well i always say get i always say get a job until you get the job because right now okay literally anything you do is going to help you guys out yeah if you drop the kids off and go work at a bakery you know for you know whatever

it is like go yeah doing something because um and what's your name can Can I ask? We have Tony and... Inez. Inez. Inez, okay. Yeah. It's not that I haven't tried. I believe, sure, sure. To come up, like, with the side jobs, like staging. Yeah.

Because here's the deal, you guys. I know Tony had mentioned, or at least it's here on our screen, one of your biggest questions was debt consolidation. And here's what I want to... So here's the deal, you guys. What's going to fix this issue is you guys. It's not rearranging this credit card debt and trying to find a lower interest rate. That's not your problem. The problem is, is that you guys lived a cycle with your money that got you in this problem and in this mess. But the beautiful thing is, yes, you were the ones that got yourselves in this mess, but you're the ones that's going to get yourselves out of it. Okay. And so listen to each other because this is the stress point because

you're starting to make that turn of saying we're going to do something differently. She's looking for a job. You've sold a car. I mean, you guys are feeling this tension. You're starting to make these choices. You're getting in the right direction. So stay on the same team because Tony's not feeling great about himself. And when I heard you, when I heard your voice immediately, Tony, I thought he's caring so much. There's a lot of shame. Yes.

There's a lot of guilt that you feel, Tony, like this was my responsibility. I tried taking care of my family and this is what I got us in. She is supportive. She sounds wonderful. You know, she's wanting to help. But you guys together, you have to work as a team and stay on the line because Austin's going to pick up. And we're going to give you Financial Peace University and Every Dollar Premium, which

is our budgeting app. And you guys sit down together, go through these lessons, learn the basics. Because debt consolidation, that's not going to be your answer. Yeah, not the option. You are your answer. Yeah, not the option. You are your answer. You guys can do this. We take these calls every day and hear people that do their debt-free screams. I mean, Jade is a living testimony of this, of you guys can do this.

It's going to take a long time. It's a lot of sacrifice, but it is possible. So I'm so glad you guys called today and we wish you nothing but the best. You guys can do this. Hey, you're listening to The Ramsey Show. I'm Jade Warshaw. This is Rachel Cruz to my right. And we're taking calls about your life and your money.

Just came off of a call. And, you know, honestly, we get calls all the time of people, you know, they're in a hard financial situation. And, you know, we're asking questions and mining around to kind of figure out what's the core of the problem, where the problem come from, how can we go about a life that we're not repeating those mistakes again. And you kind of do have to dig in and each individual kind of has to go back and do their own digging so that they're figuring out what happened here. Like, it's good to want to solve a problem, but you also have to go back and go, okay, but what happened? Like, what caused me to to act in that way? What did I do that caused us to kind of spin out?

And we try to help you guys with that a little bit. And some of that is personal work. But one of the themes that I notice, Rachel, is and I get this like this is not me pointing a finger. This is just, I think, a human nature thing that we have to guard against which is you know everybody has work in the words of ken coleman that they were created to do and everybody wants to find the work that they're created to do and the thing that gives them life and the thing that gives them energy and i'm all for that you know you want to be excited to go to work and feel like it's time well spent um but i do find that a lot of times we enter into seasons of life that we are doing work

that we don't love and it's not the job and it's not the one that we were hoping for. And you'll hear me say it time and time again, do a job until you get the job. And so in the spirit of what I think is just a consistent thread that we see throughout and even that I face throughout times in my life is five reasons to get any job to go just to get any job all right so number one some money is better than no money that's right right some money coming in is better than no money when COVID hit uh we were in the cruise industry and ain't nobody going on cruises and the live entertainment industry and wasn't nobody going to a live event so I had to get a job and my husband had to get a job I had to get a job that I did not like that to be honest I was

over fully fully fully overqualified for but we didn't want to just burn savings. So it's like bring in some money. Like we were debt free. We have hardly any expenses. Any money that we bring in is going to be great. So we did that and it didn't feel good. And let me just say, I don't necessarily believe that work is beneath people, but in some days it felt like it was beneath me. Like, let's just be honest about that. Somebody needs say it you you know some of you feel like listen I don't I shouldn't I shouldn't be working at McDonald's okay I get that you feel that way but you don't have any money so go work at McDonald's all right and listen just be happy that McDonald's is open because back in the day in COVID it wasn't even open so anyway um some money is better than no money Rachel the next one I have here is your spouse needs to see

who you are. And if you're a husband or a wife and you're facing a very hard time in your marriage, go get a job. Because when they see you at home and you're not working and they feel like they're taking on the burden of that, you can help take some of that off. So go get a job. And then that might encourage your spouse to go get a job. Like that is good. Your spouse will feel like, I remember when I was a kid, like my dad, he just was always working. And I was like, one thing about my dad is like, this man is going to work. Like, and it just, it builds a sense of security in your kids and in your family. Go get a job. And no one's going to be going, well, but my dad only works here.

No one is saying that. They're going, listen, my dad goes out and works hard every day. That's right. Go get a job. All right. Number three, you'll learn what you like and what you don't like. Yes. By testing out all different things.

Listen, I don't like food service. I don't like call center. I don't really like working with animals even though I like animals um yeah I like cooking I don't like making wedding cakes I've done it before it's a lot of work like I can tell you Rachel Cruz the things that Jade does not like doing okay um and I now I know the situations that I do enjoy working in so you'll learn what you like you'll learn what you don't like. Number four, you'll be productive. Yes. And there's just something to be said for, all right, I'm getting up and leaving and doing something. Yeah. Or not leaving, but staying at home and being on your computer, doing something. Yes. Something. You're getting

out of your bed, even if you're putting on sweatpants and going up and putting your little headpiece on and doing your call center job. I'm almost talking about it like I know it. Okay, and then finally, it will build confidence in you because when you go, the longer you go without a job, the more you wonder if you'll ever be able to get a job. So to just go from one job to another says, listen, I've got some confidence. I can say when I go to my next interview, I can say that I'm currently working or I can say- Here's the experience that I've got some confidence. Like I can say when I go to my next interview, I can say that I'm currently working or I can say,

here's the experience that I've had. Yeah. Or at least feel it on the inside. That's right. So there you have it. Five, five reasons to take any job before you get the job. And that was free ladies and gentlemen,

free game, right from Jade Warshaw. That's amazing, Jade. I mean, seriously, because I do think that there is this feeling and especially if you've been in a certain industry or you kind of have your line of sight of like, this is what I do, and you get laid off or you're in a bad situation, you quit,

whatever the reason is, and you still have that kind of narrow focus of this. And to your point, when bills have to be paid, open those horizons and go just do something yes yeah and you know one door leads to another and you never know you might be uh taking someone's burger order and you meet some you know the person taking the order they they have a situation that they tell you about and it leads to the next thing you just you never ever know what's behind a door so don't don't count it out and think that you're above it or think that it's, just keep going. Anyway, I digress.

I gotta take a deep breath. I love it. We gotta go to Brenda in Washington, DC. Sorry, Brenda, that you have to come after that, but what's going on in your world? Hi, so me and my husband are looking to buy a house. We wanna know if we're even there yet

and if we are, what steps financially we should take to get there as far as pausing our investments, continuing to invest or, yeah, what we should do. Okay. Well, what we look at, Brenda, is a series of steps that we want completed before you go and purchase your first home. So are you, how much debt do you guys have? We have about, I think, 12,000 total for our cars and that's it. And that's it? Okay, perfect. And do you guys have any money saved? We have about 55,000 in savings. Okay, that's great. How much do you guys make a year? Combined, we make around $220,000 before taxes.

I don't know what it is after, to be honest. Yeah, okay, perfect. That's a great income. Okay, so if I were you, Brenda, I would pay off your cars today with the money that you guys have saved in that $55,000 account. And then the remaining, I would look to see how much your expenses are a month. Because what we say is

after you pay off all your consumer debt, look to get a three to six months of expenses saved in a fully funded emergency fund. And you can put that money in a high yield savings or a money market. And for you guys, you may want to put some more towards savings um what's the car once you pay off the cars or maybe that's enough for you guys but i want you guys to look at your own budget and figure out okay if we need probably three months you guys have kids no we do have a kid on the way that's part of our oh okay we want to buy a house too that's so great well congratulations when are you due yeah thank you um september in september okay that's awesome um so yeah so i i wouldn't i wouldn't push the timeline of the home with or without the baby okay so meaning like i wouldn't

feel like oh my gosh i have to get in before the baby or what? I wouldn't let the baby's timeline dictate your house timeline. I want your money to dictate the house timeline. So again, I want that fully funded emergency fund. And honestly, Brenda, with the baby on the way, you know, starting to look for a home, I would feel comfortable around that five to six month mark for an emergency fund and just making sure you guys have plenty of cash set aside. And then you want to start saving up for your down payments. And I would say to put at least 5% down and make sure your payment is no more than 25%

of your take home pay. So when you run those numbers, you guys can kind of look now you're in, you're in the DC area. So you're in an expensive part of the country, real estate wise. So your expectations and our formula, we get knocked on it sometimes. It is more on the conservative side, but I don't want this house to be the thing

that stresses you guys out. So it may take maybe another year or two or depending on what kind of house you guys are looking at to really kind of slow down and say, yep, let's get in a good position, have a good down payment and making sure that it's a reasonable payment within our income to make sure to pull the trigger. So I hope that's helpful, Brenda. And if you go to ramseysolutions.com,

we have tons of articles and free content on home purchasing. So make sure to check that out. You're listening to The Ramsey Show. Hey, by by the way a couple of days ago we did a Q&A after the Ramsey show all on budgeting and it was it was really cool it was live it was George and I here in the studio it's still on the YouTube page if you want to go and check that out if you have any questions about our budgeting app every dollar which is the best budgeting app in the world. We did a live Q&A where we had EveryDollar pulled up on the screen. George and I were just kind of little characters in the corner. So you can really see how the budgeting app works. And we answered, Rachel, gosh, probably eight or 10 questions in depth. And I mean, it's questions that most of you have all the time. How do I do sinking funds?

What do I do if I get paid four times a week? Do I do my budget by week or how do I do it? We answered all those questions. We talked about, gosh, paying off debt. So many just everyday questions. So if that's something you're interested in, find it on our YouTube page. I'm sure they'll pull it up at some point

or maybe even after this segment. So stay tuned for that. It's so valuable. There it is. It was really, really cool. I think like over, gosh, the numbers on it were crazy. I'm not gonna sit here and try to quote it. But my point is go watch it

because it was super duper valuable. And I'm sure that we'll do that again. I don't know when, but it was super valuable. So go in there every dollar again, such a great budgeting tool. But like, let's be honest, there's sometimes questions that you have and things that you wanna know about it. And so we're here to answer those questions,

as well as questions about your life and your money, which we're going to do. The number is 888-825-5225. We're here to help. And let's go to Jerry in Phoenix, Arizona. What's going on, Jerry? How are you doing? Thanks for taking my call. You're welcome. How can we help? My question is, I'm 66. My wife is 71. She's been diagnosed and said dementia for three years. I'm sorry. She's supposed to have to go into a long-term care facility.

I've done the baby steps. I have like $5,000 in emergency fund and $20,000 in savings and investing. My house is paid for, but my question is, should I sell my house to pay for her long-term care, which I can't afford on my income? How much does the long-term care, how much is it costing you? What's the cost per month, per year? Cost per month for long-term care is about $7,000 a month, and I take home only $5,000 with my retirements. Okay. And are you retired, Jerry, then?

Yes, I'm retired, military, disability, and Social Security. Okay, okay. So tell us more about your home situation. Okay, I own my home. It's worth about $700,000. I could sell the house here and move into a smaller house for like $400,000. It would be about $250,000. And I could use that to pay monthly on long-term care, memory care. That would only last for maybe two years or three years. Assuming it's not invested. What's that?

The house? No. The $250,000. Are you just thinking of it as a lump sum as it is? Yeah, it would just be my equity out of the house after I sold it. And tell me again, sorry, I was kind of writing down some things. Tell me again what you have in retirement as it stands. Okay, military retirement, military disability, social security, and my wife's social security.

And it adds up to about $4,800 a month. But what are the nest eggs? Is there a nest egg anywhere in there? I've got $20,000 in the savings account and $5, 000 in another savings account for my emergency fund okay let me think i've been trying to get everything you know we're trying to get everything right and house paid off yeah getting there but then this happens yes i'm so sorry and jerry i mean i'm assuming because you called and asked the specific question. I mean, so she will need to be in a long-term care. Yeah, she's getting to a point where I'm not going to be able to take care of her at my age. I'm doing full-time caretaking for her right now, but I'm just trying to look into the future.

I know it's not going to last forever. Yeah, I know. Oh, I'm so sorry. Have you, um, have you looked at other options at other, whether it's, you know, homes or facilities or even in, in home care at all? Um, yeah, I have looked at it. It's a little bit cheaper, but not, not very much. Still going to be about 5,000. Okay. More than I, more than I take home. So yeah. In this case though,

a 2000 difference is a big difference from 5,000 to 7,000. So it is something to consider. Okay. Yeah. I thought about that because the house that I have now, well, I'd have to sell this house. That's all. That's the only thing I get in the interest,

to be able to have money to do anything. Yeah, I mean, I do think so. Yeah, it's a large asset. It's paid off, which is just incredible. And I think it is, you know, you need money for her, right? And so you do have a stream of income in a sense with this. I mean, not income, but you have the ability to get some cash if you do sell this home. What would it look like?

You ran one scenario where you sell this $700,000 home, you take $250,000, you invest it well, and you're pulling off of it for a number of years to only fund it for so long. But that's with you buying a $300,000 or $400,000 house. Is there any situation it's just going to be you in the home, possibly, depending on which route you go? Is there a route where you buy something far less expensive, like a condo, as opposed to a full-size house, even though it would be downsizing, but something even smaller where you've got a larger nest egg

that you can invest and draw off for a longer period of time. That's always an option. I know in the Phoenix area, even condos are getting up there price-wise. Yeah, for sure. Yeah, I mean, Jerry, I'm so sorry. I mean, I probably would, yeah, I would look to to probably sell. And and I think you do have to map out because what I don't want to happen is you sell this paid off asset and there's nothing left for you or you end up running out and then you have to go to another option right um and so um yeah i would run the numbers pretty tightly i probably wouldn't rush into buying something new right now for you um as you go and i would look at other options for um care care as well um i mean obviously we want the best for our loved ones for sure but that industry can vary so, so much.

And you guys, obviously, she doesn't have long-term care insurance or anything, right? That's something I never planned for. I wish I would have. No, I know. I know. Well, and she's so young. You know, it's just, I'm so sorry. Would you invest the money if you sold the house and then try to take the money out of the investments?

Or how would that work? Yeah, I probably would try to take away as big a chunk as possible. That's why I was saying, is there a way that you can do a situation where you're taking the majority of the sale of this and investing it? Because then what you're drawing off of it is much less and you would only draw off what you needed to fund this since you're living since you already have some income, of course, coming in from all of your different retirement options. You wouldn't have to pull much. I mean, we're talking about you said you bring in five thousand. This is an additional seven to five thousand. So it'd be coming up with a retirement option where it allows you to pull off five000 and you're dwindling that nest egg far slower

than if it was a $250,000 nest. Like going in with $600,000 or $700,000 is a lot different than going in with $250,000. So to Rachel's point, like I hate the idea of you being a homeowner and then you not being a homeowner anymore. But I would love if you worked with a professional to see what your options are because A, I want you to be able to take care of her. But B, you're not getting any younger either. And so there's got to be a situation where you're covered as well. And that'll just at the very least, having your options will really just help give you peace about, OK, this is this is what I know I can do. Here are my options. It's not floating around in my head. And being able to choose between a couple of things on paper as opposed to just thinking, all right, this is my only choice. I can only do X. That's right. That's right.

Right. So that makes sense. Talk to a fellow investor. Yeah, we have SmartVestor Pros. You can hop on ramseysolutions.com and check out our SmartVestor Pros. And they're going to help you really see, okay, here's what weor Pros. And they're going to help you really see, okay, here's what we can do. And they're going to shoot you straight

and tell you what your options are. And again, that's going to help give you a very clear picture of what your choices are moving forward. And how to stretch this money out as long as possible, Jerry, right? I mean, I think that's going to be the goal to make her comfortable, to make you feel good about the situation.

But how can you do that while balancing? You have a chunk of money. And how can we get that to go as far as possible? Yeah, tough stuff. But, you know, there are options. And the more knowledge is power. That's what I was trying to get to. At the end of the day, knowledge is power.

So go out there and see how those smart investors can help you. This is The Ramsey Show.