The Ramsey Show - App - Should I Get Into Real Estate Development?

Episode Date: June 7, 2022

Dave Ramsey & Ken Coleman discuss: What to do after you sell your house, Getting into real estate development as a career, Investing an inheritance or saving for a house. 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

I'm out. Live from the headquarters of Ramsey Solutions, 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. This is the Ramsey Show. We help people build wealth, do work that they love, and create actual amazing relationships. Ken Coleman, Ramsey personality, number one best-selling author, host of the Ken Coleman Show, is my co-host today. Thank you for being with us. Open phones at 888-825-5225. Annie is in Minneapolis. Hi, Annie, how are you? I'm good, Dave. How are you?

Better than I deserve. What's up? Well, thank you for taking my call. So last week I sold my house, and later today I'm going to get the profits from that sale deposited into my account and it's going to be $73,000. I'm a registered nurse. I'm a single mom. I'm 28 years old. And at the moment I don't have any savings. I do have $44,000 in debt. And so my plan was to pay off the debt and then I would have $27,000 left over. And I know that that's not a ton, but I guess I'm just wondering the best way to steward

that, you know, if it's savings or if it's retirement or just kind of what to do with that. What do you make? So monthly after taxes and including child support it's four thousand a month you said you're a nurse yes okay what kind of nurse um i work from home at the moment um i was previously working in the clinic but with the pandemic i I took a work-from-home job doing medication refill.

For no money? You took a pay cut? The $4,000 a month, yeah. I mean, yeah. You're an underpaid nurse. That's what I was asking. Okay. Typical nurse is making $60,000 to $80,000 right now.

You're making $35,000 to $80,000 right now. You're making $35,000 or $40,000. Well, that's after taxes and everything because it's $34,000 an hour, and I work over 40 hours a week. Okay. What's coming out of your check? You got health insurance coming out of your check? Yes. How much? um you got health insurance coming out of your check yes how much and then i'll um you know i don't actually have the exact number um i chose the highest tier so it's more expensive yeah how many kids you got one what age nine where are you living now that you sold your house?

I am renting. Just got an apartment? Yes. Okay. All right. Okay. Well, here's the thing. I think you've chosen an incredible career, don't you, Ken?

I think so. She has the sky's the thing i think you've chosen an incredible career don't you ken i think so she has the sky's the limit there and i think you're getting um mediocre to poor results on your career i think you can make a lot more money without destroying your life you have a nine-year-old and um because i you know five years from today you're going to be sitting right here unless you save some money for a down payment, right? Yes. Why did you sell the house? I had taken out a first-time homebuyer's loan, and I wanted to get out of that. I didn't know whether I should refinance or sell,

but just seeing the way that the market was, I wanted to kind of take advantage of how much that the home had gone up in value. Okay. So you can clear all these debts, and you've got no debt now. And if we can maximize your career, you can use the $27,000 to first put an emergency fund of three to six months of expenses aside for your rainy day fund. Then the rest of it we throw to start your new house fund, your new house down payment saving fund.

We're going to separate the two, because you don't need a $ 000 emergency fund in your situation you need maybe 15 okay um and so you got 10 or 12 to put in a thing and then let's get your income up and get you on a budget a detailed plan now that you don't have any payments to rebuild a good emerge or a good down payment and buy a house a couple three years from now what do you think yeah i think, three years from now. What do you think? Yeah, I think that sounds really good. Ken, what do you think about this career? Yeah, I mean, you're making around $65,000 a year. Does that sound about right to you based on what you told us?

So what does upward mobility look like for you as an RN and a single mom? Because here's the good news. Today, you're out of debt. You've got your emergency fund, your three-month emergency fund set up. You're ready to go. And so now it's okay, what kind of goals do I have? And then what finances, excuse me, what financial growth can I now add to that picture? Because if you could be making 80, 85 or more and set yourself up for a great future, all of a sudden you're playing some serious, serious ball now and catching up big time with investing and you're in really good shape for a single mom. So I do want you to at least challenge yourself to say, okay, what could my

RN career look like based on where I want to be financially? How does that, the income, play into it? Because you've got a lot of options on how to use a nursing degree to make money in the open market. I mean, hey, I'm still concerned about your take-home pay. Okay? Because if you're making $65,000 and you're only taking home $36,000, there's something wrong with these numbers.

Okay? Because you don't have $30,000 in tax withholding. How much is your stinking health insurance premium? Well, I think that it is $300 a month. Oh, you said you didn't know. You said you didn't know. That's right. Yeah, I'm not exactly sure. Okay. I think you need to look at that because I think you bought the lowest deductible, most expensive health insurance plan because you're a single mom and you were a little bit afraid.

Yeah. And I think you need to get a big butt deductible. You got $27,000 in the bank. And get that premium down and look at like, are you and the nine-year-old both healthy? Yes. Okay. Yeah, let's get a big old deductible like an HSA, like a $5,000 or $7,000 deductible, whatever they've got,

and let's get this premium down to about $400, $500, $600 a month because I think you're paying $1,400, $1,500. Are you getting a big tax refund as well? It was $5,000 this year, which is the most it's ever been. Okay. Yeah, you need to change your W-2 then because you've got too much coming out for taxes. Okay. What is the child support payment? $5,000 a year is $600 a month. Too much coming out of your check.

That's part of where this money is going. Because basically you've got $30,000 coming out of your check before you get the money home. Am I hearing that right? Yeah. You're getting home with 36 000 and you made 65 so your health insurance you're withholding is there anything else coming out of your check are you were you paying any of these bills out of your check like was your car in there and it was with the credit union or something no it's um also i have an amount going into retirement as well. How much? I'm not exactly sure.

I know I had set that up when I started working. I want you to get down in your numbers again. You're going to have to know your numbers about what your health insurance costs, what you're getting, what you're putting in this retirement, and let's get this stuff straightened out because your check's getting slayed before it it gets to you and i want to know where it's going if i'm you hang on i'm going to sign you up for financial peace university we're going to teach you how to handle money kiddo and we'll show you exactly what to do you call us anytime you need some help because i think you've got the tools right at your fingertips to really prosper and i think you made a good move selling

this house it was a very hard move emotionally but i I'm glad you did it. I think you leapfrog ahead if you get these other things under control. People all over the country are discovering a faith-based and budget-friendly way of meeting health care costs through Christian Health Care Ministries. Christian Health Care Ministries, or CHM, is a nonprofit organization that helps members carry one another's burdens with health care expenses, and they have successfully shared each other's medical bills for nearly 40 years. See if CHM is right for you by visiting chministries.org. CHM is a proud sponsor of Dave Ramsey Live Events. Guys, if you're wondering whether to buy or sell a home this year, we've got some answers.

You can expect the market to be similar to last year. Pete, prices are still going up. They're not going down. You don't need to be sitting and waiting on prices to come down. You're going to be waiting a long time, baby. They're not going down. You don't need to be sitting and waiting on prices to come down. You're going to be waiting a long time, baby. They're not coming down. Prices are not coming down in real estate. You can just tell

people, you heard Dave Ramsey say it right here, prices in real estate are not coming down. Now, what we are going to see is the market's going to slow down. And we're going to quit having 10 buyers for every house that's for sale. And so it's going to soften, and and we're going to quit having 10 buyers for every house that's for sale. And so it's going to soften, and the craziness out of every house that goes on the market, it's a freaking auction, is going to go away.

That's going to stop. This white-hot market that we've had for the last two years is going to stop. But interest rates are going up. We're heading into a recession. It's going to slow down. It's not a catastrophe. It's not the end of the world. And if you're going to buy a house in a situation like this, this is a good time to buy a house. If you are ready to buy a house, if you're out of debt, you have your emergency fund,

you have your down payment, I'm going to wait until the prices don't wait. Prices next year are going to be higher than they were this year, and the year after that, they're going to be higher than that. If you're ready to buy, now's the time to buy. And here's what's than that if you're ready to buy now's the time to buy and here's what's weird if you're ready to sell this is a great time to sell you can't always say that usually one or the other but you can't always say both but right now it's a unique market it is a great time to sell like that last lady that we just talked to she saw she got out while the getting's good but you know if you're gonna prices are up compared to three years ago,

but you can't go back to three years ago if you're a buyer. You've got about a day. And they're not coming back down. So, hey, my Uncle Charlie just got his real estate license. Good God, this is your largest purchase ever. Your Uncle Charlie knows about this much more about real estate than you do. Get away from Uncle Charlie. He's sweet. We love uncle charlie don't buy a house from him get it buy a house from a pro that knows what the flip they're doing list your most expensive asset that

you have with somebody who sells 100 houses a year not somebody who just got their license and is a friend of the family and used to cut hair three weeks ago geez people come on seriously uncle charlie poor guy i mean he's a lovable guy we love uncle charlie but he's not your real estate agent no well ramsey solutions.com slash agent get a high octane high protein agent that's been vetted by us that gets the freaking job done you don't this is not amateur hour you need you need somebody in your corner that knows what they're doing our question today comes from blinds.com they have a 100 satisfaction guarantee that means even if you mismeasure you pick the wrong color they'll remake your blinds for free free samples free shipping new promos they run

all the time you'll save even more use the code RAMSY to get the best possible deal. Today's question comes from Tyler in South Carolina. I'm 20 years old and have been watching the show for some time. I'm wondering what the best way is to get into land development, real estate development. I'm currently trying to decide if I should go back to school and get a degree in either finance or construction management, but I also know that school is not always the way to be successful. Well, amen to that, Tyler. But I have to cede the balance of my time to the gentleman from Antioch to my left

who's done real estate. Dave, does he need a degree? Would it help him if he wants to eventually get into land development or real estate development? I would question that. What do you say? I spent a little time with a developer the other day that is finishing up a $40 million residential development.

He's got a degree in accounting. He's very successful as a developer. There's a lot of moving parts and a lot of bureaucrats to deal with called planning commission, called zoning, all these things, and city people that you work with if you're going to be a developer. And there's a bazillion numbers involved. So a degree in finance or construction management or accounting would be very helpful to do something that is as complicated as land development.

Having said that, Tyler, I will tell you that the most risky category of all real estate investment is real estate development. More people go broke doing that than any other kind of real estate. The most risky. And if you want to really make sure you go broke, put a golf course on it. It'll make you go broke every time. The second guy that buys that, the one that always makes the money, golf courses and ski slopes, the second guy who buys it out of bankruptcy are always the ones that make money.

The first one just turns his dream into a nightmare. So at 20 years old, you're not going to be a developer if you're smart. You're going to spend a lot of time studying your craft. You're going to be working for a developer. That's the key. You're going to spend – this is the type of industry that you need to spend 10 years in apprenticeship before you actually do a deal. Yeah, I would add that, Dave. You know, if you believe in the degree there, it's going to give you some real knowledge.

That's great. But I got to tell you, the School of Hard Knocks is also a wonderful school. And going to work for men and women who are winning in this field, where you can watch how they run the business. Head on a swivel. So while you're going to school, I'd be working if you can. Work for a developer. Absolutely. Even if it's summers and breaks. Get a real estate license and sell the lots for them. I love that.

Go to work for them. Get every angle from this side of things. Take the desk job where you work with the bureaucrats and help push the zoning through. Get a degree in engineering or accounting or even architecture because you're going to need all of those things when you're developing property. I mean, you're putting in streets and sewers and lights and water, and you're putting in amenities to go with the development or not. You're making all these decisions. You're getting all the zoning done. There's so many moving parts in it.

It's a very, very high-risk endeavor. And I got to tell you, I've been doing real estate over 30 years. I grew up in the real estate business, and I can count on one hand the number of people that were doing developing when i started that are still doing development yeah it's tough it's just it's it's it's it's just uh it's a real quick way to go out and to get to get taken out jordan's with us in vancouver hey jordan welcome tosey Show. Hey, thank you so much for having me. Appreciate it. Sure. How can we help? Long story short, it has to do with cars and money. I'm

pretty sure you're familiar with that topic. Basically, a friend sold me a lemon of a car, and I'm trying to figure out if it's something that I should be fighting to get some sort of compensation back for, if it's something worth jeopardizing the friendship over, because they kind of basically ended up saying that, hey, sorry, it kind of sucks, but not really my problem. I feel like they've jeopardized the friendship, so at this point you don't have to worry about jeopardizing anything. Yeah, let's see. You screwed me, and I jeopardized the friendship?

I don't think that's how that works. So he knew the car was bad? No. To my knowledge, I don't think he really had any idea that the car was in rough shape. The problem is that within less than a week of owning it, less than 100 kilometers put on it, it completely died and ended up needing to get completely scrapped for scrap metal. May I ask what your pay for it? About $3,300.

So how in the world did you have no idea that this car was on its last breath? It was a deep engine problem. Basically, we did a full pre-purchase inspection, kind of passed with flying colors. Oh, $3,300. What kind of car is this? It's a 2002 monster tribute and when you say deep engine problem you're telling me that the mechanics that did the inspection they didn't hear any kind of engine knocking at all nothing no kind of sound that

would give uh some type of clue there's some engine issues so i'm not sure if there's a difference between canadian american pre-purchase inspection but they didn't actually take the vehicle on a test drive. They just looked at it from sort of an outside perspective, like taking the externals of the vehicle and kind of putting up on the hood and kind of taking a look at it, but they didn't actually take it for a test drive. Yeah. Well, I can just tell you, I don't know much about cars, but I know that if you take a car for a test drive and there's a deep engine issue that about a week later, 150 miles or kilometers later, something goes wrong, there are signs of that. I can tell you that.

I recently bought a car, did that, did an inspection. I was going to buy an old car to flip it and got rid of it. So you don't think that your buddy had any idea the car was bad? No, we actually took it for a test drive with him, like on two separate days. Okay, so it's not his fault. It's not his fault. He doesn't owe you a thing. He doesn't owe you a thing.

Correct. So you just lost $3,300 because you bought a bad car. That's the answer to your question. Wow. Your buddy didn't do anything wrong. Yeah. He didn't dupe you. He's not a car manufacturer.

He doesn't warranty a $3,000 car. Now, this is The Ramsey Show. We'll be right back. Ken Coleman, Ramsey personality, number one best-selling author of the book From Paycheck to Purpose, is my co-host today. Tom and Jennifer are with us. They are in North Carolina. Hi, guys. How are you? I see you're debt-free. Congrats. Thank you very much. Hey, Dave. How are you? Better than we deserve. Brother,

how much did y'all pay off? $175,000, Dave. Cool. How long did this take? About five total years. Five years. Okay. And your range of income during that time? So it ranged, we started about $72,000, and then the the last year about $110,000 to $115,000. Good for you. What do you guys do for a living? So I own my own education consulting company working with charter schools and my wife is our customer service relations person. All right, very cool. Good for you guys. So what kind of debt was the $175,000? $120,000 of it was student loans. There were three cars, credit cards, and some orthodontist work.

Wow. That's a lot of student loan debt. That's not mine. It's the educational consulting guy. Yes. Exactly. Exactly. Love it. Very cool.

Okay, how long you guys have been married? So it'll be 19 years on June 20th, actually. So after 13 or 14 years, you looked up and said, this sucks, something's got to change. Tell me your story. What blew you up? What made you change we uh tom had purchased the financial piece um he had read it and then told me about it um we had a second child i was home with him and our daughter daughter and we just built a budget and the student loans just weren't going away

yeah i think that was a big part of it there was this yeah they just weren't going away they're just looking at you yeah sally may has her own bedroom in the house okay yes yeah it was more than our mortgage and it just wasn't going down at all and we just we just got sick and tired of being sick and tired and said hey let, let's just try this plan. And, you know, Jennifer did a great job with the cash envelopes and really, you know, held us to the plan and the process. And then actually when COVID came is actually when we really started to get momentum and, you know, use some of the opportunities that I had as a business owner to actually help really pay down debt at a higher rate. Wow. Okay. Wow. Good for you guys. Okay, so Jennifer, you're at home with a baby.

You get out the book that he bought a while back. You read the book financial piece. You say, we're getting on a budget. That kind of starts the momentum heading the right way, and then you kicked it into high gear during COVID. Am I getting this right? That's about right yes okay yeah we um we thought things we started to see some results after we were able to actually pay for a car and thought you know this is going to work and we can we can do this so paying off a little one first gave you a little hope yes exactly yeah and that increases

your intensity always yeah way to go guys paying for cash for things yeah i'm curious when we hear folks tell us that there's a period in their debt-free journey where they really start to make up serious ground obviously tom you you mentioned uh the covid season and some specifics but i'm just curious in that budget sacrificing that gazelle intensity what did it look like for you all what'd you do what was tough about it what came out of it yeah good you go jen well staying staying on budget hello oh i believe we lost them. I believe we did.

All right, we'll put you on hold, see if we can get you guys back up. We don't want to lose you on your debt-free scream, for sure. Well, open phones at 888-825-5225. Let me try that. I'll pull that line back up to see if it's there. Tom and Jennifer, do you happen to be there? Hey, guys, Tom and Jennifer? Yes, sir.

Oh, you're back. Good, okay. All had some we had some kind of electronic blip we're got uh lightning strikes happening all around us here in tennessee okay so how oh way to go guys we thought we lost you but you're back um so the uh uh what do you tell people the secret to getting out of debt is you gotta you gotta trust the process. I mean, I think that's really the hardest part, Dave, is just really staying focused. We made a budget. You got to stick to the plan. And sometimes the hard part was when you had a debit card, like, nope, I don't have the cash on me. We're not going to use it. And just really, really seeing the end. I think one thing was that I never thought myself as being debt-free of the student loans. It just wasn't even like a visual, but once we

actually saw the end in line and saw the money that we had, you know, coming in and could use it and how much the growth with the business had during COVID, like it got really intense fast, and we saw the end. So, you know, that's just the key is seeing the vision. So your business did a lot better during COVID. Oh, yeah. We had our best years under COVID. This, you know, evolution of our own actual plan in the business and the profit increased, and we used the profit. I was just with 3,000 business owners last week in Orlando, and among them them i think people are just now able to say

i had my best year ever during covid because it felt like because other people were hurting it felt like it was uh inappropriate to say i'm winning you know and they're like it's it's just now far enough the other side of covid that it's okay to say it without feel like you're shaming somebody else or something absolutely i mean wouldn't have been great to be in the plexiglass business during COVID I mean oh my gosh you know you know I mean no shame on the plexiglass guy he just happened to be in the right place at the right time he made bank everybody everybody wanted his stuff you know and you were same same with you I'm happy for you I'm glad you were able to succeed during that time you You didn't hurt anybody.

You helped people. But it was kind of a thing where we weren't allowed to say we're succeeding during COVID. It's like it was culturally inappropriate. So, hey, we got a copy of Baby Steps Millionaires for you. We're very proud of you guys. We think that's the next chapter in your story. Also, a copy of the Total Money Makeover and a one-year subscription to Financial Peace University in every dollar, all as our gift to just say congratulations.

If you've done all of that or any of that and you want to give it away, pay it forward, feel free to do that or do it all yourself. We just love you. We're proud of you. We think you're incredible. Congratulations. How does it feel to be debt-free? Free.

Amazing, yes, as our son said. Stress-free, absolutely. Good for you guys. Well, congratulations. We're proud of you. Very, very well done. All right, it's Tom and Jennifer in North Carolina. $175,000 paid off in five years, most of that student loans, making $72,000 to $110,000.

Count it down. Let's hear a debt-free scream. Debt-free scream. Three, two, one. Debt-free scream. I think the young man got excited. I think we got a little harmony going. Yeah.

Got a little harmony there. Good little mix. That's excellent. Very, very well done, you guys. I love that. That's perfect. Good job, dude. The young man off the top rope's there.

Yeah, he comes out of the corner. There's an atomic slam right there. That's excellent. Very well done. Well, he probably got his mom and dad back now. You know, we're debt free. They've been working their butts off thinking about nothing else. Yeah.

I thought it was amazing that when you asked them how does it feel, both they weighed in, but then they said they used the words of their son who got enough of the journey to appreciate it. To say amazing. It's pretty incredible. He's a teenager. And he's excited. It's hard to get teenagers excited about anything except their cell phones. Yeah.

That's awesome. Hey phones food yeah that's awesome yeah hey man that's pretty incredible that's a great story i'm so proud of y'all it's good stuff so a lot of student loan debt paid off today and the debt-free screams that we've done on the air here and um you know well biden just paid off five billion dollars worth of student just forgave five billion dollars worth of student loans. Just forgave $5 billion worth of student loans. Did you see that headline last week? No. I missed it. Well, he did.

It was all over the news. But only Biden didn't forgive $5 billion worth of student loans. It was $5 billion worth of student loans to a private college called Corinth College that went broke. And when a private college goes broke, the people who got the student loans and got ripped off by that college, all those loans are automatically forgiven. That plan has been in place for 25 years. Yeah. So he didn't do that.

It was not a Biden plan. Biden didn't have anything to do with it. It was a natural occurrence of the existing regulations. It has nothing to do with student loan forgiveness. It's a standard regulation. God, these politicians. This is The Ramsey Show. Let's go. Our scripture of the day, 1 Peter 4.8, 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. Wow. 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 got to chill. That's just, there's so much going on in that little quote. That's the Oliver there's so much going on in that little quote. That's 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, out of 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 a,-bedroom, two-bath. But we're just trying to make the most wise decision. Are you renting? 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 of that as 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, our income might change down the road. So we're just trying to make the best decision. I assume your income is going up down the road. Yeah, yeah. Why would you make a career change where your income is 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 we, 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 will 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. That's kind of down the road. 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. 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 we're just we're just we're thinking that you know we want to just wait um and and save um and wait to say purchase yeah so what what what is the target what are we saving how much how much is it down how much is the purchase price of the house that you're going to pay cash for yeah i mean 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 $100,000 making $155,000 with no payments? Pretty fast. Two years. Yeah, two years. Do it. Two years. You're going to be 30, and you're going to pay cash for a $225,000, $230,000 house. You've 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 don't need opportunity. You're going to pay cash for a quarter- is uncomfortable. You're comfortable. Absolutely do it. You don't need a car. You're going to 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 going to do with a massage therapist staying home with a kid that's not even here yet so you know you can't okay we don't plan the 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 have any, 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 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 with 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 is why we you know 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 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 right i make less correct if i do good work that's a spiritual calling i make less both of those are mythology 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. 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. Hey folks, Ken Coleman here. Did you know The Ramsey Show is one of the most popular podcasts in the world? Get your daily dose of advice on life and money. Check out all of our shows from The Ramsey Network wherever you listen to podcasts.