The Ramsey Show - App - Should I Use a Cash Gift to Pay off Debt? (Hour 3)

Episode Date: December 23, 2019

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🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave 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. I am Dave Ramsey, your host. Thank you for joining us, America.

We're glad you're here. Open phones at 888-825-5225. That's 888-825-5225. Katie is with us in Memphis, Tennessee. Hi, Katie. Welcome to the Dave Ramsey Show. Hi. Hey, what's up? Yes, so I'm glad to talk to you. I've been listening to you for a while, and I just wanted to call in and ask a question. I'm trying to figure out if I need to take a break from school and pay off some debt and maybe get a second job and then go back to school later.

I just kind of wanted to get some insight on that. What are you studying? Psychology. Psychology. Psychology. Okay. And why did you laugh when you said that? Well, because I'm starting to realize that there's not really any money in it. And I mean, it's my passion, but...

What is your passion? There's no money, so... What is your passion? Well, I really want to be a licensed therapist, but. Okay. Well, licensed therapist, I mean, if you got your master's and built a practice, a lot of them make $100 a year. And that was my original plan, but I don't see how that's possible right now. Why?

Maybe later down the road. Why? possible right now so why maybe later down the road why um because i made some bad financial decisions and i only make like 29 000 right now and i'm 30 000 in debt where are you studying uh liberty university where i'm doing liberty Okay. Yeah, I did that because all the local schools don't do night classes, and I work full-time. Okay. All right, cool. So University of Memphis doesn't have any kind of an adult program? No.

They only do daytime classes. Okay. All right, how old are you? I'm 28. And you make $29,000 a year doing what? Well, I just got a job working at FedEx World Headquarters. I'm a customer service representative, so I start Monday, so obviously there's potential for growth there.

Oh, great. So you're making $29, 29 there with some upside. And depending on what you're doing there and how it's structured, you may even be able to just take some OT if you could. And so what kind of debt is the $30,000? Okay, so when I went to school, I took out, I'm not doing this now, but I took out some loans for a little while which is like 20 000 and then um about three years ago i um i have epilepsy and i had a some a really bad spell basically um and i

was in and out of the hospital and that was ten thousand dollars okay so you don't have a car payment i don't have a car payment i paid for my own car and your student loans are not they don't they're accruing but you're not paying anything on them if you're in school right correct okay so um are you still stressing me out they're stressing you out just sitting there okay and and the deal is is i don't have enough money right now to um i i'm short every month i'm taking out my emergency fund to pay for school. So I'm just like, is this smart? How much is in your emergency fund? Okay.

So there's $25,000. Okay. Where did that come from? My parents passed away when I was a teenager. Oh, I'm sorry. It's okay. Okay. Okay. And what were you making at the insurance place before?

You're making $29,000 now at FedEx. I was making like $30,000, but the issue was I really couldn't sell. They liked me. I just couldn't produce the sales part of things. So I didn't want to stay in it and just continue because I had been in it for like four years. But it just wasn't working. I wasn't seeing me growing any.

And then they let me go a few times. I got let go a few times because of my low sales. So I figured it might be time for a change. Right on the wall. Okay. All right. But you're not making more money now. You're making about what you were making.

Correct. So you're still burning through your emergency fund to go to school, right? Yes. Okay. All right. Well, the first thing is, let's name, out of the $25,000, I would name three to six months of expenses the emergency fund, and that would not be $25,000.

That would be less than that, three to six months of expenses. And that's that would not be 25 000 that would be less than that three to six months of expenses and that's your real rainy day fund and we're not really getting into that the rest of this money is to be used to invest in you and i would use it for education i love the idea of getting your income up to where you can address these medical bills and get them cleaned up how old are those you it was epilepsy, and it was how long ago? Three, four years. I'm sure I could get it down. It was originally $30,000, and I called and debated with them and got it down,

and I've been doing that off and on for the last three years, and I've got it down to $10,000, and I think I could probably get it down even maybe a little bit more. Yeah, I bet if you called and offered them five cash, you could probably clear it and use some of your money to do that, I would. Okay. Lump sum and be done with it, not payments. Then we're down to just student loans that are sitting there waiting on you to graduate,

and they're going to just sit there, and we're not going to do anything with them right now, and then we're going to start investing into you. I'm not 100% sure you want to be all over this psychology thing because I'm not sure you want to do it. I don't mind you doing it. If you follow through and you get a degree and you've got a plan to get your master's by working and using some of your savings to get there that is a valid goal and you could go for it and do that not getting into your emergency fund

but using some of your other savings five thousand of it clears up the ten thousand dollars in debt some of the rest of it is used for tuition and you have a lay out a game plan to where i'm going to graduate by this date by taking these classes at this cost. And you lay the whole thing out as a program, and you budget it, and you go, okay, now where am I going to get that money? Well, I can use this much out of savings, no more, because I don't want to get down into the emergency fund. I can use this much out of work, and I can work extra, and I can do this. I can take some time off and then go back. Or, you know, what kind of a plan can I develop to graduate and get that?

But I think you need to stop and go, why was I getting this degree, and is that really who I want to be when I'm 40? I don't mind if you do it, but you did not call me up passionate about being a licensed therapist. I didn't hear passion anywhere in this discussion. You were not disappointed about it. It's kind of an eye roll. Well, I guess, I mean, I am passionate about it. Then fight for it.

I just struggle so much. Then fight for it. Then fight for it. The reason you're scared is you don't have a plan. You cannot see the end of the tunnel, and so the light looks like an oncoming train. But if you'll lay out what I'm talking about, you say, okay, five grand gets rid of the $10,000

worth of medical. We're going to set aside $10,000 for my three to six months of expenses, and I never get below that. That then leaves me $10,000 to start buying some tuition. That's not enough, so I've got to have some work plans to pay for this. But here's where I'm going to take the classes over this many years.

Here's what they're going to cost. I'm going to end up having to take, I'm going to have to quit my full-time job at this point and go do my master's or whatever it is. I don't care. But lay out a detailed game plan of how you're going to fight through this and get there. Then you're going to start getting there. I think you can do this. You're a sharp young lady.

Over the years, I've seen so many families suffer by not having life insurance. It's not that they didn't care. It's just that they didn't know, so they did nothing. That's a huge mistake. Listen, husbands and wives, moms and dads, think about it. If you died, how would your family pay the bills, the mortgage, food, and plan for a better future? This is what life insurance is all about, and term life is the only way to go. It's not expensive and it's not complicated.

Stop wasting money on cash value plans. You need 10 to 12 times your income in protection, and I recommend 15 or 20-year level plans. I also only recommend Zander Insurance, and I have for over 20 years. These are the only people I personally use and they only offer the plans I recommend. Call them at 800-356-4282 or get instant quotes online at zander.com. Trust me, these simple steps will let your family know how much you care. Thank you for joining us, America. We're so glad you're here. This is the Dave Ramsey Show.

Open phones at 888-825-5225. Mark is with us in Atlanta. Hey, Mark, welcome to the Dave Ramsey Show. Hello. Hi, how are you? I'm doing spectacular. I was doing better until I decided to follow the directions of your call screener, Kelly, I think it is. And she asked me to pull over. So I started fasting today, and I'm parked 100 feet away from the front door of the Waffle House. We better get this call over with fast.

Okay, how can I help? I'm going to get to the point. How can I help? Okay, so my question is about health insurance, not health insurance, but life insurance. So my wife and I went to our employer. They gave us the Smart Dollar program. And I've got the Gazelle in Kansas City right now, as you've described in some of your YouTube videos. So we are just completed with baby step one.

We've just started baby step number two. Your phone's going all over the place. You're going to have to speak directly into it. I am so sorry. That's okay. We have just finished baby step number one. We're starting baby step number two. Okay.

And the thing is, I gave your call screener a heart attack, I think, Shelly. I told her that my life insurance policy had me dying off at 2021. But what I said is I'm due to die off at 2021. So anyways, I have a $750,000 term policy that expires in 2021. Overweight, I'm 55. And I'm paying an exorbitant amount of money right now, as you know, through my employer, which is about $800 a year for a 50K policy, and it will increase each year.

So the question is, I'm 55. You know, in your 50s, getting life insurance is not very cheap at all. It's not hard at all if you're in shape. But if you're overweight or you smoke, it gets real difficult. Well, I don't smoke. I enjoy my wife's country cooking. And I don't freak with the Waffle House that I'm looking at. But it is bothering you severely, okay?

Yeah, it's got some things going on in my head. Okay, so what's your question? So my question is, what is your advice on finding this life insurance to keep me going? Because, you know, we make an, my wife and I make a combined income of about $160,000. So what do you make? What do you make? I make $20,000 in salary and $12,000 doing consulting work on the side. Gotcha. Okay. Well, what I would tell you to do is get on the phone, not the website, but get on the phone with Zander Insurance.

You can go to zanderinsurance.com, get their number and pull it up, and just get on the phone with them and talk to them and talk through what you've got with your height-weight ratios and let them give you a quote that way. Because the online quote system uh might not you know it's not going to take into consideration all the things all the variables we're talking about but you need about 300 000 on you um and you can afford to do that in the midst of this but yeah and you do put it in the budget until your family is out of debt and until your family

has enough nest egg in place to take care of your wife if something happens to you and um then you know you can also look at it and say well what if i did lose weight where would i be and start asking some questions about what you would save there um in terms of policy and so policy costs and so forth um Because one of the things they look at is, have you lost weight for the right reasons, or have you lost weight because you're ill, obviously, and they also want to know that it has been for a while. And so those are possibilities, though.

I mean, some lifestyle change could really, really save you a lot of money here. And you can start to look at that and make some decisions on that. I'm not saying you have to, but you can ask them what would happen if I did this. And here's where I am today money-wise. Here's what it costs me to get life insurance today. And here's what it would cost me two years from now if I had a different height-weight ratio. And do I care? And if you care, then you could go do something about that and get there

so hey good question man i appreciate you joining us i fight the exact same thing my wife's country click cooking and the temptation of the waffle house i can i can totally relate my doctor told me one time he said if you don't quit eating that briskets and gravy we're gonna have to do a biscuit eectomy in your heart one of these days. JP is with us. JP's in Cleveland, Ohio. Hi, JP. How are you?

Great. How are you today? Thanks for taking my call. Sure. How can I help? Well, we're basically done with our baby steps except for number two because we're helping our kids pay for their student loans since we co-signed for those. But we have our emergency fund, and we have our three- to six-month emergency fund for saved away,

and then we have about $1.9 million in our retirement account. Way to go. Thank you. So we kind of did it backwards a little bit, but. How much of these student loans are you paying off? How much of the student loans are you paying off? Well, there's about, there's two of our kids, and they're about $180,000 total. How much money do you have that's not in retirement accounts?

Well, we have about $50,000, but they're in a Canadian fund. How much money do you have that's not in retirement accounts? Well, we have about $50,000, but they're in a Canadian fund. My wife's Canadian, and when her mom passed away, we had an inheritance there, and we've kept it in a Canadian bank there. I would use that to get out of debt. Because if we converted it to U.S., it would be like a 35% exchange rate difference. And we didn't know if that would be prudent for us to remove that to help pay down the debt there. Yeah, I'm going to use that and get out of debt with it.

Take that hit and do it that way? Yeah, I don't play monetary policy. I don't sit and play currencies trying to figure out if I can make money. Currency is an investment, and by you holding on to this based only on the exchange rate, that's essentially what you're doing. It's not a deal-breaker or deal-maker for you guys. You've already done it. I mean, you've got $2 million.

Well done. You killed it. It's amazing. Now, if you're over 59 1⁄2 and you've got $2 million in retirement, I'd use some of that to pay off the debt, too. I'd have this debt cleared immediately. You're co-signed on it. Translation, you're liable.

And I would clear it as fast as I could. Now, if you're under 59 1⁄2, I certainly would not cash out retirement to pay off debt. Conlon is with us in Madison, Wisconsin. Hi, Conlon. Welcome to the Dave Ramsey Show. Hi, Dave. How's it going? Better than I deserve.

What's up? So I'm 17 years old. I live on my own right now with my uncle, and I'm kind of trying to figure out what I want to do for college and sort of like a career. I was kind of wondering what you would suggest. Okay. I would not pick school based solely on the income that it produces.

If you get to producing a great income doing something that you hate doing every day, you will not be good at it, and eventually you won't produce a good income on it. Okay. I would pick it, but I would also want to have an income figured out. So if you're going to spend X number of dollars on anything, you want it to make you more than it costs you. And education is an investment like anything else. And so if I'm going to spend, you know, $50,000 on it,

and I can make $100,000 a year as a result of that, then that's a good investment, right? But if I'm going to spend $200,000 on education and I can't get a job making $20,000 because I got a degree in left-handed puppetry, then that puts you in the stupid list, right? And people do that stuff all the time. And so I would try to figure out what is it that turns you on? Is it the languages and the English language? Are you going to be a writer?

Is it math? Are you going to be a writer? Is it math? Are you going to be in finance? Or accounting? What are your natural skills in your high school experience? I've been a math nerd my whole life, so it led me easily into finance and real estate. My parents were in the real estate business,

so I got a degree in finance and real estate. And it has served me well. I've got a basic business degree, in other words, undergrad. And it's served me very, very well. My return on investment was excellent. Janine is with us in Phoenix, Arizona. Hi, Janine. How are you? Hi. How are you, Dave? Better, Janine. How are you? Hi.

How are you, Dave? Better than I deserve. How can I help? I have a question. I'm in Baby Step 2, and I have just over $39,000 left on a student loan. It was a master's degree to pay off. And my husband died two months ago. Oh, no. And my husband died two months ago, and he had, I've come to find out, about $40,000 to enroll those retirement accounts into a Roth IRA account that I had

set up prior to starting with Dave Ramsey. Yeah. So what's your master's in? My master's is in education. My bachelor's was in business, and so I work in technology systems for education. What's your income? My income is $68,500. Okay.

How old are you? I am 46. Wow. What happened to him? It was like a culmination of, he had severe sleep apnea. He was overweight. The men in his family have bad hearts. Usually at the age of 50, they get a pacemaker kind of a deal instead of a birthday cake.

And so it just was, you know, one day he didn't wake up. I'm so sorry. Yeah, thank you. We're just dealing with it day by day. So what is the rest of your, if you take this money out that is in his name, it's an inherited IRA, it will not be penalized, but it will be taxed. Yes. At your rate. Let me preface too, I'm putting in $1,600 a month on my student loan, so it'll be done. I'm trying to sell a few, like his car that we're not using, that kind of stuff.

So my goal is to be done with it in 22 months if I don't take this out. And I take it there was no life insurance? Because of his health issues, no. We did have, like with his work, some set aside to to pay for uh there's not a there's not another pile of money here that we're not discussing that i don't no not not at all but like we've been we've paid off like almost 16 um no like $160,000 i mean we've paid over the last five years. We've worked our butt off. Wow.

You're almost there now. We're close. I can see the end. Yeah, I think you're right. I think we work your 22-month plan that will probably end up being about 18. And I think anywhere along there that you run into a major catastrophe, you can cash this money out and pay it off. Okay. But I don't think you're going to run into another catastrophe., you can cash this money out and pay it off. Okay.

But I don't think you're going to run into another catastrophe. No, I have to. I bought my house from my parents. I mean, if worse came to worse, they would just say, don't do anything for a little bit, and we'd make it up later. Okay. Well, you've got a good education. You've got a good career field.

It's a real steady, real predictable environment in the middle of all this pain. And I think you can be the tortoise here and just trudge your way through it, which sounds like just listening to your tone of voice and everything, it sounds like your tendency is to do that. Yeah, we will. And you'll be fine doing that. But you always have that safety net that you can do this. I tell folks never cash out retirement to pay off debt because you have the penalty and the taxes.

In your situation, you would not have a penalty. You would only have the taxes. So just roll it into my Roth IRA or my regular IRA? It's called an inherited IRA. It would be a regular IRA because it's a traditional now, right? It's not a Roth now. No, I do have, like, from before we started doing this, I had a Roth IRA and a traditional IRA. Yeah, but the one that we're talking about of his was a traditional, right?

Like, one of his was in, like, it was in the state retirement system. Yeah, yeah. It's not a Roth. No, it's just, it was like a 401K kind of a situation. We do not want to make these into Roths today because that will all become taxable when you do. Okay. So just move them to do a direct transfer rollover into a traditional IRA in good mutual funds. Sit down with a SmartVestor Pro.

Click SmartVestor at DaveRamsey.com if you haven't gotten yours picked out yet. I'll drop down a list of the people we recommend in your area that do the stuff the way we teach, and they'll sit down with you, help you do the rollover on those two accounts. It'll be called an inherited IRA. There is a mandatory withdrawal, but it's minor, that you gradually have to begin taking down an inherited IRA, but it's minor, that you gradually have to begin taking down an inherited IRA, but it's minor, and it lets most of it grow tax-deferred. And I would do that to avoid,

I think I just want you to go ahead and be building your nest egg with that, if possible. And then, again, if you stub your toe, you have a problem, you can reach over and grab that money without penalty only with paying taxes ordinary income on it and use it to pay off this debt instantaneously but today i probably wouldn't do that i'm sorry you guys are facing this especially during this season my goodness thanks for calling in open phones at 888-825-5225. Megan is with us in Cincinnati.

Hi, Megan. Where are you? How are you? Fine. How are you, Dave? Better than I deserve. What's up? So me and my husband, we have no debt except for our home.

Great. I'm in nursing school. Great. We have a two-bedroom duplex. We live on one side and we rent the other side out. So we have three children and we're kind of busting at the seams here at this point. And I was wondering if you think it's okay for us to go ahead and buy our next home and use this as rental or if we should just sell and buy our next home.

I'd sell it. Okay. Because you don't have the money to buy the next home in cash, and I wouldn't be buying a rental while you own your next home until you were ready to do that with cash. And so let's take this equity and just move it to the next property by selling it and making the move, and then, of course, never taking out more than a 15-year mortgage

and never taking out a 15-year mortgage where the payment is more than a fourth of your take-home pay. Tessa's in Santa Rosa, California. Merry Christmas, Tessa. How are you? Oh, Merry Christmas, Dave. Thank you for taking my call. Sure. What's up? I have been listening to you like crazy these last couple weeks. A girlfriend of mine mentioned your name, and I was super curious,

and I want my husband and I was super curious, and I want my husband and I to have financial freedom. We have a big pile of debt. Part of it is my student loans for my master's degree, truck payment, a fifth wheel that we don't even have in the state with us because we move from place to place. So it's really a sore spot for me. And I'm struggling. I have a really special gift from someone that I lost a couple years ago. I received $50,000. And from listening to you, it seems that once we have that little bit of savings in place, to use excess savings to pay off debt is our next step. But I'm struggling with coming to terms with that because I feel like using it on stupid things that are so not important and that person was so important to

me is not the right thing to do. Okay. What would be the stupid thing you'd be using it on? Credit card debt, you know, my husband's decisions to buy things that, you know, we didn't need at the time or before we were married. I'm very conservative on spending. He is not. And it's something, you know, I've been working through. And I had a challenging conversation with him. And, you know, I ordered your book. I'm so excited to get it.

I'm trying to get him to just be on the same page with me. And he says that he is and wants to work towards this because I know he wants our future to look better than what it is. Until he's willing to sell the fifth wheel and maybe the truck, I would not do this. Okay. Because I don't need his words and his actions. I know. That's how I feel, and I come to terms with thinking about taking $20,000 to pay off the four big credit cards that we have,

and one is mine, and I, you know. You're trying to halfway do something. See, the problem is not the debt, and the problem is not the gift, using the gift to pay off the debt. The problem is you can't see a future where your husband is not going to repeat the stupidity. Yeah. And you need to have that future cleared up, and the future is cleared up when we know he has transformed his heart and has become a grown-up and has quit buying toys that he can't afford. I did that.

When I was a quote grown man, I was a little boy buying toys I couldn't afford. And so I know who he is. I know this guy. He likes stuff. He likes trucks and things to pull behind the trucks and all these other nights. And he needs to sell all that crap. Our scripture of the day, Deuteronomy 6.5, Love the Lord your God with all your heart and with all your soul, with all your might. Ronald Reagan said,

We're blessed with the opportunity to stand for something, for liberty and freedom and fairness. And these are things worth fighting for, worth devoting our lives to. Yes, they are. Good stuff. Open phones at 888-825-5225. Merry Christmas, America. We're glad you're here. Craig is with us in

Kansas City. Hey, Craig, welcome to the Dave Ramsey Show. Hey, Dave. Thanks for taking my call. Sure. What's up? Quick question. I've always hated debt, and growing up, I remember back in high school, my dad telling me that you should always have a car payment. Just not have the car. Make a car payment to yourself. Always put it in your bank account. So growing up, I was always a saver. I read a book called Multiple Streams of Income years ago, and it talked about passive income, and that just got me burning for that. I'm a

heavy equipment mechanic, so I work on big construction equipment, and I know that my body's going to give out before too long climbing up and down on track. So I was wanting to get some passive income. So we now have rental houses, and I was wanting to get your take on rental property. I have two rental houses plus my house. I do have a mortgage against all three. They're all locked in on 15-year mortgages. I got about seven years left. My house is at two and three quarter percent and the rentals are both about three and a

half percent on them. Um, both houses do cashflow about 500 a month each. Um, I'm very mechanical inclined. So every time I have an issue with them, about percent of it i can fix myself hvac the electrical water heaters plumbing whatever i can do myself that's perfect how have you done with tenants i'm sorry how have you handled the tenants have you done well with them we've been we've been great with them we've had multiple ones in there but i'm 42 What's your household income today? About $110,000. Way to go.

You're doing great. Okay. And so what do you owe on your personal residence? What's the balance? My personal house is $98,000. What about rental number one? Rental one is $61,000. Rental two?

It's $54,000. Okay. So $200,000 has you 100% debt-free, and you make $110,000, and you're 42. Exactly. Exactly. Let's just start working to pay them off. Well, that's what I'm doing. Early.

Yeah, exactly. I do every time I get extra income. We have two young kids. My daughter is now in daycare, obviously, and that's expensive, and we've got other things going on. I was listening to your show, and the thought of being debt-free just sounds ridiculously cool. So if I paid the rentals off, I could pay my house off and be debt-free. But I feel like we're in a pretty good position.

You are in a pretty good position. You're not about to file bankruptcy. You're not stressed. But you see a future that is better without the without any debt here and i do too as a matter of fact i'll go a little bit further into the future and say when all of these are paid off uh the cash flow will be so incredible you'll be able to save up like you did for those old cars uh and buy another rental with cash and the third one will be easier, and the fourth one will be even easier because every time you do it, you've got these things cash flow like a bandit, man, when you've got no debt at all.

And so, you know, if you work 10 more years, you could end up with a bunch of paid-for rentals making $110,000 to $150,000 during that 10 years. You could end up in a really sweet position. So it sounds to me like you're a natural saver, and that's caused you to be so successful. You're very successful at this. Very proud of you. You did a really good job.

What I would tell you to do to fine-tune it is a couple things. I don't think you're doing a detailed written budget that you and your wife are looking at and agreeing on. Correct. wife are looking at and agreeing on correct i think your natural savings personality has led you to this success but not a system or a plan and so pretend like i hired you for two hundred thousand dollars to manage this money tighter and better and more carefully so let's throw let me throw a couple numbers at you. Making 110, if you guys just looked at your budget and said,

by the time I'm 46, I could be 100% debt free, that'd be $50,000 a year for four years. That's doable. Yeah. But you're going to have to do that on purpose. That's not going to happen on accident because of your saving personality. That's going to happen only with a detailed plan and a written

attack plan so i don't care if it's uh four years or if it's five years if it's 40 000 a year for five years you know you're 100 debt free there in your future and i'd probably knock that if i was doing 50 a year i'd probably knock that little one off first and just get her done and then i may knock those two rentals off ahead of that house. And, see, you're paying payments in that, too. So you're going to – it's going to – you really have about a four-year plan, probably, if you tighten it up. It might take you a little more. Between four and five, we'll just leave it at that.

I don't care. You work it out. But, see, you're not even 50 years old at that point, and all this stuff's paid for. Right. That feels pretty good. I was thinking the same way. It's good to hear somebody else think it, because, you know, I just need the reassurance we're doing the right thing. Yeah. I think we're on the right way.

Because, see, I don't think your body's going to give out to the point you can't do the odds and ends maintenance around these rentals until you're really old. I agree. Now, your body may not allow you to do your current career more than about 10 more years. I don't know. That's up to you because that's hard work. I mean, that's hard physical work. But, I mean, tinkering around with a heat and air or a dishwasher that's broke is different than what you do every day. Right.

And our end goal is 55 be retired. Okay. My wife is a school teacher. We are just now, she's two weeks away from getting her master's degree. We cash flowed all that. So she'll get a raise there. At 55, with my job, I can take an early retirement with a reduced pension. Plus my 401. Plus she's got her capers.

So how many rentals? What is the value of these two rentals? What's the current value? One of them is about $185,000, and the other one is about $160,000, $165,000. Okay. So how many $150,000 rentals can we pay cash for if we get these three loans paid off between now and 55? So I bet you could have – I'm just doing some quick – I bet you could have three or four more. Okay.

And then at that point, we're done. Yeah, you're done. We're not going to have anything to worry about. Your pension and the rental income off of five or six rentals? Yeah. Okay. But see, you just lay the math out. You can do it.

Right. It's just going to have to be. I just want you to fine-tune the plan. You kind of, again, wandered into it by your nature, which has caused you to be very successful. And again, I'm not dissing you. I'm very proud of you for doing that. But let's take it further and let's go all the way to, you know, let's have you about a $3 million net worth, 100% debt free,

by the time you get to about 60 years old. Because see, all these rentals are going up in value during this time and these rents are going up. And the more they go up and the more the value goes up, the easier it is to pay cash for the next one it just gets fun it just gets ridiculously fun it's you this is this is it so um yeah this guy right here this guy's right on the tipping point y'all hear it he's right on the edge he's on the bubble he's just about to go over the edge into everyday millionaire status. And then once you get that, then the jump from $1 million to $5 million, doing things the way he's doing it, again, it's just common sense.

And his wife's a teacher, and he works on heavy equipment. Don't tell me you can't be great in America. You just have to be intentional. And his daddy taught him growing up, you know, always pay a car payment to yourself, never pay a car payment to the man. In other words, always be saving up and paying cash for whatever you buy. Did you hear him say it? That's what led him to being as successful as he is.

Some of you are just out there running around like a bunch of juvenile delinquents with your money. And meanwhile, the rest of us are sitting around like grown-ups watching you. This is just silliness. That puts this hour of the Dave Ramsey Show in the books.

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, it's Kelly, associate producer and phone screener for The Dave Ramsey Show.

This episode is over, but if you heard about a product or service and didn't have a chance to write it down, don't worry. We list everything that is mentioned during this episode in the podcast show notes section. Thanks for listening.