The Ramsey Show - App - Should We Pay Off Our House? (Hour 2)

Episode Date: November 2, 2022

Dave Ramsey & Dr. John Delony discuss: Paying off a house with savings, ...or with retirement, Helping a child, Buying a house from parents, Taking a new job with a 401(k) loan. Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studio, it's the Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. We help people build wealth, do work they love, and create actual amazing relationships. Open phones this hour.

Dr. John Deloney, Ramsey Personality, number one best-selling author and host of the Dr. John Deloney Show, is my co-host today. We will be talking about your life and your money. 888-825-5225. Jay is with us in Charlotte, North Carolina. Hi, Jay. What's up? Hey, guys. Thank you so much for taking my call.

I'm going to be as quick as I can. Okay. Other than my mortgage, my wife and I have no debt of any kind. Good. We just built our dream house. The balance on the mortgage is $550,000. I'm sitting on about $500,000 cash. And so my question for you guys is, do I take a substantial amount of this money and just do a recast and nuke my monthly mortgage payment?

Do I take a substantial amount of money and invest it in mutual funds? We do have retirement accounts. Or do I just sit and hold all of it? I don't think that's the best strategy. My wife and I really don't feel comfortable with having less than $100,000 in cash just because of the nature of my job. And honestly, we don't have any children yet, and we want to have at least one child. What's your household income? Last year we made right at $350,000. Okay. What's the nature of your job that is unsettling to your wife?

Well, I'm in real estate full-time, and it's been great, but, you know, I do see the market turning where I am, and, you know, you just can't count on selling 40-plus homes a year every year for the rest of your life. You know, it's a bit of a work-life balance, and if we can have a kid, you know, I'm going to take my foot off the gas at some point. I'm not there yet, but that's the long-term play. I'm going to assume the goal is

what is the short... The answer to the question should be based on what is the shortest distance between where you are and wealth, and the shortest distance between where you are and a high quality of life. If those were the same answer, then we would go with that. Agreed?

Yes, I would agree with that. Pay off your house. Okay. As soon as you can. Put $500 on it today or $400 on it today or $450 on it today. Take a big chunk of your wonderful income and finish it off by spring. Be 100% debt-free as soon as you possibly can. Now, let me tell you what's going to happen and why I said that.

Then you get to decide if I'm right, okay? In studying 10,000 plus millionaires, the largest study of millionaires ever done in North America, and in 30 years of sitting in this seat walking with people that have become wealthy, the data shows us very very clearly that the typical millionaire in the first one to five million dollars of net worth has two things they have a beefy consistently funded over a 10 or 12 year period of time plus 401k roth ira plan in good mutual funds and they they have a paid-for house. That is the typical case of all of them that we've studied. Now, there's exceptions, but the vast majority fall,

they have those two things. Almost none of them said, we didn't pay off our house, we invested the money in mutual funds, in a retirement account and that made us wealthy that is a theory that all but that a lot of people talk about and actually almost no wealthy people do it right so the shortest distance from where you are to millionaire based on the data and the experience i have is pay off your house as soon as you possibly can and then continue to steadily invest in your retirement. The second thing that's going to happen that is not from the data but is from personal experience as well as experience of sitting in this seat is what you don't realize as a self-employed person and as a salesperson to boot

is that when you have zero debt your swagger changes the way you walk changes the way you deal with clients changes the way you get rid of high-maintenance time-sucking horrible clients and don't take them makes you available to take on the good clients you will end up making more money because you're peaceful and you are more selective and you're careful and a broke salesman smells different than one that's not right you're going to make more money because you paid off your house it's hard to grasp that but all of my 30 years of experience indicates that that's the truth and i'll throw one more at you. Okay, number three. Your wife sits in some,

she's got $500,000 in a checking account and she still has that little voice saying, we're not safe, we're not safe, we're not safe. If something happens, if the market turns, if something goes sideways, we're not safe, we're not safe. Take all of the risk variables off your table. Then you don't need 100,000.

Y'all have never breathed air where you owe nobody anything. And suddenly you don't need $ hundred thousand. Y'all have never breathed air where you owe nobody anything. And suddenly you don't need a hundred thousand dollars because if the market turns and you only sell 15 houses, there's nobody starving, right? You're going to have to change your lifestyle a little bit, but all your bills are covered, right? It changes the air you breathe in your home, which makes you laugh a little bit more. You sleep a little bit different. You don't skip as many workouts. don't fit your whole rhythm changes when i got a net worth in excess of 10 million dollars and had zero debt i did not work

less hard i just worked less desperate oh you should write that book you know i still i still work you know i work my butt off yeah i work all i love i love what i do so i'm down here all the time i'm but i i absolutely have zero arithmetic mathematical reason to work zero yep and uh i'm not bragging it's just this crap i teach works that's right that's right i've been doing it a long time so uh it just it sometimes sales people sell a lot and work really hard and have bad work-life balance and it's desperation and sometimes they do it just because they're freaking good at it and they like it i mean they're peyton manning tom brady man they just get her done and it's just a thing of beauty to watch you know they're in a zone they're artists with what they do and

it changes your brush strokes it just does man and you just you hit the ball different you throw the ball the whole thing i'm telling you it changes everything and it's hard to grasp that and that is for those of you listening in on this conversation which is all of you except jay because it was with him but jay go pay your house off shut up but now then anyway but that that that's part of we were talking about this in a meeting a little bit earlier the borrower is slave to the lender. Now, we throw that around and we go, okay, yeah, when all your money comes in and you have to give it all to the bank, that feels like a slave, right?

So the Bible's telling the truth in Proverbs 22, 7, right? But here's the thing you need to take on is what are the character qualities and lifestyle and mental health of a slave? They're trapped. They don't have any choices. Right. Everyone else makes their choices for them. They've got no freedom.

They've got no peace. They don't breathe their own air. It's impossible to be generous. Right. Slaves are never generous. You ever met a generous slave? I've never met a slave, so I don't know. But, I mean, think about it.

Think about the concept of what slavery does to the psyche. Yeah. What slavery does to your psychology, to your body. And it's generational, right? It goes on forever. It keeps going. And you don't even know it because you get so used to it that even the people of Israel wanted to go back to Egypt. Your spirit is damaged at that point. And we don't grasp all of that when we're just talking about i want to get

our credit card debt it's great get sally may out of the house she's a witch get her out okay but but what happens to your life and your spirit it's a big big subject this is the ramsey show សូវាប់ពីបានប់ពីបានប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពីប់ពី last couple of years real estate market's been tough we've all felt it if you're scared well you don't have to be the market seems crazy it has slowed down but it's not going to crash if you're ready to buy it's a good time to buy if you're ready to sell it's a good time to sell it's just not as wild and crazy and white hot as it was a few months back so what you've got to have somebody with knowledge and skill to help you navigate this this is not amateur hour you need a high octprotein real estate agent. If you're going to list a house right now,

this is an excellent time to list a house. But you need to get in touch with one of our endorsed local providers that are Ramsey-trusted. These are agents that are high producers. They know what's going on. They've got their finger on the pulse. They're doing lots and lots of transactions every month. It's not your Uncle Charlie who just got his dadgum license.

Don't list your house with your Uncle Charlie who just got his license. That's dumb. Because you're going to put your largest asset that you own with a newbie, with a beginner. Don't do that. Get somebody that knows what they're doing. RamseySolutions.com slash agent. Get with one of our ELPs that are Ramsey trusted.

RamseySolutions.com slash agent. Lisa is in Grand Island, Nebraska. Hi, Lisa. Welcome to the Ramsey Show. Hi. Thank you. It's an honor to speak with you both. You too.

What's up? Thank you. I have maybe a couple questions. My husband and I, I'm 60 and he's 63, and we have about $30,000 left on our mortgage. And I am wondering if we could take $15,000 out of our Roth and $15,000 out of our 401k to just kind of rip the Band-Aid off. How much is in your Roth total? Now it's about $520,000. Why don't you just take it all out of the Roth?

Well, our 401k is $520,000, and our Roth is at $22,000. $22,000. Yes. Okay. And the balance on the mortgage was 30 yes you've got any money in savings that's not in retirement um just our savings how much is in that uh 15 okay all right i'd probably clean out that roth just for simplicity okay that's 22 of it and then pull the rest out of your 401k and you're going to pay taxes on that but no penalties okay and i'd be debt free like by the end of the week oh good all right because my advisor is kind of thinking that

we're not going to have really enough to get us through if thirty thousand dollars keeps you from getting through when you have 525,000 in your account your advisor is an idiot okay i feel much better i mean think about it you're not if you're thirty thousand dollars off you got other problems i think a great gift you could provide your advisor would be to swing by a CVS and pick up a calculator and when you go visit you could just hand that with a bow on it. It's an old fashioned thing that people used to use yeah. Our question of the day comes from blinds.com find out for yourself why blinds.com is the number one online retailer of custom window coverings free samples free shipping new promos. They run every month.

You'll save even more. Use the promo code Ramsey to get the best deal. All right, today's question comes from Jason in Texas. Jason writes, I've been a huge fan for 20 years, but have not been able to implement any of your strategies because. Just take a pause right there. My wife thinks tithing and the rest of your methods are too restrictive. She stopped going to church a long time ago

and refuses to forgive me for things that happened in our past. The ministers that I've consulted with say she has emotionally and spiritually abandoned me years ago. Oh, man. My 18-year-old watches your videos and loves them. She keeps asking, why didn't you and mom do all this stuff? It seems to work really well. I'm trying to explain why, but don't want to throw her mom under the bus.

Is there a way a 52-year-old can start over in life and help a daughter be a cum all she can be? Yes. They do it all the time yeah all the time um i don't want to minimize jason i don't minimize your pain here's what your daughter really needs um to quote our friend jaco she needs you to take ownership uh you look back over your life and it's because your wife did this your wife didn't do that it's because of this what she needs you to say is i didn't i made some choices along the way and here's where i find myself and here's what i'm gonna do with these next steps and here's

what you can do too and there's something about that ownership that's really powerful. So it sounds like there's a chasm in this relationship. Is this due for an ultimatum, like you go see a marriage counselor, and you say, I'm going to go see a counselor, and if we can't begin to get on the same page and resolve some of these things, then we're going to call this? The way it writes is, is there a way to start over? I was just assuming that they've called it. Yeah, they've called it.

It sounds like he has. The ministers have given him permission. It's in his mind. But I don't think he's looked at her and said, This is done. It's time for me to move on. looked at her and said this is done it's time for me to move on it's um unless we can heal right this is done that's right um there's zero chance of a healing or yeah i mean if somebody if if your spouse left you emotionally and spiritually and physically years and years ago then yeah these kids have grown up in a home and that's their

picture of what love looks like that's their picture of what love looks like that's their picture of what marriage and partnership and communication and connection looks like and so healing starts with um i didn't i should have had a hard conversation a long long time ago and i didn't and this is the law that i basically they've been divorced they just need to actually formalize it they've been divorced for a long time and they just need to formalize they've modeled modeled what that looks like to their kids and so it starts with ownership here's some choices i didn't make right a long long time ago um and here's the more importantly or as importantly is here's what i'm going to start doing now and i'd love you to join me and i think i think it's that complicated and that hard and that simple.

Yeah, when we went through bankruptcy and lost everything, it terrorized me and traumatized Sharon, and so that's a thing I did that she had to forgive me for, in a sense, because I basically, you know, I always laugh and say she thought she married Sir Galahad. It turns out it was Goober, but that's, you know i always laugh and say she thought she married sir galahad turns out it was goober but um but that's you know the the truth is she was left um with situation but i was not going on nor but i there's a period of time that we can uh recognize the terror that she felt the trauma from having little kids and no money in the water got turned off because her husband's a buffoon right uh okay granted but five years later we're not still talking about that then she's choosing to carry that stuff around and i'm not gonna i'm not gonna be at the other end of

that weapon it odd infinitum right once somebody says i'm staying so dude 20 years ago you did something you know after four years of, everything after four years is your fault. If you choose to carry that thing around. No, he accepted the paralyzation of the household for 16 years longer than he should have. That's right. He should have dealt with her. That's right. A long, long time ago.

Lack of healing. That's right. And it was not that she didn't have a valid reason for being pissed. don't know what he did right but i know what i did i lost everything it was my fault sharon had no idea what was going on it wasn't her fault i didn't hide it from her i just didn't ask her right and she didn't know and so she's left feeling uh you know uh like you're driving down the road in the middle of the night and you hit a patch of ice and the car starts spinning yeah that's a great you know you're going to hit something you just don't know what or when and you know and that's where she was for a year and a half period

of time as we went down the the the toilet financially and around and around we go you know and so yeah granted and today even um know, we've got checks and balances in our relationship in place so that she's not left feeling like I'm somehow out of control again. That's right. Because that little seed. That was 30 years ago. That's right. And how old was Rachel when all this happened?

Born. Baby. She's a baby. She's a baby. So when I think about my friend Rachel, we've talked about this, when she has an emergency fund for her emergency fund, those seeds were planted in money could be scarce or money's a thing, right? And those are long ago, right? So sit with your daughter. Tension from her mom. Sit with your daughter and have that conversation right here, Jason. Exactly. Take ownership, brother. Yeah, time, past time to take ownership this is the ramsey show Dr. John Deloney, Ramsey Personality, number one best-selling author,

host of The Dr. John Deloney Show, is my co-host today. Open phones at 888-825-5225. In the lobby of Ramsey Solutions, Olivia is with us with Kino? Keanu. Keanu. I'm sorry. I knew I was going to mess that up. Welcome.

Welcome. Good to have you guys. All right. Where do you live? Wisconsin. Yes. What part? We live in LaMira. Okay.

Which is near? Small town near Oshkosh. Yes. Okay. There we go. That's something a Tennessee person recognizes. Beautiful area. How much debt did you pay off?

$72,000. All right. How long did this take? Just about two years. Whoa. Good. And your range of income during that time? It ranged from $55,000 to $80,000.

Cool. And what kind of debt was the $72,000? Just about everything. We had cars, credit cards, and some medical. Kind of normal. Yeah. Normal Americans. All right, what happened? What woke you up two years ago? Well, it kind of first started after we got married.

We used most all of our wedding money to start paying off our debt. And then a few months later, we got pregnant, and we're like, this is our I've had it moment. We can't bring a child into this world and not have our finances in order. So that's really where we started right from then. There's something about a baby grows you up instantly. You're like, oh, this just got real.

How long have y'all been married? Three years. Three years. Ah, very good. We've been together for 10 years. uh high school sweetheart yeah fun very fun so um who who got how'd you get connected this ramsey stuff the ramsey way you know i uh i actually was watching some vloggers and they were talking about how excited they were that they paid off their car and when i saw that i was like that seems weird i'm like i couldn't imagine having like a paid off vehicle. So I, and they do use your name. This was years

ago. And I was like, we should try this. And at first she was like, no, you know, we're not, it seems weird. I was reluctant. I was like, we got to cut the credit cards up. I was gun home on it right away. And, um, yeah, that's just how we learned from me. And then as soon as I started dropping the Ramsey name around coworkers and family, they would all start kind of giving their two cents on it. Ah, okay. Positive or negative. Positive, positive or negative.

He's a snake oil salesman. Stay away from that guy. Yep. I sell a lot of snake oil. Tons of it. Lots of it. I've got it all in my hair and everything. So, Olivia, what probably finally brought you along?

I just really needed to realize that I was living beyond my means. I didn't need certain things, and I just needed to focus on our main path and changing our family tree if we were going to have a child and bring more children into the life. So one of the most common questions we get is somebody married to somebody else saying, how do I get my spouse on board? What did Keanu do?

What was the conversation that finally happened that you said, you're right, let's do this? He just really put out an outline for me. He's really good with spreadsheets and he explained all that to me, and I'm like, you know, that sounds awesome. It would be great to be debt-free, and then we can just give back eventually

and, yeah, have a great life. So he gave you a vision of what this could look like. Yes, the vision definitely gave me a great outlook on it, and I'm like, yes, let's do this. Yeah, very fun. Very fun. Love my spreadsheets. There you go, man.

So you heard about us, and then how did you plug into our stuff? Just YouTube or what? YouTube and the podcast. I would listen to the podcast every day at work, and I'd come home with something new to show her. Yeah, we'd be listening to the podcast all night. I'd say when it really— Going through everybody's story, and he's like see this

could be us when it really took off was when we started actually putting everything out in a budget and first we were trying to use like random budgeting like apps and stuff and then we were like well we should just use the every dollar app that makes more sense and then we started seeing how much money we were wasting crazy amounts of of money. We were like, this money could easily have been used for... On what? What were you wasting it on? Going out to dinner or shopping. And there's sometimes we were sitting there like,

we have no idea where all this money went. Yeah, we would be so confused. Like, we're living paycheck to paycheck. Where is all this money coming from? So once we started putting everything down into the budget, we're like, this is where it's going. cannot do this anymore we need to change especially with a baby on the way yeah yeah the baby gives you that urgency that's fine we've got to change our family tree we got to be grown-ups when this little one gets here we can't children raising children not a plan

no it's a how old are you guys now i'm 24 i. I'm 26. Wow. And y'all owe nobody. Nope. How's it feel? Feels great. Feels great. It's a weight off the shoulders for sure. It seemed like every week we were getting hit with a different credit card payment and stuff.

And it just, it was, it puts you in like a depressive state at times where you're sitting there like, I'm finally getting ahead. And then all of a sudden you realize, oh, I forgot to pay the capital one bill this week and now we owe an extra 75 bucks and it's just great to be able to do this at such a young age too and we don't have to worry about doing this in the future will you go back in debt no no you you two don't understand what you've done for your financial future yet you'll be 35 and y'all will be smiling and then you'll be 45 and you'll be really smiling like what y'all have done millionaires oh my goodness i hope so that's the plan yeah you are you will oh if you stay on

the track no question all right when people hear you did this and they ask how do you get out of debt what do you tell them i tell them that that start off with a game plan and sit down, especially if you're married or something, sit down with them and write everything out. And you work as a team. You can't work against each other. You can't hide things from each other. You need to work as a team and just make sure everybody's on the same page because that's the only way you win.

Cash is king. That's dumb. That's pretty much it. There it is. You married Socrates, Keanu. There it is. I like it. Very good.

Very good. Well done. All right. And you brought your son with you. We did. And what is his name? Grayson. Grayson.

All right. We got a copy of Baby Steps Millionaires for you. We're proud of you two. Well done, you guys. Very proud of you. Oh done you guys very proud of you oh he's great oh look at that that's how he can be happy i love it that's fun and i also got a copy of financial peace university for you a one-year membership to that and we will also send you or give you a copy of the total money makeover you can give that away and get somebody's journey started so very very cool good stuff all right keanu olivia and grayson from wisconsin 72 000 paid off in two years making 55 to 80 count it down let's hear a debt-free scream three two one we're debt free! Yeah!

Woo-hoo-hoo! I love it! Well done, you guys. Very well done. So for everybody listening, I hope you heard this trajectory here. He really wanted to get out of debt. He wanted to follow his plan.

Wife wasn't on board. So he sat down and he painted a picture of this is what this could look like for us and he had a plan how to get there and he said i'll be a part of this if you will right so it's it's all of that stuff right have a dream meeting yes with your spouse what this could look like and um and paint it out in great detail in hd this is exactly where we could be sitting. We could be in this situation at this age, because the math says we can't. And it's not pie in the sky. This is conservative.

This is reasonable. We get out of debt, and we get the house paid off. During that time, we build this level of wealth. We're 35. We'll be sitting here with this kind of net worth. And put you in a completely different mindset then because you start to believe it's possible when i was about oh was i was 22 years old and um i went to one of these uh multi-level get rich quick things

oh i thought you're gonna see a covered wagon convention yeah okay so yeah let me tell you what let me tell you what they carry when they're riding on covered wagons. They carry Colt 45s. I know, I know. So just keep that in mind, all right? So circle the wagons. The Zilonis are here. All right.

But the, yeah, so I have no idea what I was going to say. The multi-level marketing convention. The multi-level. So anyway, the guy pops up there a compound interest chart and says, if you saved $100 a month at 12% from age 30 to age 60, age 25 to age 65, you'd have $1,176,000. And I went, why don't everybody do that? Right? Right? Because I was 22. Yeah.

And I'm like, I don't even have to get started until I'm 25. Yeah. 25 to 65, 40 years, $100 a month, 12%, $1,176,000. We can't get 12%. It wasn't the point. The point was, why don't everybody do that? Yeah. Because once you see the math, it gives you a vision, and you go, dadgum, everybody, $100 a month.

Everybody ought to be a millionaire. It's just crazy. This is The Ramsey Personality, is my co-host today. Chad is in Augusta, Georgia. Hi, Chad. How are you? Good, sir. How y'all doing?

Better than we deserve, man. What's up? Oh, yeah. I was just calling. I have a mortgage. Just about ready to pay it off. Good. But I'm a real estate agent.

And you know, with a real estate agent, you got to kind of go get it. And I love going to get it. But it's a big chunk. And I just like i think i'm there but i'm looking for i guess maybe a final confirmation with retirement that i have what's in place to pay it off i've been a fan of yours for probably 20 years and i've hit bumps along the way to get my house paid off and now i'm at a position so what do you owe on it oh 95 how much cash do you have do a lesson good lord pay it off pay it off what are you doing pay it off today you don't need to think about this you knew what i was gonna say

jacobs in fort worth hey jacob welcome to the ramsey show. Hot dog. Is this really happening? It's happening. What's up? Hey, so my in-laws bought a house in 2018 for $280,000, and they're offering to sell it to us now for what they paid for it then. And since it's a non-Arms League purchase, we were wondering who we need to hire to help us make that happen. Okay. So they're selling you the house at a below market price. Yes. And are you getting a mortgage?

Yeah. We were also wondering what would be the best way to pay for it. And do you have a down payment in cash? Not yet. We're moving in. Their tenants just moved out. We're planning to rent for six months to a year to build up down payment. Okay. Work with a mortgage company to establish what you've got to do to do that so that you do that properly.

Okay. And then the mortgage company will require a formal closing with an appraisal, a survey, title insurance, all the things that you've got to do anyway. The title company that the mortgage company can hook you up with to do the closing can also then simply prepare the deed. Okay. The vast majority of the paperwork done at that closing will be around the mortgage. All right. But you just need a deed in addition to that. A warranty deed in most states is what it will be. Right. But this is arm's length.

There's no weird family crap like you can't figure out. You're not allowed to buy Christmas presents for five years because you bought this from them or something. They don't have any strings attached, right? Yeah, no strings attached. Real healthy people mentally. Yes. Okay. All right.

Yeah, just trying to help us out. Yeah, and they're not going to, like, say, you shouldn't have bought that car. No. We don't like what you did with the flooring. I don't think so. No. Okay, good.

All right. Just checking, because you know this is a dangerous thing so sometimes that discounted price comes out of your backside instead of your wallet it comes out of your yeah it comes out of out of your soul exactly and affects your relationship with their daughter your wife and so on so yeah you just want to make sure all that if that's all good but the transaction is fairly simple uh while you're getting, I will tell you to get a title policy. The mortgage company will require to get you to get a mortgage title policy that usually in most states you can get what's called a simultaneous issue,

and you get an owner's title policy as well while you're at it. The title company, in order to execute on the mortgage probably will require a sales contract be developed but they probably have a form you can just fill out and do that okay so it's really most of the uh detail crap will be handled by the mortgage company and their tight and the title company that they recommend to get everything done you'll add to that probably a sales contract and owner's title policy and a which would probably be 50 bucks or 100 bucks or something and then uh you'll add to that the deed and in most states that's called a warranty deed i don't know what it is in texas but i imagine it is so uh So that's the actual title

to the property. And then the title company will charge a closing fee and the recording fee to record the mortgage or the deed of trust, depending on the state. And then they will also can record that warranty deed to you. The warranty deed is of no value until you record it at the courthouse. And that's every state. And so if you don't, if you're walking around with a deed to your house in your pocket, you don't own the house yet unless or until it has been recorded at your local courthouse. The courthouse, the recording of the deed at the courthouse is how ownership is established and transferred. So that's where you want to make sure that goes through.

But that's a fairly basic thing that any title company doing the mortgage will help you do and probably automatically tell you everything that they're doing and all that. It's most title companies in America do a really, really good job, or closing attorneys, or whoever's doing the real estate closing, which if it's a closing attorney, they probably sell title insurance. So it's all tied in together there. Very, very cool. Good situation. Yeah, it's a great situation.

Kyle is with us. Kyle is in Chicago. Hey, Kyle, what's up? Hey, Dave. I'm good. How are you? Better than I deserve. How can I help?

I'm good. How are you? Better than I deserve. How can I help? I'm good. I got a job offer to increase this lateral move from two companies, but company A, I've got a loan on my 401k, and I think that's going to hinder my move. I want to move because it's a substantial increase in pay, but I don't know what to do or how to make this happen. How much is the 401k loan? It's $15,000. Okay, and what's the increase in pay? About $100,000. Lord, that's nice.

What do you make now? 101. And you're going to make 201? About 200, yes. Doing what? What do you do now? 101. And you're going to make 201? About 200, yes. Doing what? What do you do for a living? I'm an engineer. Nice job.

Well done, man. Were you being underpaid before, or are they overpaying you? Maybe a little bit of both. Maybe a little bit of both, I guess. Is there any signing bonus at all? I could ask for one, and that's what I thought about doing, but I don't want to be hooked on that. Just tell them you got a $15,000 401k loan you need to clear.

Can they give you that much of an advance and take it out of the next three checks? Okay, that could work. Yeah, and that just takes care of it because you got if you don't repay this loan in full within 60 days of leaving it's considered an early withdrawal and you're going to get hammered with taxes and penalties that are going to make you wish you had done something okay yeah so you do need to take care of it i i you know you've already have one kind of debt if you move it to a different kind of debt over to a credit union loan, that's okay. But my preference would be that the new employer somehow help you make this move.

If I were bringing you on and I could advance you 15K against your next three months pay or whatever, or four months pay and take it out of that where you could still eat during those months, but still get my money back pretty quick as the employer i would do that okay cool yeah like i said the change the increase in pay is definitely going to help me pay other you know other debt off but i just was worried about this probably not until you get this unless they take if they take this out of your future check because they advance it it may take you maybe your get out of debt plan starts after that's done because you may need that you may need to eat out but against 200 grand 5 000 over three months is that's not a big chunk yeah it should it should be okay yeah it should be

okay it should be very very doable but yeah sometimes you just um just say uh look we got a deal but i have a problem can you help me solve this problem so as an employer would you think less of me if I came to you with that challenge no no as long as you don't come in demanding and belligerent about it like I gotta have that you know but instead you know help me solve a problem yeah I would love to help you solve a problem you're a new team member I'm bringing you on to you know I'm good you know I'd love to do that you know I don't have the money to move so we pay relocation expenses. I mean, it's whatever.

There's problems to be solved when you're hiring people sometimes, especially in this market where we've got almost no unemployment. And so they probably are real happy he's coming. Clearly, they're doubling him up. Clearly, they're adding $100 to what he was making, so they're pretty happy about it. But it was important to say, if they say no, go down to the local credit union, clear this thing, and get that thing out. And then just put that in your debt snowball and knock it out.

That's right. Yeah, that's simple. The good news is you've got an extra $100,000 to knock out your debt snowball now. Real quick. Ding, ding, baby. This is the Ramsey Show. Hey, it's John Deloney, co-host of The Ramsey Show. Did you know over 18 million people listen to The Ramsey Show every week? A lot of those people listen on one of our 600-plus radio stations across the country.

To find a station near you, go to RamseySolutions.com slash show.