The Ramsey Show - App - Should We Pay Parents Back for a $40K Gift? (Hour 3)

Episode Date: September 13, 2021

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Thank you. Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Ramsey Show. For dad is gone, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. Thank you for joining us. Open phones at 888-825-5225. Christy Wright, Ramsey personality, is my co-host today. Open phones at 888-825-5225. This is launch week for her new book, Take Back Your Time,

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If you want to learn something about life balance, Christy and I are going to help you do that, especially Christy with this new book. It is a beautiful book. It is a wonderful thesis. It's the life-changing, transformational kinds of material here, and we are excited that it is coming out on the Ramsey brand, the Ramsey Press label.

And it's going to be fun. It's going to be good. Yeah, it's been fun to see the reviews come in. And it's one of those things that, and you talk about this all the time, Dave, we, you know, you intersect with the podcast. We see people all the time on the debt-free stage. They listen to the podcast. It changes their life.

You read a book, maybe one takeaway or one concept, one principle, one step changes how you live your life, which has a direct ripple effect forever. So that's the heart behind this is to help people take their time back truly, literally, and so they can spend their life on what's most important to them. Take back your time at RamseySolutions.com. You can get it there at $20. If you order it today, we will ship it today, and you can download the e-book, the audio book, and everything within 24 hours. And you'll be able to watch us on the live stream on Thursday night. We've got about 21 seats left here in the studio. If you want to join us in the Ramsey Solutions headquarters, we're going to have a small, about 200, 250-person studio audience for the event on Thursday night. And we can get a few of you in if you want to.

Just put, again, RamseySolutions.com slash time. Erin is with us. Erin is in Evansville, Indiana. Hi, Erin. How are you? I'm talking to Dave and Christy, so I'm fantastic. What's up, kiddo? Hey, I have a business budgeting question for you guys today. I launched my business on July 15th of this year. How many months should it take to have a set budget after going through the baby steps and my own personal life

this unknown business budget at about two months in feels very uncomfortable to me okay what's your business i am a crop insurance agent and i opened up my own agency. Cool. Okay. Awesome. Well, because you've experienced this on the personal side, then you know it can take a few months to start to see the rhythms and that type of thing. The only thing is on the personal side, you have a track record of your bank statements to look at and go, hey, we spend about this much on groceries or we spend about this much on electricity, that type of thing. Because this business is so new, Erinin a lot of that's unknown so you're going to set a budget and these are projections that are going to incrementally get more accurate month over month however it's still a projection really with i mean really within your first year now you're going to have a more accurate idea in three months or four months than you did on your first year. Now you're going to have a more accurate idea in three months or four months than you did on your first month. It's going to get hopefully more accurate,

but it is going to take a little bit more time because this business is so new. You're going to see what seasonality looks like in your business and you're going to start to see the trends. Obviously that will reflect marketing or what's going on in the world, what the trends are in your industry, that type of thing. So just know that similar to the personal side of budgeting, it can take some time. In fact, it can take more time because it's so new, because you don't have these bank statements to refer to like you do on the personal side. So it's a projection, though. It's a goal.

You're still budgeting every step of the way. Just know that it might take a little bit more time to get more accurate. Do you have a rule of thumb that you advise people when you're talking about budgeting and it's a new business, especially in that first year? I think you're right. I think it's incremental. The longer you've been in business, the more accurate your budget's going to be. We launch a new product here. We don't know what it's going to do.

But we've got your planner coming out this year, and it's's what, the sixth year or fourth year or what is it? Fourth or fifth. Fourth or fifth year of putting out the Christy Wright Planner, which is a calendar that sells for $49. It's out right now, as a matter of fact. And so we can predict the sales on that based on the trend lines. Right. Every year has gotten better.

We've sold more every year, substantially more every year, but we can trend line that out, and so've got something but the first year it was a guess it was a total guess not even a budget it's just a guess and so that's kind of what you're doing right now you're guessing it's hopefully an educated guess and actually our first year budgeting on that planner was not that far off we hit it pretty close but it was a guess and you know you could do a whole lot more or a whole lot less than you thought you were going to do, and then you make adjustments from there, and then you say, okay, what is, as she said, the seasonality to this as you go along.

But what I do want you to know is two things. One is you should be upset the less accurate it is the longer you've been doing it. If you've been doing this 10 years and your budget's still like an unknown and you're freaked out about it, something's wrong. But if you've been doing it 10 months, you're just now kind of getting in the saddle. But every month, you should be getting a little bit more accurate, a little better, and then certainly after you've gone through a few years of it, and you say, oh, well, fall is always a big time. Spring is not.

Whatever it is. I suspect the crop insurance thing might be tied to that, you know, be tied something to seasonality. I suspect you're going to have some times that are big and some times that aren't. But you're going to see that and you're going to build that into your business model. John is with us in Minneapolis. Hey, John, welcome to the Ramsey Show. Hi, Dave and Chrissy. Thanks for taking my call. Sure.

So I have a question regarding a freewill gift and where that might work in the baby steps. So from what I can understand right now, we were gifted a chunk of money from my parents for a down payment on our home. My parents are extremely generous with their time and their money, and we don't want to appear ungrateful. Quite the contrary, we want to reward them for their generosity. And in our short baby step journey, we've experienced what it's like to be debt-free.

And although this gift is not strictly a debt, we do feel like it's something that separates us from being financially free. Whoa, whoa, whoa. What? I thought it was a gift. Why did you declare it a loan? What right do you have to declare it a loan? Well, it's something that from time to time has been brought up in conversation.

And I don't think it's been brought up after the fact with any malice from my parents, but it is something that is still talked about. In what way? They hold it over your head? No, no, no. They don't hold it over our head at all, no. So what, they brought it up and said one time we gave you $40,000 so you owe us? I mean, I don't understand.

Was it a gift or not? It was a gift, yes. I think your wife needs to let this go. It's a gift. In an uncertain world, being a good steward of your money is more important than ever. While some circumstances can't be controlled, there are items within your budget you can take charge of, such as your health care costs. For nearly 40 years, Christian Healthcare Ministries, or CHM, has provided a budget-friendly means of sharing for medical bills when our members need it. Learn more by visiting chministries.org slash budget. That's chministries.org slash budget.

Christian Healthcare Ministries is a Ramsey Trusted Provider. Okay, if you guys want some help in different areas of your life, get your pencil ready. Here's what we're doing. This Thursday night, we have a live stream from Ramsey Solutions Headquarters. Christy Wright and I, on her new book, Take Back Your Time, the guilt-free guide to life balance. I will open up the live stream, and Christy will do the majority of the teaching. Obviously, it's her material and her new book that comes out tomorrow. This coming Saturday, and if you want to be in the live studio audience, we have about 20 or 18 or 14 or whatever it is right now.

Tickets left. They're free, and you can come. Are they free to come in the audience? If you use the promo code TIME, and you get your book signed when you're here. So come join us. Yeah, there's a few tickets left if you want to come and be part of the studio audience Thursday night at RamseySolutions.com slash TIME. Then on Saturday, we are doing a Financial Peace Accelerated event here. And Rachel, George Camel, John Deloney, and I are teaching the entire Financial Peace University in one day.

All nine lessons, long day, for the audience and for the speakers. And we're going to get the whole thing in, and it is here in our lobby. And I think there's about five tickets left to that, and I think there's a charge for that. So RamseySolutions.com, and you get the whole Financial Peace University Ramsey solution ramsey plus thing is all every dollar is all tied into that it's all one package and you can come and be in the because we're doing a video shoot to reshoot some of the lessons and uh that's what we're doing and so but again i think we've got about three or four hundred tickets for that it might be sold out but it's right at it somewhere right around there check ramsey solutions.com for that then on september the 28th christy and george camel and i will be doing an event to help you set your life and your money up

to go win called game plan we want to put you in place for your game plan this is a completely free live stream again there is a few tickets for the live studio audience, same exact venue. And so we'll limit that to 300 or so tickets max, something like that. And because we've got camera crews and everything else in there to shoot the live stream with. And Game Plan is all about helping you get a game plan, breathing room in your time, breathing room in your money, what it takes to have a game plan, what it takes for you to win. Winning is an intentional act, and it requires a game plan. If you're going to win the Super Bowl, you need a game plan.

If you're going to win at your career, you need a game plan. If you're going to win at your life and your money, you need a game plan. That is September the 28th. It is a free live stream, and you can text GAMEPLAN to 33789, all one word, and you don't have to live a life that's normal. We'll show you how to have a game plan. And, again, that's a free live stream, September the 28th. Christy Wright, George Campbell, and me text one word GAMEPLAN to 33789.

So three live streams in the next week or two. A lot of stuff going on around here. A lot of cameras and camera crews and stuff moving around. Let's turn this place into a dadgum production facility. But, hey, let's do it, man. Whatever it takes to win. Let's go. Christian is with us in Virginia Beach, Virginia.

Hi, Christian. How are you? Good, Dave. How are you? Better than I deserve. What's up? So I recently, I'm in the military and the Navy, and I'm basically trying to have a date on when I'll project it to rotate out of the military into the civilian world. And I just wanted to know what would be a good number to have in my savings account.

God forbid I couldn't find a job after being so used to such a... I've never transitioned from an actual career to another one. Yeah. How old are you? I don't necessarily know. 24.

When will you transition out? Potentially in 2026 okay well we got some time to plan that's what i was thinking too um i i've never so i my idea was i would like probably i don't know 85 000 or 100000 in my savings but I mean that just seems like such an unrealistic number having never had more than 20,000 in my savings before yeah what do you make uh right now probably about 48,000 good for you well thank you for your service and I think it depends Christy on everything on what he lands in yeah and how quickly he lands well and that and I just I think you plan that yeah like I think you'll be fine obviously if

you have 80,000 Christian but I don't think you have to have 80,000 to be able to make that transition I think you could make it on less I think there's probably you know in your mind that that's a number that gives you peace of mind, which is fine. And I think you can save between now and then, but you've got some time. And I think you'd be just fine on less, especially if you spend the next three years not just saving money, but thinking about what you want to do. Working on those contacts like Ken Coleman talks about. We can give you a copy of Ken Coleman's new book, Christian, where he talks about getting clear on what you want to do and getting connected with the people that are doing it. What's cool is you're thinking so far in advance, you can start making some of those connections and even getting clear on it between now and then, where by the time that you're out, you're not starting from scratch then, which is going to give you a huge head start

where you won't even need that much of a savings, if any, to be able to transition to that job. Yeah, the other variable in this equation is your new job and how quick it lands okay so let's let's play pretend let's you make 48 you said right yeah let's pretend that your new job makes 148 and it starts the day after you rotate out of the military how much money do you need in savings none right you're right i mean it'd be nice to have some but in order to survive How much money do you need in savings? None. Right? You're right. I mean, it would be nice to have some, but in order to survive, you just got a $100,000 a year raise.

I think you can struggle through it, you know? So it has to do with how quickly you have landed something. And so you plan that soft landing, and you start working it hard a year out. And you start landing into that career and figuring out what you've got to do to tool up to get that deal. And, you know, it's probably going to be a raise. And if you set it up right, you're going to join the next week after you leave the military, and you don't need any savings. Now, the other end of the coin is it takes you 10 years to get employed.

Well, you would have needed a million dollars then, right? Which is absurd. Yeah, it is. So you're not going to take that long. So the way to lower this need or to scratch this itch is not the size of the savings account. It is the surety of the landing pad and the place you're going to be. And that's what I would work on. So I'd start reading everything Ken Coleman writes.

Hold on. I'll have Kelly send you a copy of his first book, The Proximity Principle, and then you can go buy From Paycheck to Purpose. It comes out in November. It's on presale right now. And go to the Ken Coleman website, kencoleman.com. Start listening to his show on career. And, you know, you've got plenty of time to figure out your purpose and plug into it and

have a good soft landing. And the more sure that is and the better that is, the less money and savings you'll need. That's the part of the formula that was missing. All right. Up next is going to be Art in Phoenix. Hey, Art, how are you? Art there? Hey, Art. Art's gone. Hey, Art, how are you? Art there? Hey, Art.

Art's gone. No, Art didn't make it. All right. Okay, well, let's try something else here. What did I do? Maybe I messed Art up. I don't think I did. Lindsay is in Charleston.

Hi, Lindsay. How are you? Hi, Dave. How are you? Good. What's up? Well, I'm going to give you a quick background and then thank you in advance for helping me with this. I am 58 years old. My husband is 69.

We didn't follow any principles because we were never talked to until just a few years ago when we found you. And where we are today, we have absolutely no debt except a mortgage that has $180,000. We have six-month savings. We have about $600,000 in our retirement. Way to go. Thank you. Thanks to you. And my question is, we have a beautiful 130-year-old house that we've completely renovated over the last 20 years out in the country.

We did put it on the market because we thought that it's the best time to sell while the market's good. It's because my husband's getting older and feels like he's not going to be able to keep up this 15 acres without help at some point and to secure our retirement. All right. I'll tell you what. You hang on. We come back from this break. I'll give you a quick answer to that. I don't want to rush it with 10 seconds left. This is The Ramsey Show. We'll be right back. Christy Wright, Ramsey Personality, is my co-host today.

Lindsay is in Charleston, South Carolina. They've got a home that is a beautiful old home on 15 acres outside of Charleston, South Carolina. Her husband is 69. She's 58. They're debt-free except for that. They've done a really, really good job. But the maintenance of the beautiful old home is wearing thin on him along with the 15 acres, and they're talking about selling it.

Is that a fair summary of what you told me so far? Lindsay? Did I push the button? Let me try. Lindsay, there you are. Hey, is that a fair summary of what i said of what you told me so far yes i think so okay so what's your question my question is to secure our retirement is that going to be the right thing to do we made every mistake that you've ever mentioned

um starting the baby steps so we did not know about you or did not even make any plans until about five years ago. My income went up tremendously. So we really just started planning and paying off everything in retirement five years ago. But my concern is we won't be ready when I'm ready to retire. My husband retired a little early, and we know an old house is nicer than it is. It's going to continue to need constant maintenance of some kind. So let me see if I can read your mail, okay? Sure.

The dream that this house represented has died, and it's hard to let it go. Absolutely. It was cute and fun and had some acreage and has a lot of character, and it's a historic cool baby. But the reality is it's a pain in the butt. Well, it's only a pain when it's a pain. So I just sold my home, and i'm going through the exact same emotions i built this big beautiful home up on the side of a hill i live there 12 14 years and

i had an absolute blast in the home it is an amazing property but it got to where just keeping the freaking light bulbs changed was too much trouble and so we just decided a new adventure was at hand we sold it and now i'm kind of grieving moving off the side of that beautiful mountain. But I'm also needing to move because it's the next season in my life. The season has changed, and I have to grieve the dream that is gone and enjoy the memories of the past that was there and move on to the next chapter, which is wisdom. And it's part of my adventure adventure and it's a wonderful adventure

and so you might enjoy having some new appliances in a new house after living in there because they don't build them like they used to thank god yeah true of houses and cars and think about what that makes possible lindsey like when you grieve this and move on from this what does that make possible because you're willing to change with your season so i love how you're talking about that earlier dave of something dying means that something new can grow and that's exciting too steve and melanie are on the debt-free stage right here in the lobby where you guys live we're huntington beach california oh i was just there i was in aneim. Okay. I just spoke at a church over there this weekend. It was wonderful.

So, hey, guys, so how much debt have you paid off? We paid off $1,078,000. What? Yeah. Well, that has not happened yet today. I need this story. Amazing. How long did this take?

It took us four years and two months. Oh, my gosh. What's your household income range during that time? We went from $180 to just under $250. Cool. What do you all do for a living? I'm a registered nurse in the emergency department. Oh, yeah.

And I'm a construction project manager for a commercial real estate company. And both rather busy right now. Oh, my goodness gracious. Oh, wow. My goodness gracious. Wow. Okay, so what kind of debt was this? We had seven mortgages, so we're just slightly leveraged. And that included five out-of-state rental properties.

We had a home up in the eastern Sierras. Melanie had lived in Mammoth Lakes for about 27 years, and so we had her home up there, and then when we got married seven years ago, then we had the home down in Huntington Beach that I had been in. Wow. So what did you do?

Start amputating properties? Yeah, so we had the seven mortgages, and then we also had school loans for Melanie's nursing school, credit card, and then furniture on a 0% interest. Oh, yeah. Oh, yeah. That was our gift to ourselves for our two-year anniversary. I love it. We don't have enough debt.

Let's get some more. That's right. We did all the things. Did you sell a bunch of the properties? Is that what you're saying? We actually did. So we went through financial peace through our church in 2017, and we started working the steps. But with the amount of debt, we started hitting the school loan debt and the credit card and furniture loans.

So we kind of hit that hard, but hadn't really looked at selling the properties just yet. And what really kind of triggered that was I started listening to the podcast in 2019 and it got me really fired up based on hearing you talk about when things are all going smooth, everything's great. But if you have a little bit of a hiccup there, then everything can turn, not looking at the risk.

So I think that was a big one for me. And so we just started looking at it and decided, you know, let's unload the properties, the five out-of-state properties. And when we started really kind of shifting, we just really felt God kind of led us with that because everything just went really quickly and super smooth. We basically sold those properties immediately. And then COVID hit. So had we owned all those rent-dependent properties during COVID, we'd have been homeless. Yeah. Well, and I got laid off after almost 15 years. Yeah. So that happened. Right. In the midst of COVID,

due to COVID, I was laid off. So if we'd had seven mortgages, it could have been catastrophic for us. Yeah. Yeah. So we put everything back on our primary residence and then we just started hitting that hard. And that's when I got on board because i could we were so deep that i couldn't i couldn't even see a bit of light anywhere i so i couldn't get on board i just wasn't a fan of i mean no offense but this whole thing this whole thing was too much i was like there's just no way there's just no way i had 60 000 just real60,000 in student loans that I'd been paying on for four or five years that were more than when I started. Sure. Yeah.

That's the blessing of student loans. That's the blessing. It just keeps on giving. Yeah. So with the podcast, something that was really good information, as you had mentioned, not trying to like, I got fired up and said, okay, we've got to do this. But I go, I've got to tread lightly because if I want to get Melanie on board, you know, I need to bring her on board willingly. I'm not going to be able to force this. And so we, you know, really coming up having a why, getting intentional, and just making that decision that, you know, we want to make a real, you real, take a bite out of this debt. Wow.

I mean, you guys are incredible. So you had this turnaround. What kept you motivated? How did you stay with it for this long haul to get through all that? You said you couldn't see any light. When did you start to see some light? After we sold all of our properties and put it down on our primary residence, I think we were down to like 160.

Okay. Yeah, from a million, that's like, wow. It's huge. And he had lost his job and got a big severance. And so then I'm thinking, oh, if we put that on, if you get another job, if this, if that, and everything just kind of lined up. He got another job. God just laid the way, and we just kind of took the steps,

and it just blew up the whole thing. And then COVID. So then obviously I could work as much as I want. just kind of took the steps and it just it just blew up the whole thing and then covid so then i you know obviously i could work as much as i want so i took two full-time jobs worked six 12 hour shifts a week for 10 months and uh six twelfths for yeah and you're a beast girl that was because we had the why yeah but as soon as the why like i was trying to see it now yeah now now there was light i could see the end of the tunnel. And so once I was on board, it was like steamroll.

It was a little bit like a wildfire with wind. Once she was on board, it's like, I'll work, you know, as much as possible. You guys are amazing. I'm so proud of you. What the beautiful part of this story is just the Holy Spirit whispering to you at just exactly the right time, like three years before you had to. Yeah. And you would have been messed up.

I mean, and he just completely saved you. You listening saved you, but he saved you. That's amazing. I'm so proud of y'all. Very well done. All right. It is Steve and Melanie from Los Angeles. A million seventy eight thousand paid off in four years and two months.

Count it down. Let's hear a debt free scream. Three, three, two, one. We're debt free. I love it! Our Scripture of the Day, Proverbs 21-31, The horse is made ready for the day of battle, but victory belongs to the Lord. Henry Ford said, If I had asked people what they wanted, they would have said, faster horses. That's the theme of the horses.

There we go. Still there. All right. Joanna is with us joanna is with us in philadelphia hi joanna welcome to the ramsey show hi thank you for having me sure um i i graduated college last year and my student loan payments begin in march of next year um i'm responsible for paying back my student loan debt as well as the parent plus loans that I took out under my mother's name, which is about a total of $72,000. My brother suggested that I look into the resources that you offer, and I'm basically just trying to figure out how to go about paying both loans at the same time while keeping up with my financial responsibilities

and getting paid a salary of $32,000 a year. Well, that last number makes it tough, doesn't it? Yes. Yeah. So what do you do? I work as an appeals clerk for a federal government agency. I get paid about $17 an hour. I have good benefits, 401K and all that stuff.

Okay. And what's your degree in? I graduated with a degree in communication arts and digital filmmaking. Okay. So you're not working in your field? No. Okay. What's your plan? Well, right now I'm looking into possibly finding a job that pays more because I'm living paycheck to paycheck. You know, this is my first year living alone, and I have to already start thinking about like a plan of paying back the loans while keeping up with all my other payments.

Okay, all right. And how much of the $70,000 is in your name, and how much of it's in your mom's name? Under my name, it's about $29,000, and under my mom's name is $38,000, interest of $5,000. But she just got a mortgage about two years ago, so I'm pretty much responsible for paying back what's under her name. And that was your deal all along, right? Mm-hmm. Mm-hmm. All right. Right. So you invested seventy eighty thousand dollars into a degree and you're going to need to benefit from that degree by using it to get a better job than you have now so that you can pay off this debt. Does that make sense? Yes.

So I want you to really to work on the career side of this equation. I'm glad you've got what you've got, but there are no benefits in the world good enough to make what you have to be called a good job. Right. You just got a job. It's not a good job. It's not a good job. Okay. A good job in your world is you're going to make 60 to 80.

Okay. And you can do that. It might not be instantaneously, but I don't want you five years from now sitting in that same place you're sitting in now because it's where you happened to land the first month you got out of college and you never did anything about it. Right. Does that make sense? Because as you have found, the $32,000 is tough to live on, much less reduce $70,000 worth of debt, much less to even pay the payments on it. So you're looking at extra jobs right now just to break even, aren't you?

Yes. Yeah. Okay. So what I'm telling you has to make sense. You've got to work on the career side, and I'll help you with that. We have a Ramsey personality named Ken Coleman that helps people find their best way to move into a career. And

we have a career assessment that we charge $30 for. I'm going to give it to you free. We have a book that he wrote called The Proximity Principle, which is going to be a big deal for you. And I'm going to give it to you for free. And I want you to do both of those things this week.

I want you to finish the book and finish the assessment both this week. Okay. And then I want you on KenColeman.com. I'm downloading his resume templates and start listening to his podcast because what you have more than a student loan crisis would be an income crisis. Does that make sense to you? Yes, sir. Because obviously, if we can double your income income you can get out of this pretty quick and joanne joanne if i'm you i'm i'm right now looking at

this as if i'm taking on two part-time jobs one part-time job literally anything to get some some extra income coming in right now immediately, like this weekend. And the second part-time job is looking for a career change. I'm looking at it that way. You're going to get immediate income in a part-time job to give you some breathing room. And then in addition to that, you are going all in on exactly those resources. Dave just talked about searching, making connections, doing everything you can to get a better full-time job that's going to make you more money.

And it may take a little bit longer to do that, and that's fine because you're going to have a little bit of margin from this other part-time job. And I don't want you worrying about benefits. Yeah. You're broke. I want you to worry about money. So the next time someone asks you about your career and what you're getting paid, I want you to say, I make money.

Right. Okay? Because if you make $60,000 a year and there aren't any benefits, I think you'll be okay. And there will be some benefits, probably, unless you're doing contract stuff. But, I mean, you know, if we can get you a 60, 70, 80, get you on a track in the communications world, in the film world, whatever it is you've been studying, whatever your dream was that caused you to go get that degree, then you can move in the right direction. So, very cool.

Kelly will pick up and get you signed up for everything. You call us or Ken back anytime, and we'll be honored to walk with you and help you do all this. It's an income issue for you, kiddo. All right. Justin is in Mason City, Iowa. Hi, Justin. How are you? I i'm good thank you for

taking my call sure how can we help um i have a question i have um i'm debt free my wife and i are debt free um finally paid off my student loans after listening to your show and not waiting for the government bailout. So I did that. But my question is, we have a mortgage still, and we owe $152,000 on our mortgage. And we have some mutual funds that we could take money out of the mutual funds, but we're worried about the tax bill on the mutual funds counting it towards income. Well, how long have worried about the tax bill on the mutual funds counting towards income. Well, how long have you had the mutual fund? In December, it will be considered long-term gain. And so that would only be a 15% tax, right?

Right, right, right. And how much is in the mutual fund? We have about $400,000. Okay. And so if you pull $200,000 out, how much is the gain on the $200,000? How much has it gained? That I'm not sure. It's only been a year.

It couldn't have been much. Right, right. And the tax is only on the gain. Okay. And so if your $200,000 went up $20,000, your taxes are $3,000. Okay. So it's nothing. Yeah.

No, that's nothing. That's not right. You did that wrong. I did that wrong. No, if it went up $20,000, it's $3,000. No, I did do that right. $20,000, not $200,000. That's right, yeah.

Yeah, so 15% of your gain is all you're paying taxes on. That's the whole thing. Okay. And so, yeah, you're going to use that and pay off this house. That's awesome, man. But I might wait until December and hit the long-term capital gains and cut your tax bill in half. Yeah, okay.

All right. Yeah, if you wait from September to December and it costs you $3,000 instead of $6,000, that's probably a good idea. Yeah, all right yeah if you wait from september to december and it costs you three grand instead of six grand that's probably a good idea yeah all right okay that's that's what we were thinking um and we just didn't know uh you know what the taxes were going to really be on it i know it was 15 but i didn't know how to figure out that. It's only on how much it went up, and if it's only a year old, it shouldn't have gone up that much. Does that make sense? Well, some of it is a year old.

Some of it is older. Some of it's four or five years old. Then on the part that's older, you don't have to wait. Okay. But you may have a little more capital gain on that part, and so you talk with your broker and figure out which is the most tax-efficient portion to cash out to pay off your mortgage. And then I would get after it and do that. Thank you for calling.

Take back your time. This is the last day to get all the deals, all the add-ons before the book hits the streets tomorrow. Check it out. Christy Wright's brand-new book, Take Back Your Time, The Guilt-Free Guide to a Balanced Life. Be sure and check it out. Christy Wright's brand new book, Take Back Your Time, The Guilt-Free Guide to a Balanced Life. Be sure and check it out. Christy Goodhour. Thanks for having me.

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