The Ramsey Show - App - Should We Retire Early (Hour 1)

Episode Date: September 20, 2023

МУЗЫКАЛЬНАЯ ЗАСТАВКА Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships. I'm George Campbell, joined by my good pal, Mr. Ken Coleman, this hour, and we're taking your calls at 888-825-5225. You call in. We'll talk about your life, your money, your work, the toxic boss, that job that you're really dreaming of, and how you can take steps to get there. And, Ken, this has been a hot topic, especially this year with the hot job market. People are going, I've got options.

Yeah. What do I do next? Yeah. I saw something this morning, a new survey that came out that said 42% of Americans are saying they're going to demand a raise this year to keep up with inflation. Is that how it works? And I just chuckled. You know, a good chuckle.

It's not a true laugh. It's a chuckle like you can't these people cannot demand a raise to keep up with inflation because that's going to actually create more problems involving inflation and you've got so many of americans can't even name the three branches of government so i'm not surprised don't quiz me ken are going to demand that their boss give them a raise for a cost of living. First of all, it doesn't work that way, or people will be out of business. And secondly, you're going to get laughed at, and you might get fired.

So see how that works out for you. We're here to help you with things like that, because the bottom line is, is if you're living debt-free, and even if you're in the robust zone of gazelle intensity, you can be inflation-proof. People who stand on that debt-free stage every day are inflation-proof. I'm inflation-proof. You're inflation-proof.

Is it because we're better than anybody else? No, it's because we have margin and we have peace. So you know what? We live in a topsy-turvy time. So yes, we'll talk about your work as well, because as Dave has said, it's your greatest wealth-building tool, your income tied to your work. And so we'll help you. We'll help you in that process however we can, because it's tied to money, it's tied to relationships, and your overall health.

So how about that for a setup? I love it. All right, well, give us a call if you're interested in that pitch right there, 888-825-5225. Angel kicks us off in Dallas. Angel, welcome to the show. Hi, thanks so much for taking my call. Sure. George and Ken, just my lucky day.

I get to talk to Ken as well as you, George. I love your show. Oh, thank you. Wow, we should record that, James, and we'll play that for our wives. I did not pay Angel anything to say those nice things about us. Very nice. I always love every drink that you suggest on Smart Happy Hour. Oh, thank you for listening. I wish Rachel was here to hear this instead of Ken. She needs the validation. My question really is probably geared more toward you. My husband is 42 and I am 50.

We have two children and one is going off to college in June. And then we will have one child left in high school. We make about $335,000 each year. He would like to retire when our youngest graduates high school in three years, so at 45, because he's been in the job in financial services for 22 years since he graduated college, but it's not very fulfilling. But, you know, I just don't know if that's the right time to retire at 45. We don't have any debt. Our house is worth $835,000. It's paid off. Wow. And we have about $1.3 million in retirement savings. So I would like to encourage him to, yes, change careers.

I just don't know when the right time is financially for that to happen. Well, that's a very interesting question coming from you. And I think that your safety gland is probably flaring a little bit. Is that fair? Yes. Yeah, well, let me just tell you as an objective bystander here, it shouldn't be. You guys are fine. This is not a man who is a lazy loafer.

It's not a man who's confused. He's not having a midlife crisis. I think this is a guy, I'm taking a stab here, tell me if I'm right or wrong, that has done the same thing since he got out of college. He's done quite well at it. You guys have a lot of margin. And at the age of 45, because he has less pressure, he wants to shift. He wants to pivot. And you should be totally in support of that. Because I don't think this guy is going to just shut it down for the rest of his life. I think he's going to move on to something even more exciting and might even move on to something more profitable financially.

So I think this is a good move because of your position. You guys have no debt in the world, a fat retirement, and I think him stepping away and reassessing as this season comes to an end when your youngest goes off to college, I think it's a great decision because he wants to do it and he can do it. Therefore, I'm fine with it. Awesome. How do you feel now? What are your fears around that, Angel? Is it financial or is it, I don't know what he's going to do. He's not even halfway through his life. He's going to sit there all day. Is that it? I just think he doesn't know what he wants to do. And even though he would like to leave, he's feeling those golden handcuffs and thinking, if I leave, will we have, you know, be to provide health care for the children?

And sometimes kids come back, and I'm thinking, we could just sell this house and have a smaller house, but he would like to move into an apartment and not own anything. And you're like, wait a second, Sparky. That's my nest you're talking about. And you want to keep your McMansion and have your nice life. I see what's going on. Okay, a couple things. Angel, number one, he's got three years, if I heard you correctly.

He's got three years to figure this out. That's plenty of time. And he's got three years to do it under no pressure at all. That's even better. So I'm going to give you my Get Clear Career Assessment for your husband, okay? Chris is going to give that to you as my gift. I'm also going to give him the book from paycheck to purpose, which outlines the seven stages to moving into the real dream job, not a fantasy, but something that he absolutely loves and something that matters to him. It's doable. He's got three years to figure this out. That's more than enough time. And he has all the clues, all the details that he needs. He's been doing good work for a long time. And so he's going to retire to something, not from something. And I think if I were to say to him today, hey, I can guarantee you that we can get you into something at 45 that you really, really enjoy, that lights your heart up, and you can make really good money and never even miss the old job,

what do you think he would say to me? He would say, sign me up. Okay, so we are signing him up. So it starts with the assessment and the book from Paycheck to Purpose. And from there, he's got everything he needs to to go and explore and make connections and figure out that thing that he wants to do you got it got it and that means you get to keep the mcmansion whoo that's a big piece of this puzzle they are not in agreement on what kind of life they want to have going forward yeah that's

the bigger piece of this we We can figure out the finances. You can go make more money. But I like where this is going. We have some homework to do, but I think they're on the path to being financially independent. I think once he figures out that thing, he'll cave on the apartment thing. I think that's an extreme reaction to a guy who's just tired of being in the hamster wheel. Amen. Thanks for the call, Angel.

This is The Ramsey Show. Welcome back to The Ramsey Show. I'm George Camel, joined by Ramsey personality Ken Coleman. The number to call if you want to jump into the conversation is 888-825-5225. And we'll be here for you. I know it's scary to use that phone app on your phone instead of whatever else the kids are using it for, but it's the only way currently to get advice on the show. I get a lot of DMs on Instagram saying, hey, can you help me? I say, call the show. Don't be scared.

We're here. Yeah, I love the DMs, but it's very hard to answer these complex questions via DMs. Yeah, Ken's got to get his readers on. It's a whole situation. Yeah, I can't type with my thumbs like George can. Did you just tell everybody that I use readers? I don't think anyone's shocked by that. A lot of people are.

Most of the people in the lobby think I'm about 35. They thought you had 20-20 vision. Yeah, you know. It's fine. You look great in them, Ken. You got some stylish ones. Not as good as you look in that child-size jean jacket. I knew it was coming.

I was waiting for an Oshkosh Begosh reference. It's all I got. It's all I got. No, it's a wonderful jean jacket. You look great. Thank you. It looks like an adult small. That would be accurate. Is it?

It's not extra small? I have no idea. Okay. You know, I don't look at those things, Ken. It's just, if it fits, I sits. There we go. Nice. I like that.

I do like that. Oh, let's get to the calls before James takes us off the air. Here we go. Kimberly's up next in San Diego. Kimberly, save us from ourselves. How can we help? Hi, George and Ken. Thank you so much for taking my call.

Sure. You sound like you're in a fantastic mood. I am. I am in a good mood. Good for you. That's exciting. How can we help? Thank you. So my in a good mood. Good for you. That's exciting. How can we help? Thank you.

So my question is about investing, specifically for my twin daughters. They're in a bit of a unique situation. They've filmed a handful of commercials. Nice. Yeah. So they've earned a little bit of money. So I'm just looking for some advice on how to invest that. How old are your daughters?

They're four. How fun. Were they just so stoked on this? Yeah, it's been pretty fun for them. Was it print or film? So the first one they did was film, and that was when they were babies. They were like two months old. Oh, wow.

Yes. They're experienced actresses by this point. I guess so, yeah. So the ones this year, they haven't come out yet. They're not exactly sure how they're going to be used. Um, but they had two this year. That is so fun. My daughter, um, actually all three of my kids did some, uh, early acting and my daughter

has stayed with it. So how much money are we talking about? Um, it's not a lot. Um, this year it's about $5,000 each. Nice. That's a lot for a four-year-old. I was going to say. You give a four-year-old a $10 bill, they think they can retire. I know.

So $5,000 each. That's awesome. Where is it now? So I was thinking, it's just in the bank, but I was thinking of investing in mutual funds for them just because, well, I'm just not sure. I want it to be accessible for them when they're 18 so they can decide how they want to use it. But then I was also wondering, since they do have earned income, if I should put some of it into Roth for them, or if that's kind of silly. No, that's not silly at all. It's one of the greatest life hacks of all time. And because you have to have earned income to contribute to a Roth IRA. And so the one caveat kind of loophole is if your child does legitimate work like they have done,

you can actually invest that money. And we talk about compound growth on the show all the time. If you let that money just sit for 20 years, 30 years, 40 years, I mean, they're going to be multi-multi-millionaires just from the work they're doing today. So you're thinking the right way. Okay. And I love what Ken did for his kids and the way they process this when they get a check, because it's a four-year-old, right? So it's a weird thing to try to explain to this four-year-old that they just got all this money and what to do with it right you're kind of the financial advisor right now so what we did for Josie I think she was seven when she uh did one of her first paid ads it was a print ad for like fazoles I think like she had breadsticks or something like this. So anyway, she was old enough to understand like I'm getting paid.

And I think she made $1,500, you know, which again, fantastic money. She's seven. And so we sat her down and, you know, we understood that she understood that she was getting, you know, paid for doing this, this, this modeling and this little acting job. And so we explained the concept of giving. And so we pulled out a chunk and we let her put it in the offering plate at church that week, right? And then we gave her some money to spend. And I think we gave her like a hundred bucks or something, which again, you would have thought, I mean, this kid's eyes bugged out of her head.

It was like, this is your hundred dollars. You can put it in your little bank you know we had the ramsey give save spend little you know the i don't know if we still make those oh yeah i think they just updated it yeah so she could see it i think we gave it to her in 520s because it just felt so awesome for her and then we told her that we put the rest in the savings and we put it in her 529 account um that she could you know could use later as she goes into any kind of training or any type of education. So that's what we did. We just explained it to her. And again, at the age of seven, she was able to understand it. And so- Four might be a little bit early for that.

Four is probably a little early, but let them experience the fruits of their labor. It was so exciting to let her go. I mean, I was like, you can blow it. Because it wasn't about being wise with it. She's seven. She's already being wise with the money. It was like, go buy something fun. I think she bought a Build-A-Bear and whatever seven-year-old girls love to buy.

It was just all a bunch of nothing. She was excited. But it was the reward piece that she got. I work. I get the reward. And then I've also been smart with it and I saved it. So we were very practical with it. So whether or not you want to do the Roth or the 529, I think that's a great move, but let them spend some of it and then teach them to give some of it. Okay. So about the Roth, does that tie it up until retirement for them? Now, technically, in most cases, the Roth, you're not going to be able to access until 59 and a half. You can take out the contributions that you've put in without penalty, but even then,

I wouldn't because you're unplugging that compound growth that's building. And the way your kids are going to be set up, they're not going to need to dip into the retirement accounts for money. And so you could do a few things. I would put most of it in that Roth IRA. I think that's building and the way your kids are going to be set up, they're not going to need to dip into their retirement accounts for money. And so you could do a few things. I would put most of it in that Roth IRA. I think that's a great move. You could put a little bit of it in a 529 into a high yield savings account and just let that money grow into kind of a custodial account for them at the bank. And then like Ken said, give a little bit of it, spend a little bit of it. What's the toy they've been wanting? All right, let's go get them the toy. You worked hard for this and that comes from work. So I would just say, leave it in that Roth. They're going to thank you later. When you start doing the calculations on $5,000 in a Roth IRA from age four to 64, it will explode your brain.

It is going to be so much money, even if you never added to it. And so that's what I love about that. They're going to be like, mom, thank you for doing that because you just made me a millionaire at four years old and I didn't even know it. That's changing your family tree. Awesome. Thank you so much. Absolutely. Thanks for the call. Yeah. You're a good mom, Kimberly. Mom of the year, Kimberly. How about that? I can't wait until your little princess comes to you and says she wants to act or maybe sing or write.

I need to ask you about this, Ken. So those of you that don't know, I had a baby. I didn't have a baby. My wife had a baby less than four weeks ago. We're coming up on four weeks, and I'm already thinking about the 529, and I don't want to push her towards acting, but it's one of those loopholes where you can go, if she can contribute to that Roth at two months old, that's a game changer for her future. So what are your thoughts about that, Ken,

pushing your kid into something like, do you kind of encourage it, let them explore their passions? Obviously they're so young. So parents don't push your kids into anything. That's the problem we've got with this current generation. They've been pushed and they've been coddled. And so they've not had a chance to make their own decisions.

So what you want is if your little kid comes to you and says, hey, daddy, I want to try soccer, then go, great, and sign them up for soccer. If they hate it two weeks in, say, you gotta finish the season. Teach them some life lessons. Then if they come to you and say, I want to try guitar, say, great! And go get them guitar lessons. If they want to quit after

two, say, nope, you gotta finish. And you rinse and you repeat. And eventually, they're gonna do something that makes the tuning fork of their heart go off. And now, parents, you've let them discover it. And it's what're going to do something that makes the tuning fork of their heart go off. And now, parents, you've let them discover it. And it's what they love to do. It's not reliving your childhood dreams that you never met.

Ouch. Beautifully said. That's good advice. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm george camel joined by ken coleman if you enjoy this show i imagine you would enjoy some of the other shows on the ramsey network including the ken coleman show the george camel youtube channel smart money happy hour which i co-hosted rachel cruz we have a lot of fun on that one very different style we don We don't take calls. It's just fun, pop culture, comedy.

And real cocktails. We had a previous caller who said she loved the drink suggestions. It's fun. And we made one live at Smart Conference, a mocktail. I understand. And it was one of the best I've had. And I saw the recipe for that and took a picture of it on my phone, and I'm going to do the real deal.

Wow. By the way. That's an honor. Is there any truth to the rumors in the back of the suburban when we were riding back to the hotel, you and Rachel were promising me that you would be a guest on Smart Money Happy Hour. Is this a bad time to bring that up? It's not as long as John Deloney's not listening because he's also wanting a coveted guest spot on Smart Money Happy Hour. I don't, listen, I don't pull the string scan. I'm not the producer. We're just the just the talent we're the mere talent but it would be an honor to have you guys we're talking a big game

i think you would add it would be for me to be on and i had a lot of value i think i would all right we'll let america way people love to blame their producers for when they don't want to have people on you know that's true well you know the producer heard it in the back of the car they were laying it on thick hey you should come on and blah blah blah blah but uh i keep checking my inbox still nothing nothing there keep dreaming okay all right let's go to the phones if you want to jump in the number to call is 888-825-5225 we'll help you take the right next step with your life your work and of course your money josh is in albany new york josh welcome to The Ramsey Show. How are you doing?

Hey, fellas. Thanks a ton for taking the time to chat with me today. Sure. Hey, so I find myself kind of at a bit of a positive financial crossroads in my life. I just started a new job in Long Island that pays $125K a year, which is more than double my previous salary. It's great. But I currently live in Albany, New York. So I have been commuting down and it's about, you know, anywhere from six to eight hours a day of driving, depending on traffic.

Hold on a second. How long have you been commuting six to eight hours a day? It's only been two weeks and it is on a hybrid schedule. So I'm only in the office two days at the moment. So it's not exceptionally brutal. Um, and it will probably be three days, uh, on site, you know, moving forward. Um, and my initial intention was to move down to the city, but the more I do the math, the more I think about it, the more I'm debating just doing the commute and functionally doubling my already doubled salary, you know? Are you married, kids? What's your status? No, single is a day as long. I don't even have a house plant to worry about. I think it's bananas that you're even considering

doing this, but the fact that you're single is the only scenario. Yeah. How old are you? By which I could do that. 32. 32. Okay. Well, I'll tell you, it's not a sustainable solution. Even two or three days a week, your mental health is going to suffer. You'll be calling the Dr. John Deloney show shortly here because of this. So we've got to find a solution. And if that means finding a different job, finding a job that's closer, that can pay you that, or moving to Long Island and figuring it out. Maybe you get a roommate for a while to be able to afford the cost of living there. Why don't we get rid of the extreme, Josh, and why don't we think 30 miles, 40 miles outside of Long Island? Let's get outside a little bit where maybe the cost of living is not as much as being

right there where you work. Split the difference a good ways here. I just think you're going to eventually get miserable. You're going to be miserable with all that. And by the way, that's just not good for you and your health. It's just not good for you. Putting a lot of miles on your car. There's just a lot of diminishing returns to this. I'd really like to talk you out of it.

Okay. So George isishing returns to this. I'd really like to talk you out of it. Okay. So George is the best at this. All right, so I'm going to tap George here on the shoulder, tag team here. Let's talk him through roommate. Let's walk through his raise plus cost of living. Let's walk through this. Here's what happens, Josh. People tend to go, well, I've got A and B.

A is I stay in Albany and I commute eight hours, or B, I move to Long Island and broke. And I go, what about C, D, E, F? You go down through the alphabet here. And so let's talk through those scenarios. Could you move closer to Long Island but even close to the city my minimum commute is already going to be like an hour you know even unless i can find something explicitly like in the township that i would be in but the cost of living there is actually much higher because it's kind of a rich area um so i've been looking at like maybe poughkeepsie something to cut it in half you know maybe an hour and a half commute each so how much how much more does it cost you to live in Poughkeepsie? By the way, I love saying that word. I knew it. I was just thinking Ken loves saying that word.

It just came out of my mouth and it felt so good. So let's say it again. Poughkeepsie. There it is. There it is. How much more is it to live there than where you're living now in Albany? Well, my current situation in albany my rent is 575 bucks a month which i'm never going to live this cheap again yeah are you

in a box no it's actually a great apartment wow my room is like 400 square feet it's gigantic um 400 square feet's never gigantic but but how much difference? Not the whole apartment, just my bedroom. All your bedroom, okay. What's the difference in cost? Probably, I'm looking at a minimum of at least $1,500 increase in rent, probably $2,000 in rent. For a one bedroom? Sounds about appropriate. Yeah, probably $15,000 to $2,000, somewhere in there. What about a two bedroom?

Probably only a little bit more, maybe $2,200. Okay, so that's where I'm going with this. You get one roommate, a similar, you know, guy like you, in his 20s, early 30s, single, and just looking to have a place to crash. That's all you're looking for. A guy who's clean, who can pay on time. Now your rent is

$1,100, right? But, you also just gained seven hours of your life back every single day. Yeah. And not to mention, you just doubled your salary, right? But you also just gained seven hours of your life back every single day. And not to mention, you just doubled your salary, correct? Yeah, more so, more than that. So doubling your rent payment is not the end of the world. Yeah, it's not like you're going backwards. I think in your mind, you're so stuck on this unbelievable rent that you have,

$500 a month, which is unbelievable. It's like you're in the Stone Age. Somehow you've managed that. That's phenomenal. Good for you. But you're looking at that and the increase over that, and you're not looking at how much better your life is. This great job that you love, you over double your salary. I think you need to be focusing on that. And this is about stretching and growing. And you can handle a $1,500 a month, one bedroom. That's not outrageous, given the money he's making.

Yeah, do you have any debt? Just my car, which is about $32,000, but that's it. How much do you owe on that? On the car? Yeah, is it $32,000? Yeah, $32,000. Oh, what's it worth? Probably about that.

It's a 2022 Subaru Outback. I just bought it earlier this year. Yeah, but dude, you are just appreciating the snot out of that thing with all that driving you're gonna put a hundred thousand miles on that thing in a year the way you're going that's the number one reason to move is that right there yeah that you're gonna be underwater on that car yeah that's if you aren't already it's gonna be screaming at you, swearing at you, puffing. I'd get you a Prius if you're going to be driving seven hours a day. There you go. Yeah, for sure.

But yeah, I think you know what to do, Josh. The hard part is letting go of this amazing rent and dealing with the idea of having a roommate and moving again. But man, it is worth it. You doubled your income, and there's got to be some sacrifices that come along with that if you're going to keep this job long term. Yep. Yeah. No, I appreciate it it thank you yeah you got this man you're not you're not doing anything crazy i mean he's really nervous about that rent i can't picture taking a road trip every single day just to go to work and back i don't when is he leaving the house 2 a.m he's probably not sleeping i didn't want to ask that because i honestly it i was afraid i was going to break out in a rash just for him.

Just the anxiety of thinking about six to seven hours. Six to eight hours total. Six to eight hours total. So we're talking that's probably three or four each way, I imagine. And then he goes, well, it was only a couple days a week. I don't care if it's once a month. That would drive me bananas. No, thank you.

I don't like to be in a car very long. You need your beauty sleep. You don't get this with three once a month. That would drive me bananas. No, thank you. I don't like to be in a car very long. You need your beauty sleep. You don't get this with three hours, four hours of sleep. Look, you know, it takes a few minutes to do this hair, too. This doesn't happen in a couple of minutes. There's a process here, George. We both have our process. Well, I don't think your personal sanity, your physical health, your mental health is worth commuting to that job.

Even if it's a dream job, you're living a nightmare. Do not forget that that hampers your ability to do your job well and potentially get promoted. So this is a holistic life decision here. I hope he goes closer, and I hope he lives in Poughkeepsie because I like saying it. Ken was just dying for a call from Poughkeepsie, y'all. This is The Ramsey Show.

This is The Ramsey Show. I'm George Campbell, joined by Ken Coleman this hour. It's a free call at 888-825-5225. You call us up. We'll talk about your life, your work, and your money. And hey, if you're a new listener to this show, first of all, welcome. We know you have a lot of options when you fly. We appreciate you checking this one out. And if you want to dive deeper into the Ramsey baby steps and some of the lingo we dish out on the show, you can go to RamseySolutions.com and click on the Get Started button, and we'll help you figure out the next best step for your journey based on where you're at today.

That's RamseySolutions.com. Click on Get Started. By the way, I should also say to those who may want to come see us, we have a great group of people in the lobby today. When you said the whole you have many choices when you fly if you come watch the show live at our world headquarters here just south of nashville uh we don't give you pretzels and peanuts we give you fresh baked goods cookies cakes uh lemonades bottled water hot coffee cold coffee and uh yeah so there you go and a free mug you get a free mug yeah i didn't know this and of course it costs nothing to watch the show although if times get tough i

guess we could charge and see if anyone you know donations at the door kind of thing that is true we could but it's a great time we love meeting people from all around the world we have someone from germany yeah a nice lady from Germany. So who knew? So we're open for business. Come by and see us. All right, Sean is in New Orleans. I like how you said that, George. New Orleans.

How are we doing, Sean? I'm doing great. You're talking to one of the original George Hamill fans here. I was a George Hamill fan before he was a Ramsey personality. Wow, long time. I need to know more. What period of time was this? This was when he was doing the commercial breaks.

Oh, the YouTube. I thought you went to high school with me. I appreciate that. I was hoping you were like his high school shop teacher, and you were about ready to drop some knowledge on us. Okay, good. I love it. Well, thank you, Sean. No, I no i'm uh all right so i'll get to the question so i'm at the opposite end of the uh uh spectrum here you had a guest there uh uh uh asking how to deal with uh four

or five year old kids and setting them up i've got a 75 year old mother who is still working as flight attendant. Wow. Saved up about a million. So we've been on a withdrawal plan for the last 10 years since she was 65. So she's only got about half of her money in a Roth outside from the withdrawals and the other half is in regular cash and she has about a half million left in the pre-tax 401k portion. So she's in the, I guess, the winter of her life and is going to be having to look at drawing down eventually. So my original plan was to do tranches and annuitize the $500,000 as opposed to drawing down further. But with inflation, I know that's been a main concern that y'all have been talking about. I'm concerned that with an annuity or slowly annuitizing it, that if inflation does take off, that it will essentially destroy the value of the monthly payments on the annuity.

So one of the things I was considering, I know, you know, Dave is typically not a fan of gold, but as far as the drawdown portion to where managing her finances over a one to nine year period in the liquid phase, you know, beyond baby step three, as far as the 36 months of emergencies funds, excuse me, was to use a portion of that,

not with physical gold, the gold funds, you know, something that you can easily turn into liquid cash, you know, in the market. I just wanted to get your thoughts on gold funds that hold physical gold on your behalf as a hedge for somebody in their twilight years to try to protect their purchasing power. Yeah.

What they have. So I just want to get your thoughts on that. Well, I appreciate the question. I love that you're thinking about this to help your mom, you know, retire with dignity and keep this money alive as long as possible. But even a gold fund versus gold itself, the problem with gold is, and we talked about this on yesterday's show with Dave, is that it doesn't produce anything. And so what you're looking for is a growth stock mutual fund, companies that have publicly traded stocks that are focused on

growth. And what that does, they're producing something called profit. They're creating revenue out there in the economy, and that's going to give you a much higher return in the long term. And so what is the $500,000 currently invested in inside of that 401k? So about 15 to 20% of it in the growth stocks that you talk about, the remaining, so it's the 401K. It's basically in the interest income fund, which I guess is going around 6% right now. Because my main concern is just on a historical basis,

growth stocks appear to be significantly overvalued relative to where the mean is over history. I think the S&P, for example, typically trades at a 15 multiple. It's about 25 now. So it seems like the odds... You're saying, hey, what happened the last 30, 40 years is not going to happen the next 30, 40 years. Therefore, I'm spooked. I'm going to put the money elsewhere. Yeah, the concern is, I'm not going to say that we're going to head for an exact repeat of the 1930s after the stock market crash or anything like that, but it is a possibility. And for somebody who's five years of age or even 35 years of age,

you're going to have maybe 40 years to recover from that. But if my mother was to suffer a 50% loss in her remaining 10 years or 15 years of life, I don't know that we'd be able to recover from that. Does she have a paid-for house? Any debt? Yeah, she has no debt. She rents. And so her rent, we calculated about $65,000 a year is what she would need to live on.

36% of that would represent the rent around $2,000 a month, including the, you know, garage and some other amenities that come with the rent and a car, which we're accruing. That $65,000 would accrue, I don't know, about $200,000 or $300,000 a month to replace the car. And what's her monthly income? Her monthly, well, she used to make in equivalent in today's terms $120,000, but she's down to $60,000. What do you mean today's terms? What is her paycheck today? Her paycheck today is $60,000.

That's because she's only working about, she's essentially working the equivalent of part-time, I guess you would say. Got it. She's not able to work the hours that she used to do, you know, getting older. Yeah, that's a young man's game. I mean, flight attendant, it's a lot on the body to travel that much and that up and down and early mornings and late nights. But Sean, I'll tell you what I would tell my mother, who is not 75 yet, but I would still trust the US stock market and I would

still invest in those mutual funds and index funds. And if you want to go a little more conservative, a 70-30 split and not have it all in stocks, that's okay. But I would not turn out of fear of what could be to things like gold funds or US treasuries. I don't think it's going to beat inflation over the long run. And I truly have faith in the US economy. So that's just personally what I would do. I appreciate the call though. Thank you so much. Ken, are you with us here? We got some mic feedback. Yeah, I'm actually here.

I'm not sure what's going on. Something's happening in my ears. Okay. Yeah. We'll figure that out. Yeah, it's live. We know. We'll power through it.

There we go. Whatever just happened. But, Ken, this is a real thing, people getting spooked by the U.S. economy, wanting to pull their money out, wanting to put it in things like gold and other commodities. What do you tell people when it comes to fear as it relates to their life? Okay. So we have to figure out if fear is telling us the truth and protecting us, like if I were to get on a ledge, okay, overlooking a very steep cliff and fear says, whoa, back up. Now, that's fear telling me you're too close to the edge, and it's protecting me. But many times fear is not telling us the truth. It's not truth-based.

Therefore, it is holding us back. So we want to sit down and we want to go, okay, let's just take this situation, okay? Because there's a lot of, I mean, my goodness. I don't want to take a shot at Facebook, but I'm just going to keep it real. My dad is in his 70s. The guy's on Facebook all day long. And it's just one scary link after another link that this guy's clicking on and the algorithm is feeding him.

And so there are a lot of people going, the world is going to crash. It's coming to an end and all this stuff. That could happen. If it does, the stock market and how much money your mom has left over is the least of your worries. So I would act as though everything is going to be fine and let's move forward that way. And that's how I would choose to take on that fear. That's a good plan. And also working with a financial advisor who can show you real data, real facts, real perspective. And I would highly encourage her to check out ramsaysolutions.com and get some help there. That puts this hour of The Ramsey Show in the books.

Hey, George Camel here. If you love the show and you want a deeper dive on your money journey, we've got a weekly newsletter that gives you helpful articles and tips on following the Ramsey way. Just go to ramsaysolutions.com today to sign up for the newsletter. Again, that's ramsaysolutions.com to sign up for our weekly newsletter.