The Ramsey Show - App - Should We Save Extra Funds or Put Them Toward Our Mortgage? (Hour 1)

Episode Date: September 16, 2021

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Thank you very much. Live from headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studio, this is The Ramsey Show, where America hangs out to have a conversation about your money, your life, your relationships, everything, all of it. We have a packed house here in Nashville, Tennessee. It's good to see everybody. And we are taking your calls on life, on everything. 888-825-5225. I'm John Deloney, joined here with my good friend George Campbell.

And we're going to take all your calls about any and everything. All of them. We can't stop them from coming through. We could. We do what we're told. You are correct. Hit the buttons. This is James' show, and we do what James says, because we're in James' world.

That's right. You doing well, man? I'm doing great. How are you? I haven't seen you in a minute. It's been a little bit, and I'm excited because we have an event this weekend, and we are tag-teaming this talk together. I'm really excited about it.

Tag-team back again. That's before your time. Yeah, no recollection as to what you're referring to. Yeah. You are 78 years old. You will improve your life if you get into some old hip-hop, but you'll get there. You'll get there. Thank you.

888-825-5225. Let's go to Wayne in Birmingham, Alabama. Hey, Wayne, what's going on, brother? Hey, I'm an over-the-road truck driver, and currently I'm just a company driver, but I'm wanting to get my own truck and be an owner-operator. But I'm currently on Baby Step 2, so I'm just toying with the idea of whether I should put Baby Step 2 on hold

because I want to pay cash for my truck and build up the funds that I need to start my truck driving business and everything. Let me ask you this, Wayne. What does it cost to start this business? Well, I don't really have all's going to probably cost between $40,000 and $60,000 to get a used semi. It's got decent miles and everything on it. So that's what I'm currently looking at, getting a semi that's just a few years old, maybe around 500,000 miles on it. Why do you want to move jobs, man?

I just want to be able to have more freedom as far as, you know, I'm not – I don't have to take – I'm the one that's choosing the loads that I take. I choose where I want to go and when I come home and those kinds of things, just more freedom as far as my day-to-day life goes, I guess. Gotcha. Well, if I'm in your shoes, I want to get rid of this debt so I can not have this business be a huge stressor in my life as I'm trying to kick it off.

And I especially don't want you starting this business off with debt, which is going to be hard to do when you're trying to cash flow this expensive truck and you're trying to pay off your debt. You're going to be doing too many things at once. How much debt do you have? Probably around $30,000. Okay. What kind of debt is that?

Student loans. Student loans. Okay. And what's your income? This year I'm probably looking at probably around $80 or $90. Okay. That's great. Well, you've got a great income comparatively to your debt load.

I think you can clean up this debt within the year and then start saving up for this truck. I don't know where the urgency is coming from to start this business tomorrow. I know you're itching to do it because of the freedom that you talked about, but I think you're going to actually feel that financial peace and feel that freedom. When you get out of debt, you have the emergency fund, and then we can start saving up for that truck and start this business. What's the emergency, brother? It's not really an emergency or anything. I guess I just feel the itch to have my own truck with all the freedom things I was talking about.

At the same time, I was sort of feeling the same way as far as the debt. Initially, when I started thinking about it, I really wanted to be out of debt because I just want to be out of debt because I just want to be free of all the debt before starting a business. I just feel like I won't be as stressed on the business side if I don't have a whole lot of debt sitting out there. Exactly.

Yeah, I love the idea of you using this desire to jump jobs, to spend a year figuring out what the loads are going to look like, what your routes would be, taking time to find a good truck, and in the meantime, just using this as jet fuel to get that 30 grand paid off so that you can buy this truck

and you owe nobody anything. And it feels like you're fantasizing about the freedom you're gonna feel when you own your own small business you have no idea brother what it's gonna feel like when you owe nobody nothing and you have a paid for truck and you're running your own loads man then you are free to run man but thanks for the call brother let's run to a dalton in virginia what's up dalton hey how's it going good man how are you doing good. What's up, Dalton? Hey, how's it going? Good, man. How are you?

Doing good, man. What's up, dude? How can we help? All right. So you've got kind of a unique situation. I graduated about a year ago. I'm a full-time travel nurse. I've been driving the same car, it's like a 2005 Versa, for at least five or six years.

And it's kind of come to my attention that I've gotten to the point where I've driven into the ground. I don't want a new car. I would drive this car if I could. So I'm definitely not looking for an excuse to get a new one. But since I travel, I move about every three months with travel nursing because I work off of contracts and where I go where the money is. I'm about $70,000 in debt, which I'm working through. And I make, I'm trying to think right now with the current contract I'm on, I make about $4,000 a week. So I'm just trying to figure out with the current used car situation,

because I've been on used car lots looking for used cars and trying to find something that's reliable enough where I can drive it across state lines and love all my life with me and not be back in the same situation I am here in six more months if I bought something that was about like $3,000 or even if I can find something like that. I'm just kind of looking for some direction on what I should do. So you're making $4,000 a week. Yeah, right now with this contract, yeah. So what's your annual take home?

Is it about $150,000? If you signed a contract every time, that would be about $190,000. What's your overall picture? About about 150 i know like if you if you signed a contract every time that'd be about 190 what's your what's your overall picture about 150 this year uh right now yeah just about 160 one yeah around there because i because a lot of it's not taxed because it's a housing stipend yep so i take home i take home about 3300 a week. Okay. All right. And your housing costs are covered too? No, that's part of it. So without getting super deep into it, I still pay, obviously, it's a little bit more of a premium because I do Airbnb and stuff like that. But usually, I try to stay under about $1,500 a month of wherever I'm at, which I've been able to do for a while. And then I have to, for tax reasons, I have to have another house back in Virginia that I pay a room rent to show just for a weird travel tax reason.

Very cool. So I want to get into this because there's several things here that I want to dig into. So we're going to run up into a break here. I want you to hang on the line, Dalton, and when we come back, George is going to dig into the financial side of this. And there's some bigger picture questions I want to walk through with you too, brother. But thanks for the call. We'll be right back. George, I love being on the show with you, man.

It's a blast. All right. Hey, give us a call, 888-825-5225. We'll be right back on The Ramsey Show. work doesn't have to suck there's a reason you can't shake the feeling you were meant for more than just another job 61 percent of people aren't even engaged at work, let alone doing work they love. That's why Ken Coleman, America's career coach and national best-selling author, wrote his new book, From Paycheck to Purpose, The Clear Path to Doing Work You Love. And it's available for pre-order right now.

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888-825-5225. We're going back to Dalton in Virginia. Dalton is a traveling nurse, and he is wondering about a car. His car is, as he says, come to his attention that he's running into the ground. So, Dalton, what does come to your attention mean? Did it make an announcement that just said, brother Dalton, I'm tired? So, yes, I've been fixing cars with my dad since I was a kid. So I've done all my own repairs, all my own oil changes and everything

and tried to stay up on the maintenance. And it's just gotten to the point where it's come to the repairs that I'm finding that are that in my heart are on the horizon are going to be more than what the car is worth. I mean, the car cannot be worth more than fifteen hundred dollars. And there's some rattling and some things going on and some stuttering that makes me think it's transmission and things that it's like. And it's also just not reliable being the fact that I'm miles away from home. And I love my whole life in it everywhere I go, either every three to six months, something like that. So I'm just worried that I'm going to be on the way to work one day and it just like craps out of me. And then that would be put me in a situation where I would be like,

okay, I don't have time to look for a new car or used car, so I have to go buy a new car. And I don't want to have to do that, especially with the used car situation right now with COVID and I guess the semiconductors and them just being not very available. So I'm going to turn it over to George, but I will say, any time in my life, I won't project this onto you, but any time in my life,

I, quote unquote, feel things in my heart that are on the horizon that would sure be more comfortable if I went ahead and just did it now. Or sure would just, you know, I'm going to go ahead and just buy that now.

Is often me projecting a worst-case scenario just because I make X number of dollars and I think I should just be driving a car that looks like this. Or I can invent problems that I could just solve right now with a click on Amazon or with a new car or with a new fill-in-the-blank. And so George will walk through the numbers with you, but as a mechanic, as a guy who knows cars, and also a guy who loves cars, I'd love to hear how honest you are with yourself about, could this car make it another 12 months in time for you to take this

extraordinary salary and blow this debt out and then go get another car? But go ahead, George. Yeah, I'm with John there, and I do think you can cash flow this thing with your incredible income. But I do want to know how serious are you about getting rid of this debt, the $70,000? Are you currently paying extra on this? Oh, yeah. So right now, I have probably turned it was about 110 over the year. And I wasn't making my first year nursing. I wasn't making anywhere near this money just because I was only making about 60 and then I've only been

travel nursing for about three months. So this is, it's a lot of money that I've never had before. And instead of being irresponsible with it, I'm using as much as I can to, um, to just kind of really get through this so I can be debt free. Um, I have, I mean, don't be mad at me. I know in the baby session, I only have a thousand I have because of my unique situation, about 10 grand in the bank. Um, and the reason why, just cause at any point a company can just pull my contract and not to be just out of luck and I have to look for a new job right then. So it kind of makes me feel uncomfortable only having a thousand dollars as an emergency fund, just because I would still have rents to pay. And obviously, I'd have to find another job, which wouldn't be super hard right then. But it just kind of...

So you sign a contract with a company and you go halfway across the country to work that contract and you sign a lease and they can just pull it? I thought that was the point of a contract. Yeah. So it would... Do they have a buyout clause? They can pull it for whatever reason. As far as I know, no. So I work with a travel agency, and then they ask me where I want to go, and they send me all these contracts and how much they pay.

And then I apply to them, and they... But I have heard horror stories that a moment's notice, they get a text message that morning or an email of other travel nurses and they're like hey your contract has been voided and i mean i don't know how pretty that is like i said i'm pretty new to it but i just i hearing that i never want that to be the case and then i'm like and from what i've talked to with my recruiter she's told me like hey if that ever did happen we would kind of like move mountains to try to get you another job in a hospital close to where you already have a lease. And yeah, so. Well,

I'm excited that you have some savings. That makes me feel better about this situation because if I'm you, I'm taking some of that savings that you have and just buying a car that's reliable. Don't go crazy. And I don't think you are. You've got a great head on your shoulders. You're a real hardworking dude. And I want you to take advantage of this time that you are making buku bucks and pay down this debt, which you can do with well under a year with this income, and you can cash flow this car from your savings. Once you're out of debt, then you can go wild. Go get that six-month emergency fund, but right now, it feels like there's just a lot of fear in your life. When you get rid of those student loan payments, you're going to sleep a lot easier at night because you're not going to have payments coming out.

You're going to have less expenses to cover. So if I'm you, I'm taking maybe three or four grand. You're great with cars, so it doesn't worry me. You're going to inspect that thing. You'll be able to keep up with the maintenance. It doesn't matter. Get a Honda or Toyota if you're driving a lot. We talked about this on the show yesterday, even if it has 100,000 miles, those things will go 300,000, 400,000 miles if you take care of them, which you obviously do.

So that's what I'm doing, and I'm going to take whatever the rest is in that savings account other than $1,000, put it towards the debt, and use that healthy fear to then fuel you to get rid of these student loans with this amazing $4,000 a month you have coming in while you have it because you probably won't have it forever. It's $4,000 a week. $4,000 a week. $16,000 a month you have coming in while you have it because you probably won't have it forever. It's $4,000 a week. $4,000 a week. So $16,000 a month you have coming in. Dude, you could crush this debt in six months if you keep up these contracts, and you can cash flow this car today, and you're going to be in a much better spot. I don't want you to live with paranoia about what's going to happen with this contract and what's going to happen with this car.

That's just not going to be a fun way to live. Your job is already stressful as it is. Hey, Dalton, this is normally when I would take another call, but can I ask you one personal question? Yeah, absolutely. What was your financial situation growing up? So my parents were not to the point where they are now well off until I was well out of high school and into college. My dad was an E1 in the military, had me and my brother, my older brother, really young, around 18. So lived in like a two-bedroom apartment in San Diego.

And my mom always tells a story about like having to like have cloth diapers because they couldn't afford diapers. So there you go. So that almost exact, I mean, that was my guess. You now have worked your butt off to get to a place where you have the credentials and you're leaning into the experience and you're willing to travel. You're a hard worker and you must be good at what you do to make that kind of salary. And you're willing to go where the work is.

So what I want to tell you is there's a part of your brain that is still living in we can't afford diapers. That's how you were raised. That's the world you know. And if you grow up the son of a first responder, of a veteran, or a daughter, I mean a kid, there's also this understanding that any day this all comes crashing down. Right? That's the ecosystem your brain is scanning on a daily basis.

I want you to begin practicing, and whether you get a group of friends into this, and it's going to be tough because you're going to be on the road, whether you get a counselor, whether you do that, an online counselor through betterhelp.com, whatever that looks like, I want you to begin to be on the road, whether you get a counselor, whether you do an online counselor through betterhelp.com, whatever that looks like, I want you to begin to lean in and practice. I'm good.

I'm stable. I have a great career, and I work really hard. And at any moment, could this come crashing down? Yeah. Is it going to? Probably not. And if you spend your life in fight or flight, which you've

been in for 20, 25 years now, you're going to burn yourself out. And you're going to always be looking for the next thing, the next scary thing, the next scary thing, the next scary thing. And you're going to be lugging $70,000 worth of student loan debt around with you because you're going to be buying the next thing, getting the next thing. Just stop.

You made it, man. Congratulations. You're a stud, Dalton. Awesome. Thanks, man. Did you hear that? Yeah, I appreciate it. And I want you to, like as George said, the challenge here for sprinters,

for high achievers, for people who are used to crushing it, people who are used to running their whole lives from we can't afford groceries and, hey, dad works in a job job he may not come home every single day those folks often spend their life catastrophizing running sprinting ah and the baby steps are hard because they're methodical and they're slow and they're every single day and they're every single day and they're every single day. Like George said, crush this debt. Get it out of your life and begin to breathe and sleep and laugh from your guts for the first time in a long, long time. Thanks for the call, Dalton. This is the Ramsey Show.

888-825-5225. 888-825-5225. 888-825-5225. A lot of numbers in there, John. Listen, my brain said, we're done with numbers. We're just going to go right to words. And I was still talking. 888-825-5225. And most importantly, I'm looking up to the lobby.

And on the debt-free stage, I see two extraordinary people. We got Cheryl and her son, son Tyler from Anchorage, Alaska. Debt free. Are we, are we debt free? We are debt free. Congratulations. Welcome to Nashville. So how much you pay off? $125,632.92. Wow. Not that we're counting every penny. To memorize that. $125,632. How long did this take you to pay off? 30 months.

30 months. Wow. What was your range of income during this time? Between $80,000 to $145,000. $80,000 to $145,000. That's incredible. What was the jump in income about? I worked massive amounts of overtime,

and in the middle of this, I opened my own financial coaching business. Goodness, you're a rock star. Way to go. And so it is, did you sell some stuff? How'd you get here? No, that doesn't count the stuff I sold. That is what I paid in cash, working massive amounts of overtime, running my financial coaching business, and living on a budget. You cash flowed this whole thing through your income and side hustles and all the extra work.

Yes, sir. Wow. This is incredible. So take us back 30 months ago. What in the world happened? I went through a divorce. Okay. Knew that we had to change a lot of things, and we did.

So you left this divorce with $125,000 in debt? Like I said, it was more than that that but that's what we paid off in cash we sold a bunch of stuff we sold vehicles got rid of houses things like that and then in the middle of this Murphy was not nice

the gentleman I was dating we were planning on a future together and we found out he had terminal brain cancer and he passed away six weeks later oh no but when I knew this worked brain cancer, and he passed away six weeks later. Oh, no. But when I knew this worked was the day after he passed away. I blew a tire on the highway doing 65, and it was not a crisis.

In the middle of my life being in shambles, it was not a crisis. Wow. That puts things in perspective, huh? Yes. Wow. And so you come out of a divorce, which we talk about all the time, and it's a common experience. We undersell what a hard season that is. Yes.

That is a tough, tough season. And you transitioned out of that and you said, you looked at this extraordinary young man sitting next to you and said, I got to make some major changes. How did you get connected with this crazy crew? My parents did Dave Ramsey years and years ago. They're now baby step seveners, live in life. And I just connected with that and ran with it. I knew it worked. I'd seen it work. So what type of debt was this? You mentioned cars and houses. What type of debt was this?

$125,000? Student loans, vehicles, credit card debt, unsecured personal loans, you name it, it was there. So you were basically normal. Yes. Normal, normal, normal. Wow. So you're extraordinary just in the two minutes I've known you. Thank you.

So often somebody comes out of trauma like this on top of other trauma, and they simply turtle up. Where did the fire come from, the spark come from, that you walked out of this divorce and said, this all changes, this is on me, and you lit the fire with jet fuel? I have spent 30 months trying to figure out what God genuinely put me on this earth for, and I was not going to hide under a mattress, a bed, whatever. Life is to live.

And God has got me through this whole thing. Ups and downs, trials, tribulations, he's got me. Wow. Wow, wow, wow. So your parents, you had it back in the back of your head somewhere that Dave Ramsey's some guy in Tennessee, blah, blah. So you got on the plan. Then what happened?

I ran for it. I figured out how to budget real quick. Loved the EveryDollar app. And there were a lot of no's. There were a lot of getting up at 3 o'clock in the morning to take him to daycare. But we were going to do this, and we were going to do it as fast as I could

because I wanted the freedom. And when you're in debt, you have no freedom. So what was this like for you, Tyler? I don't know. Hey, that's fair. That's fair. Okay, so who are the people who thought you were crazy in your life? Oh, everybody where I work thinks I'm crazy. They're like, you can't do that.

I'm tired of working overtime. And trust me, I was tired. I'm a single mom. I was tired. Where do you And trust me, I was tired. I'm a single mom. I was tired. Where do you work? What's your day job? I'm a correctional officer. Oh, wow.

So you're a correctional officer, coach. What are some other side projects you did? I volunteer a couple of times at his school. We volunteer within our community. There's a place called My House that's a homeless team resource center. We feed into them. We do Santa Cop and Heroes in our community, which helps seniors during Christmastime.

You're just genuinely an extraordinary human being. Thank you. Hey, Tyler, you realize you won the lottery with this one, right? Yes. Your mom's pretty amazing. Pretty amazing. Who are your biggest cheerleaders? Really, my parents. My brother as well, but my parents were behind us every step of the way.

That's incredible. So have you had the moment where, A, have you got to drop off some of these jobs and just get down to one or two? I've cut my overtime down, but I still do financial coaching, which I love feeding in. Being a Ramsey coach is awesome. Have you had that moment where you don't owe anybody any money and the checks deposit, and you're looking at this money in your account saying, what do I get to do with this? I have. Tell everybody what that feels like.

I don't even know how to describe it. You look at all this money and you're like, wait, now I have to give that dollar a name. Where's it going to go? Currently my emergency fund and then obviously traveling to nashville that's incredible yeah i love that you know sally may's name is not on those dollars anymore it's cheryl no that's huge you get to put that yeah towards your dreams i mean this is i'm just impressed because i feel like i i make excuses john I don't even have kids. My wife is working here and I feel like I don't have time to volunteer. And she's out there side hustles,

coaching, volunteering all day long while keeping this day job. How did you do it? Are you the type of person who just doesn't make excuses? There are times for sure in the middle of this, I made a couple of excuses. But really, I knew that if I could stay focused, there was essentially light at the end of the tunnel. And really the volunteer opportunities they do on the side feed into me. They encourage me, they build me up. And so that's what I needed in the middle of working all these hours to see that there are people that don't have the opportunities I have. And so to be grateful for the ones I do. That's that's amazing well you are a rare gift and the people driving down the road right now who've been kind of considering this or thinking about it you just

took away every single excuse they might come up with and i hope you'll enter a season of rest and of dreaming of what's next and what can be right um this type of gazelle intensity is extraordinary. You've changed your family tree in 30 months, right? And this young man next to you, he doesn't talk very much, but he absorbed every second of it, and he understands what an extraordinary woman his mama is, how strong, brilliant, and capable. It's incredible.

You've changed his life too, and we applaud you for that. We're going to give you a copy of The Legacy Journey because that's the next step. You are on the road to being a baby step millionaire. And you can probably get there with just two or three of your 18 jobs. That would be great. And we're also going to give you a copy of Total Money Makeover so you can give to somebody else and you can pay this one forward. Thank you for inspiring us all. What a gift. So Cheryl and Tyler from Anchorage, Alaska paid off $125,000 in 30 months,

making $80,000 to $145,000. This is the moment you're waiting for. Count it down. Ready? Three, two, one. We're done. We're free! Woo!

There he is. I knew he was in there, John. there he is I knew it was in there John there he is he was just waiting for his moment Tyler was waiting for his big moment and there it was it was all that

pent up now finally we can go to a restaurant I love it what an incredible incredible woman I mean goodness gracious

that just that makes my day I can't help but smile seeing that family right there and seeing that legacy change, the family tree change. Because someone decided, you know what, I can make some sacrifices for 30 months in the midst of trauma, in the midst of going through a really hard season because this stuff matters and my freedom is more important. It'll take 30 months, go through hell and back, and we're going to change everything. Nothing's stopping her now. Nothing.

Absolutely nothing. What a gift, Cheryl. This, hey, if you're listening to this, that could be you too. You can say no more, I'm done. Okay, 24 months, 30 months, change everything. What a gift. This is The Ramsey Show. How many times in the past year have you heard someone say, I wish things would get back to normal.

Well, let's be honest. What was normal like for you? Worried about money? Stress? Too much to do? Not enough time to do it? You shouldn't have to go back to that when there's so much better ahead for you. But to get the life you want, you need the right

game plan. You can't just run out in the field like a maniac. You gotta have a plan. So join us for Game Plan Live, our free live stream on September 28th. This costs no money. Free plan. Game Plan Live on September 28th. Dave Ramsey, Christy Wright, and George Cam will be laying out the clear plan to make all your money goals come true. Like how to find a vision that gets you excited, how to set healthy boundaries that keep you focused, and how to take control of your money

so it can start working for you. You can have the abundant, balanced, debt-free life you want, and it all starts with Game Plan Live. To register for the free, F-R-E-E, free live stream, text GAMEPLAN to 33789. That's GAMEPLAN, all one word,

to 33789. All right, let's go to Suzanne out in Spokane. Hey, what's up, Suzanne? Hi there. Hi there. How's it going? I just love that it rhymes, Suzanne in Spokane. It just made me happy. It's good to have you, Suzanne. How can we help? Yeah. Good. Thank you guys so much for taking my call. You got it. What's up? So this is basically what I've got. So my husband and I, we moved up. We're actually in the North Idaho area. So we're just kind of over the border from Spokane. We moved here really unexpectedly last year after my husband lost his job.

And it just ended up being such a blessing. He got a job up here. And we absolutely love it. We don't want to leave. We're closer to family now. And he got a job up here and we absolutely love it. We don't want to leave. We're closer to family now and he got a good job here. He's been able to start a business. So he's actually working two jobs and I am a stay at home mom. Now we've got two baby girls. And so thank you. So it's really expensive here. That's one thing we didn't know. We didn't know the area that well, but we love it. So we're determined to stay here.

And we were actually able to pay off all of our debt last month. Wow. Congratulations. Yes. So in the midst of COVID and babies and this move and everything, we still managed to pay off our debt. So we own our vehicles, all that. And we're in a rental, but we've decided that we want to go ahead and buy, even though this market is really crazy and it's really expensive here. But we figured since we're debt free, we can go

ahead and pull the trigger and do it. So we're in the middle of purchasing a place that we found. So you already have a contract out? Yes, we do. Yeah, we close here in a couple of weeks. Okay. Yeah. So it is expensive and we know that, you know, we had started with a budget that was a bit lower and we decided to go higher because we just, we found this great property and it just seems like a wonderful place to raise children. And since we're dedicated to staying in the area we wanted to do it so you've laid the groundwork to justify not making a smart decision is that what happened is am i questioning the decision yeah you've laid the

groundwork to have possibly made a not great financial decision It sounds like there's a lot of emotion behind this of just excitement about getting a house and all this. So give us some details about the financial aspect. Yeah. So when we first started looking, so we've been looking for months and months with our realtor, and we didn't have a super firm budget in mind, but we decided around the $450 mark was we didn't want to go much over that.

We felt we could really afford that and still be able to save money. But in this market and in this area where we live, what you can get for 450 just doesn't even seem worth it. These aren't even really starter homes. They're not even really fixer uppers. And we just found that nothing in that price range we were willing to go for. So we decided that we wanted to not only do a house, but get some property since we've got little kids. So we ended up finding something, but it's about a hundred thousand more. So 550?

We initially started. Yeah. So now we're in the 550 range. And how much are you guys putting as the down payment? What percent? Well, we aren't because we're both veterans, so we're going through a VA loan, so we aren't actually putting anything down. Oof. Okay.

What's your take on? Yeah, so we are going to finance the whole thing, which puts us at about a $2,500 a month mortgage. On a 30-year? Yes. Okay. Suzanne, what's your question? You're getting us all fired up here.

I'm getting riled up, Suzanne. How can we help? Well, that's what I was looking for. I don't know if we can help. You're knee-deep in this thing. If I'm you, I'm getting out of this thing if there's still time. But you've already signed a contract. So what's your question?

Well, my question is, should we focus on saving money? Because, you know, we're in this, we're going to be paying this mortgage. Should we be saving money and focusing on that? Or should we focus the extra money that we have every month towards this mortgage and get it down? You should have focused it before you ever got in this contract and had a healthy down payment on a 15-year. That's what I would feel better about. I don't love this idea of you guys getting out of debt and then taking on over a half million dollars on a mortgage and thinking that they're doing you a favor by giving you the VA loan. Is that not a big part of your take-home pay?

What is your take-home pay? What is your take-home pay? It is. Right now, well, we've got several different sources of income. What's the total? Here's what happens, Suzanne. You have created a universe that you want to have. You want to be in this area. You want your kids in this area.

Well, our kids need to go ahead and have this too. So you created that as well. And you've created a really fungible, flexible dollar amount. We just got a lot of money coming from this place and that place and this place. And here's what you've done. You've created a cloud that allows you to, A, not see very clearly and not have to see very clearly, which allows you to live in a fantasy. And now you've zeroed down in one of the, if not the hottest real estate markets of all time.

So it takes a teeny tiny correction and you are underwater in a half million dollar house. Working side jobs that are, we kind of make this as, you know, and suddenly this zero down VA loan is a nightmare because you're underwater and you can't get out. So tell me how much money you make, how much money comes into the Suzanne and company home every month. About my husband's business is tough, we can't, because it's a new business, but about $100,000 a year right now. Is that take-home pay, or is that gross? Yes. That's take-home. So you're taking home about $8,000, right? Right.

And your mortgage is going to be over about 31% of your take-home pay is going towards a mortgage, and that's on a 30-year, which we never, ever, ever recommend. We always tell people to do the 15-year fixed rate. But you're here, right? But we're here. Suzanne, how old are you guys? 35 and 37. Okay. You've got a lot of life to live and I want to see you live it. And I don't want to see you drowning in this giant mortgage payment with

nothing down. I've just talked to too many people, heard too many stories and they start out like yours. Starry eyed about the housing market and wanting to get in and we want the property. We got to have the yard and the budget's flexible and we're not putting anything down and all of a sudden they can't breathe. Yeah. And we get calls, I'm sure we'll take one during this show where someone calls in and says, we're in over our head, we put nothing down on this house and we're drowning. And so if there's time to get out, I mean, it's just-

Well, you signed the contract, so you signed the contract. I don't know what the situation is there. If you're stuck with this thing, you may want to look at increasing income, refinancing to a 15-year, and making sure that you can afford it. But as far as paying down the mortgage, I mean, it's a little late for that conversation because we're knee-deep in this thing. But we recommend 10% to 20% down to avoid PMI or more on a 15-year, where the mortgage payment is no more than a quarter of your take-home pay. So, so far, every one of the rules has been broken, which just hurts my heart because I want to see you guys win. And you've worked so hard to get to this point where you're debt-free and you're making these decisions. And I don't

want to see you step backwards and make a bad financial decision for your future but if you're here to answer your question yes i would treat the 20 down as the new gazelle intensity i wouldn't save money i would sprint and get some sort of cushion underneath your feet and make sure you have an emergency fund of three to six months before you do any of this before you start saving saving anything, right? You're underwater and y'all got to get your head above water first. Get 20% down on that house, pay it down, and get an emergency fund. So now we're in the books. We'll be right back on The Ramsey Show. This is James Child, producer of The Ramsey Show.

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