The Ramsey Show - App - Should We Take a Job That’s Closer to Family? (Hour 1)

Episode Date: July 23, 2024

Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help you win, build wealth, do work that you love, and create amazing relationships. I'm George Campbell, joined by Dr. John Deloney, bestselling author and host of The Dr. John Deloney Show, and we're taking your calls. It's totally free. Just call 888-825-5225. We'll do our best to help you take the right next step for your mental health, your relationships, your money, and your work. Savannah's going to kick us off this hour in, your money, and your work. Savannah's going to kick us off this hour in Seattle, Washington, Siena. Savannah, how you doing? Welcome to the show.

I'm doing good. How are you? Doing great. How can John and I help? So I was diagnosed with bipolar I about two years ago and have been stable for about a year now. It looks like I don't need stable for the foreseeable future. I take my medications prescribed and see a psychiatrist, go to therapy every other week, and use my coping skills. When I had my manic episode, I spent about $30,000 in five months, so I transferred $24,000 of my money into my mother and her name for her to keep safe while I got stable.

Now that I am stable and probably will be for the future, I am wanting to transfer some of that money or all of it back into my name. I'm thinking about opening up a number of accounts into my name. All accounts would be a joint account with my mother, so if I were to have a manic episode, I could give her my debit card and from the checking account she could pay my basic expenses and give me cash to do things like buy groceries, gas, and some spending money. The problem with this system is that I could get access to the money without my mother's oversight by opening another checking account and my own name and pulling my money from the joint account.

Is this a good idea or is there another way that I should go about doing that? I'd say the first, I just want to applaud you. A year of staying on meds, that's like an impressive feat. I'm proud of you. Thanks. Good for you. A year of staying on meds? That's like an impressive feat. I'm proud of you. Thanks. Good for you. How do you feel?

I feel really good. I've never been stable since I was 10 years old. So it's kind of... And how old are you now? How old am I now? I'm 21. Wow. When's your last manic episode? When I was 19 turning 20, so September 2022.

Ended in December 2022. Okay. When was your last basement episode? Ended in August 2023. Okay. Okay. So, I mean, I would high five you if you were sitting right in front of me. I'm really proud of you. It's awesome. It's awesome. Um, so you painted me two different

pictures here. Okay. You painted me one picture where you are very, very wise. And that is saying, I know that, um, I am, I'm going to make up a story here. I am five foot one and I have dishes in the top shells of the cabinets in my kitchen. So I have a stool in there. And in your case, that analogy would be, I've got bipolar one. I have a decade plus of ups and downs, radical ups and downs. I am doing great right now, but for my own, just as a tool for getting through the world, I gave my mom access, I gave her my money to hold it for safekeeping. Awesome. Proud of you. The question I have is, the next question you posed seemed to assume that you're going to go back and do this whole thing again. So tell me what is being well feel like, look like, I mean, tell me what it feels like. Tell me what that plan looks like moving forward. Can you handle 24,000? It's in your checking account right now?

I think I can. I have been managing about $5,000 on my own. And then before I had my big manic episode, I have a total of like $60,000. Some of what is in a brokerage account. And I managed that completely fine until I had my big manic episode I think you manage this the best way you know how to moving down the road and knowing that you're going to have stumbles and that's okay and that you've proven to yourself

that you can get back up and you can have long periods of success especially when you do the things that you know you need to do to stay well and whole. And everyone around you is going to say, oh my gosh, I can't believe you give your mom access to your checking account. Well, you've got a special situation and you're managing it with great maturity. And I was going to suggest that you practice with smaller amounts and you've been doing that. You've been knocking it out of the park. Let me ask you this. What do you need that $24,000 for? Some of it is my college expense savings because I'm in college right now. Okay.

And she transfers $700 of it a month over to me for me to use every month. Some of it is like sinking funds. Another part of it is my emergency fund. It's just bits of multiple different things. So paint me a picture as to why you need it right now. Or is it just you want it? I don't need it right now. I just feel uncomfortable because it's in her name. My name is not even on the account. It's all in her name. And I feel uncomfortable with it on her account. We set up a transfer upon the account. So if she were to pass away, it didn't really go to me,

but I just feel uncomfortable. If she were to get sick, I'd still be alive. You're breaking up with us, Savannah. But yeah, I, here's the deal. I, I think that's a good next step. I think it's a good next step. So George just walking through, she had a manic episode. So she transferred, she blew a bunch of money and she, she learned that when I'm not well, here's one of the things I do. And it makes me not safe, makes my future self not safe. So she transferred all the money to her mom and said, safekeeping. Mom seems like she's trustworthy and is paying her college expenses, is sending her money that they have saved up for her college expenses. So she wants to slowly regain autonomy

after a year of being well. Awesome. And so she practiced with $5,000, manages it great, and then now says next step, what about me joining those checking accounts with mom? I think that's a great next step. And mom knows if anything gets sideways, we can get in between here. I that's a great next step. And mom knows if anything gets sideways,

we can get in between here. I'm okay with that next step, especially given that her commitment to continue to take her meds, continue to go and meet with other professionals and licensed professionals. I think that's great. Yeah. And I'll give you a modern tip here, Savannah. This might work for you. What if you open a high yield savings account online and you don't have the password your mom does? So your mom's on the account, but she knows the password. I like that. There's no debit card attached to it. And if you really need the money for a real reason, mom can sign in and transfer the money over to checking. I like that. But the account is in her name. But the account is in Savannah's name only. And that avoids some of

this, you know, the scary, weird situations we've seen on the show or hey mom drain the account and it's gone who knows uh your mom sounds trustworthy by the way so i'm not saying that what i like that plan i like that plan and then she you know only transfers as much as you need to cover your monthly expenses that month and if there's a sinking fund expense she transfers that amount if it's a big insurance bill or something that comes up. I think that's the best case scenario. And then maybe you guys have a game plan of saying, hey, if I do really well over the next 12 months, here's what we're going to do next. I'm going to have access to the login and you're still going to have oversight. Who knows what you guys decide then, you know, if everything goes well. So I like this plan, but I think we need to make some

tweaks to it in order to protect you and give you some autonomy as well. But there's no need to have more in the checking account than what you need for that month. That's right. Especially while you're in college. And there's no need, regardless of whether you're five foot one, whether you've got bipolar disorder, whether you have any number of physical or psychological challenges. I just wanted to bring you into the picture, into the conversation, George, of having help and having support as you need it. It's part of life. And also, there's a moment for people to grow up if that's appropriate for you.

And we often conflate the two. Not necessary here. It's what's happening right now. I'm proud of Savannah. She should hold her head high. She's done hard work and she'll continue to do hard work. Thanks for trusting us with The Call, Savannah. More of The Ramsey Show coming up. 888-825-5225. This show is sponsored by BetterHelp.

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888-825-5225, that's the number to call. This is The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. A lot of people thinking about maybe selling the house. We got some equity. It's appreciated. Well, selling the house the Ramsey way will make home ownership a blessing instead of a burden. And the Ramsey Trusted Program is the only way to find an agent you can trust to keep you on track with what we teach here at Ramsey and get the best offer on your house or find the right house for you. So we're going to send you some

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Okay. So my husband recently had a job opportunity get presented to him, and we are flip-flopping back and forth whether or not we should take it or whether we should stay where we are. So I'll try to give you as much as I can so you understand kind of the challenge of the decision. So the job would take us to the Houston area. We're currently in the Dallas-Fort Worth area. I am from Houston. That's where I grew up. My family is still there. We still have a bunch of friends there. So that definitely makes the move appealing. Hey, can I just cut you off real quick? Can I tell you what else makes that appealing? Sure. You get to be an Astros fan instead of a Rangers fan. And that's a big deal. No, I'm

a diehard Astros fan. So we literally go watch the Astros play the Rangers here. You're my favorite caller I've ever taken on this show. I didn't know you were an Astros fan, John. I love it. I have a huge H tattooed on my chest. It's all he talks about. They're the best. I freaking love it.

No, I got to go to game six when I won the world series. That was awesome. I got to be there. Okay. Back to the call. Back to the call. So clearly the answer is yes. You moved to Houston.

My God. No, I, I funny, I funny enough said that to my husband. He's like, Hmm, con.

But anyway, um, but yeah, so we would get to move back to Houston, family, friends, all that good stuff. Um,

so there's definitely a financial component to the decision. And there's also like a a financial component to the decision. And there's also like a heart personal component to the decision. Financially where we're sitting. So the offer would be that my husband would be guaranteed 600,000 for 18 months. He's in sales. So his, you know, he never makes the exact same thing every year. So he's guaranteed the exact same thing every year. So he's guaranteed $600 for 18 months, and then after that it's what he's kind of grown his territory to.

It could be that same amount. It could be more. It could be a little less. What's he make now? So currently he technically could make like $525 this year. That's about the highest he could make, really. I think realistically, he's going to be closer to the 450 to 5 range. Okay.

What does he sell? He's in the finance industry. They sell air. They sell air. Bitcoin and NFTs. No, he sells to financial advisors are his clients.

He works for one of the bigger firms. Snacks? Does he sell them snacks for their machines? No, he sells different funds, different solutions for their clients. He sells that stuff. And he's really good at it, clearly. What's the con here? different solutions for their clients. He sells that stuff.

He's really good at it, clearly. What's the con here? He's going to make more than a half million dollars. He's getting a significant raise. A massive raise. You get to be Astros fans, and you get to live in Houston. Right. All these great cons.

Hashtag hurricane. What's the negative? Here's the negative. The financial negative, he would lose $80,000 to to 90,000 in stock with his current company because he'd be moving companies. He'd be leaving his current company. And also is our housing situation. So right now where we are, we got a pretty sweet situation. We have a beautiful home on almost like 0.7 acres. We are like on a cul-de-sac walking distance to all the things you would want

um and at a 2.9 interest rate and looking into the housing market of what if we try to keep where we're at yes we're making you know significant more money but almost all of it's like going to your mortgage because it would increase our mortgage like a solid $2,000 to $3,000. How big is your mortgage now? We're at like $3,700 a month. How much total? What's left on our mortgage? Yeah, what's left on the balance? It's like $500-ish.

Okay, so if you sold and got a new property, what would your new mortgage be? We would guesstimate somewhere around six to seven. How much equity do you have built in? So it depends on what you get to our house for, which we've been told it could be anywhere from one to 1.2. What do you owe on that? We owe another five. Okay.

So you'd get like six, 700 out, put it toward the next one, but you'd have to buy like a 1.4 in Houston. It's yes. So like what we've been looking at, if we wanted to stay somewhat comparable to where we are, it's around 1.2. So it just be depending on how much equity we get out of the house and we sell it would make,

you know, slightly more or less on the new mortgage. Okay. There's something you're not telling me here. Here's why. Um, more or less on the new mortgage. Okay, but there's something you're not telling me here. Here's why. I skipped a final to go on a date with the woman who has become my wife.

I have made some loop-de-loop intellectual gymnastics in order to justify me taking a job that in my guts I knew was right and I've turned down jobs that paid well because in my guts they were wrong. Everything on paper says this is a good move and you are finding ways to not take it. What's the real reason you don't want to leave?

Do you have friends there? Do you have community? What is it? Yeah, yeah, yeah. No, that's the heart part of it I was going to kind of get into. Because logistics, all of that, like on paper, it makes sense, right? Yes, move. So get to the heart of it. So the heart of it is like, we love where we are. Like we're happy where we are. We're content

where we are. My husband makes obviously really decent money here now. Um, and we've built a community here. Cause like neither of our families are here with us. They both live hours and hours away. So we've had to build something where we are for ourselves. And we've done that. And we have a community here now. And we've had two kids here now. We have a three-year-old and almost five-year-old, and we're in the process of trying to have another. And so there's just this... So don't move. So don't move. Like seriously, does that give you peace? Some, but my husband's on the other side. Like seriously. Does that give you peace? Some, but my husband's on the other side.

He's the long-term vision, logic guy. So here's the deal. I don't see a way y'all lose here. And I don't see a way that y'all don't make this move and it's not going to cost you something. You're going to have to create a new community. And that's not going to be fun at first, but you did it once and you'll do it again. Or you're going to have to let $150, grand go and your husband's a killer salesman he's always

going to have money dangling in front of him for the rest of his life right and he's going to have to decide am i going to have make peace with living an amazing life or am i going to is peace for him going to be chasing something red and there's not a right or wrong to that. You just have to be aligned in it. And that's where we're struggling. We flip, we have truly flip-flopped. He has said he was like, go with staying. And then, and then now he's like, it just makes sense to go.

And so we don't know. What if either way it was going to be okay? What would you do? I think you'd move. See, I think she'd stay. I think there's enough upside on this. Oh, man. Y'all guys.

Y'all are killing me. There's two guys' opinions, and we're telling you there's no bad options here. There's not a bad option here. But I think you're burning so many brain calories and toiling over this when really there's no destruction either way. Let's say you move and you hate it in 18 months. He was guaranteed 600K. You pay down the mortgage, you move back. And by the way, our families live hours and hours. Fort Worth is like three and a half,

depending on how you drive or four hours away. It's not long. It's half a day. No, it's not. And we've been able to make that work. We started talking in the conversation of like aging parents, like, because our parents can come visit right now. Like we can go down there. It just starts being a lot more challenging. Once parents get older, they're not going to keep being able to come visit. I know, but your husband's a salesman. A really, really good one. Yes, he is. He'll always have a job. Yeah, for sure. Always. and so if your parents are aging and they're 60 and y'all are starting to think about what 70s and 80s are going to look like that's a decade and a half away your kids will be out of the house you'll

have one kid left in your house or the reverse if your parents are in their 70s or 80s and aging parents is the next year or two yeah Yeah, I would totally consider that. I think you have to live in this tension that we don't talk about very often. There's not really a bad option here. And both options, you're going to gain something and you're going to lose something. And whatever you do decide, you got to make peace with it. And then go all in on it. And don't go, but what if we had stayed?

What if we had gone? You just got to make peace. You'll be all right. Thanks for the call, Rachel. This is The Ramsey Show. Hey, you guys. Health insurance costs are only moving one way, and that way isn't down. And if higher costs aren't enough, the wait times to see your doctor are longer, and it's harder than ever to get anything approved through the bureaucracy. So if you feel like the system

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Welcome back to The Ramsey Show. I'm George Campbell, joined by Dr. John Deloney. The number to call is 888-825-5225. You jump in. We'll talk about your life, your money, your relationships, and whatever else you want to chat about. Henry is up next in Cincinnati. Henry, welcome to the show. Hey, how are you guys today? Doing well. How are you?

I'm good. What's going on? Hey, so just to get to the quick question, there's a bit of a background story, and you guys can ask whatever you want to after that. So right now I want to, or I'm looking at buying a duplex with my two oldest kids. I am debt-free, and actually they are too. I have money. They don't, um, they have, the older one has good income. The younger one is a recently, uh, single mom and so i'm just looking at how best to do this because i can do this without without debt but they cannot why are you wanting to include them

that's part of the backstory they um because of my kids i'm looking to to help especially my daughter during this time. So instead of them, my oldest son is looking to make a move so that they could rent together and get our area. The rent is absolutely ridiculous. And so I said, maybe it's a good time for us to get into a duplex to where the rent is staying in the family as opposed to going in somebody else's pocket. So are you saying you would live on one side and son and daughter live on the other? I'm not moving, no. My son and daughter would live on one side and son and daughter live on the other? I'm not moving, no. My son and daughter would live on one side and the other side would get rented.

So if I was you, I'd buy this duplex with cash, and I would let my son and his family or whatever rent one side, and I would help my daughter out when she was in a tough season. But I would not include them on the note or anything like that. You're going to end up in a war with your kids, and the relationships you're trying to preserve and save, you'll end up in ashes. I'm just telling you that's going to, you're going to end up in a war with your kids and the relationships you're trying to preserve and save, you'll end up,

it'll end up in ashes. I'm just telling you, that's what we do. But I love that you're taking care of your kids, but I would just buy yourself a duplex, man. And if you want to give,

gift her money every month, then gift her money every month. But I don't think you need to wind it through this sort of business transaction. That feels like it's going to get messy. And I would,

just because we wouldn't have a show, if these things didn't go sideways all the time, I would have my son sign a lease. I would tell my daughter, we're going to do this for six months and then we'll reevaluate. It just keeps them from feeling parasitic. It keeps the dad-kid relationship solid. And then there's a business relationship as well. So in your view, in no way should this happen like as co-owners or anything? No, no, no, no, no. Let's walk through this. It's awkward.

They're broke. They don't have money. You put all the money down. They're going, okay, well, what's our equity versus yours? And what if we want to sell? Let's back up a minute my i would say that my daughter is my daughter is the closest to being broke but she's not exactly broke my son has really good income but he's starting out in life so he has no money it takes money to buy real

estate i'm not saying they're they're great kids they're debt free i'm not saying this has anything to do with their financial acumen but But as far as making this business transaction happen, you're coming to the table with 100%. They're bringing zero, and yet they're co-owners. And so it creates inherent awkwardness. Nope, that's not it. That's not it. It would be like, I could potentially buy it outright, but that would burn up more money than I'm looking to burn up. Well, I wouldn't tell you to take a mortgage on this. We don't tell anyone to buy investment property with a mortgage. Here's the deal, brother.

You can do what you want to do and help your kids out the best way you think you can help them out. What I'm telling you is one of your kids is going to get a job, and they're going to have to move. One of your kids is going to find the love of their life and it's going to happen quicker than anybody thinks. And that person's going to either want to move in or want to get their own place. And then we're going to have to sell this place, but the other person is not going to want to move. And you're going to have, it's just going to turn into a mess. And I just wouldn't buy, like, I just wouldn't buy a house with anyone other than my wife, because there is a legal detangling of that

relationship if it ever got that place. But it's just a recipe for somebody wants to move, somebody wants to stay there. Well, I got this house for you guys. It's just a way to create unnecessary chaos. I would just buy the house outright. And if you can't afford to, or you're not interested in that, you need to have that conversation with your kids, but bringing them into a financial relationship that they can't pull their full weight on, that you want to kind of pull their weight,

but hey, dad, we're grownups now, but yeah, but I'm paying for this house. It's just going to make everything so messy, man. But you do what you want. I mean, you love your kids and you're a grownup. You can do what you want. We're just telling you what we would do in our situation with our kids.

And what we've seen. And what we see day've seen and what we see day in and day out and day in and day out okay sorry henry i we've we failed him as far as what he wanted to hear but i'm i just my heart palpitates with all the things that could go wrong and it's like well we're paying rent so i feel like that should go towards our equity and it's just, I can see this going poorly in so many ways. Or I don't want you guys having this guy come over to your house, but this is my house and it's just going to create chaos. So the cleanest way is buy the house

and then let your kids rent it from you. I got no problem with that. Let your kids live there for free while they get their feet underneath. That's amazing. You can be as generous as you'd like on that front. Yeah, but trying to weave it all together just makes everything really tough and chaotic. Thanks for the call, Henry. It's an interesting one. Eric is up next in Philadelphia.

What's going on, Eric? Hi. Thanks for taking my call, guys. Sure. My company was bought out by another company, and when they did, they had to roll my 401k over into the new company's plan. And so when this happened, I was charged the $17,000 MVA, a market value adjustment, even though I took no money out myself. And I was wondering how I could fight something like this and see if there was any avenues I could go through. Because right now we were told that we wouldn't lose any money in the rollover, and then I lost $17,000 and one of my colleagues lost $32,000. It sounds like you're not invested in mutual funds or in 401k.

What was this investment account? Well, the funniest thing was I was invested in the 401k, and when I ended up speaking to the representatives from the company that was holding my money, they guided me into the fund, which took my money. Are you talking about an annuity? This is an annuity. Because that's usually what, when market value adjustments happen, it's on annuities, which is a contract with an insurance company for payments later in life. Well, see, that's what these people are telling me, but I did this over the phone with these guys. I went from a 401k into one of the funds in the 401k was the stable market value fund, which was supposed to be there.

The way it was explained to me was that this was going to be an actual number on the account so that it wasn't going to fluctuate during the transition of my money from one, from the 401k into the new 401k. And, and I've heard what you're saying from other professionals saying, Oh, you weren't in a 401k, but I've, I've always been in a 401k. It wasn't until a month before the switch that I was moved into this fund with, with the help of the people that were guiding me. And then all of a sudden it was $17,300-something was just pulled from my account. What was the total balance beforehand? $257,000 and some change. Okay.

So we're talking about, I'm just doing the math on this, it was about a 6% market adjustment. Yeah, 5.96. So the market adjustment happens when the underlying funds, the value changed. And so the value changed by 6%, and when they moved it over, they made that adjustment. I don't think you're going to be able to get that back, unfortunately. Now, see, this was done a month before into that account.

It was never in that before. And so my question was basically, is there anything I can do to see if we can argue with these people about, hey, there's no way that the market changed 6% in one month. It actually went up. It was charged as a fee to me because of... Eric, we're out of time. Go to ramseysolutions.com, get in touch with one of our SmartVestor pros, and maybe they can dig into this for you. But it's hard to do on a short call.

Thanks for the call, man. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm George Camel with john deloney here taking your calls at 888-825-5225 john it's time for our long-running segment talk nerdy to me man um i just want to know your thoughts just on that alone i've just we've been traveling a lot and uh there's many nights you and i are driving late nights you, to an airport or to a speaking gig. And you're like, John, talk nerdy to me.

And we get into it. Yeah, we do. And that's what we do on the air. So we're going to make it a segment. We're going to explain a financial concept that maybe you've never, you know, thought about all that much. Or you hear it and go, I think I know what that is. And I try to pretend when I'm at a party that i know because when you're at parties what you talk about john is don't say it because i got a tip a clip to tease it you ready let's do it let's see if you

can guess america based on this clip from seinfeld i'm not an investor people always tell me you should have your money working for you i decided i'll do the work i'm gonna let the money relax you know what i mean because you send your money out there working for you. I decided I'll do the work. I'm going to let the money relax. You know what I mean? Because you send your money out there working for you, a lot of times, it gets fired. You go back there, what happened? I had my money. It was here. It was working for me. Yeah, I remember your money.

Showing up late, taking time off. We had to let him go. Ah, that's good stuff, John. That's gold, Jerry. Is that any good to you? No? Okay.

Well, John, what we're talking about today is not investing. It's the cousin of investing, which is savings. So there's a big difference. Savings, think short-term. Investing, think long-term. And the word of the day is high-yield savings accounts, or HYSA. Talk nerdy to me, George. What is a high yield savings account? So it's, this one's kind of what it sounds like. It's like onomatopoeia.

I think that's what that is. A high yield savings account has a higher yield, higher interest than a traditional savings account. So let's talk about those numbers. A traditional savings account, the average you'll get is 0.46% in interest on your balance, which is not even a half a percent. High yield savings accounts, we're seeing some record numbers here, John, at 4% or 5% that you're getting on your money. So you have $100,000 sitting in there. If that balance just sat there over those 12 months, you would make $5,000, which is

pretty sweet for doing nothing. And so we talk about having your money work harder for you. And that's why I recommend people store their emergency funds, their big savings, like a home down payment, you're saving up for a car. Because once you get that ball rolling, it's nice to make a little bit of dough. So the goal here is not to make 10, 20%. We're not investing. This is for short-term goals. Think one year, two year, two year, three year, four year goals. A high-yield savings account is a great place on top of your emergency fund. And what you're going to see is this word, APY, annual percentage yield. So 10,000 in a

high-yield savings account at 5% APY, that's 500 bucks in interest at the end of the 12 months. It's that simple. And so with a traditional savings account at 0.46%, you get a measly $46 a year versus, you know, the 500. And so that's why I recommend those high yield savings accounts. It's a great place to store those things like the emergency funds, sinking funds. But again, this is not a long term investment strategy. So do not think that you're investing by putting money into this type of account. And if you're spooked by the stock market, people go, I'll just put it in savings. Well, you're going to hopefully maybe keep up with inflation at that rate, but your money's not going to grow. So long-term, think five plus years, you want to invest it into the market, into your 401k, IRA, brokerage account,

short-term, high-yield savings. So just practically speaking, here's a couple of ways I've used high-yield savings accounts. Well, my wife and I were saving for house. And we were, basically it was a sinking fund, but it was where we put a ton of money for our down payment and we went and put a huge chunk down. We used a high-yield savings account. And we did. I looked up after 18 months. I couldn't believe how much interest we'd made.

It was remarkable. Yes. Also, I use a high-yield savings account for, I pay my taxes and insurance and lump payments every year. And so I basically pay a bill every month, but I put it into that high-yield savings account. So it earns money over the course of the year. And at the end of the year, I'm never surprised by something. That's right. And so those are two ways that we just use it in the Deloney household.

And if you're wondering, well, how are they able to offer these? Well, they're generally offered by online banks, which have lower overhead because they don't have to create a thousand brick and mortars and hire a bunch of people. They can be a little more nimble and they can pass the savings on to you. So that's where you're going to see these. Recently, John, I partnered on my YouTube channel with a company called Laurel Road, a great online bank. And they've got an APY right now it's 5.15 which is impressive and so if you guys want to check that out this is not like a sponsored segment i just i'm a fan of what they do laurel road.com slash george you can check it out and john you use probably a different account for

your uh yeah my smart investor pro uh craig with swan wealth management he uh put me in cambridge stone castle it works it's it's been in that in that range it's probably around five percent yeah so give or take and it's been awesome don't go chasing's probably around 5%. Yeah, give or take. And it's been awesome. Here's the thing. Don't go chasing like, oh, well, this account. Don't go chasing waterfalls and don't go chasing the spread because you found another company that offers a 0.05% higher rate than you were getting. The juice ain't worth the squeeze there. But the key is don't go with one of these scummy companies that are like part of like SoFi or Capital One, you're seeing a lot of these debt companies start to offer high yield savings accounts as a gateway drug to get you into their, you know, grimy little grubby fingers. Don't do that. So, you know, there's some credit unions out there that have

some great high yield savings. Ally, I think is one that Jade and Rachel have used. I use Laurel Road and John uses a different one. The key here is it keeps your money safe. You want to make sure it's FDIC insured, which means your deposits, if the bank collapses, you're going to keep your money safe up to $250,000 for a single person per ownership category or $500,000 if it's a joint account. no monthly maintenance fees, no heebie-jeebie minimum balance required here. You don't have to worry about that. So those are some of the things to look out for. We've got a great blog article on this. We're going to link it in the show notes if you want to learn more about high yield savings accounts. Painless, John. Painless. Let's get to a call. Isabel is up next in New York City. What's going on, Isabel? Hi, Dave. So glad that I'm... That's what they call me these days.

He wishes he was Dave. Oh, thank you. He wishes. That's such a compliment. Oh, I'm sorry. It's okay. It happens to the best of us. He asks us when it's just us.

He's like, hey, will you guys call me Dave? So we do. It's cool. What's up? Go ahead. Okay, so this is my question. Should I pay off my mortgage on my second home with the money that I originally saved for an emergency fund? What's in the emergency fund? How much? $160,000. What's left on the mortgage?

So I have two mortgages, one on my primary home, which is $57,000, and the other one is $52,000. So you're telling me you could knock both of these out and still have like $50,000 left over? Um... The answer is that was basic math. It was rhetorical. Today. Do it right now. Pay them both off today. Do it right now.

If you were going to drain your emergency fund down to $0 I would say, hey, let's hold off. Let's leave three months in there. Anything beyond that we can chunk at the mortgages. But you can knock both mortgages out today. You have two paid-for houses and $50, let's hold off. Let's leave three months in there. Anything beyond that, we can chunk the mortgages. But you can knock both mortgages out today. You have two paid-for houses and 50 grand in the bank. Okay, I was just saving some of that for the next car because I like to pay for cars in cash.

Good. Well, here's the thing. A car is not an emergency to upgrade a car. You're going to do it with cash and leave as much as you need in the emergency fund, three to six months of expenses. Create a different savings account for a car. Because what happens is people get confused over

what an emergency is and all of a sudden you just bought a cruise to Cabo as an emergency. And here's what's also cool. You pay off those two houses today, they're worth more than that tomorrow. You're not losing that money. If you take that money and buy a new car, they're worth more than that tomorrow. You're not losing that money. If you take that money and buy a new

car, it's worth less tomorrow. Right. No, it won't be for a while. I just like to have that. I think you're so great at savings. Your savings muscle is amazing and now it hurts to let go of that money. It feels like it's disappearing, doesn't it? Yeah. But it's not. It's a it's disappearing, doesn't it? Yeah.

But it's not. It's a forced savings plan. Because guess what? You just freed up two mortgage payments that you can now throw into a savings account. Yeah, wait until August 1 when you don't have any mortgage payments. It's going to feel dope. Do it right now.

What do those mortgage payments add up to? If you add a principal and interest on both mortgages? Principal, like $3,500 a month. A month for each one? Yeah. So we're talking like $40,000 a year. One is like $2,000. Yeah. Right. And the money that I'm saving on the interest. What do you make a year, Isabel? $150,000 and my husband makes like $150,000. So you guys were making $300,000 and this year you're going to make $340,000 thanks to the raise you just gave yourself because it's not going to the lenders anymore. It's going to you, Bank of Isabel.

You just got a $40,000 a year raise. That's awesome. That's awesome. Cha-ching, Isabel. I'm proud of you. Way to go. Pay it off. You're not going to regret it.

And if you do, we always joke you can go back into debt. But we haven't got that call yet, John. Dear bank, I hate owning my home outright. Give me some cash so I can have something to pay every month. Yeah, I just need a challenge. I need the hustle. No, thank you. That puts this hour of The Ramsey Show in the books.

Thanks to Dr. John Deloney, all the folks in the booth keeping the show afloat, and you, America. We'll be back before you know it. you