The Ramsey Show - App - There’s No Such Thing as a “Forever Home” (Hour 2)

Episode Date: March 16, 2023

Dave Ramsey & Jade Warshaw answer your questions and discuss: "Our debt is worse than we thought it was..." "Should we pay off our mortgage or save for a dream home?" "My ex-wife's student loans are in collections", "Sell one rental property to pay off the other?" Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Want a plan for your money? Take our FREE 3 minute assessment: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Live from the headquarters of Ramsey Solutions, broadcasting from the pods of Moving and Storage Studios, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Jade Warshall, Ramsey personality personality is my co-host today. Open phones at 888-825-5225. That's 888-825-5225. Natalie is in Fresno starting off this hour.

Hi, Natalie. How are you? I'm good. How are you? Better than I deserve. What's up? Hey, so my husband and I just started listening to you. I needed something to listen to while I was doing cardio, and I found your show, and I

told him he needed to start listening, and so we just decided to crunch the numbers, and I guess what we had been doing was ignoring kind of what the debt was because when we added it all up, now it seems awfully overwhelming. And, yeah, I don't know. I just found out I'm going to lose my job. My company sold and they're getting rid of all of their remote workers. And I'm at home with our four children and I homeschool them and so I don't have the ability to just go get another job. So it was kind of adding fuel to the fire and we're not sure where to go from here or how to tackle this mountain that we've created. How much debt is it?

We currently owe $80,881. Hey, I want you to take a deep breath because you, I can hear in your voice that you're just, you feel overwhelmed, you feel worried, you feel stressed, you don't know if there's a way out of this. I can hear it. You sound like actually you're on the verge of tears, which I've been there. That feeling of just kind of sweeping it under the rug and not looking at it. And I know for my husband and I, we just kept putting it on forbearance and putting it on. And then when you come back to it, it's like, oh my gosh, how did it get this much? You've officially had an oh crap moment. Oh yeah.

Yeah. So what kind of debt is the 80? So the majority of it is in a home equity loan. That makes up about half of it. We also have a fuller loan and actually very little of it is in credit card debt. There's also another small loan, but all of those are- No car debt? Like the credit card debt. We have a small loan on a car, yes.

What's your husband make? He makes $83,000. What do you make? I was bringing home about between $800 to $1,000 a month, so it wasn't astronomical, but it was just kind of something that we weren't expecting to lose my income, you know, in the midst of like, hey, we should get out of debt, and now it just seems almost impossible. Yeah, we're finding the work from home workers are the first to get laid off. Yeah.

Well, you also said you're homeschooling, right? Yes. So I just wanted to check, are you homeschooling by default because you got laid off and you thought, okay, well now I'll just do this? Or was that originally the plan? Yeah, no, I've been homeschooling my kids from the start. I have sixth grade, fourth grade, and second grade currently, and our youngest is just one. How much is your house payment? It's $1,481. Awesome. Okay. Yeah. Yeah. Okay. I'm with, I'm with Jade here. Um, yes, I can hear that you've had this thing and I can hear the, um, emotion that comes with an old crap moment. Uh, but I can also tell you, uh, if you guys are willing to go bananas, I mean, go crazy where your broke friends are making fun of you type of stuff for about for about three years.

We can get you 100 percent out of this. I can show you how you can do this. But you're going to have to get real different. You're going to be living on half of what you make now. Yeah, you're going to be you're going to be cranking and you're going to go pick up some side gigs that you do from home. There's stuff out there you can do for $1,000. I thought you were making 50 or 60 grand work from home or something the way you were talking. But you can go pick up some side stuff and just something else to work from home.

He can look at picking up OT or something else. You all can look at what you can sell. And then you're going to be on a scorched earth, nothing budget. You have enough clothes you don't need to buy anymore, budget. You're not going out to eat. You're broke people. Broke people shouldn't go out to eat. You're not going on vacation.

You're broke people. Broke people shouldn't go on vacation. You're going to clean up the mess so you're not broke people anymore because it's no freaking fun to be where you are right now. Agreed? Yeah, and we just got done with a no-spend month. My husband had a mission trip planned this month, so he kept that because it was already paid for before we started this but we definitely we've

been trying to just cinch wherever we can and our kids are feeling well your your whole your whole life for the next three years is going to be a no spin month you're about to have three no spend years and that's baby step two and you know I just have to add this to it. You've had your oh crap moment of like, this sucks. I don't want to live like this. But you got to go now to the next step of what's the greater why? And you need to start envisioning what your life is going to be like if you do the things that we're telling you to do. And what would it be like to have no payments?

Because if you don't connect a greater why to this, I tell people all the time, the stronger the why, the stronger the try. So if you have a very strong why, you are going to do your best. You're going to work your hardest and you're going to stay motivated through that three years, those three no spend years, so that you can achieve that vision that you have in your head. So you and your husband are going to sit down and you're going to do a detailed written budget every month where every dollar has an assignment. It's called EveryDollar. It's the world's best budgeting app.

We're going to give it to you. We're also going to give you Financial Peace University, our nine-week class that has helped 10 million people do what you're getting ready to do. And the two of you, you and your husband, are going to sit down, look at this, and you're going to start to dream again, and you're going to lay it out, and you're going to cut everything even further than you thought you did when you did no spend i mean and then you're going to do anything you can do to

get your incomes up that's legal and moral we are going to go bananas and uh for three years if you'll commit three years to live like no one else later you're going to be able to live and give like no one else you won't ever have to save up for a missions trip again. You can just go. Yeah. Yeah, that sounds awesome. Thank you, guys. You can do this. You can do this, Natalie. It's hard today, but each step that you take, you're getting closer to a life that has financial ease. Right now, you're in the angst moment. If I give you this Financial Peace University, can you get your husband to sit down watch his first lesson with you oh yeah he he's all on board when he started and then and then download the every dollar app as soon as you get off the phone and it goes right in there with it we're going to give you the advanced version so you can use the

every dollar app is tied to your bank and it's going to be really really easy to do to keep up with the budget and to start it but the thing that's going to be hard is you guys are going to dramatically change your lifestyle because you're now going to tell your money what to do instead of wondering where it went. Because you've been living like Congress for too long. And you've got to break the cycle. And it's painful to break the cycle, but it is worth the price because you're going to be free. You're going to be free. What would it be like to have no payments?

I promise you this will work. Hold on. Austin will pick up. We'll get you signed up for it. Jade Warshaw, Ramsey Personality, is my co-host today. Thank you for joining us, America. We're so glad you are here. Austin is in Atlanta, Georgia.

Hey, Austin, welcome to the Ramsey Show. Hey, thanks for having me. Sure, what's up? Hey, me and my wife, we bought a home in 2020. It's not our forever home, but it gets the job done. When we get the baby step six, should we continue to focus on paying down the home or build a nest egg to assist with our forever home we plan on building about five to eight years from now? I mean, if I were you, Austin, I would continue paying down.

I mean, well, let me find out. Where are you in the baby steps? She says six. Okay, I missed that. Maybe step four, five, and you said right yeah so we're we're uh we're on step two right now but we're we're looking to have all that done within the next eight to ten months uh i'm doing long-term planning okay how old are you i'm 27 okay uh let me help you with this there's no such thing as a forever home except heaven

forever home is just an excuse for people to spend more and do the most. Yeah. I mean, you can do whatever you want to do buying a home and you're still going to move again. I mean, if you build it at 68 years old, it might be your forever home. But other than that, your life's going to change and you're going to move again. So that's a concept that's just completely bogus. So anyway, aside from that, just pay off your house. Because here's the deal. If you're going to sell the house and move up in-house, which is really what you're saying, that's fine. I got no issue with that at all.

But when you sell your current home and it's paid off, they're going to give you a check for the whole thing. It's not like you're spending the money. It's not gone. You're just paying off the mortgage. It's still there in equity. Does that make sense? Yeah. Yeah. So pay it off off and then that gives you more options and then sell it and they're going to give you a check at the closing use that check to buy the next house that's the upgrade home right because here's the other part of that people put a nest egg aside and they think i'm just gonna

sit on top of this money for when the right time comes. And then before you know it, Uncle Boo Boo, he's having a... Uncle who? Uncle Boo Boo is in everybody's life. That's when the wedding in the Caribbean comes. Uncle Boo Boo. Wedding in the Caribbean comes. Uncle Boo Boo. I had an Uncle Bubba.

Uncle Boo Boo has a real estate project he wants you to invest in. Uncle Boo Boo tells you to buy cryptocurrency everybody has one day man this guy's evil he is he's got a horrible name too but everybody's got everybody's got one and and and he's the one that steals from that that nest egg that you say oh i'm gonna save this for my forever home yeah something always pops up so when you go ahead and pay off your mortgage you find bass boats are on sale yes it's gone see that's uncle boo-boo uncle boo-boo

buys bass boats too he tells you to go buy it gets around he's like he's like the boogeyman of finance i love it uncle boo-boo who knew yeah it's another jade is another jade it is all right malachi is with us in princeton kentucky hey malachi what's up uh yes thank you for having me on your show dave sure how can we help my my question about it is is i finished baby step one. Now I'm on baby step two. I'm actually moving away. I'm going back to my hometown. And my ex-wife I co-signed with on her student loans and on her car. The student loans are $7,621. They have offered me, that's gone to collection. They've offered me a $5,000 payoff. And if I were to do that first instead of taking care of my smaller loans,

which I know that you say, you know, you pay your smallest loans off and you move on to the next and the next and the next. But would you... You have $5,000? Say again? You have $5,000? Say again? You have $5,000? I do not. Where are you going to get it?

You're going to have to pay it all at once. Okay, because... The offer's not payments. Because if I were to get that off... You don't have $5,000. Yeah. These deals only work, and they're usually for a limited time for a lump sum for a lump sum yeah because i'm i'm whenever i'm moving i'm looking

for my full-time job right now um but i've already got my part-time job lined up i'm in the national guard i've been in there since 2018 i'm gonna be pulling three jobs getting my kids every weekend because i'm paying twelve hundred dollars a month in child support and we used i actually i took your class in high school um i had ten thousand dollars i had eight hundred and thirty credit score and so you must have not learned anything in my class okay yeah well i had um i got with a girl and she i got her pregnant and um now i have three kids and now we're divorced i've actually been separated since july it got finalized in february February. I'm sorry. I got this new place in November, and I've had to ask for money from family members and stuff like that, because all this debt that we had racked up for the life that she had wanted. In the divorce decree, was she supposed to pay the car and her student loan? Actually, my lawyers and her negotiated, because it was so much for the student loans,

I'm responsible for half. For half of the $7,000. And her car would be refinanced after that got out of collection into her name completely. And that would get the car out of your name? Okay. Okay. Yes. So, yes, you do need to pay the student loan, and, yes, you do need to negotiate a lump sum when you have a lump sum. But right now, Malachi, you don't have any money.

Yeah. Because I'm actually moving back into my parents' home. So right now what you're going to do is you're going to get on a detailed budget. You're going to live on nothing. You're not going to go out at night at all. You're going to work all the time, and you're going to start paying these debts off. And when you can get enough debt paid off that you pay off the little ones, and that will get you more cash flow because you're paying payments on all this crap

except her loan. You're not paying on her loan. Actually, I am, sir. I thought you said it was in delinquency. It is. Here lately, I've been directly sending it to her. Yeah, so stop. Don't do that.

Yeah, so stop sending her money and stop sending the student loan people money. Tell them where she lives. Yes, sir. Tell them to call her. They already know. Yeah, tell them to call her. I'm the co-founder there. I know. They're hounding me. I know. Just tell them to call her i'm the coast honor there i know they're hounding me i know just tell them jump in the creek you're not paying it

i'm broke okay i'm broke i'm divorced and i'm broke i don't have any money i'm not paying it i'll pay it when i've got some money how much other debt have you got not counting this mess I've gotten down from right now as of today, I have $410 in one credit card, $239 in another. The car that I originally bought for her that I got throughout the divorce is $13,354. So $20,000 makes you debt-free. I want you to go make $20,000 in the next six months extra and be 100% debt-free. And cut up the credit cards. Cut up your credit cards, your car, her student loans, everything. Completely debt-free.

Yeah. I want you to work like a maniac right now this is all happening to you and i'm trying to get you to happen to it there is not a technique that fixes this except money and you get money from working more yes sir and that's what i'm that's what i'm doing actually you're about to start but you don't have any money right now and you don't even have a job right now yes sir i've i've been on contact with phones i've already got one part-time job there you go that i'm going to be doing after my full-time job good i'm doing national guard and i'm gonna i just got done with the interview today as soon as all this money starts coming in pay off those little

credit cards and then save up five thousand dollars and call the student loan people and offer them five thousand dollar lump sum until, don't give them any money. That offer is going to continue to be good. I mean, it's in collections now. Just call them up and go, I can give you $5,000 now. If it's two months from now, they'll take it. And then that clears that. Then all you've got left after that is your car.

And then I want you to pay that off in about three months. And really, you should be debt-free in six months. You're living at your parents' house. You've got no overhead. It only takes $20,000 to pay off everything. But all this crap has been happening to you. Divorce, kids, job loss, people calling you and hounding you. Everything's happening to you.

And it's time for you to stand up and happen to it and start telling this money and these people what to do instead of doing what they say to do. It's time for you to bust this thing in the nose. And and these people what to do instead of doing what they say to do it's time for you to bust this thing in the nose and you're about ready to do it i can hear it but i'm telling you this is how you get after it get it get it jade washaw ramsey personality is my co-host today in the lobby of ramsey solutions on the debt-free stage brian and elizabeth are with us hey guys how are you hey dave hey jade welcome welcome where do you guys live littleton colorado oh the denver area huh cool good to have you guys

and how much debt have you paid off 244 0004,000. Wow. Wow. How long did this take? 56 months. Good for you. And your range of income during that time? We started out at $156,000 and we ended at $225,000. Excellent. What do you guys do for a living? I'm the executive director of a non-profit. I manage a memory care facility. Oh, very good, guys. Very cool. Good for y'all.

So what kind of debt is this $244,000? It was a little under $20,000 was student loans, and the rest of it was our mortgage. Yay! Weird people! Totally weird. No mortgage! Way to go, you two. What's this house worth?

About $745,000, Dave. Wow! I love it! And how much you guys got in your retirement accounts uh right about 520 right now baby steps millionaires also wow how old are you millionaires i am uh 46 and elizabeth is 43 wow not even 50 years old wow that's exciting ding ding excellent job we wanted to pay off the house before i was 50 it was my goal we blew that out of the water Not even 50 years old. Wow. That's exciting. Ding, ding. Excellent job. Yeah, we wanted to pay off the house before I was 50. It was my goal.

We blew that out of the water. Sure did. Yeah, just blew it a big time. Yeah. All right, tell us this story. What got you guys started on this Ramsey stuff? Well, I do a lot of driving for my job, and I was driving south of the Denver area

and found you on good old-fashioned radio. It was God's hand because I lost the Denver radio station and picked up some Colorado Springs radio station and heard some guy talking about these baby steps and I'm thinking, what is he trying to sell me? Good old KRDO of Colorado Springs. You got it, Dave. Wow. That's the one. That's the one. And so I love nerding out to this stuff. I always thought I was good with money and I knew what I was doing. And these baby steps weren't jiving with the stuff that we were doing. And so the more I listened, I heard you mention Financial Peace University. And I saw that advertised at our church.

And so I connected the dots. I said, okay, this is what that's all about. So I came home and I asked Elizabeth, I said, would you take this class with me the next time it's advertised at our church? And she was initially a bit hesitant. Yeah, the word budget to me meant restriction at that time. So yeah, I was a little hesitant. The sell point for us, though, was the fact that we weren't getting any traction.

We both had really good jobs. We had good income. We were playing these financial gymnastics at the end of every month. We were pulling from our savings to cover our expenses for the month and then promising ourselves the next month that we would replenish our savings account. You're Americans. We're totally Americans. So that got us into the class. And we started taking the class, Dave. And unlike a lot of people, we just went all in. I mean, both feet, we just jumped into the pool.

We didn't dip our toes in. We found ourselves. But Elizabeth, you kind of came in a little bit like, I don't want to do a budget. Don't tell me I can't do stuff. And then how long did it take before you were like both all in? I want to say it was probably the third class because that's when we wrote the check. So, wow. The check for? for all of our

debt those student that student loan debt oh we paid it all off yeah we had consumed we had a little nest egg built up she had enough to just knock out your dad in baby step two that's right so we had our thousand dollar set aside and then everything it took everything else that we had saved up to go into baby step two yeah yeah it, week three. And we just, we got it all taken care of. Was that scary to do? Oh my gosh. We felt so vulnerable. Like a lot of people go gazelle in tents and do their debt snowball on two. We were in this place where we had nothing to fall back on. So ours really kicked into three. We did the math on how long it would take us to get three to six months of expenses. And we weren't comfortable living in that space. So we went full bore. We went crazy. I started slinging packages for Amazon. She started picking up work doing dog

sitting. I was flipping lawnmowers. I was getting free off of Craigslist. I like that one. That's good. People just give away free stuff and we're flipping. We were just going nuts. How quick did you build your Baby Step 3? Yeah. So it took us the majority of that time that I was working for Amazon about 11 months. That got us through 2018 and 2019 rolled around. We found ourselves in Baby Step 4, 5, and 6. And life hit us up the side of the head real hard. We were doing good. And we are so thankful for FPU and your lesson on insurance and knowing that there's this defense that you need to, to go along with the offense. And I'm so grateful for that, for that message. Elizabeth did all the work. She made all the phone calls. We found out that we were underinsured in a lot of areas. We got ourself an umbrella

policy. We had a new 16-year-old driver in our household. We've got five kids, three living at home right now, and woefully underinsured with liability. So we got all that stuff put in place, and we're so grateful. And about a couple months after we got the defense set up, it would be put to the test. We ended uh, my son had a tragic accident that took the life of an individual and severely injured another one. Um, so we had to not only navigate trauma, stress, and of course, mental health, um, but we also had to navigate legal matters. Um, but one thing that we did not have to navigate was our finances because we had

the setup for the defense. We finalized our last lawsuit last year. Wow. And we were set up for financial success. We stayed in the program. When the accident happened, how old was your son? 16. 16. And so he's like 18 or 19 now he's just turned 20 okay how's he doing he's okay now he's still in mental health yeah that's a process to go through it is a process unbelievable yeah i mean it's horrible the with the other family had the loss obviously um but people don't realize that that um you got a 16 year old kid that's got to absorb this yeah and work through it that's that's traumatic so we're and work through it. That's traumatic. So we're navigating all that, but, Dave, we didn't have to worry about money.

That's the one saving grace that we had. And it was really just looking back, this is all God's hand, right? Just guiding us to all this, finding your radio station, getting this stuff in place. Not exactly random that you land on the radio station. No, not exactly random at all. And so we restarted our 401Ks after that point, Baby Step 4, because we had stopped those to get our emergency fund built up. We started 529s. We were late to the game, but still were able to get enough in there.

All of our kids have at least their first full year of college going in state paid for to kickstart them. And every last dime went to the house. We just stayed gazelle. We're freezer burnt food out of our freezer. I mean, we're wiping off dust off the cans in our pantry. Oh, that's weird. To eat. Yeah. All that stuff. Been there. Yeah. That is something. Man. So what's next for you guys? You've got a paid off home mortgage. You've done everything that you can do. What's your live and give moment? Well, I can tell you that we drank the Kool-Aid of Dave Ramsey.

And we're wrapping up our 10th course that we have taught. Thank you. Wow. Thank you. Wow. That's something. And we are going to Ireland. Yay! I love it. I i love it which cities do you

know yes we're starting off in dublin we're gonna do a 10-day tour we're gonna go to south killarney and then we're gonna end up in south um ireland so yes okay very cool beautiful it is a beautiful trip have a good time yeah yes we will're going to pour the perfect pint when you're in Dublin, for sure. But yeah, way to go, you guys. Yeah. Very good. Good. I'm so happy for you.

Me too. Thank you. Sorry for what you've been through, and I'm really happy that God's timing set you up to walk through that. Amen. Yeah. Very, very cool. Well done, heroes.

Whoop, whoop, whoop, whoop. Ireland. I like it. Yes, I like it. That's going to be a great trip. Very good stuff. All right. We've got the Live and Give bundle for you guys.

It'll all be give for you because it's the Baby Steps Millionaire's number one bestselling book. You already are. So you can show someone else how to do it. Same with the Total Money Makeover and the same with the Financial Peace University membership. So you'll have good use to be able to pay that forward on all of those we're honored to have you with us here today so proud of you thank you very proud well done what a great story and a great process that you guys plugged into very very cool brian and elizabeth

denver littleton colorado they paid off 244 000 house and everything baby steps millionaires weirdos 56 months making 156 to 225 off to ireland count it down let's hear a debt-free scream three two one we're debt-free love it love it love it well done wow this is the ramsey show jade warshaw ramsey personality is my co-host today thank Thank you for joining us, America. Open phones at 888-825-5225. Well, there's a lot of questions about taxes right now. It's tax time and we all hate it. I stay perpetually angry during this time. And so let's unpack a question from one of our listeners. Dave, we have a cabin we inherited years ago. We're thinking about selling it. Since we're older, it's getting harder to keep up.

Is there any way to get around capital gains taxes? Well, for this scenario, there's three ways to help reduce capital gains tax. Sell the cabin as soon as possible. The longer you wait, obviously it's going to go up. More tax you're going to owe. You can move into the cabin, make it your primary residence for at least two years. You will lose the primary residence exemption on your personal home, though. I wouldn't do that. Or you can rent out the cabin make it your primary residence for at least two years you will lose the primary residence exemption on your personal home though i wouldn't do that uh or you can rent out the cabin and when you do eventually sell it you can defer the capital gains by uh doing a 1031 from one rental property

into another but you'd have to have at least one year that the primary use of the cabin was a rental and so if you rented it for a year then you could uh you could do a 1031 and roll the which is a tax deferred exchange it's called and you roll the gain into the next deal if you wanted to do all of that um other than that you're going to pay capital gains here's what's interesting it may not be that much uh the um the value of the cabin when you inherited it is your basis and so go back in the year you got it what was it worth that's what your everything above that will be your capital gain of course minus expenses and so if the cabin was worth $150,000 when you got it, now it's worth $220,000, and it costs $20,000 to sell it in expenses, you'd have a $200,000 net minus a $150,000 basis

would only be a $50,000 gain at 15%. It's only $3,000 in taxes. So you're probably, you know, depending on how it all works out i don't know the value when you got it or the value today but um i honestly wouldn't go through any of that other crap i would just um it looks like a lot of hoops to jump through to get three thousand dollars back if that's what it is if it is a three thousand dollar actual taxes yeah and um but but sometimes we hear you're going to get capital gains tax and we go into we start doing stupid stuff just and then you if you ever write it all out and figure out it was fourteen dollars you know i was getting ready to do i was getting ready to be stupid for 14 because we get all this emotion because we hate taxes so

bad yeah i hate taxes the only thing i hate worse than taxes is financial stupidity. Mm-hmm. Mm-hmm. And I have done and I have seen people do financial stupidity to avoid taxes. And that's what you don't want to do. So I would actually calculate out what your gain is going to be after expenses versus what you paid for or what the property was worth when you inherited it, and then figure out what your taxes are, and then that will tell you the direction to go.

Jennifer is in New York City. Hi, Jennifer. Welcome to the Ramsey Show. Hi, Dave and Jade. Thank you so much for taking my call. Sure. How can we help? My husband and I, we have no debt except for two income property mortgages. Our primary residence is paid off entirely.

The total mortgage debt combined on the income property is approximately $580,000. One of the remaining mortgages is $218,000. The other is $366,000. So we're thinking of unloading the one with the $366,000 balance, using it to pay off the $218,000 balance. So the reason that this is a question is because they're both very profitable properties. Each property earns a net income of about $50,000 each annually, so about $100,000 combined,

a little over. What's your household income? Household income is $250,000 combined, a little over. What's your household income? Household income is $250,000. So with the rental properties, we net about $350,000, a little bit over. So how quick can you pay off $550,000 if you keep them both? So with Gizelle Intensity, we project to have them both paid off within three to four years. I'd keep them. The idea of having the rentals paid off for in a few years is definitely appealing. I'd keep them. The idea of having the rentals paid off for in a few years is definitely appealing.

I'd keep them. It's also appealing, though, to have your head hit the pillow debt-free sooner rather than later. But wondering your take on giving up such a cash-generating asset, because it's essentially like... There's no wrong answer here. In neither case is your face going to appear in the stupid column, okay? So if you want to sell one and be debt free head hit the pillow tonight that's the right answer if you want to pay them off over three or

four years that's the right answer the wrong answer would be one you didn't mention which is i think being in debt for rental properties is wonderful and i'm going to stay in debt my whole life right that wasn't that was not on the table and so for you or for me or for jade it sounds like you like both of the properties. If you were saying that the property that's $366,000, you hated it and it was getting on your nerves and things like that, then yeah, maybe sell it and take it to pay off property number one. But you said they both generate great cash. And I like what Dave said. I mean, you can pay both of these off with your cash flow and then you're going to have three properties that you own completely full out,

including your personal residence. That's amazing. And if life changes, sell one of them. True that. I mean, you can change this decision. I personally, if I woke up. Maybe our dark hotel ballroom moment. Do what now?

We thought maybe, you know, the mortgage debt is like our dark hotel ballroom moment, how you talk about in your book, that we were kind of brainwashed into thinking, you know. Well, if you were brainwashed, if you decide you wanted to keep it around like it was a pet, and so we're just discussing whether it's reasonably wise to get rid of it in three or four years or instantaneously. Neither answer is wrong. How old are you well we're 38 years old both of us and um we we have a really really strict budget um and you know we have about 30,000 saved for rainy day and we both put 15 to the 401k so we've got about 300 um i have 360 000 in mine my husband has about 300 in his so 600 and um almost about 650 combined

um there's not a wrong answer but it sounds like i'm just there's not a wrong answer between the two that we are talking about but it sounds like it's bothering you a little bit to keep it around and if that's the case is it bothering you or are you just afraid you're being stupid afraid of being stupid yeah that's that no you're not b you're not okay we would tell you if you were yeah if you call me up and said i want to go into debt to buy rental property of course we would tell you now but you're here you can clean all of this up you're millionaires you're 38 years old you're goal-oriented people you're very intentional with your decisions and your decision making paradigms and i don't hear anything in here that sounds anything close to stupid that's what i mean by your face is not in the stupid column so if it i and unless i hear something different uh you know and talking with you for another 20

minutes or something i would tell you to keep them and pay them off in three to four years make sense make sense to me but if you want to do the other that's okay too that's okay too but you're not stupid for paying them off in three to four years you would be stupid to say i'm going to keep the debt around forever and then you can open up a tic-tac account all right julia oh wow see here's the thing this is so funny to me you know the old ecclesiastes uh the word says there's nothing new under the sun yeah and i'm getting old enough to where god man bell bottoms are back i own a pair and so is nothing down real estate oh i mean everything comes back around you mean you mean these guys i think the next thing i think beanie babies are coming back i mean everything seems to come back around nothing down real estate since i've been on the air in 32 years now has gone through three major cycles

the cycle right before i went on there that i went broke in. I lost my tail and nothing down real estate. Then there was another big one with the cable TV, midnight cable infomercials, sitting by the waves, selling you a cassette tape set on how to get rich in real estate. Dave Del Dotto, who now makes actually really good wine in Napa. He's got a wine called The Beast that's incredible. But yeah, he made all his money selling tape sets by the waves. And now the Tic Tac generation's just running it crazy, and they're little slime balls running around all over Tic Tac trying to get you to go up to your eyeballs in debt, because

all real estate's good debt. I mean, Dave Ramsey doesn't know what he's talking about. All this crap. Yeah. Yeah. It's the way it works, y'all. The way it works, it goes in cycles't know all this crap. Yeah. Yeah. It's the way it works, y'all. The way it works, it goes in cycles. Even stupidity goes in cycles.

That's true. Jennifer is not on that list. No, she's not. Not on the stupid list. This is The Ramsey Show. dave here you can find all of our shows with the Ramsey Network app on your smartphone it's the only place to listen to the entire back catalog of episodes download the Ramsey Network app in your favorite app store today