The Ramsey Show - App - To Change Your Life You Have To Start With the Man in the Mirror (Hour 2)

Episode Date: May 8, 2024

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, create actual amazing relationships. Rachel Cruz, number one bestselling author, including her two book series so far on children's books, I'm Glad For Where I Am, just a recent bestseller for your kiddos. It's the second one in that series. Be sure and check it out. She's my co-host today and my daughter. Open phones at 888-825-5225 katie's in minneapolis

hi katie how are you hi good thank you how are you better than i deserve what's up um i'm calling because i have a daughter who's going to be graduating college this month um she's going to have about eighty thousand dollars in student loan debt good lord um i know so here's the thing. My husband and I knew inheritance money would be coming our way, so we didn't push back on her going out of state where there's higher tuition. And we didn't really tell her we would pay for her college, but we told her we'd figure it out because we thought we might be able to do that. And that would be money coming from his side and my

side. So my husband and I divorced when she was a sophomore in college. And then after the divorce, I did get my inheritance money. And so I have enough to pay it in full. And I want to do that very much. I want to help my daughter. The only thing I'm just wondering is, should I pay it in full or have him ask? He would be willing, if he had the money, I don't know if he has it right now, to take on half of that burden of helping her. Does he have the $40,000?

Not right now. He does not. Okay. not right now he does not okay all right um does the divorce decree demand that you two pay this or is this just something you all sort of kind of had a discussion about once way back there and never talked about it again uh correct there's nothing in the divorce decree on this yeah your ex-husband's not going to give her any money. Well, yeah. I think he wants to, and he would if he could. So that's where I'm thinking what I could do is just pay it in full and then ask him to pay me later, but I don't think I will ever see that.

Yeah. I mean, if you're on speaking terms with him and you want to pay it in full say i just paid it off one time we talked about it and you said you'd pay half if you can ever give her the other 40 maybe she could use that towards a house or something okay yeah because it was a quite oh go ahead yeah it's okay so if you mean if you can have that conversation, that would be fine. But then forget it. It's over. You know, you don't get to go back later and go, where's that money?

Right? Right. You just drop it. You made a decision, and you made a comment, and you moved on. That's what I would do. Because otherwise, this is going to ride around rent-free in your head. Yeah. Yeah. And we're quite less friendly it's quite amicable um situation not relative if he doesn't ever give her money yeah and it bothers you and you lay awake and he doesn't think about it again you'll be the only one

thinking about this on the planet. How much did you get from the inheritance, Katie? Well, quite a bit. I was able to buy my own home after the divorce with it. What's quite a bit? How much did you get? Do you feel comfortable saying it or no? Sorry, just under a million. Okay, yeah yeah so you have a paid off house how are you doing financially because that's almost what i'm want to make sure that you know this money's being because i mean it's 80 grand so i'm like i want to make sure katie you're you're set up well um for your future retirement like looking like we talk about doing that laying that foundation for the parent first before the kids and so so making sure that, yeah, where you are financially is in a good spot.

So you bought your house outright, so you have no mortgage. Correct. And how are you doing with retirement investments and everything? I think I'm okay. I have $700,000 in an IRA. Well, in an IRA, $85,000 and a 401K. And the house is worth what? $500,000.

And you're how old? 55. Cool. So you're a 55-year-old married, I mean, divorced millionaire. Cool. That's neat. Well, thanks to my mom. I i know and so we want to honor that memory by being wise if i'm in your shoes yes i would write a check based on what you have told

me and pay off your daughter's student loans and yes i would make a phone call to the ex and say hey remember when we said that i just paid the whole thing when you get ready to pay her your half like you promised someday she can use that for her first house or something else and um i'm not letting you off the hook i want you to know i had done it though and drop it after that forget it ever happened just walk away and never think a thing about it again can you do that i can do that okay because i don't want this becoming this constant thing like when's he going to do his part you know and all that because you're doing your the only person you can control is you and you can't control him and i'll you know you're you're saying it's amicable and he intends to

and you have faith in him um you know i've just been doing this 35 years my faith in the x following through on a promise is fairly low you know it's just fairly low i just see you know i've just been doing this 35 years my faith in the ex following through on a promise is fairly low you know it's just fairly low i just see you know i guess nobody calls this show and says oh my ex followed through that doesn't happen i guess we hear the bad we get only the other ones yeah but but yeah i just wanted to let you know dave no i mean that because i guess some of them do but i mean we just don't run into it and thank god for you know that she oh i hate to say that because it was her mom's passing so i didn't mean that but just that she's in the situation she's in because that's another reason why we say don't take on debt because life happens and they had this plan yeah and then end up getting divorced in the middle of school and

if this inheritance hadn't come this daughter you know if it's a parent plus loan, I'm like, yeah, both could be on the hook. But also, I don't know what the daughter signed. I don't know how they did the student loan agreement, but I don't know what the daughter signed up for. Yeah, she could have been 80. I mean, she would have been 80 grants thinking like, we'll take care of it too. So that's the asterisk too of this story is that you're taking on risk always always always always when you take on this debt and life rarely plays out exactly how we have it planned out like never yeah so it's it's just that that word of caution but um katie i'm so sorry that's a hard season katie you know losing your you know your mom the divorce in the middle of of it and it's just that's hard that's really hard

but this is a redeeming beautiful thing that you'll be able to do from a financial aspect um to be wise with so i'm glad you called in very good very cool good stuff so yeah the the cool thing about student loans is is they shouldn't be there at all almost all of student loan debt is based on someone choosing to go to a school that they could have gone to a cheaper school and paid cash. Almost every time you're choosing a school you can't afford, just like choosing a car you can't afford. And so I can buy a car to drive around for $5,000. I have $5,000 or I can buy a $50,000 car because it's a nicer car and go $45,000 in debt. That's a choice. It wasn't a

requirement to have transportation. It was, you chose poorly and you choose to go to a school you freaking can't afford. Moms and dads, you need to learn a new word. No. It's a new word. Try it. No. Everybody practice with me. No.

This is The Ramsey Show. Rachel Cruz, Ramsey personality, is my co-host. I was going over my notes this morning to get ready to speak this weekend at the Total Money Makeover weekend. I am so excited to get to do this. I haven't done the classic Total Money Makeover material in a while, and I'm getting to do this. I haven't done the classic Total Money Makeover material in a while, and I'm getting to do some stuff I haven't done before. This Total Money Makeover weekend, I'll be speaking, of course,

Rachel, Jade, George Camel, Ken Coleman on how to get your income up, John Deloney on how to bring more peace to your life overall, getting out of debt, creating a budget, communicating better with your spouse, easing anxiety, investing and building for retirement. And it's a whole thing. We start on Friday night this coming weekend and go all through Saturday and live taping of the hit podcast Smart Money Happy Hour with Rachel and George. We've got live Q&A all through the thing. It is going to be an absolute blast.

And there's still some tickets left, sadly. I thought it would be sold out by now, but I was wrong. So we'd love to have you guys. It's right here on the Ramsey campus this coming Friday, May 10th and 11th. You could come a little early and watch the show be done. We do the show every day from 1 to 4 Central Time on the glass. Following that, grab a bite to eat somewhere, and then come on up on top of the hill to the Ramsey Events Center and we'll be doing the event. So

you can get your tickets at ramseysolutions.com slash events and a handful of tickets left. You can still get in and we're excited about doing this. Yeah, it's going to be a fun weekend. It's always fun. Our events are always enjoyable and we'll'll all be there. And I like that it's so money-focused the whole weekend, which will be great. Yeah, you'll laugh. You'll cry. You can bring that spouse that needs to be converted or that friend that thinks you're crazy, and they will leave being as crazy as you. Yeah, that can happen.

Daniel's with us in Tallahassee. Hi, Daniel. Welcome to the Ramsey Show. Hey, Dave, Rachel. How are you guys doing? Better than we deserve, sir. What's up? All right, just a quick question.

So basically, after some convincing, I did get my wife on board. We are both on board when it comes to attacking our debt. I want to be good on chance, and if I can borrow the language you guys use, she wants to be more on the intentional side while still taking care of things that she thinks are still important. So I'm the grumpy guy who says, I don't want to do nothing. No more Christmas, no more gifts, no more nothing. Did you say no more Christmas? Well, no more.

Yes. Well, no wonder you're unpopular, Gr yeah i am the grinch i'm not a big i'm the only because i'm like how can we strip down to the bare minimum i'll go with that but i mean you start with christmas i mean i'm cutting some of your stuff before we're getting to christmas buddy oh my gosh no wonder she's not enthused about you so my question well i guess i introduced her to we both uh i introduced her to sinking funds and now we it seems like we're starting to have a growing amount of sinking funds so we can stop dealing with things as they come up and it's helped we have the money when we need it but i feel like the sinking funds are taking a little too much of the margin. I would like to attack the debt at a more aggressive speed. So I don't

know how to compromise with her. And we're running at different paces here, it seems like. What are the sinking funds for? Let me pull up every dollar just to give a few examples here. But so every year... She's pretty on board. She's doing every dollar. Okay, keep going. Sorry, go ahead. For instance, the homeschool program every year comes around around August, September. We pay for that. We used to go into debt for that, but we stopped doing that since we stopped this whole thing. How is that a waste? It's not a waste.

No, some of these are not a waste. That's not a waste. Okay, we need a for instance. That's one of these things that's bothering you. Give us a waste. That one's not bothering you. If it is, you've got an issue. My daughter's birthday is coming up.

This is so bad. Now that I realize it, okay, but she wants, we're saving up some of that because How much are we planning to spend on the daughter's birthday um i have twin girls so it's we're setting aside 100 a month um you're gonna spend 1200 on a birthday party no no no it's about 500 it $500. It's coming in August. So $250 a kid. Right. Okay, so your argument is that that might be too much.

No, I feel like they're starting to all add up. Well, they're adding up because they're real. I mean, that food thing, it adds up. Yeah, because I think, Daniel, there could be an instance of like, oh my my gosh life is expensive where y'all just been charging everything you said the homeschool stuff we just go into debt for it you almost just delayed everything and now when you're paying for stuff so up front it is going to feel like yeah that there that there is more yeah you're actually admitting what's going on now by doing a budget with sinking funds and you weren't before so I unless it's a vacation right gazelle intense

i would say we don't do vacations let's let's pause 12 months on the vacation eating out eating out we're gonna pause like a couple of things to do but um yeah but the but the reality of life and what life costs may be the thing that's like oh crap this is this is a lot and when we're cash flowing everything like what we teach you really face oh my gosh our life is eating up so much of our money because life is expensive so there could be stuff that you guys tweak here or there um but yeah so daniel it sounds like that um you're you're i don't think you're on as different a page as you think you are. I think your argument's not with her. It's with reality you're struggling. And so let's give it a month or two

and just kind of see if the emotions of this iron out. Okay? I appreciate and embrace your enthusiasm. I appreciate and embrace your passion to get this done. Those are keys to getting it done and so you keep that part going yeah but just don't blame i don't think she's to blame nothing you gave me here was like that she's acting like she's not intense i mean we're gonna buy clothes and we're gonna buy food and we're gonna pay for the homeschool materials and you know um we're gonna have a

birthday party might be a little high but it's not it's not you know it's not throwing you off by two years yeah right you didn't tell me you spend twelve thousand or twelve you just said twelve hundred i'd probably say it's a bit much but yeah but the um and it depends on the age of the kid and all that kind of stuff too i mean if you got twin one-year-olds they don't even know you're doing this so you're doing it for you so then that's a different thing so uh you know but it but if they're twin 10-year-olds they definitely know they know everything about what's happening there and i guess a um a visit to the magic mouse mr cheesy what's his name? Chuck E. Cheesy. Chuck E. Cheesy. Yeah, the Magic Mouse. I guess that's probably a couple hundred bucks.

I was like, Mickey Mouse? No, I'm thinking Chuck E.'s probably a couple hundred bucks to go down there. I mean, per kid. Yeah, I mean, those birthday parties at those places, you're paying per kid. Yeah. So, I mean, the package, it can be expensive. I mean, you've had them down there. I don't know what they cost, but I've been down there when it happened.

20 bucks a kid, 30 bucks a kid for the unlimited stuff. Me and the mouse are in there. We've drugged. I have to Chuckie cheese, indoor trampoline parks. There's been a lot of great birthday parties. A lot of great birthday parties. There's not enough disinfectant in the world. There are some there are some gross it's full of kids yeah little sweaty kids all over all the yeah it's just nasty you know uh but yeah i'm guessing

that i mean i've been to those with the grandkids and i'm guessing you guys are shelling out yeah yeah yeah so yeah. So, yeah. I would say if you're getting out of debt, the birthday party is probably at home. You're ordering some pizza, having some friends over, and calling it a day. I mean, like, you know what I mean? If you're going to go just like the simple routes. Yeah. And it can be done.

Like, it's, that's possible. But the thing here, Daniel, I think is as we talk through this with you, everything you brought to us were things that were not out of bounds. And so it didn't sound like your wife with the sinking funds is like destroying your little plan. It's more like reality is destroying your little plan and dampering your enthusiasm. And it's actually a really great point. I hadn't thought about that. But for a lot of people that are starting this process, when you say no debt so that we can pay off debt, then those expenses are real.

It's not this like, oh, we can just worry about that later. Real money now. Kick the can down the road. But then that's the power too, though, to his point, is that's when you can cut some of those things. You're like, oh my gosh, what were we paying for that? Maybe there's a cheaper homeschool program or whatever, right? Like that's when you actually start caring about the expenses because you're you're seeing it in real time and in real life

rachel cruz ramsey personality is my co-host today in the lobby of ramsey solutions is the debt-free stage on the debt-free stage is ruben and Kirsten. Hi guys, how are you? We're awesome. Hey Dave. Welcome, good to have you, good to have you. So where do you guys live? Colorado Springs, Colorado. Colorado, all right. Well welcome to Nashville, good to have you. And how much debt have you two paid off? We paid off $270,000 in five years. Wow, good for you. And your range of income during that time? We started at $72,000 and then went up to $112,000. Very good. What do you do for a living? We both

work in the finance department of a software supply chain management company. Awesome. Same place, same company. That's fun. Did you guys meet there? We actually met at a different location and we worked together the entire time. Yeah.

We've known each other just different places. That's awesome. So great. So how long have you been married? It'll be six years next month. So right after marriage, boom, boom, we're getting out of debt. Yep. Five years, game on.

What kind of debt was the 270? This was our house. You paid off your house? Oh my gosh. Looking at a couple of weirdos i love it you're so weird what's this house worth i'm probably about 425 i love it and how old are you two weirdos 30 30 years old i'm 31 he's 35 okay close enough close enough he's trying to get some youth good good move reuben well Yeah, I like it.

Hey, very good, guys. In your early 30s, that's amazing. So you get married, and is this the only debt you've been working on, or did you pay off others before that? So it started about eight years ago, but we cash flowed my bachelor's degree, our wedding, our honeymoon to Alaska, just saved like crazy. And then during the payoff, weced or not financed sorry we paid off about 50,000 um and home renovations yeah and paid 270 yes way to go guys what in the world

happened to y'all that made you so weird this is wonderful like a year after marriage it's game on on the house yeah basically started for me about eight years ago, driving home from work in a job that I hated and just really wasn't happy about who I was and where I was at in life. Turned you on, you just happened to be actually turned on the radio. You just happened to be on the radio and never listened to the radio back then and heard your voice, heard your name before, but had never truly listened to you. And some context my grandparents my dad there's been huge influences on my life they basically practice your principles from day one you know pay cash for things live on less than you made gods and grandma's ways

of handling money and when i heard you like that instantly clicked for me um so i was super just intrigued at that moment but i also just just loved how raw you were with the collars. I don't want to see you in a restaurant unless you're working there. You need to sell your truck. So I was pumped up just listening to you. And you really started talking about changing your family tree and talking about things that really hit me hard, changing who you are,

really just owning up to yourself and taking control of your life and that hit me hard because yeah just when I heard that I looked at myself in the mirror and I was like if I'm ever gonna have the things that I love and really want my life then I need to I need to I need to do something about it I didn't have a money problem I just had I had problem. Oh. So thank you. That's amazing. And that's it. I'm like, that's the key for so many people. It's that awakening of like, oh my gosh, I can do this.

Like I can wake up tomorrow and make different decisions. It's so empowering. So you guys had babies during this time. How old are the kids? Isaac is two and Ruby is seven months. Okay. Okay. So you all have little ones, little ones. So what was the hardest part of this?

I mean, this is a lot of money, guys, that you paid off, a lot of, I'm sure, extra work and everything. But, yeah, what was difficult? I think just staying in the track, you know. It could have been really easy to divert the plan or, you know, just make other decisions. We've had hail-damaged cars our pretty much whole lives, you know. We just don't care.

But it could have been really easy to move, to divert, but we had a better purpose. And we knew we weren't bringing kids into the world at some point. Was it worth it? Oh, it was so worth it. Absolutely. Who made fun of you? We got called crazy a lot.

But nothing like down-putting. It was just more poking fun. And it encouraged us just in a different way. Yeah. Yeah. The jobs and cheerleaders, people that were supporting. Yeah, definitely. Yeah, good, good.

And another thing that was kind of hard for us, I guess, is I had had a townhome in, like, 2015, and it was super cheap. It was not in the best part of the Springs, and there was a lot of crime activity. Drive-by was across the street. Somebody had gotten killed, shot and killed. So people were like, you need to get out of there we're like no we know we got a we got this we're doing this for a reason you know this is for a purpose so

that was yeah yeah the location and then you got the house though so you moved out of that we wanted to wait until after we were married and yes yeah things in the right way yeah they stayed there longer than we should have but we did we're still here we weren't shot so there we go oh you guys that's incredible i don't know if i've ever heard anybody say that so pleasantly we're still here and we didn't get shot yeah way to go kirsten i love it good for you guys way to go you guys i'm so proud of you i would imagine your mom and dad are jumping up and down proud, aren't they, Ruben? Oh, man.

My mom passed away in 2008, so part of that was she did have a $30,000 in life insurance that we were able to put down on the house that we're in now. So to honor her that way has been awesome. Yeah. It's incredible. So great, you guys. So great. So what would you say to people the key of getting out of debt is um for us we put when we initially got the mortgage we

put the extra principal when we did the paperwork so there was that gap for us like the extra payment was automatically coming out so we just got used to that being our mortgage payment even though it was more than double. And it put that gap. So you couldn't make any real impulse decisions and that would take you off of your goal. Yeah, yeah, that's great. That's a smart way of doing it for sure.

Automate your discipline. I like that. Just keep it going. That's a good plan. I used to do that to myself all the time until I had natural discipline. I put stuff on auto everything, so it just automatically happened. And I went, oh, now I have to live on what's left because I put all that money in a mutual fund.

You know, it's like, wow, that's very cool. Good for y'all. Well done. Very well done. Congratulations. All right. You want to bring Isaac and Ruby up for the debt-free scream? Isaac.

Isaac, come on. So sweet. Oh, my gosh, she's so cute seven months seven months we're gonna get her she's gonna get scared to death when her mom and dad yeah i know i hope so the babies yeah they always get a little frightened with the screams so great i love it all right ruben and kirsten isaac and ruby's uh heroes they've changed their family tree. Early 30s with a paid-for house in Colorado Springs. Meanwhile, America sits around in some places whining that it can't be done. These two prove that it is done every day. This is what you call millennials.

This is what you call millennials that win, and we see them all the time. Or Gen Z. and we see them all the time or gen z ruben and kirsten paid for house colorado springs 270 paid off in five years making 72 to 172 count it down let's hear a debt-free scream three two one as predicted scared poor ruby to death i think isaac got a little got a little scared too there's a lot going on there that's so great amazing oh amazing yeah so for every time i hear that you and i on the ramsey show and Jade and George and we're out of touch and we don't know what the real world is today and you're speaking boomer language and all that kind of stuff, all these negative things that are out there, then we meet people like them.

Yep. Kirsten and Ruben. And they do. I know. Not just purchased a home, but they paid it off in five years in their 31 years. And I think it was making $112,000, not $172,000. $172,000 to $112,000. Oh, I wrote that down.

It looked like a seven. No, no. But I'm saying, you know, so it's. It's not like they're making $300,000. Right, right. Exactly. I mean, it's amazing. And it is.

It's the discipline and it's choosing. And now it's the whole idea that now, oh, my gosh, there's no payments. There's no payments. But they did it. Well, Ruben said, y'all could replay that monologue for over and over on loop because it's true. I'm like, you have to take responsibility. Yeah, you take responsibility. And it's amazing.

Yeah. He said the guy in my mirror had to change. Yeah. And he did. I'm so proud of him. What a hero. And he's got changed his kids lives yes and kirsten just killing it i'm amazing well done well done this is the ramsey show

rachel cruz ramsey personality is my co-host steven is with us in chattanooga. Hi, Stephen. Welcome to the Ramsey Show. Hello. Hi. Here we go. So I'm about to be divorced. The income disparity between my wife and I is pretty great. So I have a large amount coming my way in a quadro, and alimony coming my way, three years of bonus money of her coming my way.

We're going to be selling a home here soon, and I'll get about $100,000 out of that. I want to get myself into a house and have it paid for in the next few years. I don't have any retirement or anything set up yet. I'm 46. My income is growing rapidly. I'm a brand-new barber. I'll make about $30,000 this year, but I believe every year probably go up about $10,000. Okay.

Where am I going with this? What do I do with this quadra? I'm going to have $80,000. Quadra's got to be put into an IRA. You've got to leave it alone. If you cash that out, you're going to get penalized in tax. You've got to leave it alone. Yeah, cash that out, you're going to get penalized in tax. You've got to leave it alone. Yeah, so just pretend it doesn't exist.

Exactly. You need to get with a SmartVestor Pro at RamseySolutions.com and find somebody to sit down with, and they can help you do the rollover, and you can move that into your own personal IRA and some mutual funds and have no taxes on it. But if you pull it out and screw with it, you're going to have taxes on it, so leave it alone because it's in her. All it is is a section of her 401k being sliced off for you yeah that's all it is i had thought about using that for a down payment no no you're getting 100 out of the home and you're getting what other money you said you're getting a couple of bonuses

and other stuff how much money total yes not counting the clock um uh four years of alimony 875 a month and three years 25 of her bonus it'll be about eight to ten grand each year oh it's not all going to lump sum no the only lump sum the only lump sum that we can touch they're going to get eight thousand you're gonna get 8,700 a month is that what you said I'll be getting I'll be getting about 1,600 a month in alimony and child support oh okay okay okay I got you okay yeah yeah okay broken up over four years and my income will be increasing over that time as well yeah so I'm gonna be looking at putting a hundred thousand down on a house that's what you've got.

Yeah, and just ignore that quadro. Yeah, you've got to. Because it'd be like taking the money out at 30% interest. Yeah, because I'll just get taxed. You're going to get taxed and a 10% penalty. You're going to get hammered. So you leave that puppy alone and just go do your house of some kind with 100 down based on the current income that you've got. And you can count.

Palomone, you can count shots. I mean, you can count all of that in terms of as long as it's going to continue. And that'll offset the fact that your income hasn't gone up or you can wait a year and let your income come up. And then you've got a story to tell to a mortgage company showing tax returns as a new barber that made this and then i made this and then i made this and here's a trend line and so it's reasonable to qualify you based on those things you gotta have two years tax returns uh as a new self-employed person uh and then you'll be able to move forward on that but yeah just just take your time. There's no reason to, you know,

you are getting some money out of the divorce, but it's not exactly like you hit the lotto. I mean, it's a nice amount of money, but it's not going to put you on easy street. You're still going to be doing a bunch of careful things there. Today's question of the day comes from Taylor in Mississippi. Taylor says, I'm currently 12 weeks pregnant with a baby girl from my boyfriend. I recently lost a loved one who left me a large inheritance.

I have $40,000 of debt and my boyfriend is debt free. Do I take this inheritance and put towards my debt and then take what's left and put down 20% on a house? My boyfriend and I plan on getting married, but for some reason he's really against getting married before I have the baby. That's weird. Okay. Well, I don't know why that would be the case, but yeah,

I mean, that's what I would do. Yeah. I would take the inheritance. I'd pay off your debt. Taylor, I would keep everything so separate. If you bought a house,

I would buy it on what you make your income your life i mean i i would be very very uh hesitant to put him on anything i wouldn't put him on anything not hesitant and i don't just don't do it and i probably wouldn't do anything until the baby comes i mean honestly i don't think i would make a big decision like no pay off your pay off your dad pay off your dad but i wouldn't buy a house pregnant i would continue to rent uh maybe rent for the next year or two then then hopefully you guys get married then it's after you have the baby and then you guys together after you're married look and see okay let's let's purchase a house but while you're pregnant i probably i wouldn't

take some of this inheritance and put it down payment. I would rent, be where you are for one to two years, and then from there see what happens relationally if that changes, and then even just financially at that point. I'm old. Why is he? There's a term from my generation called shotgun wedding oh yeah which um you got a baby on the way buddy you show up or daddy's gonna bring a shotgun and help you show up oh my gosh that's what that means that's where that comes from that's where that comes from i'm gonna bring my shotgun and by god

you're gonna marry i just thought you meant a fast money okay no that's that this is like disturbing but i agree well i agree that's weird that he's like really really against getting married backwards i it's it's just it's not weird it's just wrong and it just i hear you my warning bells are going off like crazy mine is too bad i don't want to force her into a marriage with a terrible guy so i'm like right no i wouldn't no i would not say just go get married right now if he's not a great guy for some reason he doesn't you know okay so yeah don't put this guy's name on anything until he is a husband and um period. Yeah. Under any circumstances. And don't put anybody you're not married to, period. No matter how sweet and wonderful they are, their name on your freaking house, you get yourself in a disaster.

This just, ugh. All right, John's in Colorado Springs. Hey, John, how are you? How are you? Good, how are you? Thank are you? Good, how are you? Thank you for taking my call. Sure. So I've got a bet with my wife on what we should do with our side hustle money.

So we owe $102,000 left on our house. We have no other debt. We have our rainy day fund, our money in savings. We get 15% to our 401k and our pension. Our interest rate on our house is 2.2%. I make between $30,000 and $60,000 on our side hustle. So I say that we take the $30,000 to $60,000 every year and put it in mutual funds because the rate of return is greater than the 2.2% on the house. Your wife has been listening to the show and she set you up. in mutual funds because the rate of return is greater than the 2.2% on the house. Your wife has been listening to the show and she set you up.

Yeah, she said that we need to just pay off the house. She set you up. I hope you didn't bet much. No. John, what we teach and have the entire time we've been on the air for 30 years is that you pay off your house as fast as possible, regardless of the interest rate, beyond the 15%. Because in doing the largest study of millionaires ever done in North America, we've talked to 10,167 of them. Let me tell you how many of those 10,000 said we became a millionaire because we didn't pay off our house and Instead made more money by investing the money in mutual funds out of 10167 what number said we are going to go with John's plan? Zero zero not one. We've never met a millionaire who really did this we've met a lot of people

who have a theory and discuss it the way you're discussing it because you're a math guy like me and i'm i immediately go to where you're going to um because that's how i my math brain works you're looking at the spread but what your spread doesn't take into consideration is risk and the two elements of a paid for the two elements of someone getting a fur their first one to five million is typically their 401k being well funded which is 15 of your income going in you're doing that and a paid for house and so you're on track if you follow her plan to be a millionaire faster than if we follow your plan based on the data that we've studied of actual millionaires not with mathematical theory because the math theory of what you're bringing up is reasonable but the actual facts are when you pay off your house other stuff changes

in your life and you tend to excel in your career and do other things you can invest the mortgage payment yeah you don't have one yeah you can invest the mortgage payment. Yeah, exactly. Once you don't have one. Yeah, you can invest the mortgage payment like crazy. Yeah, you go into overdrive. This is The Ramsey Show. Thank you.