The Ramsey Show - App - We Put $112k on Credit Cards for Our Wedding (Hour 1)

Episode Date: January 9, 2023

George Kamel & Jade Warshaw answer your questions and discuss: What's the deal with tipping screens set so high? "Should I do a cash-out refi to buy a new home?" The debt snowball method vs. the avalanche method, "Should we rent before we buy in a city we just moved to?" Investing after selling off real estate. Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Want a plan for your money? Find out where to start: 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

Девочка-пай Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studio, it's The Ramsey Show, where America hangs out to have a conversation about your life and your money. I'm Ramsey personality George Campbell, joined by my good friend Jade Warshaw, and we're taking your calls at 888-825-5225. That's 888-825-5225. Well, Jade, I want to start off the show with something that grinds my gears. Can we do that? Let's do it, George. And that is the iPad tipping screens. Can we all agree we need to be done with those? Thank God somebody said something, George. So Rachel Cruz and I,

we've got our Smart Money Happy Hour podcast and the most popular episode we've ever done was called Guilt Tipping. I listened to it. All about the tipping culture in today's, in America especially. This is not a problem in Europe, apparently. I hope it doesn't spread over there.

No, that's not the culture at all. You don't, matter of fact, it's kind of like frowned upon. It's like if it was amazing, you give them a little bit. Yeah, sure, sure. Because you get a living wage. But here in America, we decided, no, make the people tip when you just ordered your black coffee and they spin around the iPad and they start complimenting you. Yeah.

And you subconsciously feel guilty and go, the options are 20%, 40% and 1000% tip. I don't know that I feel guilty, George. Well, you're a better person. I think I feel more irritated. Well, I now hit no tip exclamatory. They need to put an exclamation point. No tip exclamation point. Now let's be clear. We're all about generosity here. We're not talking about not tipping your servers, not tipping your bar barbers we are talking about those little ipads when you are sitting there and someone just rang you up and you bought a salad you've got no service or food yet that's right they're saying how much do you want to tip and the preset amounts keep increasing 20 22 one time there was one that was 33 i saw this with my own brown eyeballs.

Now, here's the thing. And you said it, George. This is very clear. We have to be crystal clear for the people. Restaurant service, places where you're not earning your hourly wage. Your hourly wage is tips. We support you. Matter of fact, tip those people 25%. Tip them as much as you can.

And if you can't do that, then please don't go out to eat. Don't go out. Don't go out to eat. But I'm talking about I bought a salad and I haven't even gotten to see yet. Did you make it with no bacon? Like I asked? I'll take the bacon, Jade. Please don't ever waste. Yeah, you know, I'll get a little side. You can have the little side thing of bacon, George. Well, there's an article here. This is spreading now like wildfire. The Hill covered this. Here's their headline. Why are the default tipping screens set so high? And of course, they start the article with a very clever line.

Have we reached a tipping tipping point? Very clever. That sounds like something you might say. We should have stolen that. That's good. I like this part. It says it's hard to know for sure whether more establishments are accepting or soliciting tips than, say, a decade ago.

It's not hard to tell. It's not hard. We are everywhere you go. There's that little iPad. It doesn't matter if it's coffee, salad. Doesn't matter where you go. It's not hard to tell. These quick service type places.

Yeah. Especially that are guilty of this. And here's a quote. People think it's manipulative. They resent it. And their perceptions of service go down. And there is guilt involved. There's one ice cream place locally, I won't mention the name because I'm a big fan of their ice cream.

I know what you're talking about. The service isn't great, but all of a sudden when they ring you up, they get real chatty and real nice. Okay, I don't like that. They start complimenting me as they're turning around. Hey, how's your day going? Oh, that's good to hear. I love that shirt. Love those glasses.

Huh. You don't believe that they love your shirt and glasses, George? No, I believe they want to get in my mind subconsciously while I'm trying to choose a tip. Nefarious. Gross. Man, you know, here's where I'm at with this, George. And this is my personal take. And here's why I get frustrated slash irritated.

We already have inflation, right? Which is already built into the cost of our food, not just groceries, people. When you go to the restaurants, it's there. And we know that that rate's somewhere around 11.4%. Then you've got the tip, 20%. And then for you people out there who are using credit cards,

I hope you're not. The average credit card interest rate, 19.20%. George, do you see what I'm getting at here? I just threw up in my mouth a little. Do you see where I'm getting at? Not me, because your girl's not using credit cards. We're not doing that. But the people out there who are engaging in that way of life, they're paying a premium of over 50%.

Ouch. That's why the tip screen, I got to just say no. Just say no. If you want to hear more on this topic, go check out that Smart Money Happy Hour episode called Guilt Tipping, How to Deal with an Absurd Tipping Culture. You can just search Smart Money Happy Hour wherever you listen to podcasts. And if you're calling in today, we'd love to hear your thoughts on tipping culture. And if you're an iPad tipper, and if you are, why did you choose to do that?

Because you're just perpetuating the problem at that point. Yeah. Well, you could budget for it. That is true. There's that. And I'm not saying I never do it. Yeah. But I'm saying in general, if there was no service provided, it's a no tip for me.

I'd rather save it for the food service workers. Amen. All right. It's your calls, 888-825-5225. Tara joins us in Albuquerque. Tara, welcome to The Ramsey Show. Hi, thank you for having me. Absolutely.

How can we help today? Okay, so I have to refinance my house. I'm going to take $10,000 from my refinance to pay off my car because I can't afford refinancing and a car payment. But I was wondering if I should take out the additional $40,000 for a down payment on a new house so I can make my current home a rental property as another source of income. Okay. A lot going on here. So what is causing you to refinance in the first place? I'm going through a divorce. Oh, I'm so sorry to hear that. It's okay. Thank you. I appreciate it.

Is this in the final stages? Is it finalized yet? The divorce? Yeah. Yeah. So this is the fine print of the divorce agreement to refinance to get his name off of the house. Okay. And you're looking at doing a cash out refi in order to pull some money out. You want to pay off debt. You want the down payment, but you want to keep this property. That's the confusing part. I agree. Because I want to make it an all-time investment, right? But turn it into a rental home. And then, I mean, God willing, able to go further with that. I have a question. So with the divorce, you are able to, like, once you do the, once you give him his cut you can sell the house right it doesn't say that

you have to keep it or anything like that right um right no um so he we technically had um two homes so he got one home i got this home this home um just happens to be under both of our names and the other home was just under his name but you're not wanting to live there. He didn't get any. I do want to live there, but I would like to upgrade into a bigger home at some point. What baby step are you on? So I guess I'm back to baby step number one. I mean, the only debt I have is my car and my mortgage. Okay. So in the baby steps, Tara, we would tell you, hey, don't jump into home ownership until you're out of debt with that emergency fund. So if I'm in your shoes, I'm selling this house, I'm getting out of debt, I'm renting for a while, and then I can use that down payment later on down

the road to get a primary residence. And the investment property, while it's a great goal, that is a longer-term goal. You don't want to have two mortgages at once after going through what you've been through. So I'm taking my time with this and slowing down. That's good, George. This is The Ramsey Show. Субтитры подогнал «Симон» I'm George Campbell joined by Jade Warshaw this hour this is the Ramsey Show open phones at 888-825-5225 you jump jump in, we'll talk about your life, your money, what ails you, what concerns you, how to get out of debt, how to build wealth for the future. We

are here for you. Renee joins us up next in Cleveland. Renee, welcome to The Ramsey Show. Thank you so much for taking my call. Recently got married and we got ourselves into $112,000 of debt. Just from the wedding? Just from the wedding. Oh, my. The ring, the... Holy cow. And I wasn't even invited.

The party of the century, and we weren't even there, George. Does that ring look like a disco ball? Yeah, exactly. It's pretty much that, yes. Oh, my goodness. Okay. Yes. Well, we're here.

So I want to, you know, other than a old college loan debt of about $40,000, we don't have any other consumer debt. We own three properties together, one fully paid off, probably worth about $600,000 to $700,000. The other two have mortgages on it. And my husband has about $395,000 in stocks and bonds. Oh, okay. So there's good news here, which is you guys have a pile of money to clean this up. The question is,

is he willing to cash out those stocks and bonds to put you guys in a place financially that will cause you to succeed in this marriage? That's a million dollar question. I'm sorry. That's all right. Hey, we're here with you. You know, we've all done stupid stuff with many, many zeros attached.

So we were poking fun at you earlier, but we definitely know the weight of what you're facing right now. And we're definitely here to walk with you. Are those tears because of the arguments you guys have had around this? Yes. What has the latest conversations been like when you bring this up and say, hey, we're in a big pile of debt. I want to get out of this. Well, the other thing is, is that the day after we returned from our wedding weekend, he lost his job. And he was making over 200K a year. Okay. okay, Renee. And how long ago was this?

About a month ago. Okay. Are you working at all, Renee? I am, yes. What is your income? What did I make? A fraction. That's all right. 70.

70. That's great. That's a great income. Okay. What's he doing right now? Is he currently looking for work? Yes. Okay.

What was he doing? Yes. He was in the automobile industry. Okay. I have a question. I have a question about these properties. So you mentioned three properties, one paid off, two with mortgages. The one that's paid off, is that your primary residence or is that? It is not. It is not. It's just a vacation home. Okay. So that's the vacation home. So that means the other two with mortgages, one of those is your primary residence? Correct. Okay. Can you tell me the numbers on that? Like what the mortgage is worth and what you owe? Sure. So let me actually pull that up because I've since had, you know, we've had some serious conversations. Yeah. What I'm getting at is, is getting rid of at least one of these mortgages,

not the primary residence one and clearing up some money there. And George mentioned the stocks and bonds. If they're non, if they're non retirement related, definitely wanting to liquidate those. So that's what we're, that's what we're getting at. So, yeah. So the one that we currently live in probably has about 235k on it worth about maybe 350 the other one with a mortgage is actually in another state

and it has a much higher you know it probably has about 200 in equity, 200K in equity. But the mortgage is about 550. Yeah. And this is what I would do. If I were in your shoes, if I woke up in your shoes today, I would get rid of that third property that's got the 200K in equity. And I would take that money and I would use it to start paying off this. I'd for for sure knock out the student loan because that's it's just the student loan and the wedding debt. Correct. That's your only debt. I would knock out that student loan and keep a thousand aside for any savings in case you don't have baby step one.

And then whatever is left, I throw it towards the wedding. And then if there's any debt left, I'd start liquidating some of those stocks. OK, now. OK. Thank you for that. I guess prior, because of the location of the third property, we've been probably bringing in about 200K, 200K, my apologies, 2K in rental income. That's per month. The one that's out of state? Correct. Yeah, just because it's in a good location.

The one that's got the 200K. Is that your net profit? Or is that? Maybe. Because you still got to pay the mortgage on that. Correct. That's my net profit. Okay. I mean, that's good. It's good still got to pay the mortgage on that. Correct. That's my net profit. Yeah.

Okay. I mean, that's good. It's good that you're making a profit on it. My concern is that it's out of state. And then my bigger concern is that you've got, I mean, you called us in tears because of this debt. So at that point, you know, you're really weighing the opportunity cost between the two. Do you want to get out of debt? How quickly can we get out of debt? The other thing that I'm hearing in this call is, and George, correct me

if I'm wrong, but it kind of feels like we can give you our take on this and we can say, hey, this is what we think you need to do. But your husband being on page with this is the other part. Do you think that if he comes home tonight or if you guys have this conversation and say, hey, I was talking with some experts. Here is the plan that they have advised us to follow. What do you think his response is going to be? Well, he'll be happy because it's my property. So he's like, well, that's your business. Don't try to sell one of mine.

But that worries me because you're married now. It's we it's our properties. And so I want him thinking that way. Exactly. Exactly. this and understand what's going on there. But as far as this property goes, I don't want to be a long distance landlord. I mean, this is a lot of work for 20K. I agree. And so this cleans up all of your consumer debt and gives you a pile of money at the end of that, which is your fully funded emergency fund. So this one property puts you in a completely different place financially if you sell it. Absolutely. And I wanted to ask just because, you know, I'm always thinking about the baby steps. Do you have any other money saved, like just laying around saved up for a rainy day, three to six months, anything like that? Yes. Okay. I do. About 45K. So think about it like

this, Renee. If you follow the advice that we've given you, you're still going to be millionaires. You've got this vacation home that's worth $700. You've got your primary real estate that's worth $350. Just right there alone, you're net worth millionaires. All right. And then, you know, I don't think that I don't know how much is in the stocks and bonds that you have. You may not have to liquidate all of that, but do you see what I'm saying? About $390. Oh, come on now. So this is great. If I'm in your shoes, I am selling that third property

and cashing out the stocks and bonds, making sure I can pay the taxes on that. And that's going to put you guys in a completely different place because you can pay off the other mortgage. Now you have zero payments in the world and everything is cash flowing with 100% profit going to you with very little stress in your life as newlyweds. I know that's right. Suddenly you're wiping those tears and you're rejoicing because you're suddenly ahead of 90% of the people out here. Do you see that? Yes, yes.

Now we need him to see it. Yeah. Hey, send him this call. I'm going to. I sent him the link and I said, hey, honey, I'm going to be on the Dave Ramsey show, so listen to this. That sounds good. So hopefully he did, but I do him the link and I said, hey, honey, I'm going to be on the Dave Ramsey show. So listen to this. That sounds good.

So hopefully he did. But I do like the solution. I'll be honest. I've been afraid to let go of that because it is mine. It's the only property that I actually own. And it's been a cash cow for me for a long time. But you're right. When you put it in perspective and say only $20,000 a year, like forget it.

You make over triple that. And you can always get another property. That's the thing. The way we're setting you up, you'll be able to, if you want to purchase more real estate, you'll be able to do it. You'll be able to cash flow it. And it's going to be a blessing, not a burden. And he's going to be back to work in no time, making great money. But right now, this is a great moment for you guys to reset, clean slate. This is we now, how are we going to set ourselves up financially for a successful marriage, for successful wealth building for the future? And this is a way to do it. And it's a good problem to have when you have all this money

sitting around in different pockets. Put it to good use and make yourself free. More of your calls coming up. 888-825-5225. This is The Ramsey Show. open phones at 888-825-5225 this is is the Ramsey Show. Our question of the day is coming up here, and it is from Brittany in Kentucky. What does Brittany have to say, Jade? Brittany in Kentucky says this, I'm currently on baby step two, but I'm having a hard time reconciling the debt snowball on credit cards that can be paid off over time without interest accruing as long as I pay them off before the end of the interest-free promo. But I was hoping to use the avalanche on my loans, not my credit cards.

In my mind, I'd rather pay extra money on the interest-heavy loans and diligently pay off my credit cards, thus taking advantage of the interest-free promos. Side note, I've cut up all my credit cards and I'm sticking to my zero budget diligently. Could you help me understand the best course of action? It sounds like Brittany wants to do her own course of action personally. Yeah, she's working her own plan. So what she's talking

about here is the avalanche method of paying off debt, which says pay the highest interest debts first and make your way down regardless of the balance. The debt snowball method, which is the one that we've taught here for 30 years now, is pay off the smallest balance first regardless of the interest rate. That's right. Which, you know, makes you scratch your brain when you go, well, it's 0% interest. Why would I even pay that off? You know, from my experience, and I believe the experience of the millions of people who have worked the baby steps and used, you know, the debt snowball as their method. We've learned that, you know, when it comes to money, Dave says it all the time, it's 80% behavior, 20% head knowledge, right? And so

there's something that builds up in our behavior when we're working the debt snowball. For me, it was about getting those quick wins, right, George? When you put them from smallest to largest, you're able to knock out those small debts quick, and you feel like, oh my gosh, I can do this. You start to believe that you can actually pay off your debt. And we've said that personal finance is 80% behavior, 20% head knowledge. And the people who are making these arguments, they're focusing on the head knowledge. But I'm always going, this isn't a life hack to try to take advantage of the 0%, you got yourself in a pile of debt. And so if you were so astute and disciplined to pay off the highest interest rate first, you wouldn't have gotten into debt in the first place.

That's right, George. So there's a whole nother mentality here going like, I'm going to hack the system that I trapped myself in. And so we found, and it's not just a Dave thing. It's not just Dave Ramsey says, and yeah, millions of people have done it. If that's not enough for you, there are new studies from Harvard Business Review, from Texas A&M saying the debt snowball method works better. That's right. If Harvard says it, I'm biting. And here's the direct quote. Snowballing your debts is from Chicago Tribune. Paying the smallest to largest, regardless of finance charges, might not make sense mathematically,

but it just might work better according to their new academic study. And so this isn't anecdotal because we meet these people. I haven't met someone who's like, I am an avalanche debt-free screamer. I just don't meet them. I don't meet them either. And I think it's because it's harder to gain traction. And so you stay in the process longer. And yes, on paper, you would pay less interest if you could do the average method with discipline. But the truth is we are human beings and we need that progress. We are wired to feel that progress. We need to feel the win. And it's tough because when we think about money, our mind goes directly to the numbers. It goes to the math. But in a lot of cases, money is not mostly about the math. It's mostly about

your mindset and you feeling like you're winning and you feeling like you can succeed. And definitely the debt snowball sets you up for that. Yeah. Staring at a giant pile of debt that has the high interest rate and going, all right, I got to tackle this one first. It's like me starting running by going, all right, I'm going to run a marathon and then work my way backwards to the 5K. Oh, gosh. That doesn't make sense. So why do we do that with our money? End quote.

That's it. Well, hey, thank you for the question, Brittany. I encourage you to use the debt snowball method and come here and do your debt-free scream and share your story because it works every time you work it. It does. That's all I got to say about that.

All right, let's go to Stacey in Sacramento. She is waiting there. Stacey, to say about that. All right. Let's go to Stacy in Sacramento. She is waiting there. Stacy, welcome to the show. Thank you. Thank you for taking my question. Absolutely. How's it going? Well, good.

I'm sort of at a crossroad and just hopefully need some guidance and support here. I'm married, live in California, as you mentioned, Sacramento area. We have no kids. We're in our early and mid-40s. We make about $230,000 combined gross income. We don't have any debt except for our homes, when I say homes, because we just recently purchased a home in this worst time of the year. At any rate, I used about $235,000. Oh, did I mention, I'm sorry, I'm also at baby step four of seven.

Great. I used about $235,000 of my personal savings that I had put down on the new house that I will get back once we sell our old house because it's currently on the market. Okay. And so once I get, you know, once we net out the $235,000 back to me from the old house, we should have about a $250,000 profit left over. Okay. So, you know, with having two mortgages and two, you know, utilities, we've been stretching ourselves pretty thin this last couple of months. I bet. So yeah, it's been tough. And especially in

California when everything feels like it's tripled. I'm sure it hasn't everywhere else, but- Is it looking good for that home sale? I mean, how long has it been on the market? A month and a half. Okay. It's been on the market for a month and a half. So it's looking, we don't have an offer yet.

So, but it's killing us because we've got a higher interest rate on this new home, on this 30-year fixed loan, 30-year fixed home loan, and we just really want to pay off the new home loan ASAP. So, I guess where I'm sort of questioning is how we, once we do sell the old home and we get the $250,000 profit, I'm curious to know if you recommend whether or not we apply that to the current loan, the current new home loan, and then roll the dice with Danny May to recast the loan, or should we just wait to apply that $250,000 profit to a refinance, maybe an 18 to 24 month

interest rate gets lower than 6.5%, which is what we got. Well, if you were going to refinance, I would want you to refinance to a 15-year. Right. Would that payment be too much for you guys? It would be more than 25% of your take-home pay? It'd probably be closer to 30 or 40, maybe. What if you use the 250 to pay down the mortgage, and then later down the line, you could refinance to the 15-year if you wanted to and it made sense financially? I like that idea, George.

That's not a bad idea. Yeah, that might be a possibility. You also could just pay the $30,000 like a 15 and pay like a 10, pay like a 7. I mean, how quickly could you do this? You're kind of re-engineering the whole idea because ideally, they would sold the old house first, gotten their 250 and then purchased the new house. And my guess is that if you had gotten the money in that order, you would have put a lot more of that money to this new house. So I kind of like George's idea of taking that money, putting it to the house when you sell it. And then, you know, when the time is right to refinance, you're just

in a better situation. What's your current mortgage? What's left on the loan? What's on the old house? On the new one, the 30 year fixed. On the new one, it's $4,150 a month. What's the total loan? $545,000. Okay. So if you applied the $250,000, that would take you down to about $300,000 left? Correct. And then you guys are making $230,000. How quickly could you pay off $300,000 making $230,000 with no debt? That's a good point. A few years, right?

Yeah. I think when we netted out the amortization schedule, something like eight and a half years or so. But yeah, I mean, I guess... monetization schedule something like eight and a half years or so um but yeah i mean i guess if you want to get inspired stacy go to our website ramsay solutions.com and use our early payoff calculator under the tool section and start to play around with the numbers and you once you start to see that you can't unsee it i know that's when you're like oh we put four thousand a month towards that extra on top of them we could could be debt. We could be before we turn 50, completely debt free and baby steps millionaires with a paid for house in California. You know how

crazy and weird that would be? I like the sound of that. And then guess what? We can retire early instead of having to work until we're 65. What if we could retire at 55? What would we do? Where would we go? What could we buy? How much could we give? That's where life starts to get exciting. What do you think, Stacey? That makes a lot of sense. It's just, yeah, absolutely. I think you need to go for it. I think you need to take George's advice here and start dreaming a little.

Get rid of that. You know, take that money, throw it to the house. Man. Here's the good news, Stacey. If you regret it, you can always go get another mortgage. The banks are happy to give you more debt. But I have a strong feeling that when you have no payments in the world,

you're going to be on cloud nine going, I'm good. I'm glad with the decision we made. So we're cheering you on. You guys are in a great spot. We're rooting for you to become completely debt-free. This is The Ramsey Show. While most of you are probably glad to rid of 2022, It was just hard enough to keep gas in the car,

food in the fridge, and money may still be tight for so many of you out there. And you're wondering, is this year going to be any different? Is it going to be more struggle, more anxiety? Well, good news for you. You do not have to live through another year of stress and worry. And that's why we want you to tune into our free live stream called Building Wealth in 2023, happening this week, this Thursday night, because we want to show you that you can still make progress on your goals, you can build wealth, you can have peace with money, even in this crazy economy. During this event, you'll hear from myself, Rachel Cruz, Dave Ramsey, John Deloney, Ken Coleman, and we're going to talk about how to set goals, how to create margins so that you can build wealth this year.

We're going to have some fun as well, some fun surprises planned, and you are going to leave fired up for 2023. And this is a great event to share with your friends because let me remind you, it is free, and you can live stream it from anywhere in the world. So guys, even if the economy feels out of control this year, you don't have to feel out of control. Register for the free live stream at ramsaysolutions.com slash wealth. That's ramseysolutions.com slash wealth. Open phones at 888-825-5225.

Jet joins us in Lubbock, Texas. Jet, welcome to the show. Hey, guys. How are you? Man, big, big fan. So very honored to be on the show. Oh, we appreciate that. We are honored to have you. How can we help today? I've been, gosh, hard time doing or I've done all the steps pretty much except for number six. Recently new married. I've been married for about five months.

I'm 24. She's 21. She's got another semester of college left. We're fully paying that with cash. We're looking to move. We're feeling very led to kind of get out of Lubbock. We've been there our whole lives and the Lord's pushing us to move. And my question for y'all in this time, is it better to, when you do move, if we're starting a family in a new city, would you start looking for a house and really build a family in a house and put all your money into that? Or is it time to

rent and stay there for a year or two and then try to buy a house? Yeah, you know, you're newly married. You're going to a new city. If it's me, I'm going to rent for a little while. I'm going to rent. I'm going to get to know the area, you know, find out if this is really, you know, do we like this area? You might get there and after six months be like, oh man, that other side of town, that's really the place to be, you know? And I definitely think that that's the wiser choice because once you buy, you know, you're locked in and it's expensive to move, it's expensive to sell. So renting in this case, I think George would be, that's the choice I'd make. Absolutely. And it turns out babies, they don't need a lot of space and they don't know the

difference between a rental and a home. And so that's the good news while they're young. And so I love that you're thinking that far ahead going, hey, we want to start a family. I want you to be a homeowner, but I'm with Jade on this. I'm going to rent somewhere, sign a six month lease, a 12 month lease. You can always renew. And the key here is what are we doing to get ourselves in a position to get a home the right way where it's not a stressor, it's a blesser. That's right. And George is right. Jet, you guys have been very

smart. You're in baby step six. I mean, this is excellent. You should have plenty of money to start saving up for a great down payment. You've got time. You're not in a rush. And if that's the one thing that you leave coming off of this call is, hey, there's no rush. The next goal is how much of a down payment can we save? And here's what that does, by the way. When you take your time and you have the patience and you build up this big down payment and you can put 20% or more down and your mortgage is now less than a quarter of your take-home pay. Here's what that does.

When your wife wants to stay home one day with the baby, it's not even a conversation. You just go, okay, cool. We just got to adjust the budget. Nothing much is going to change. We can cover it. But when you are up to your eyeballs with a mortgage for a house you barely can afford on that 30 year, and one person says, I want to stay home. You guys go, you can't breathe at that point. And so just put yourself in a position where you have those kinds of options. That is my goal for you guys as a newlywed couple. That makes sense. I like that.

And that's kind of where we are. I've got great savings. She has great savings. And we're able to put a very hefty down payment on. But we just are like, ah, I think we should rent and see the area. And so definitely clarifying and affirming my thoughts and our thoughts. I love it. Well, number one, Jet, you're going to have to ignore a lot of the voices that are going to be coming your way from friends and family going, Jet, what are you doing, man? You should be a homeowner. It's such a sin to rent. You're throwing away money out the window.

Those people can shove it because they don't get a say when it comes to your money and your life. They're not experiencing the stress that you feel. And especially as a newlywed couple, you guys are figuring out life. That's right. And so to add home ownership on top of that as a whole other layer, that is very stressful. I feel like that's been a theme, home ownership, what to do with the mortgage, how to buy the mortgage, how to save for the mortgage. I feel like that's been a theme this hour. Well, that American dream of home ownership ownership turns out it's a lot more complicated than we thought. It's more stressful. It's more expensive than we thought. And it's something that I want for everyone, but it has a time and a place. That's right. And I think what you said is true, but you can eliminate some of the stress out of

it. You can eliminate some of the fear, some of the remorse out of home buying if you follow the principles that we teach when it comes to buying a home, you know, that 15-year fixed mortgage, that is everything. And I know people struggle with that because for some people it means- Jay, the payment's higher on the 15-year. Well, you know what?

That's because that's what you can afford. But it's a bigger number, Jay. It might mean that you have to get less house. I want the smaller number. Well, you know what? That's what's wrong with our spending culture is we try to get as much as we possibly can and we end up in debt up to our eyeballs. Give me all the small numbers added up and you're still broke. Yeah, man. Just pull back, buy what you can afford. The whole goal, right, is for us to be debt free. Absolutely. We want

to get to that quickly. Good stuff. All right. Charles is up next in Asheville, North Carolina. Charles, welcome to the show. Oh, thank you. It's such a great honor to talk to you. You as well. How can we help today? Me and my wife, we're both 73, and we've got some rental homes. We've been married eight years.

We both got married after our spouses died of cancer. We've been married eight years, but we've been nursing these rental properties. You know how that is, one thing after the other. And we just decided, hey, we don't want to do this anymore. It's working us to death. So we got rid of one rental property, and we've got two other ones that are for sale, and we've had a lot of people looking at them. So we're just trying to figure out what to do.

Those two houses are going to be pretty much a wash because we've got capital gains and so forth. But we're going to end up with at least $100,000 to invest or to do something else with. We want to do our tithes and offerings and be able to help other people, and that's what we're trying to get to. So we're trying to figure out what's at this stage of our life. We're both in good health, but we just want to be able to go with, we've got no debt, all our credit cards and everything, and we're doing plastic surgery on them.

Love it. Are all the properties paid off? The two rental houses that are for sale now are not paid off. They have mortgages against them. And so that's what we say. Once those two are sold, they'll be paid off. You'll be completely debt-free. Yeah.

Do you have any other money in retirement? We don't. We bought this house in waynesville this is our retirement home 960 square feet and it's paid for what's it worth i own a house in burlington north carolina which is my mother's house she has lifetime rights and once it's you know once she passes and she can't live there anymore then we we'll sell it, and that'll be more additional income coming in later. She's 101. Wow. She's holding on.

Now, are both of you retired? None of you are working? Yeah, we're both retired and tired, but we are retired, yeah. Well, so all of these rental properties, this is your only income. Do you have any Social Security? Is there anything else coming in? What's your monthly income? Our monthly income from Social Security is $5,300.

Okay. And is that more than enough for you guys to live once these properties are paid off? Yeah. Our monthly expenses run about $2,000 a month. Okay. Well, if you've got $100,000 and you've got no debt, including any of these properties, there are multiple ways you can invest this. One outside of retirement is just in a brokerage account, in an index fund or a mutual fund. And at an average return, let's say you get eight or let's say 10% on $100,000 for easy round numbers. Well, that's $10,000 a year that you can pull away from that, hopefully without pulling away the principal too much. So that's one option for you, Charles. And I would connect with a SmartVestor Pro because we are down to like, we got to really figure out how

to maximize this money. And so I would work with one of our SmartVestor Pros at ramsaysolutions.com to make the most of that money so that you guys can have a great retirement with the money you've got. And hopefully these properties can do that for you once they're paid off in cash flow. Thanks so much for the call that puts this hour of The Ramsey Show in the books. My thanks to my co-host, Jade Warshaw, all the guys in the booth, and you, America. Thanks for tuning in. We'll be back real soon. Do you love a good day, Brandt? Want to see the latest Ramsey Show videos going viral? Check out your favorite moments from the Ramsey Show on YouTube. Go watch and subscribe to the Ramsey Show channel on YouTube.