The Ramsey Show - App - We're Having Issues With Husband's Military Survivor Benefit (Hour 2)

Episode Date: December 31, 2021

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🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Ramsey Show. Where debt is dumped, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host, Christy Wright. Ramsey Personality, number one best-selling author, is my co-host today. Open phones as we answer your questions about your life and your money. The phone number here, 888-825-5225. That's 888-825-5225. Sam's with us in New York City to start off this hour.

Hey, Sam, how are you? I'm doing well. It's a pleasure to speak to you. You too. What's up? Life's great. Quick question for you. I'm newly married.

I am expecting our first child, God willing, in about a month. Yay! Thank you. We have about 50 combined, about $50,000 or $60,000 sitting in an account, jointly between our two accounts. About $60,000 so far in some, like, $10,000 is in, like, the S&P 500, and $6,000 is in mutual funds that my wife had before we got married. I have about $28,000 sitting in Canada in some investments. I'm originally Canadian. My question to you is, with this $50,000, $60,000, which, by the way, this is including the emergency fund. We didn't, like, split it out yet.

It's just sitting in an account. My question to you is, to take that money to put it into real estate as opposed to the market, I know you're a big fan of mutual funds and so on and so forth. I just wanted to hear your thoughts. Okay. Do you have any debt? No, you're a debt. Oh, that's cool. Good for you. Well, I'm a big fan of having a huge pile of cash when a baby's on the way. And when baby comes and baby and mommy are okay and you come home, then we kind of push play on

what we call our baby steps. And so if you're debt-free, then your first baby step would be to set aside, as you said, the emergency fund. I'd carve some of that out. And, Christy, we always say three to six months of expenses. Yeah, and I think one of the cool things is you guys already have this in place before the baby comes. A lot of people are trying to stockpile cash for a baby and you're already there and so once the baby's here and healthy

then you can put any of that extra on your investments baby for baby steps four five and six paying off the house do you guys own your home so we're renting we're renting now i mean we're planning to buy in the next couple years so you're saying it's waited out the next until after my wife's birth yeah yeah just hold on to that yeah just hold on to the cash because it's just good to have that extra cushion when you're bringing a baby into the world just for any unexpected medical expenses that type of thing and then whatever your next goal is if your next goal is to buy a house at some point then some of that can go into savings to save up for a down payment on a house so it really just the baby steps are there to guide you what the goals should be, but

where you are with having your emergency fund and then, you know, your investments and so on, then you can start looking at that goal of saving for a house as well. Got it. And you think our emergency fund should be a little bigger being that my wife's on maternity leave. She's not going to be working for the next couple of months. I mean, she stopped working a couple of weeks ago. Just wanted her, so I kind of of a chill coming up to the delivery.

Can you make it on your income? So I'm self-employed. Oh, no. Can you make it on your income? I make anywhere between $600 to $3,000 a week. So it's, like, a little nerve-wracking. It hit me last night a little bit. But today, the next two days, I'm making almost two grand.

Well, realistically, during the time your wife is on maternity leave, can you make it on your income? I should be able to, yes. Okay. Then you shouldn't need the emergency fund. It shouldn't come up. I think you can. I think you're just being a new daddy worrywart which means you're which means you're a good dad okay you're you're concerned about your family that's a good thing but i i think you're going to do it i think you're

going to bust it and make sure that you make enough to live on while she's on maternity leave and you won't need to touch it but i would have a fully funded emergency fund and i would set the rest of the money aside for my house fund. And then I would begin putting 15% of my income away in retirement in good mutual funds. But I think you're fine to park that money for real estate for a purchase. But no, I would not buy real estate as an investment right now. I think you're saving for your first home, a big down payment above your emergency fund. And that's how I'm going to start allocating that stuff out.

Well, that's the reason, too, that we even suggest a range for your emergency fund. And that's how I'm going to start allocating that stuff out. Well, that's the reason, too, that we even suggest a range for your emergency fund, three to six months. Different people have different comfort levels, different incomes. And so if it gives you more comfort, Sam, to have a six-month emergency fund instead of a three-month, then you can do that as well if it gives you peace of mind. Yeah, I would do that. But again, I would do that and plan not to use it. Yeah.

Plan to live on your income. Yeah. Because your income because we know this is all coming. Jeff's with us in Cape Cod. Hi, Jeff. Welcome to the Ramsey Show. Hey, how are we doing today? Better than I deserve. What's up? Excellent.

So I'm just trying to find out kind of what you would do in my situation or if I'm handling this correctly. Back in October, my wife wanted a divorce and left, leaving me with the house, two dogs and two children as a stay-at-home dad for the last three years. She then lied in court and got awarded the house, resulting in me and the children having to leave with no income and no job. I've since started a handyman home improvement business and I have about $4,000 dollars saved but i'm having trouble finding an apartment or and i definitely can't get a mortgage so kind of just looking to see what you would do why are you having trouble finding an apartment um one just getting callbacks from real estate agents or landlords.

Two, they need the requiring pay stuff, which I don't have because I'm self-employed. They rent apartments all the time to self-employed people. Is there a place to find those? I've never had to rent before. I've always been able to buy a home until now. The only place I know is, you know, apartments.com or Zillow. Yeah. Well, no, I mean, you make a list of the rental properties in the area off of several different sites that you can find,

and you call them one at a time, and you call the real estate agent that's involved one at a time, and you make a list of the apartments in the area, and you start calling them one at a time. You don't have to go through Zillow. You don't have to go through a website or apartments.com. You can just look up and go, there's an apartment right over there. I'm going to call those people. There's one over there. I'm going to call those people, and there's one over there,

and I'm going to call those people, and just sit. You don't have anything more important to do than to get you and the kids off the street. That's your number one goal. Right. Yeah, we currently live in a camper at a campground. I picked it up for $100. That's the beginning of the spring. The best thing I could think of at the time.

Jeff, I just hear fear in your voice. And listen, exactly like Dave said, you can do this. Listen, you can do this. You're going to start looking at the apartments one at a time. You're going to take one step at a time. You're scared, but you can do this. How old are your kids? Two and three.

Okay. Yeah, the three-year-old's gonna write a best-selling book when he's extremely successful that talks about the time that he lived in a camper and how he and his dad came all the way back from that it's gonna be a great story now go write it Imagine a world where people never have to worry about money ever again. At Ramsey Solutions, our mission is to teach people how to get out of debt and build lasting wealth. And if that means we have to take on the toxic money culture that says you need debt to get ahead, then we're okay with that.

We've seen millions of lives changed, and we will continue to create digital products and services to help people transform their lives. If you want to join me and over 1,000 other team members on this crusade, we're currently on the hunt for web developers, UX designers, and SEO and content marketing specialists. To find out about these positions and more here at Ramsey Solutions, visit ramsesolutions.com slash careers. That's ramsesolutions.com slash careers. That's RamseySolutions.com slash careers.

Together, we will disrupt the toxic money culture in America and change lives. Visit RamseySolutions. my co-host today here on The Ramsey Show. Open phones as we talk about your life and your money. Dalton is in Atlanta, Georgia. Hi, Dalton. How are you? Good, Dave. How are you doing? Better than I deserve, man. What's up in your world? Well, I was just calling. I have a couple questions. I've been listening to a few of your podcasts, and I just figured, why not

call in? So, I am 22 years old, and I've been working for, well, since I was 19. I went to school for welding and uh i've been traveling the tri-state area where i lived for the past almost three years well sometimes 19 so two three years and uh i've saved up almost ninety thousand dollars wow wow good for you yeah what kind of money are you making a year as a welder? Close to, if I work, I work outages, and sometimes it's iffy. Like, you work a few months here, a few months there.

But on average, I've averaged from $80,000 to $100,000 a year. Good for you. Well done. The trades pay well. You're working a lot of hours, and it's hard work. But you're making good money, right? Yes, yeah. Yeah.

I mean, when you're on, you're working. That's tough work. And so you're working power stuff, huh? Yeah, nuclear mostly. I've worked in a lot of nuclear plants and building nuclear plants. Okay. Wow. Wow.

Yeah, you're really building a resume there. That's pretty impressive. Good. And you got $85,000. And are you living at home or are you living in a camper? I mean, what are you doing? I recently just bought a camper about a month ago. And before that, I was living with a high school friend that I went to welding school with in his camper. And then before that, I had rented an apartment, which was one of my worst mistakes. But you live and you learn. Yeah, because you're never there. Exactly.

Yeah, exactly. And I paid a lot more. I could have paid for a camper for what I paid rent in my apartment. So you're going to SUV, I mean, you're going to Winnebago it around or whatever, whatever the brand is whatever while you, whatever the brand is, while you run this circuit for a while at this stage of your life. How long do you think you're going to live that life? Well, that's what I was asking.

I was recently getting some advice because I was talking to a person I knew that owned the business and they told me, well, if you don't want to travel all the time, why don't you buy like a service truck and open your own business? And so I was just going to ask you what you thought about that idea or how much money do you think you would have to have saved up to start your own business as a welding business? Enough to buy the supplies and the truck. Okay.

You can outfit this truck for 50 grand right yes yeah yeah because you don't want a fancy truck it's going to be hauling a bunch of junk around yeah yeah i mean it is it's welding equipment it's your it's your trade but it's not this is not a you don't need an you don't need a something from a chevy commercial i mean mean, this is a work truck, right? Exactly. And so I love that idea. So what I would tell you if you're my 22-year-old son is that running a business is different than running an arc welder. Okay. So you have the skills to be a welder.

You do not have the skills yet to run a business. Okay. And much like you had to learn how to weld, you're going to learn how to run a business okay and much like you had to learn how to weld you're going to learn how to run a business and so you've got to start thinking about what it takes to operate a business not just perform the task okay so i mean buying a truck and getting the welding gear yeah and can you do the job once you've got the job yeah but you have to price it you have to collect it you have to pay your taxes you have to collect it, you have to pay your taxes, you have to get new customers, you have to take care of the existing customers, and now you're running a business.

Yes. And so, you know, it is at least as difficult to run a business with a service truck like that as it is to weld. The other thing, Dalton, is, and don't let that discourage you, because the day-to-day will still be the welding work. Your day-to-day will still be doing the work you know how to do and you love how to do, but there will be a learning curve where you figure out how are you going to price this? How are you going to manage the money? How are you going to interact with customers, with clients, and even points of contact?

Like the really tactical stuff that you probably don't deal with day to day and you haven't even thought about in terms of your business. Some of this is as simple as talking to someone who's running a business, as doing a Google search, as just putting some of your notes and ideas on paper. Start to just let this idea simmer in your mind

and capture your thoughts in a notebook or something really basic. This does not have to be sophisticated and it doesn't have to overwhelm you. Once you get through this learning curve of learning some of the basic business setup and the basic business operations, you will spend the vast majority of your time, 80% to 90% of your time, doing the welding work, especially out of the gate, because that's in the initial stages that you just own your job. That's what you're doing.

But you do need to just think about some of these things and learn some of these things. And if you start doing that, you could make even more money doing this. I want you to find a 35-year-old guy that's running a truck and doing welding and making a good living. And I want you to go take a day or two, or next time you've got some downtime, I want you to go spend three days with him. Take your camper. Okay.

Take your camper. Go hang out in that city. He could be two cities over, five cities over. I don't care. Maybe he's over at Dallas. You're mobile. You run over there from Atlanta. Spend two or three days with him.

And I want you to go to school not on welding, on running a business. Okay, on business. How do you run a business? What did you not know? What do I need to know? How do you run a business? What did you not know? What do I need to know? How do you do your pricing? Where do your customers come from? And I want you to take like some yellow pads or an iPad or something.

I want you to fill up files and files and files and files of the answers of an actual practitioner in that world. And so, you know, when you first learned to weld, someone showed you by welding. You watched them weld, right? Yes, exactly. Your very first class. And then you tried it, and then they helped you by letting you watch it again.

And then you tried it again until finally that thing would quit sticking and it would actually create an arc, right? Exactly. And so, well, maybe you're doing a settling i don't know but um but anyway point the metaphor still stands so uh yeah you go study you go study someone else and then you do it and then you study someone else and then you do it and then you study someone else and and your first step is to get the business up and running and then your next step is to grow the business to where it's not, to where you own more than just your job.

Your first goal in business is at least to own your own job. And if you don't work, if you don't go to work, you don't get paid, that's owning your own job, right? But if you've got five people working for you welding and six trucks out there, now you own a business that if you don't work one day, they all still work. And that's growing it to the next level. But I don't want to go too fast here. You're 22. You've got plenty of time.

Yes, I would buy a service truck, and yes, I would go into business if you have that desire. But go study business from a couple people. I'm going to give you a copy of our number one bestselling book, Entree Leadership, which is our playbook on how we started this business and how we ran it and run it. And it'll give you some good guidelines on how to get there. Dalton, I want to give you a couple questions, too, to ask these people that you're going to study and shadow and learn from. One, ask them, what did you learn the hard way? Another way to ask it is, what did you wish you knew when you got started? And another thing to ask them are, what are the biggest trip-ups I should look out for?

Like customers or problems or things that, man, that just might be a potential landmine that you don't even know. How can you learn about that before you get into it? Ask some of those questions to get some of those learnings without you having to learn the hard way yourself. And they'll tell you. They'll show you, and you can avoid that going out of the gate. I love that.

What a great young guy. That's cool. We've talked to a couple of 22-year-olds in the last couple of hours. They're doing pretty impressive stuff. Yeah. So there's hope, America. There's hope. The next generation coming on.

There's some good ones in the bunch. There's a bunch of good ones in the bunch there's a bunch of good ones in the bunch and um no bunch has all good ones the bunch has all bad ones but this bunch has got some really good ones that's pretty cool and the trades uh well with this uh epic student loan debacle yeah that we have uh in higher education the trades are coming back on with a gale force winds everybody's moving into the trades i mean when you on with a gale force winds. Everybody's moving into the trades. I mean, with a high school education at 22, for the last four years, while his friends were in college making nothing, he's made $100,000 a year.

He's doing okay. He's 400 grand ahead before they got started. Very interesting. Very interesting. This is The Ramsey Show. We'll be right back. Christy Wright Ramsey personality is my co-host today in the lobby of Ramsey Solutions on the debt-free stage Zane and Megan are with us hey guys how are you good we're doing good welcome where do you guys live? Springfield, Illinois. Oh, fun. Welcome to Nashville.

And all the way here to do a debt-free scream. How much did you pay off? We paid off $79,000. All right. Awesome. How long did this take? Two years and three months. All right. And your range of income during that time?

We started at $64,000 and ended up just over $92,000. Awesome. What do y'all do for a living? I'm a hairstylist and an educator at the color company we go through. And I just got a new job last week.

I'm going to be an energy sales specialist. All right. Very cool. Good for you guys. What kind of debt was the $79,000? A little bit of everything.

Credit card debt, car loans, personal loans, student loans, our house loans our house our house yep you paid off your house yeah oh goodness we're looking at weird people wow a little bit say it so casually oh in the house way to go y'all wow how long you guys been married um about four and a half years now yeah okay so about two years into the marriage this journey starts what made you decide to get on this journey i was driving home my water truck

and i was flipping through the radio and heard about you oh my gosh just like that the random scan of the radio one of my best promotional tricks so random yeah i will have to say though um when we first got married for the first about year and a half of our relationship, we kept everything separate. And he would try to get me to pay off my debt, and he was already doing it. And I just thought it was really dumb. I didn't think we could go through life without buying a car without a loan, buying a house without a loan, really doing anything without putting ourselves in debt first. So it took him a really long time of keep trying to be like oh we should do this we should do this and I was like no I'm not about that I'd rather spend my money I don't want to be told what to do and then it came

to a point where I was out shopping one day and I went to go supply buy supplies for work and my my debit card got denied and so then i had to use my credit card which also worried me because i knew at the time it was almost maxed out as well and i was like maybe zane knows what he's talking about and so i came home and i was like i reluctantly too it's a really hard thing for me to ever admit a big dose of crow right here maybe not doing things right so i was like i started listening to the podcast on my own before i would even honestly admit that i was even thinking about it because i'm super stubborn and i was not about it wasn't about him to be right. And so finally I was like. She's a sneaky podcast listener.

Maybe we should start looking into it. And I just thought it was like I just said yes to marry him all over again. Oh, wow. So you did the little Snoopy dance and everything, huh? Wow. I was pretty happy about that. I'm thinking, yeah. Oh, my gosh.

Well, I mean, you get a double bonus. One, you get to be right. The best part. That doesn't happen very often. And two, I mean, you get a double bonus. One, you get to be right. The best part. That doesn't happen very often. And two, she's going to do that money thing. Well, this is awesome. This is a good day. Yeah, I have very much the free spirit in this relationship.

You are fun. You are fun. Yeah, so it was really hard. And it was something I was like, okay, but to do this, I need at least like a little bit of leeway. So I had at least in my budget a little bit of spending money for myself because I was like, even if it's just like a top here or like a pair of shoes there, but I've got to do something to keep my sanity.

Otherwise, it's just not going to ideally work out for me. He could never spend a dime in his life and be okay. I love this story and I love your honesty, Megan. I have a theory. Dave, you tell me if I'm wrong here. I have theory that we often see obviously in marriages there's a nerd and a free spirit but we often see that one spouse is reluctant to get on board and my theory is the reluctant spouse is always the free spirit you never see the nerd going i don't know i don't know about this budget i don't know about this saving money thing it's always the spender it's

me it's you it's all the free spirits going no don't don't box me in don't tell me what to do don't give me rules i love that you came around though well done yeah like i said it took him a long time it took him took him a while but he stayed persistent and it was never like pushy about it was just like well i'm already doing it and then it'll he had also paid off a vehicle by himself doing it and i was kind of like oh like and i got money that's really cool and so yeah i was really nervous, too, about putting our bank accounts together just because I did spend so much more money and I still had the mindset of like...

That was the scary part. Scary for you or her. Yeah, because I was like, I spend so much more money. But then when you do come to the realization of we're in a marriage, we're not roommates, it does make a lot difference. And honestly, when we did put our bank accounts together it made me not want to spend as much money too it made me be a lot more

conscious about my purchases let's talk about that megan because there are people listening right now there are couples listening that they haven't put their money together yet what would you say to them i just think it's crazy i don't know i just found that once we put our bank accounts together that we got a lot closer with each other too. And it just, it opens up a lot more honesty. And I never felt like, I've never felt like I've had to hide my purchases, but even more so,

I never felt guilty about buying something because it's all laid out right there in front of you. And I just don't understand why you wouldn't do it. So did you guys feel like you were more of a team when you put those together? Yes. A hundred percent. That's really cool. And there for for a while we had what we thought

worked for us uh you know i paid this bill you paid that bill i'll buy groceries at this store you buy groceries at that store and then it it did just get to a point of yeah why aren't we we're married why why do we feel the need to keep our stuff separate when a marriage means you know unity yeah that's good usually usually the continued separation once you have that question pop into your head is shame or control and zane's not a control freak no and so uh he that helped you know and once you decided that it was you shaming you not zane absolutely then you cannot be ashamed and just go it's my money i can do what i want to do with it and i actually r I actually remember. Whereas Rachel says it's a spending plan. Yes.

Whenever, I still, I had all the credit cards, and I just remember, like, right before we were getting ready to go to the bank to combine our accounts, I was like, I kind of feel like I should pay these off. I don't know if I want them to know how much credit card debt I've racked up. And we were sitting down to dinner, and I'm just sitting there, and I was like, you know, I have to, I've got to get this I was like you know I have to I gotta get this off my chest I just have to tell you this but I have I believe at the time it was like sixty four hundred dollars in credit card debt and I was like I I've got to tell you this I was gonna

try I did I don't know where I thought I was gonna pay this off by myself is that all he was like I thought you were gonna tell me so much more than that he was like because i was like i just i've got to tell you this like i'm so nervous this is gonna be bad it's gonna be 40 grand he was like oh well that's no big deal we've got it that's awesome i love you too you guys are great so how old are you two? I'm 28. I'm almost 27. All right. And you have a paid-for house that's worth how much? Give or take $75, $80. Wow.

You're so weird. You're awesome. Yeah. You guys are a power couple. You're so fun. This is so great. You've done such a great job in everything, in your relationships, in your self-awareness, in the whole process that you use.

What happened here to you personally and to you as a couple is even more important than what happened with the money. So you guys are this very, very cool story. I love it. It's very, very fun. $79,000 paid off. House and everything. You don't have a payment in the world making almost $100,000 and not even 30 years old. How's that feel?

Amazing. Yeah, it's really awesome, too, just to know that we're really going to set ourselves up in the future. And someday when we have kids, it'll be really nice to not really have any worries about are we going to be able to afford to do this and that with them. It'll be very nice to be able to set up their future as well and teach them about money.

That's awesome. Well done, you guys. We've got a copy of the Legacy Journey for you because that is the next chapter in your story. Move on to set that legacy up like you're talking about. For sure. And be Baby Steps Millionaires. You'll be there before you know it. Absolutely incredible.

And a copy of the Total Money Makeover for you to give away to somebody who's out there doing it wrong because the stuff we teach is too dumb. I love it that's just awesome so fun so fun well done zane and megan springfield illinois oh man 79 000 paid off house and everything in two years and three months making 64 to 92 count it down let's hear a debt-free scream! 3, 2, 1. We're debt-free!

Yeah! I love it! That is fun. They are great. Oh man, what a future. And really good insights. Great storytelling. Well done.

This is The Ramsey Show. We'll be right back. Christy Wright, Ramsey Personality, is my co-host today. Elena is with us in Lexington, Kentucky. Hi, Elena. How are you? I'm doing well. How are you? I'm doing well. How are you? Better than I deserve. What's up? Okay.

So thank you so much for taking my call. My question is, so my husband retired from the military in February of 2020. In processing the retirement paperwork, there was an issue with enrolling in the survivor benefit program. So it was denied. Since then, we have appealed to try to overturn the denial but have not been successful. So the last open enrollment for the SBP is what they call it, was in 2005. And to have the SBP, it costs 6% of the retirement income. If we are to buy into the program, we would owe any mispremium.

So my question is, should we continue to pursue this? No. Okay. Not worth it. No. So the goal is for you to get a portion of his military retirement upon his death, but what you are paying for that with the scenario you laid out is outrageous. Right. Not only in lost current benefits,

but in the back pay where they're going to go back after you on the whole thing. No, you're fighting for something you don't even want, really, at the end of the day. So what is his retirement income? $3,000 a month. Okay, $36,000 a year. And how old is he? He is 59. Okay.

What kind of shape is he in? Great shape. Medically good. Medically good. Yes, yes. Go to ZanderInsurance.com and get a term life insurance policy for four hundred thousand dollars on him okay if he dies four hundred thousand dollars goes into a mutual fund if it paid 10 for easy numbers right now that would be 40 000,000 a year, which is more than his retirement is.

Okay. Which is $36,000 a year. Okay. Okay, so what we're doing is we're offset, and that term policy will cost you a whole lot less than what you're getting ready to pay for survivor benefits that won't even amount to $3,000 a month. Gotcha.

Okay, so. So it would. Gotcha. Okay, so... Well, we'd be half. Yeah, okay. So if you only want to buy a $300 or even a $250,000 policy, $250,000 would be $2,000 a month coming in if you invested that at 10%. You follow me? Now, here's the other thing. You're not going to keep this policy forever.

He's 59. You're probably going to get it for five years maybe 10 years something like that okay now the uh because and during that time you're going to have money in savings that you would live off of because you're going to drop that uh that life insurance policy when it gets super expensive later okay but if he's healthy at 59 you'll be surprised how cheaply you can buy a couple hundred thousand dollars on him okay and that's what i would do no you don't want that survivor benefit interesting call thank you and tell him thanks for his service to his country we appreciate it so when you sign up for a pension plan of any kind but certainly

the military uh you can agree to take a reduced amount while you're alive, and then your spouse gets the money. It gets a further reduced amount upon your death, or your spouse gets nothing. And so the survivor benefit is who survives after the death of the person that's supposed to be getting the pension. And so you can, it kind of, you know, when you run the numbers back out, the amount you end up getting, what it costs you in reduced benefits currently usually doesn't work very good. That makes sense, yeah.

Usually you're better off to self-insure through the death of that person or by a policy, like a term policy like we were just talking about, and that gets them out. Dawn is with us in Phoenix. Hey, Dawn, how dawn how are you hey dave thanks for taking my call and thanks for all the advice you give everybody appreciate it sure what's up hey so i have um no debt except for two properties that i own one of them's my primary residence and one of them is a rental property. I'm getting ready to sell my rental property, and I'm thinking that I should use all the proceeds that I get from this to pay off the mortgage for my primary residence.

Yay. Is that the move I should make? Is that a question, Donna? Should I do that? Yes. I mean, that sounds brilliant. So what's your income? So jointly, we're

about $275,000. Okay. And how old are you guys? I'm 53 and my husband's 55. Okay. And so you have this wonderful income and now you have not a payment in the world. Right. And then the other question is, should we bump up our retirement investment to like 50% of our income?

Or what should we do with this extra money? I know we want to invest. You know, we're very generous with our community, friends, family, you know, people in need. So just trying to figure out how we need to take care of the old people when we get that age. Somehow I got a feeling you're going to be all right. But the you know, here's the thing. How much should% debt-free. You've got your emergency fund. How much should I invest? And the answer to the question is a question. How wealthy do you want to be?

Because the more you invest... Well, you know, I want to be as wealthy as I can so I can continue to help others. Yep. So the point is, obviously, the more you invest, the wealthier you're going to become, right? Right. And so the more you consume instead of investing, the less that formula works. There's three things you can do with money when you get to baby step seven. You can give it, and you should.

You can enjoy it, and you're better, and you can invest it. Oh, you definitely better do that one. The thing is, you need to put a very specific dollar amount on your generosity and say this every year we're going to give away this percentage of our income. Every year we're going to invest this percentage of our income. Every year we are going to enjoy this percentage of our income. And that allows you to buy something silly guilt-free because it's budgeted okay because you ought to buy something silly guilt-free right you're rich you've been working

hard for a long time that's right that's right you have yeah you've been working your butts off you make 275 000 a year you have not a payment in the world you did it touchdown do the dance spike the ball okay it just seems so weird to be at this point yep yep it is it's a good way i gotta tell you it is it is an emotional problem when you get there because it's almost like you have survivor guilt like everybody in the plane died but me why was i spared you know right and it's like how did i get here i'm a kid from antioch tennessee i'm sitting in a uh you know a hundred and fifty million dollar building and i paid cash for it how did i get here i can't get my head around that emotionally and yet i do mathematically know how i got here and i do know

the calluses on my hand and on my brain from all the hard work i've done to get here i get all of that but then you still go holy crap right i sit here and you freaking utopia yeah it's got my name on the outside of it look sharon it's got our name on it you know it's like you have these moments where you don't it's survivor guilt you're still that that kid from antioch inside you know you're like how do we do it but like you said dave it's the hard work and i love that that advice it's so similar. You're like, how do we do it? But like you said, Dave, it's the hard work. And I love that advice. It's so similar to an earlier call. What do we do at Baby Step 7?

You need a new goal, a new percentage. You need to know what your vision is in this new stage. It's going to take a minute to wrap your head around what this looks like and even feels like with that different type of problem. But it's a good kind of problem to have. Oh, by the way um you know just go ahead and warn you guys these baby steps like work yeah yeah you will get there and so you're going to have this emotional problem yeah if you keep doing the stuff i teach you to do because you're going to become wealthy and then you're going to go i just spent on a car more than I made one year.

How? And it doesn't even matter. It's not even close. It's just a stinkin'. You can't get your... And it doesn't even compare to what we did generosity-wise. It doesn't even compare to what we did investment-wise. But it still feels weird. Like, oh, this really does work.

This really does work. We're doing it. Expect to have emotional whiplash when you get there. It feels like it's an out-of-body experience. If you get used to it, you're kind of arrogant or weird. I'll just go ahead

and tell you, expect the emotional whiplash. It goes with the territory. This is the Ramsey Show. This is James Child, producer of The Ramsey Show. Did you know The Ramsey Show is one of the most popular podcasts in the world? Subscribe or follow today wherever you listen to podcasts.