The Ramsey Show - App - What Do We Do With Our Rental Properties? (Hour 3)

Episode Date: June 23, 2023

Ken Coleman & Rachel Cruze answer your questions and discuss:  "Should we sell our rental properties?" "My business isn't making as much as I thought", "Should we pull from retirement to pay for our daughter's school?" Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Here's an EveryDollar deal just for our listeners: get a 14-day free trial PLUS $15 off your first year of premium. Click the link below and start budgeting today! www.everydollar.com/TRS Want a plan for your money? Find out where to start: https://bit.ly/3cEP4n6 Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Interested in advertising on The Ramsey Show? https://ter.li/s64ye3 Ramsey Solutions Privacy Policy

🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studio, this is The Ramsey Show, where we help you win in your life, specifically your money, your relationships, and your work. I'm Ken Coleman, joined by the fabulous, the incomparable Rachel Cruz this hour. You like that? That's great. Great word. Yeah. Great adjective. Yeah, there you go. I studied all day for that. 888-825-5225 is the phone number. And Rachel and I would love to help you. We really enjoy this and we have so many new people coming in all the time. And so

I want to point out two things. If you're new to the show and you're trying to figure out some of the language we use, we're talking about baby steps and then the different numbers and all that. I want to make sure that you know that we have a get started button at RamseySolutions.com. That's the mothership, the website there. And you can just take just a few minutes, a brief survey, and we kind of let you know where you are in this journey that we call financial peace and the baby steps steps and you get caught up pretty quick and now you feel like okay i i understand how all this works because we're quite frankly we challenge you with some pretty countercultural ideas about money and so we want to get you caught up so go do that it's the get started button at ramsay solutions.com all right let's do what we're here to do is just encourage and coach people. Audrey's up next in Chicago, Illinois.

Audrey, how can we help? Hi. My husband and I, thank you for taking my call, first of all. Of course. My husband and I live in our home that we paid off about six years ago. And shortly after that, we purchased an apartment because my daughter was paying a ridiculous amount of rent in the city. So we thought, why don't we buy something and have her rent it? So she did.

So I think we're about a little bit over halfway done paying that. And late last year, I lost my job and we purchased a property that we wanted for planning toward their future, which for retirement, because we live in the Midwest and it's cold. So we want to go somewhere warm because I have some health issues. So anyway, long story short, I'm wondering if we would be better off selling the apartment that we have, the condo, and having less debt, because now I feel like I'm not used to having any debt, and so I'm wondering if we have taken on too much. Well, let's run through the numbers real quick for Rachel, and she'll walk you through this. So how much do we owe on the apartment condo? $80,000. What's it worth?

It's probably worth $175,000. Good. And then what's the other property? Is that just dirt somewhere where it's warm, or does it include a house? What is that? It's a condo. Oh, so we have an apartment and a condo. You have both. Well, two condos, two condos. We have one condo in the city that pretty much pays for itself. My daughter graduated school and now she's our renter. So that property pays for itself.

Okay, I know it pays for itself. How much is that, though? We financed it for 15 years, and the mortgage payment is $1,020. Okay, how much do you owe on that condo? $80. That's the one she gave me first. Oh, I'm sorry, the first one. I apologize. Yeah, but I got us all confused because I didn't understand. So you have a second condo, and give us the numbers on that second condo.

Oh, the second one yeah um the second one we owe 130 what's it worth and and it's probably worth 230 and what is your monthly payment on that um the monthly payment on that is well we don't know yet because that one is being built. Oh, okay. And we haven't taken out a loan on it yet, but it's out of the country, and we were required to pay half up front. Now, that being said, when I was like, Hold on, hold on. I just want to make sure that we've got all the numbers. So you put down half of the $130,000?

No, it was actually $. Okay. But we put half down. But you put 130 down. That's what I'm saying. You paid 130, but you took a loan out for the 130. We have not yet. We have to do that once it's done being built because... All right. So here's what I'm asking, Audreyrey have you put any money towards this condo that's out of the country we've been calling it condo too have you put any money yes how much did you put down 130 okay that's all all right so okay and it's worth 230 if i wrote if i if i heard you correctly no yeah yeah okay it's worth about between 230230,000 and $250,000. But the $130,000, though, Audrey, was a loan you guys took out. No.

It was cash. When I got let go from my job, I got a severance package, and I said, it's not making any money in the bank. We need to start planning for retirement, so let's invest it in something. I got you. And you have no other debt. Everything else is paid for. Everything else is paid for.

Okay. And how much did you guys make a year? Well, before it used to be $200,000, but now it's cut in half because I'm not working. Okay. Okay. So $100,000 a year. Yeah. And how soon are you guys to retirement? How soon will you guys be actually utilizing this condo condo number two probably in like seven years okay and you plan on the option to rent it okay but you plan on using it within the seven years but you think will you be there full time will you sell the home that you guys currently have to go to this condo full-time,

or will you keep both was your plan? Well, we've thought about actually selling our house and then maybe getting a townhouse or something to not have to worry about the maintenance. But for now, with the housing market, I've been told that it's not to our benefit to do that. So we're fine in our house now, but I don't know what our plan is for the future. Yep. And then the other 130 is going to be due when? Next, probably next summer.

Next summer. So a year from now. Yeah. And we've been looking at options on how we're going to finance that, whether to do a HELOC or a, I think there are a couple of options, a HELOC or a, I forgot what the other one is called. Man, Audrey, and how much do you guys have in retirement? In my 401k, I have over a million, probably 1.2, I think. My husband probably is close to a million.

And your primary home is paid off? Yeah. Our property home is paid off. And sorry, you guys are how old? All the numbers, but it helps with the retirement and everything, taking it out. Oh, I'm sorry. I'm 54. Okay.

And my husband is 57. Okay. So you guys are, yeah. And our home is paid off. I mean, your net worth, your overall picture, Audrey, you guys can't afford this. I mean, you can, is what I'm saying. I just want you guys to be able to save and do what you can in the next year to be able to not only just cash flow this $130,000,

but gosh, I would almost pay off this other apartment first. I don't think they can cash flow it. If I heard you right, Audrey, you're not going to be able to cash flow this out-of-country condo. Is that right? For the 130. I know, but when he turns 15, yeah. I'm selling. Which one? Condo A or Condo B? I'm going to try to get out of Condo B. I think Condo B. I think you guys will have other options. I know. That's my other thing. So if they can't get their money back, I'm selling condo A, and I'm going to pay off condo B like it's my life depended on it. With that, but if you can get out of condo B, I would, Audrey, because in the next four

years, you guys may even switch locations of where you want to be considering it's an out-of-the-country destination. If you can't get out of it, sell the first condo. Your daughter can rent somewhere else. Attack that. I mean, that's going to come up with most of the $130 you're going to owe. And you guys hustle to pay that off. You do not want to be in debt for that. Thanks for the call. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm Ken Coleman. I'm joined by Rachel Cruz. We're here to help you

win in your money, your work, and in your relationships so that you live the life that you want to live. There's peace and freedom when you are in control of those decisions and you can be. So excited to have you with us. 888-825-5225 is the number. 888-825-5225. Okay, Rachel, I've got a fun treat for you here. I don't know if you, I love the realtor.com, the Zillows. Oh, yeah. I always like looking at the local real estate market, largely because I want to see what the trends are doing. Yeah. And I get a little house itch every once in a while.

I don't act on it. But you see what's out there, Ken. I'm known to get a little house itch. And, you know, some people look at cars all the time. I'm looking at houses all the time. And so this story got my attention, and I thought it would be fun for our audience. Now, for our podcast-listing audience, the radio and all that, you need to go to YouTube a little bit later this afternoon or later this week

if you want to see this segment because we've got some pictures. This is a visual segment. And so I've got an article here in my hands. And the headline is, Zillow Gone Wild. Thank you for the sound effects. I love doing that sound. James hates it.

That's partly why I do it. Zillow Gone Wild. Broker make Jared Hewitt's Oklahoma City home listing viral. Can I? Yeah, go ahead. Who's Jared Hewitt? I don't know. Okay, good.

Just making sure he's not like well no no i do know who he is oh he's the owner of this home that's who he is but i don't know anything make sure we're all on the same page is he anything other than the owner of this home is do we know austin austin don't we don't know okay great okay good just double check but i love that you asked that voiceover actor that worked for Disney Channel. Okay, good for Jared. And he's done quite well. Well done, Jared.

He's done well. He's done well. So this has gone viral. And I guess it was posted on Zillow Gone Wild. And that's a site, I guess, and it featured this home. Okay, it's got five bedrooms five baths and magic in every room i don't know who wrote that but that's kind of interesting uh i got questions it's listed for one million five hundred ninety three thousand dollars or

rachel two million four hundred fifty thousand dollars if you keep the furns. So close to another million with the furnishings. Absolutely. So anyway, this realtor says- Do we know how big it is? I don't see square footage. Oh, I see down here. It's, yeah, 4,800. 4,800 square feet.

Almost 5,000. Okay. All right, so there you go. All right, so can we show the pictures, guys? Here we go. Wow. Now that looks like the dining room to me. So, so unfortunate. I will tell you that I'm immediately feeling dizzy. I know. go now that wow now that looks like the dining room to me so and there we go unfortunate i will

tell you that i'm immediately feeling dizzy i know i have a hint of dizziness look at that living room and can we just talk about the filter on these pictures that really brings out the primary colors can see and needed someone of your ilk to explain that to me i would have thought that's what it looks like you You're saying that's a filter? No, no, it probably looks like it, but you can tell it's an exaggeration. All right, I want to talk about this right quick. I want to talk about the zebra print around the mirror. And then it looks like we've got some type of a horse.

So this guy was a Disney writer. So this is clearly the home of someone who is very, very creative. But what's interesting, the contrast there is the giant elk horns or whatever those were with the zebra print. So I don't know if this is a hunter or if we've got a theme. It's not good. It looks like a unicorn. We got some, what do you call those? Skinny pyramids? I don't even know, Ken, but who's going to pay another million dollars for that stuff? I'm so sorry, Jared. I'm with you.

I'm glad you said it. Jared, I bet you're a wonderful human being. I don't want any of that furniture. I just don't agree with the style, with your style, Jared. It's too much. You do you, Jared. And we'll see if someone pays an extra million bucks for all this. And in Oklahoma City, too.

That's the thing. You put it in L.A. or something. I'm like, maybe in la or something i'm like maybe see i feel like that's what happened i feel like jared and his oh jared can't yeah he did he came from la he came from southern california he did to oklahoma city to save on taxes i bet we could paint jared's whole story he's a disney writers he thought you know what i've got family in oklahoma city we're gonna save a lot of money grew up there his mom's there wanted to come back creative place and then he goes wait a second i got i got unicorns i got zebra print i got all kinds of crystals and a lot of movement in that house it made me a little bit dizzy and then i think he said but i'm in oklahoma city so i need some

elkhorns as a chandelier. I think that's what happened. Now, anyway, this has gone viral because of how magical, supposedly, it is. So here are some of the comments. All right. People love it or hate it, as you might suspect. It looks like it could – oh, wait, I'm going to save that one. Sorry. The only place I could possibly relax is the pool.

I felt the same thing. Yep. Visually, tired it's a lot of a lot of brain calories here's another person that's in my camp my eyes hurt and may never be the same after that one it's so obnoxious i can almost hear the photos that's pretty accurate i can't tell if i just had a full-blown anxiety attack or if it cured my anxiety. That's interesting. And then my personal favorite, it looks like it could double as Willy Wonka's opium den. Wow. So here's Willy Wonka on the opiums. It was a little strange. Because here's the thing about your primary home, unless you have like, there is a a point ending amounts of money that you can just do truly whatever you want and you're not having to worry about any effects of right any result of your choices when it comes to your home uh just know any property that you buy that is unique and

weird it's because it's unique and weird and the resale on that the resale on that the the people that are going to be interested in that your funnel just went so slim oh to be able yeah to resell something like that and now this hopefully it didn't look like weird architecture it's just weird decor we didn't see all we saw was the inside of the house yeah so maybe it's not a strange home maybe when you walk inside somebody referenced the only place they would be able to relax is the pool. So apparently the outside, the pool is normal. Looks normal, yeah. But to your point.

So just know, when you go and purchase a home, you guys, if it's symmetrical. There's the pool. Yes, it's great. Visually, wonderful. But when you go and purchase a home, you know, can people think like, oh, yeah, there's like this really cool, like unique thing here or there or the way it's laid. If it's weird, just it's a red flag. And again, if you're not worried about resell at all

and you can just go right in and do you and that's what you want, like go for it. I don't think you sell that house unless you remodel it. I really don't. How many people on the planet want to live in that house? I know. Well, if you have a vision for it,

if you can walk in and like- How can you have a vision? I don't know. It's like looking at a kaleidoscope. Do you remember those when you were a kid? For those of you who are listening via podcast or radio, this house looks like a kaleidoscope. Oh, and here's another tip. When you're selling, you want it to be bare.

You truly want visually. It's a bee where someone can picture themselves in the home, right? I don't want a crystal horse. That's just real estate 101. And they've done the opposite they've filled every ounce of every wall and floor and everything it looks like one of those magic guy pictures from the 90s it does the what magic eye where you have to stare at the weird pattern like how many things can you find in the picture and you close your eyes and you see you see jesus like in the dots. Yeah. Oh, wow. Okay.

And then for a cool 1.1 million more, you get the crystal horse and all the other weird looking triangles. I don't know what else to call those. I don't know. Pyramids. Let's just learn from old Jared's life choices, everyone. Jared may be laughing all the way to the bank yeah somebody rolls in jared 2.4 million and said i'll take it all please i mean wow it can't be good for the brain to walk

into that house do you know what i mean like oh where do you stressful well but the pool area was very nice very very nice maybe they're gonna work on the pool next when you guys moved did y'all look at any homes that you were like weird layout strange nothing that i would call uh that would make it into the weird category but certainly uh not efficient like that's really like why would you do that and and see that's the other thing if you build a custom home you may have some preferences but you got to think about it this is really kind of out of the ordinary. It could affect you.

Absolutely. Because people walk in and go, this makes zero sense. Yes, but it did for this one person one time on the planet. You guys just built a house. How stressful was that making decisions like that? Three years ago. Yeah, I mean, but we're pretty simple. I mean, I would say like.

You kept it simple to where you go. And you're in a great neighborhood. Yeah. You didn't stress about a lot of those decisions. No, no. It was pretty textbook, I would say. Yeah, I wouldn't know because you're in a great neighborhood. Yeah. You didn't stress about a lot of those decisions. No, no. It was pretty textbook, I would say. Yeah, I wouldn't know

because you haven't invited me over. You've been to our house. Not the new one. What? Well, we're just going to leave that right there. I haven't been to your new one either, Ken. All right, we'll see you this Friday. Yes, you have.

You were there for the Christmas party. Oh, shoot. With the personality. Glad to know it was memorable. A work party. Glad to know you enjoyed your time. Thanks for know you enjoyed your work party work friends oh folks we actually do like each other there's more show coming up welcome back america you are joining the conversation about your life your money your work your relationships here on The Ramsey Show.

I'm Ken Coleman. Rachel Cruz joins me. And we were having fun last segment talking about this Zillow Gone Wild house. And the real point of featuring that, Rachel, is because you've got to be smart with such an expensive investment like your house. And we want to make sure that you're thinking through if you're going to resell, if you buy and you had to move, what is needing to be considered here when you make a purchase like this? And that's why we recommend that you work with our trusted, trusted Ramsey Real Estate pros. These folks are really experienced.

They're skilled. They know their market. And what does that do for you? It makes sure that you can navigate things like higher interest rates, buying a new home in a new part of the country. You've got to have that trusted real estate agent to make sure that you're making a good decision. So if you're ready to buy, don't let interest rates hold you back.

You can find the right home for you and your family. Team up with a top agent who will help you navigate the local market by going to ramseysolutions.com slash agent. That's ramseysolutions.com slash agent. Jackson joins us now in Columbia, South Carolina. Jackson, how can we help? Hello, how are you guys? We're having a blast. What's going on?

Thanks for having me on. I just have a personal and financial situation. I wanted to get maybe some advice or guidance from you guys, something you guys know to talk about. All right, go for it. So I recently opened a business early January of this year. So I'm pretty new to it. It's only been about six months,

but I've just been kind of looking at the numbers and it doesn't seem, obviously I know it's still early in the business, but I can just already tell early on that it's probably not going to be a long-term solution for me. What is the business? So I own a mattress store.

Okay. Did you buy it? Like, did you buy it or did you start it? I'm in a franchise. Most of the initial expenses I paid for out of pocket. I did take out a business loan for 15 grand. I know it's that, that loan's now down to about 10 grand. Um, I'm probably looking to get out of the business as soon as I can, just cause I't want to waste time if I don't feel like it's going to work out I definitely don't want to keep digging myself into a hole um I I just wanted some advice as far as so I have currently I have about 11 grand in student loan debt um that plus the the business loans my total I I don't have any credit card expenses or anything like that.

I'm about 95% no on my college degree, so I was just wondering if it would be a wise decision to finish school and get my degree probably over the second half of this year. So by the time my lease ends on my building, by the time my lease ends, I'd have a degree, but that would probably put me in another five, six grand debt as far as student loans go. Or if it would be a better decision to hold off on the degree and kind of tackle my debt at like a job without the degree before I kind of move forward. Yeah, at this point, you're 95% done with school, so I would finish school, but I absolutely would press pause because, again, it's going to be there, and you only have 5% to go.

I don't want you going into any further debt because right now, in the grand scheme of things, to only have $11,000 in student loan debt, my friend, you're in really good shape. So many people in this country are just absolutely buried in student loan debt. So this is very, very doable to get out quickly with your earning potential. And I want you to get out of the business loan as well. When you say get out of that, what's that going to look like? Is that selling your franchise to someone else? So I know it's a new location. I've built it up pretty well. I definitely have some,

like some, my sales trend has been pretty consistent. I'm sitting around like 10 grand a month with about 50% gross profit margin. So I'm pretty much

pulling in for about $1,500 to $2,500 a month after I pay everything. I don't see like a path for it to kind of exponentially take off where it's

you know doubling or tripling that um so as far as getting out that kind of i kind of just want to be done with this by the time i know i understand what i'm asking is i'm not i'm not privy to the franchise that you bought into so i'm asking how do you exit do you have to sell that franchise to someone else or do you just say, I'm shutting down? I pretty much just close doors. So you'll close doors. Okay. So you're clearing, you said, $1,500 a month, roughly? $1,500 to $2,000 a month, I heard? Yes, sir. All right. And are you needing to live off of that? Or is that just the business itself is spitting off that much profit after all my expenses? That's how much the business is spitting off,

and then I'm also using that kind of to live off of as well. Oh, okay. Well, how many hours are you putting into this business yourself? I'm probably spending about like 50, 60 hours a week here. I definitely think I'm going to have to get a part-time job to kind of help support myself for the lease. Yeah. All right.

Well, the reason I ask you all this stuff is because if you didn't need – you're putting in too many hours, 50 to 60 hours a week. You don't have a whole lot of margin left, although you can bust it. If it were me, I'd probably shut it down now, and I would just attack the loan just like I would. I'd put it in your personal snowball. We teach a debt snowball. It's baby step two. And so we go smallest to largest. So as I'm looking at the numbers, 10K on the mattress store and 11K in student loan.

And I'm going to actually go ahead and cut my losses now. You're not – there's no long-term play. You could be spending those 60 hours somewhere else making good money. Double, maybe even triple that. So how old are you, Jackson? I'm 24. 24, okay. Yeah, what's your degree in?

I know you didn't technically get it because you still have it. My degree is in public health. I probably wouldn't choose the degree again. I have much respect for everyone who's in any kind of health care career. I just know it probably wasn't the smartest choice, but I was young. How much more money to finish that? Say what now? How much more money to finish this 5% that's left on this degree?

It'll probably be about $5,000, $6,000. Yeah, I got to tell you that. percent that's left on this degree um it'll probably be about five six grand yeah i i gotta and i'm not can you may disagree with me on this we'll see we'll see jackson if i were you yeah i would just go get any job that i possibly could i would be working extra i mean i would do anything just because the amount of hours that you're working again you could be bringing in double this you could have this debt knocked out in a year. I mean, if you're making 50, 60 grand. Oh, way sooner than that. Yeah.

So like, go ahead and just clear all this. Work in a job that's not your favorite. Maybe not even in the line of work, but it's paying your bills to get you through school. And by the time you're 28, Jackson, you'll have a degree, you'll have no debt, and you'll be able then to make career choices that you actually want to make. But if I were you, I would just go find any job I could. And I'd be working extra. Are you single? I am. Yeah. So, I mean, I would be working nights. I mean, anything, Jackson, because once you

clean all this up and once you save up that money to get that degree and you'll be working while you're in school too, you're still so young, which is so encouraging that you could still be in your mid to late twenties to find the career path that you want. I completely agree. And here's why I think you need this time to figure out what path you want to take. Now you may know what path you want to take. We're about a minute and a half from a break, so I can't dig into that piece. I'm going to give you some free tools, though. But Rachel's right. If you get a $20 an hour job, that's what you're aiming for.

Minimum, $20 an hour. That's just for four taxes. That's $1,000 a week working 50 hours. You're going to knock this debt out in about five six months if you really get after it and now that we've got a game changer now we get to cash flow uh to finish the degree if you really want to finish it it gives you that college degree you don't have to go into that field you're so close i'd go ahead and do it i'm not a fan of college degrees that we're not going to use however it won't hurt you i'd go ahead and finish And I would be thinking about what is it that I want

to do with my life? You've got an entrepreneurial spirit. I can hear that. And I think you got to come up with the next idea. And if you got to work in the field for a while to learn the ins and outs and then decide to step out, cash, cash, cash from here on out. And I think you're going to get out of this thing relatively pain-free. But Rachel's absolutely right. Let's just go get a good pain job, crush the debt, come up with the five to six grand to finish the degree, and then let's just move forward in our life. Hang on the line, Austin. Let's get him the assessment, the Get Clear assessment, help him get some ideas for his future. And then the book, From Paycheck to Purpose, that's the map to get there. You're going to be fine, Jackson, but get rid of this debt with Reckless Abandon.

Welcome back to The Ramsey Show. I'm Ken Coleman. Rachel Cruz joins me. 888-825-5225 is the number. Our scripture of the day comes from Romans 15, 13. May the God of hope fill you with all joy and peace in believing, so that by the power of the Holy Spirit you may abound in hope. Our, of course, our quote from Rachel's friend.

Did you see this? What? No. Candice Cameron Bure. Is that how you say that? Love her. Excuse me. All of a sudden I'm getting choked up.

Don't know why. He has given us life and we can either live that life with joy, believing that we can make a difference, or we can wallow in sorrow, believing we can. How about that? That's good, Candice. From your friend, Candice. You'll have to text her and tell her we read a quote of hers today. I know.

Fantastic. It came up on the show. There you go. How many of you know that you need to save money, but at the end of the month there doesn't seem to be enough money to save? We get it. But we've got some good news. This week we're breaking down 27 simple tips for tweaking

your budget that can make a huge impact and help you find extra money to save. Sign up at RamseySolutions.com slash newsletter to subscribe to our Sunday newsletter and get on the fast track to saving money in no time. Misty is up in Mayfield, Kentucky. Misty from Mayfield, how can we help? Well, I've got a question about my daughter's continuing education. She just graduated from

college. We cash flowed her through her undergrad. Now she has been accepted into vet school and will be starting vet school in the fall, which comes with a much bigger price tag. Oh, yeah, it does. Wondering, we have a good retirement and was wondering about taking money from the retirement. No, no, please please i beg of you no please the other choice is getting loans well that's not the first of all that's a false choice but before we get to the choice i'm begging you do you understand why i'm begging you not to pull

from your retirement how pay for her? How old are you? Okay. I mean, my husband is 65. We can pull from his without any penalties. And how much do you guys have in your retirement? Together we have about $950,000. $950,000. How much is the school? The school is $22,000 a semester. A semester? How many total semesters does she have to take?

It'll be eight. It'll be four years. Yeah. I mean, she'll be a doctor when she comes out of this. She'll be a doctor of veterinary medicine. Yeah, and she'll also resent taking care of animals because she won't be able to focus on taking care of those precious little furry fellows because she's miserable with debt. I'm just keeping it real. And let me ask you this.

Is this the champagne, the wine, or the beer veterinarian school? This is more the beer. This is not the most expensive. Wow. Not at all. Okay, well, so what has she done to this point from a school standpoint? Because you said continuing education. Is she just going straight out of?

Continuing. She's already done her undergrad and has been accepted into vet school. So this is the final. What was her undergrad in? It was in biomedical pre-infants on pre-vet. All right, can I ask a silly question? It may not even be silly. It might be though.

Can she get a good paying job in that field that is not veterinary level, or even if it's not even animal related, but with that degree, can she get a really good paying job to where if she's disciplined, she can save up the money and pay cash for this. And you guys get to retire with all that money that you've been working so hard to save. Is that possible? I mean, yes, she could get a job as something else. Right. But being able to get back into vet school would probably be a no.

Why? Because she's turned it down. She got accepted her first try, which does not happen very often on vet school. It is hard. It's harder to get into vet school than it is medical school. Just because there's not that many. So, okay. So, Mitzi, can I tell you what I'm hearing? There's a level to your questioning and the way you're framing some of this that are these extremes. No one ever gets in. It's big, and it's like these are the only two choices. This is the only choice.

It just feels really big. And what I have found, Mitzi, is that when I feel like I only have one option or two options in life, and I've got to do either one, and both of them are not great, but, oh, my gosh, it's the only things I have, you end up making really bad decisions versus pausing and saying, hey, what's option C? What is option D and E? When you pin yourself in a corner, you find yourself that you're going to make possibly a very poor decision if both options are not great. And what you've presented on the call are both not great options i mean pulling

from your retirement i think is unnecessary um even though you could do it without penalty but i want you guys mitzi to be able to have a fantastic retirement without taking out close to two hundred thousand dollars uh to pay for this that's not an option for me misty i listen well and i'm still i'm still um working and yeah and i and she can work she can work she can pay her way through this and you know it's so many of these programs um they have you know places where you work for the college can and you're able to you know that they help with the degree you go and you find maybe a veterinarian that you work under and you know you promise like hey I'll be here for five years if you help pay for school

I mean like there there are options and I know they're slim and I know that it doesn't happen for everyone but I would do I would I would overturn I would turn over every single rock that is a possibility to help with this price tag because it's just it's a lot and when you don't have the money and she's what at 21 22 years old she's 22 yeah she's making a decision that man it's gonna be with her for a really long time and we just will never be on the side of encouraging debts and even student loans and all the things. So I don't know. I think she can work her way through it.

I think there's two things I'm going to challenge you with. Number one, she can. She can work through vet school and she can find a way. She can get back in if she turns it down. I don't buy for a second that she'll never be able to get back in. I don't buy that. By the way, nobody cares where you want. Well, I know you don't know, but I'm just telling you, I don't buy it. And so I can still hear someone who's looking for an excuse to pull out

retirement money or you pay her way through this. And if that's what you want to do, we can't stop you and it's your decision, But I would beg you not to pull from your retirement and I would beg you to come up with any other way, even if you got to help and you want to help, fine, that's cool. But she needs to have some skin in the game in this or else she's going to get out of vet school and she's going to be under a mountain of debt. Mitzi, how much money do you make a year? Because your husband's retired. So how much income do you guys bring in um well he's um together with his actually he's on disability retirement um with his and mine probably i'm gonna say about 110 000 a year yeah okay and what what financial shape are you guys in? What do you owe on your house and other debt?

Well, we lost our house in the tornado that came through Mayfield. Oh, I'm so sorry. Oh, no. Oh, my goodness. But we had very good insurance. So we are currently rebuilding our house right now. Wow. Okay. So, but other than that, that's it.

Okay. And how much will you owe? Will you owe anything on that house or will insurance cover the bill? Insurance should cover all of it. Okay. That's great. Unless, except for, you know, there's been a few upgrades that I've done. I'm like, this is our house that will be in forever.

And some of the things that I really hated about the other house we're not going to do this time sure hey right Misty I'm jumping in real quick because I want to give you some hard facts here we're running and running out of time you're looking at 3666 bucks a month if this is just a straight 22 per semester it usually never is but let's say it's 44 a year that's what you're looking at and so what you're looking at. And so if you're going to cash flow this, if you're going to help and she's going to help, these are the real numbers. And it just helps sometimes to look at this and go, can we do this without debt? And we're going to have to do $3,666 a month.

Do you understand what I'm saying? That's the challenge before you. If that can be done and she can help a big chunk of that and you don't pull from your retirement, she doesn't go in debt, then go for it. But please, as Rachel said, don't choose the worst of some false choices. And we appreciate the call. You're a great mom. You got a great heart, and your daughter's going to be fine. I'm sorry about the house. Yeah, sorry about your loss. It's terrible. Oh, tough stuff. Rachel Cruz, good hour. Thank you for being with me, my friend James Childs and our fearless crew for keeping us on the air and you, America, for listening. This is your show.

This is The Ramsey Show. Hey, it's Ken. If you like what you heard in this episode and want to know more about getting started on the Ramsey baby steps, go to ramsesolutions.com and click on the Get Started button. We'll help you figure out the best next step for you based on your specific situation. Again, that's ramseysolutions.com and click get started.