The Ramsey Show - App - What to Do With an Inherited IRA (Hour 2)

Episode Date: September 17, 2019

Debt, Savings, Home Selling, Retirement, Insurance   Tools to get you started:  Take TDRS listener survey to win a $100 Amazon gift card, click here: http://bit.ly/2krRePv Debt Calculator: http://bit.ly/2QIoSPV Insurance Coverage Checkup: http://bit.ly/2BrqEuo Complete Guide to Budgeting: http://bit.ly/2QEyonc Interview Guide: http://bit.ly/2BuGnZE Check out other podcasts in the Ramsey Network: http://bit.ly/2JgzaQR 

Music Music Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, 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. Thank you for joining us. Open phones at 888-825-5225. That's 888-825-5225.

Brett is with us. Brett's in New York. Hi, Brett. How are you? Hi, Dave. Thanks for taking my call. Sure. What's up?

I have a question for you. I recently was turned on to maybe in the last five to six months, and I guess I would consider myself on baby step six. But my question is, we're not going to live in our house for maybe more than five more years. We recently purchased a condo and I don't know, should I aggressively start trying to pay off this mortgage or should we just continue to put the extra cash into mutual funds? I would put 15% of your household income into retirement, and anything else I can find in the budget I'm going to pay on the mortgage.

Okay. That's what we've kind of been doing. But we weren't putting the extra on the mortgage. We were putting it all into mutual funds. So my wife, I just know how to convince her of your strategy. I know it's a proven strategy because she thinks the market is doing so well right now. She just, versus the housing market here is pretty stagnant, I suppose. Well, it doesn't make your house worth more or less to pay it off.

Yeah. Doesn't change that at all. All it does is lower the risk of your life. When you don't have a mortgage, your risk goes down, your peace goes up. I agree with that philosophy. So I guess I just wanted to get some affirmation of that. That's probably what I was thinking. Yeah, you're right.

She's a bit more. The thing is this. And one way you can discuss this with her if you wanted to would be when I'm talking to someone that says that, I say things like, what if we could borrow a million dollars on our house oh it's only worth x i don't care but what if we could borrow a million dollars on it at four percent would we do that in order to invest in the stock market and 99 of the time the answer is well no and see what i did with the absurd example is i made you realize that your math argument is offset by risk and right now the risk is so low

because the balance is so low that you don't feel it but when i when I scope it up in my theoretical idea here of a million dollars, you go, holy crap, that's scary. And that means you're thinking not only with your head, now you're thinking with your heart. Your heart's where you measure risk. And so when someone makes an argument, I'm going to borrow on my home or I'm not going to pay off my home so that I can invest, which is the same as borrowing on your home to invest in the market

because the market makes more than the mortgage interest rate, which is her argument or her discussion point, right? Then what they're saying, what they've left out of that equation is risk. And, you know, we've done detailed research, and 100% of the foreclosures occur on a home with a mortgage. Okay? So, I mean, that's risk. And so I got to tell you, I meet almost no one that when they finally get their home paid off, think, oh, gosh, you know, I'm sorry I did that. And by the way, if you pay off your home and you hate it, you can just go get your mortgage and put the money in the stock market,

if I'm wrong. But you'll find out when it's paid off that I'm not wrong. Hey, thanks for the call, man. We appreciate you joining us. Tyler is with us. Tyler is in Nebraska. Hey, Tyler, how are you? Fantastic.

How are you? Better than I deserve. What's up? Yeah, so my truck transmission went out this morning. So I was just wondering, I still owe $3,400 on it, and I don't know if I want to trade it in, or do I take the bullet, bite the bullet, and spend the two grand on any training. Yeah.

So what's the truck worth with the transmission fixed? I think I had Kelly Blue booked it at trade-in value about six or seven. Mm-hmm. And I think worth about five. I mean, it's not worth more than seven. Okay. So if it's worth seven fixed, what's it worth today without a transmission? Probably about three grand. Yeah. Okay. today without a transmission? Probably about three grand. So three plus two,

three value today, plus two to fix it's five. It's almost as if you've got $5,000 in a $7,000 truck at that point. So you fix it, even if you're going to sell it. So don't go trade it in and see what I can get for it. I think you just

told me what you could get for it. Three grand. Yeah, that's the point. If you can get five grand for it, trade it in. Yeah. Because it's worth seven fixed, and five plus two is seven. And it takes two to fix it. You see how I'm doing this math?

Yeah. But I don't think you're going to get five grand for it, do you? I do not. Ultimately, no. Yeah. Probably not. If it's worth seven fixed, you're better off to spend two on it, even if you turn around and trade it then.

Yeah. So do you have two grand? All right. I do not. Where are you going to get this? Where are you going to get it? Work, I guess. Extra hours, I guess. All right. I do not. Where are you going to get this? Where are you going to get it? Work, I guess. Extra hours, I guess.

All right. How are you going to get to work? I don't know. Friends? Transmission completely gone, or is it just dragging? It's been slipping the last couple of days, and then I went to lunch today, and it was trans. I got an error saying trans fault. Yeah. It's been slipping the last couple of days, and then I went to lunch today, and it was trans. I got an error saying trans fault.

Yeah, so it won't move? Will it move barely? It moves, but it barely moves. Okay, all right. I mean, you think you can get to work in it for a little while longer? Yeah, possibly. What do you make? I make 47 000 a year okay do you have any idea what's wrong with the transmission i do not i was gonna i've been talking to a buddy today

and i was he's going through some he's a mechanic too and he's saying it's pretty much gone but how's he know that i guess he does he's just going off his our facts or his knowledge because i just don't know what was going on with it okay well i i'm not a professional mechanic i don't know uh but sometimes on those kinds of things you can change the change the fluid and the filter and um and you may change a couple of other items in there and you might spend 100 bucks on it and get it going again or get it going again enough that you could drive it one more month before it finishes it off yeah if you could patch it together for 100 bucks and then go work

your tail end off for a month you might gather up that two thousand dollars right with some ot and stuff yeah that's what i'd love to have happen here so that you're not stuck walking. Yeah, it's a $3,400 truck name. It's the last thing I have to be debt-free. So that's what I'm trying to do. So aggravating. I'm sorry. Yeah.

I'm sorry. You'll get there. You'll get there. But this is your test. Yeah. To see if you're going to live like you promised yourself you were going to live. I remember, man. I remember walking like that.

It's a pain in the butt. But this is the moment where you're living like no one else, so later you can live and give like no one else. I was driving a borrowed car that was worth about $400, and the predominant color on this puppy was Bondo. I remember. It was not a fun time in my life. Those were the good old days.

No, they weren't. They sucked. I was broke. I don't want to be broke anymore. And you'll remember it just exactly that way. This is the Dave Ramsey Show. Are high health care costs getting you down? Are you confused trying to navigate your options? Do you wish you could find an affordable affordable biblical solution to your health care costs? Based on New Testament principles, Christian Health Care Ministries,

or CHM, helps Christian families, churches, and ministries join together as the body of Christ to share their major health care costs. Christian Health Care Ministries is the original health cost-sharing ministry, a Better Business Bureau- Bureau accredited organization CHM members share to pay each other's medical bills. It's not insurance. It's Christians financially and spiritually supporting each other. It's what Christian Healthcare Ministries has done for over 35 years. And our members have shared over $2.5 billion in medical bills. To learn more, visit chministries.org.

That's chministries.org. Christian Healthcare Ministries is a proud sponsor of Dave Ramsey Live Events. chministries.org. Thank you for joining us. We're glad you're here, America. Open phones at 888-825-5225. A lot of parents think their kids have to go to college to be successful. Those of us that got walking around since know that's not true you can be successful without college but college is a big

help knowledge is a good thing knowledge is powerful and uh we're a big proponent of getting a four-year degree for those of you that are going to enter a field where that's helpful to you and that is most fields, by the way. We are not a big proponent of you going into debt to do it. And a whole bunch of people in America today believe that the only possible way to get a college degree is to go into debt to do it. Well, that's absurd. It's just not true. You select a college that's affordable, a university that's affordable. Typically, that would be an in-state school and or maybe even

you use your community college to get your first two years of stuff out of the way. You solve 90% of the problem with that right there. You know why most people go on student loan debt? It's not college. It's because they went to a college they couldn't afford. That's why they go into student loan debt. You know why they got car debt? It's not because they needed to buy a car. It's because they bought a car they couldn't afford. That's where debt comes from. Buying stuff you can't afford with money you don't have to impress people you don't even really like that is where debt comes from and the same thing's true with college you can go to college without debt ramsey personality anthony o'neill has written a new book called debt-free degree it comes out in just a couple of weeks october the 7th it'll be here in mere moments the step-by-step guide to getting your kid through

college without student loans now notice that we said to you parents it's the step-by-step guide for you to get your kid through college maybe if you're going to make an adult decision, you should do it with an adult brain. And $100,000 in debt or $100,000 expenditure on education is an adult decision. Maybe the adults in these students' lives should participate in the decision as an act of love. You parents who have walked away and thrown your hands up are part of the problem my child told me where she's going to school well my son had to see that's where it broke down right there my child didn't tell me stuff i told them stuff it's a different issue you don't get to decide with my money what you're going to do.

I get to decide with my money what you're going to do. You're a control freak. No, I'm a father that cares. And you don't get to take my money and do stupid stuff with it. That's it. Well, I don't know if I like you. I don't really care whether you like me or not. I'm not taking a poll here.

That's not the point. The point is, quit doing stupid stuff that are bringing harm to people you supposedly love. And Congress, that goes for you too. Some of you libs are running around going, we need to forgive student loan debt. Meanwhile, we're still making student loans. Maybe before we start forgiving student loan debt, we ought to stop making student loan debt. That'd be a good first step, wouldn't it? I mean, I don't know how you can logically talk about forgiving anything while you're still digging out the hole.

It's just ridiculous. It's nutty. It's socialism. And it isn't going to work. Instead, we have the antidote. And Anthony's book is just it. Debt-free degree. It's only $19.99 if you buy it before it hits the street.

October the 7th, we're going to throw in $40 worth of stuff with it. His compelling talk on how to connect with your kid, our Smart Parent event, which is two hours of talks on parenting from Anthony O'Neill and best-selling parenting expert, my good friend, Dr. Meg Meeker. And of course, we're going to throw in the debt-free degree e-book to go in the package as well. All of this for just $19.99. If you pre-purchase it, we'll ship the e-book and the book to you on

October the 7th. You can get it at anthonyoneal.com, davramsey.com, or you can call the Ramsey Concierge team at 888-22-PEACE, 888-227- 3223. Dustin is with us in California. Hi, Dustin.

Welcome to the Dave Ramsey Show. How's it going, Dave? Better than I deserve, man. What's up in your life? Well, you know, I kind of messed up quite a bit. So I graduated college a year ago from Chico State, and I got a job in San Francisco, and it totally got me in a lot more debt than I already was. So now I moved to Sacramento.

I'm trying to, you know, pay it all off. I already put $1,000 aside for my emergency fund. Good. I made a couple mistakes. About a year ago, I started with one of the settlement companies, Nationwide Debt Reduction Services. Oh, crap. Yeah, so I had like $55,000 in credit card debt.

In one year? No, no, no. This55,000 in credit card debt. In one year? No, no, no. This was over four years of credit cards. So you were running up credit card debt in college? Well, I also have $40,000 in student loans. You were running up credit card debt in college because you just said you left and you'd been in San Francisco for one year, right? Yeah, exactly.

And so I started it last year with them in august and you know obviously i've been getting you know those letters and stuff but i finally moved to sacramento in may and the debt i accumulated because i left some credit cards off of the settlement um they accumulated a little bit over san francisco and some of them were my wife's credit cards as well. So I just recently put her on the plan, too, in June. But I'm wondering if maybe it's not too late to pull that out and not ruin her credit, you know, like my credit's already been ruined. You know, hoping to buy a house in a couple years. I think you need to stop buying stuff for a while well i definitely need to stop buying stuff you know i have two new cars uh that what's your

household income uh right now i am making about 88 000 a year your household income does your wife work yeah that's that uh she's going to school and doing part-time work, so she doesn't make too much. When does she graduate from school? At the end of this year. At the end of the calendar year? Yeah, so in May. She'll get her associate's degree. She won't have her bachelor's.

In what? Her associate's degree is going to be in what in May? Oh, it's in graphic design. So she already has some experience in that field. She just wanted to get this associate's degree to kind of help get her a higher-paying job. Yeah. So how much is she bringing in right now? She's bringing in about $1,500 a month.

Okay. I want her to gear up her side hustle like triple because a good graphic artist can do all kinds of side hustle while you're working on an associate's degree. Okay? Okay. So let's get her income up. What do you owe on your stupid cars? So my

one car is $20,000 and the other car is $15,000. And they're both only a year old so they't, they're not worthwhile. Yeah, I know. So what are you, what are you, 26? I'm 27, yeah. 27, okay.

Yeah, that sounds about right. I don't know if it's too late for me to pull her out. It's not. Listen, you're dancing around the edges of the whole thing, okay? The thing you're dealing with there will answer your question, but your overall problem is you've got to have a holistic change in how you view all of this. You can't just go over here and fix the little side thing while all this other crap's going on. Okay?

You have two cars you can't afford, you're not on a budget, and you've got to spend like you're in Congress. Well, we used to. Yeah. No, you do. You definitely do. Yeah. Because you have no idea where your money's going. Yeah.

Okay. So I'm going to help you. I want you to go through our nine-week class, Financial Peace University, and I'm going to show you how to sell the cars, how to get yourself out of debt, and I'm going to completely transform your life. You're going to be a completely different person one year from now if you do the stuff I teach you to do. And you'll get your life back, sir. Right now you're distressed. And, yes, you've got to put an end to the stupid debt settlement thing.

It doesn't work. They're ripping you off and they don't do their job and they don't get you out. It's going to look like all of you filed Chapter 13 bankruptcy when this is done. So cancel every bit of that. Keep your money. Turn your money towards this program. I'll pay for it. I don't want your money.

I'll help you. Hold on. Madison will pick up. We'll get you signed up. Hey, guys. At the Dave Ramsey Show, we really value your input. It helps us to know what's important to you so we can deliver relevant content to help you crush your money goals. We just launched a brand new survey, and we'd love your feedback.

It only takes a few minutes, and you'll be entered to win a $100 Amazon gift card. No purchase necessary. Take the survey at DaveRamsey.com slash survey or text survey to 33789. Thank you for joining us, America. We're glad you're here. Open phones at 888-825-5225. Stacey's in Georgia. Hi, Stacey. How are you?

Good. How are you today, Dave? Better than I deserve. What's up? So I have inherited two IRAs that my mom left me. And she was currently taking RMDs on both of them. So I wanted to know and get your opinion on what should be my next steps. You're required to take RMDs on required minimum distributions on inherited IRAs.

That's what you're talking about, right? Correct. Okay. So you either do that or you just pull the money out go ahead and pay the taxes on it and do something else with the money so either one's fine uh make sure they're invested well are they invested in good mutual funds so i haven't done anything with the money yet what's it in so it's in the ira i know. What's the IRA in? It's annuities, insurance. Okay.

So it's crap. All right. So you need to roll it into some good mutual funds if you're going to leave it in the IRA or you're going to cash it out. How much is in the IRA? It's $150,000. Okay. That's great. Okay. And what is your the IRA? It's $150,000. Okay. That's great. Okay.

And what is your household income? $116,000. Excellent. Okay. Do you guys have any debt? So it's just me. So I have $3,000 on the credit card debt and then mortgage and that's it. How much is your mortgage?

It's $1,000 a month. I'm sorry, your balance. Oh, I'm sorry, $78,000. Okay. And how old are you? 46. Okay. The way I answer questions on this show, Stacey, is what would I do if I woke up in your shoes? If I was a 46-year-old single lady

and I had a $100,000 mortgage and I had $3,000 in credit card debt and I had $150,000 in inherited IRA that would have no penalties if I took it out, but I would pay taxes on it. So it's going to cost you $40,000 in taxes probably out of this. I would cash it out and be 100% debt-free mortgage and everything, make sure I build my emergency fund of three to six months of expenses, and then I would start investing aggressively. And you'll rebuild the $150,000 with what used to be a house payment very, very quickly in your own Roth IRAs, in your 401K, Roth 401Ks, if you've got that available to you.

But I'm going to just start investing and offset it, and you'll have the money back in no time. And in the meantime, I have absolutely no debt. That would be a very cool place to be, and that's what I would do if I woke up in your shoes. Christina is in Georgia. Hi, Christina. How are you?

I'm good. How are you doing? Better than I deserve. What's up? Good. I was calling to get your opinion about us downsizing our home. My husband is a pharmacist, and he makes about $140,000 a year and brings home about $100,000.

And we still have $120,000 of debt from his student loans that we owe. We have three children. We have one that's just eight weeks old, and I stay at home with them. So we're just trying to see what we can do to help free up some money. Money is pretty tight at the end of each month with his loans, and our daughter actually has like a severe milk allergy, so her formula is about $400 a month so we're just trying to see what would be best for our financial situation okay um how much debt do you have other than your home his truck we still

owe about $5,000 on it so our monthly payment for it is $175. Okay and how long has he been out of pharmacy school? He graduated in 2012 and then he did a residency the year after that. And so when he came out of school he had $240,000 in debt so we've paid off $120,000. Okay so you've made some progress, but just not great. Yes. And what's your home worth? About $200,000. And what do you owe on it?

$163,000. Okay. No, I wouldn't downsize. It doesn't help. You wouldn't? It doesn't help. You don't have enough equity to do any good. Your payment is not what's killing you.

You guys are not living on a detailed written budget that you're sticking to. You've been sloppy. Yes. Okay. There's nothing wrong with that. It's just normal. And I can just hear it in the numbers. Okay.

I've been doing this a long time. I've been doing it a long time. So I would, instead of selling my house and moving, I would tighten up my life. And let's get on a detailed written budget, get the EveryDollar app, and download it for your phones, and put it on the desktop. And the two of you sit down and have a come-to-Jesus meeting. Sit down and tell the kids there's a new word being introduced to our house. It's no.

And we're not doing nothing. Okay? All we're doing is getting that rid of the rest of daddy's student loans, and daddy's going to be working the extra. Yes, that was another question. He's going to pick up a pharmacy gig in the ER on the weekends and raise his income about $40,000 or $50,000 so we can get this mess cleaned up. Okay. That was my next question, too.

I'm sorry. Let me stop you. We have an unpleasant two years ahead of you. Okay. But that's better than an unpleasant decade. Right. Exactly. Yes, that's what we're trying to get them taken care of.

Yeah. That's what I'd do. I would lean into this in a way that would just, you know, that's going to shake everything in your life. You're going to live like no one else, but it'll put you in a position that you can live and give like no one else. It's going to be very unpleasant, and your kids are going to go, where's daddy, where's daddy, and he's going to be working.

And it's not forever. He's going to work like no one else so that later he can work like no one else and he can pick and choose the stuff and all that turn off the television at your house when he's home and um but he's going to be tired and you're going to be tired because you have four kids by yourself you're going to be a single mom for two years but you can clean this mess up if you do that but otherwise you're going to drag butt along for another decade and you're going to be sitting right where you are right now and the house selling is not going to help you if i thought i'd clear it up i'd do it for you

but it just doesn't it doesn't move the needle cody's with us in texas hey cody how are you i'm good dave how are you better than i deserve I deserve. What's up? Hey, not much. I was in Nashville last week and saw the new building. Beautiful place you got there. Congratulations. Thank you, sir. How can I help? I just had a question. Thanks to you and your team, me and my wife were able to pay off $203,000 in debt. So we're now debt-free.

Wow. Yes, sir. So my question is, we're now on 3b and 4 and i was wondering while we don't have any kids if i can increase step four to about 18 to 20 percent just for the three years until we have kids to make up for the time that we lost while we're on step number two no i would i would keep baby step four at 15 when you buy your home i would take anything that you want to extra throw at uh that you were going to throw at baby step five that you don't have and the extra that you're going to put in retirement i'd throw it at the house let's

get the house paid down faster sure sure so we're we're really big fans of the 100 down plan and we don't really know where we're going to live just because my job is very volatile. And, you know, she's not fresh out of school, but, you know, not far removed. Great. Let's do 15% of your income into retirement and everything else into 3B then, into your down payment savings. So instead of paying down the house aggressively, we're aggressively building up the down payment fund.

Okay. I'd rather do that than put 18% in retirement. Yes, sir. That makes sense. Because we're still reaching over there towards baby step six in the future, except you're not going to have a baby step six if you pay 100% down. Very cool, dude. Well done, man. You guys are on fire.

Rock stars. Love it, man. Get after it. That's fun. Good stuff, man. You guys are on fire. Rock stars. Love it, man. Get after it. That's fun. Good stuff, man. You can do this stuff, people. It's just hard, but it's not as hard as being broke. This is the Dave Ramsey Show. Thank you. Thank you for joining us. Open phones at 888-825-5225. John is with us in California. Hey, John, how are you?

Hey, Dave. I really enjoy your show, so thanks for taking my call. My pleasure. I've got a question about whole life insurance. Okay. So my wife and I, we've been married for 36 years, and we purchased a whole life policy 35 years ago from my father-in-law who just went into the life insurance business. And I've been listening to you how much you don't like whole life.

But we're 57. I'm in relatively good health. Everything's paid off. I have a really good pension. So my question is, I mean, you figure if we're just paying the premiums for another 15 years, is it worth to keep it since we've paid so much, so long for it? Yeah. No.

Are you healthy? Yeah, I have no health problems. I'm expecting to live live are you have children at home no they're all they're all gone how much money is in your nest egg uh well i have a really good pension and then we have about sixty thousand dollars and just other investments and then when i die my wife maintains my current pension at its current level. Yeah, and what is that? How much is the pension a year? About $130,000. Wow, very nice.

Okay. And is your home paid for? Yes, it is. Good, good. Okay. And what is the cash value in this whole life policy? About $80,000. Okay.

All right. And what's the face value that pays if you die? $650,000. Okay. All right. Okay. Well, here's the thing. $80,000 invested well would easily buy you a million dollar policy. The investments off of it would. Okay? Okay. Were you to die in that case, you would get a million dollars and the $80,000 investment. Today, the way this is set up, when you die, your wife will get $650,000 and they'll keep the $80,000.

Okay. They only pay the face value the $80,000. Okay. They only pay the face value on a cash value policy. Okay. And you've been paying extra for 30-something years to create an investment that is invested at about 1% to 2% right now. Okay. That's what you're making on your money. And when you die, they keep your money. So on that basis, I would have my investment in something that made more than 1% to 2%,

and that when I die, they don't keep my money. So when you say, I'm confused when I say they'll keep my money, but my wife would still get the $650,000. They get $650,000, yeah. But the $80,000, you understand you paid a lot more for a cash value policy all these years, right? Yes, I believe my book. I understand that, yeah. Okay, and so the fact that you paid more for it is an order that it created an investment, okay?

Correct. The $80,000 didn't appear from Santa Claus. It's because you gave them extra money. Correct. And so that's your money. And so you bought a life insurance policy and an investment, but you're only going to get one of them. Okay.

When you die, your investment that you paid extra for goes bye-bye, but the insurance that you bought, yes, the $650,000 will go to your wife. If instead you had bought term life insurance for $1 million or for $650,000 and you used the interest off your $80,000 to pay for that, you'd have both. Okay, okay, now I understand okay okay um yeah i've been listening to you for so long and but my wife liked it as she liked it because her daddy sold it to you yeah so it's uh so all right it's a family problem we have here too but yeah but um but you got to decide you know who we're going to serve here so

the bottom line is is that you all if you want some life insurance were you to invest this 80,000 and actually you'd have a hundred very quickly based on what you're spending for this thing okay if you put 80,000 plus what you're spending for this you could easily the interest or the investment returns off the 80,000 would buy you a million-dollar policy, you know, without any trouble at all, if you want an insurance policy. I'm not sure you need much of one, because if you died with zero insurance and $100,000, because this $80,000 is going to be $100,000 because this 80 is going to be 100 very quickly. So if we had 80 to $100,000 plus your 60 in an investment, a paid-for house and $140,000 pension, and you die, she'd be okay. Right.

Okay. And so the idea of insurance is to make sure your family is okay if you die. So if you want another half million until you get your investments up, you can go buy a half million dollar policy. If you're healthy and 57, you'll be unbelievably surprised at how little it costs. It's just not that expensive. So, yeah, and I think you probably want some insurance. I don't think you need it, but I think you probably want some in your all's case.

So go price a half a million dollar policy at Zander Insurance and see if that is not less than 10% on $80,000 would be $8,000 a year. If you had that invested and made 10% on it next year in a mutual fund

and see if it's not less than $8,000 a year. I bet you it is. less than $8,000 a year. I bet you it is. I bet you it's a lot less. So I'm going to save you money, and I'm going to make you money when you die. You're going to come out all the way around on this. I don't care what you do, but there's no possible way I would have money on a life insurance policy that is a cash value policy under any circumstances. Corinne is with us in Missouri.

Hi, Corinne. Welcome to the Dave Ramsey Show. Thank you, Dave. What's up? Question for you. I was a 911 operator, and I recently lost my hearing in one ear, and so I was medically disqualified from that position. The city moved me to another department that was short for the time being,

but it's a temporary replacement for probably another month. I'm not sure where to go from here. Do I keep paying my student loans because I'm still collecting a check, or should I go to an emergency mode? I'd go into emergency mode. Are they going to lay you off? No. I think the talk was after this, like, two-month temporary position, possibly going into long-term disability.

But as I understand it, that's 60% of my income. How old are you? I'm 26. Wow. If they want to pay you long-term disability while you go get your next career, that's fine. But this may be the best thing that ever happened to you, because now you're getting ready to go have a great life. Otherwise, you might have ended up working for the city.

Right. Okay. I mean, so what do you want to do now? You're 26. You've got the whole life ahead of you so what do you want to do now? You're 26. You've got the whole life ahead of you. What do you want to do? To be honest with you, I've been interning in youth ministry, and so I was planning on being full-time out of church in August,

but I feel kind of bad starting a new job with someone if I was only going to be with them for about six months. Why would you only be with them six months? Oh, because of the youth ministry thing. Yes. Right now it's unpaid. I see. Okay.

Have you talked to the church about moving the timeline up? I haven't. Let's ask them about moving that up. And in the meantime, clean some houses and deliver some pizzas or something. Walk some dogs. I can do that. Yeah, and just make the gap. But, yes, I would stop your debt snowball until you get through this transition.

You need to pile up cash because we don't know what's going to happen. You've got too much uncertainty going on right now, and a big pile of cash alleviates a lot of fear. Let's pile up some cash until we get settled in on the new job, the new youth ministry thing. God sets you free. You get to go do what he told you to do now. That's pretty cool. I love this. That's fun. Sorry you lost your hearing. I lost a bunch of mine with these headphones on over 30 years, too.

But you'll be all right. You're going to do great. You're going to be an awesome minister. Proud of you. Very cool. This is The Dave Ramsey Show. Hey, it's Kelly, associate producer and phone screener for The Dave Ramsey Show. This episode is over, but if you heard about a product or service and didn't have a chance to write it down, don't worry. We list everything that is mentioned during this episode in the podcast show notes section.

Thanks for listening.