The Ramsey Show - App - What's the Best Way to Save for a House? (Hour 3)

Episode Date: August 6, 2018

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🎵 Live from the headquarters of Ramsey Solutions, 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. This is your show, America, because it's all about you, baby. It's a free call at 888-825-5225. That's 888-825-5225.

Linda starts off this hour in Wisconsin. Hi, Linda. How are you? Hi, I'm very good. I want to thank Kelly for letting me talk to you. Well, thank you. How can we help? Well, I have a couple things.

One thing is I just, before I talked to you, my last call was to pay off my last debt, so I finished Baby Step 2. Yay! Way to go! Yay! I know, I'm really thrilled about that. How much did you pay off?

I paid off about $4,000 in about six months. Good for you. Thanks. I'd like to, I have some questions and I'd like to just tell you that my income, I'm on disability, my income is $1,321 per month and I currently have a home at $66,000 at four and5% interest. It was just assessed at $26,000 more this year than last year. Right now, I pay $745 a month with my HOA fees, my insurance, and my mortgage. And I met with an ELP realtor who suggests I sell it for $99,400. I have $1,000 in my Don't Touch Emergency Fund. For retirement, I have a fixed and variable annuity, $57,000 at Jackson National. And I believe it's an annuity so it could be liquid for hardship dispensation. I have an IRA for $29,000 at Pershing,

and I have three stocks that I bought in March, May, that have gone up about $1,000. And since then, I've learned from you that stocks are not a good thing to get into. So now I'm thinking I should sell. I actually have an appointment with a SmartVestor Pro tonight. Wow, what are they worth? To get some more advice.

Right now they're worth $5,000. Okay, all right. How old are you? So I'm 57. What's the nature of your disability? I broke my neck falling down a flight of stairs while I was sleepwalking and also have a brain injury. So it takes me longer to do things than it used to. Um, and so I, I lost my job because I couldn't do anything there anymore. And I lost my home

and, um, my marriage and just a whole, whole bunch of stuff happened all at once. And so I used your program, actually, while I was married and took all my savings account to pay off my husband's debt, and then he divorced me. So I got scared to get back on, and I got scared to use any savings that I had after that. And I just took the leap and spent all the savings I had to pay off my debt. And here I am.

So I need to know, I mean, do I rent or try to find a less expensive home? Or which, I don't know how I'd find that without having to do a lot of repairs. And since I don't have a job, I don't see myself being able to get a loan. I agree on all of that. I'd like to see you be able to sit tight. Here's your biggest pinch, and you know this already. You didn't need me to tell you this because you've done a really good analysis of everything. I mean, if you've got a brain injury, you're doing a whole lot better than some people

that don't have a brain injury, I'll just tell you. So, I mean, really, you really have got this all dialed in. You didn't have any questions about where you were on everything. So you don't have, bottom line is you don't have enough to pay off the house. Your struggle, as you are thirteen hundred and fifty dollars for the next 40 years or 30 years could be a grind and so if i'm in your shoes i'm going to start thinking of something probably a self-employed idea, that you can do at your speed to make ten times that over time. That's what I'm trying to do.

I created a paper craft business where I sell it. I'm at stores right now that sell my product, and then I sell at craft markets what i'm going to do if i'm in your shoes then i'm going to hold on to this house for right now it's killing you because it's got it's such a big percentage of your of your 1350 it's just you you can't maintain that forever but i'm going to hold on to that by the teeth if i can for the next six months to a year while i try to add some income to this equation and then hopefully over time you can add so much income to the equation that your disability becomes irrelevant your disability income becomes irrelevant suddenly

you start making six thousand dollars a month if they say oh you're not disabled anymore you went okay you know uh you'd be fine because the whole point is to have money to eat. So I'm going to try to hold on to the house because it's a very reasonable home in Oshkosh, Wisconsin. I mean, you're not out of line on anything you're telling me. It's a very modest home, and it's not the problem. It's not like you went and bought a $300,000 house and we're going, what were you thinking? No, you've got a modest home here, and it's not the problem. It's not like you went and bought a $300,000 house and were going, what were you thinking? You know, now you've got a modest home here, and it's very reasonable. I'd like for you to hold on to it while you try to get your income up.

That's what I would do if I were in your shoes. Now, if 12 months from now you're still looking at the income, you probably are looking at selling it. You've got to do something, though, long term, because the next 20 years or 30 years at 57 years old at 1350 bucks a month that just doesn't sound fun and so long term you really that that's where i'm gonna put all of my energies is on the income side of this equation in your case thanks for calling in it's an honor to talk to you. Very, very well done. Oh, and hold on. I'm going to send you a copy of Christy Wright's book, Business Boutique, because we'll help you get that small business going. That's Christy's book on equipping women to make money doing what they love.

So Christy will help you walk with you through that and help get you moving in the right direction. So good job. Very good job. Open phones at 888-825-5225. Ron is on Twitter. What's your favorite book on leadership? I almost have no favorite books.

I read too many. I have authors that are my favorites. In the leadership space, John Maxwell writes a book every other week. You ought to read almost every one of them. My favorite of his is his 21 Irrefutable Laws of Leadership. It's an older book, New York Times bestseller, a great book. I would read everything that Jim Collins writes. Good to Great is his biggest one, his most famous one.

Absolutely incredible, brilliant mind. I read everything that Malcolm Gladwell writes. I read everything that Malcolm Gladwell writes I read everything that Seth Godin writes probably the best marketing mind on the planet you want to learn about social media you read Gary V he's kicking it and the guy's on top of it

crazier than a bean I love the guy he's a friend of mine but man he's a character but the books are a fun read I'll tell you they're a romp and I'm probably leaving off people but oh Pat Lencioni But, man, he's a character. And the books are a fun read. I'll tell you, they're a romp. And I'm probably leaving off people. But, oh, Pat Lencioni. I'd read everything Pat writes for sure. So that's how I do it.

I just find an author that has a brain and that works good, and I read all their stuff. And then that transfers into my brain. Ha! It's magic. This is The Dave Ramsey Show. Okay, I need you to listen to this. Because one normal routine that everyone does can cause total chaos in your life. Folks, I'm talking about the simple act of using Wi-Fi. When you're on Wi-Fi anywhere in public or at home,

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Get brand new custom blinds without paying custom prices from Blinds.com. You get free samples, free shipping, new promos every month. Use the promo code Ramsey. Question of the day is from Paul in Ohio. How do I determine my assets? Do I count all of my Roth IRA and 401k money? Yes. Question of the day is from Paul in Ohio. How do I determine my assets? Do I count all of my Roth IRA and 401K money? Yes.

Or only the money I can access now without a penalty? No, your assets are everything. Everything you own. Any investment accounts, any real estate, anything you own that you could sell for money. And you could sell your retirement accounts for money. And I would not discount when you're calculating net worth, I would not discount your retirement accounts just because you would be penalized if you pull them out. I would just list them.

So if you have $200,000 in your 401k, $200,000 goes on the list. If you have a $400,000 house house four hundred thousand dollars goes on the list now some people put in other stuff like furniture or other stuff like that but i wouldn't um i wouldn't fool with that because really the truth is you're trying to say you know what is your business net worth and i don't put you know the value of my clothing which really wouldn't be anything in my case but um you know i guess if you got some really expensive antiques or something you put that in there if you've got some collectibles in there like i've got a 1960 corvette that has a pretty strong value okay so i would probably list that on there but most people don't list cars you know you wouldn't normally put a five thousand dollar car in there calculating your net worth i mean it, it's not that big a deal. You can, but it's not the end of the world.

But if you've got collectibles, like a buddy of mine is a wine guy, and he probably has $300,000 or $400,000 worth of wine. And so he would list that because that's something you would insure because it's such a large number. And, you know, it's not like he's got two cases of wine in his basement. That's not what we're talking about here. This is a serious wine collection. So that would be an asset that could be liquidated.

There's obviously a wine market. Art you could liquidate. Another buddy of mine has got several hundred guns, probably worth 300 grand or more, and he could liquidate those, or his wife could if he died, or something like that, which is the only way they're getting liquidated with him, I'll just tell you. But he has to die. He has to die.

That's before those guns sell. But anyway, you know, if it's an extreme amount like that and it's something that can be sold, there's a market for it. So there's a market for art or guns or wine or stuff like that, right? There's things like that. Then you would use it as a collectible or antiques. You've got another friend that's got probably $100,000 worth of antiques in just one room. You'd probably list that in your net worth because you could sell that and turn it into something.

But your typical furniture in your typical house, I mean, it's garage sale stuff. You know, it isn't going to bring anything. So you don't bother with that. But if it's kind of an extreme thing, you would put it in your net worth. You certainly would put all of your investment accounts and all of your real estate in your net worth. And, of course, you list any debts that you have on the liability side, which reduces your net worth. Your net worth is what you own minus what you owe. Your assets minus your liabilities equals your net worth. Your net worth is what you own minus what you owe. Your assets minus your liabilities equals your net worth. And when that figure is a million dollars, you are technically

a millionaire. I don't feel like a millionaire. It's not a feeling. It's a math thing. I don't think I could live on that. It's not done anything to do with it it's you have a net worth of one million dollars or greater you are technically a millionaire whether you feel good about it or not is not relative it's a mathematical equation and if you have a billion dollars in that corner in that net worth corner you are a billionaire it has nothing to do with what you earn. So you could be a billionaire and earn almost nothing a year if the assets weren't producing an income. It would be kind of weird, but it could happen. I mean, your income is not relative in this discussion. So when idiots in Washington go, you know, well, you know, the president's not really a billionaire.

He didn't make a billion dollars last year. Well, that's because you're an idiot, okay? You don't understand that it's not got to do with income. How did you make it into Congress anyway? And I'm not defending Donald Trump. I'm just saying don't be an idiot if you're in Congress because you said you don't know what a billionaire is. I don't know if he's a billionaire or not, but it has nothing to do with his income.

It has everything to do with the amount of assets minus the liabilities yes same with you same with me and that's how this works and when we're doing a millionaire theme hour we're talking to people who have a net worth of one million dollars or greater it does not mean they make one million dollars of your income very few millionaires make a million dollars of your income. Very few millionaires make $1 million of your income. Most people that make $1 million of your income or greater have a net worth much larger than $1 million. Can you imagine that? Unless they spend it all, you know, they ought to be able to end up with, you know, a pretty substantial net worth by investing some of that money.

Nick is with us in Knoxville. Hi, Nick. Welcome to the Dave Ramsey Show. Hey, Dave. Thanks for taking my call. Sure. How can I help? My wife and I have been talking recently, and we're trying to get into a house,

and we're trying to figure out if it would be okay to temporarily stop funding our retirement accounts to save up for a down payment for a house for the next, probably next year or so. Okay. Are you debt-free? Yes, we are. Okay. You have your emergency fund. Yeah, we got about $16,000. Okay. And what's your household income? I'm projecting about $100,000. Good, very good. And so how much are you putting into retirement a month?

Right now, we are doing $700,000 every two weeks, or about $18,000 a year. We're trying to catch up on that this year, so about $18,000. Okay. All right. And so if you stop doing that for a year, you'd have $18,000 plus whatever else you save, right? Yeah. So you would stop all retirement temporarily to save for home for one year? Yes, sir.

Okay. We call that Baby Step 3B. Baby Step 3 is you're debt-free, accept your home, and you have an emergency fund, and you are there. And Baby Step 4 is obviously 15% of your income going into retirement. Sometimes when people finish their emergency fund, they want to buy a home, and before they start their retirement, they save up for a home and then start for their retirement. Now, in your case, you're going to kind of do it in reverse. You're going to stop retirement temporarily, but you're not going to do it for very long, and that's the key. I don't want to do this for five years. You're doing it for 12 months, and then you're going to put other

money with it as well that you save, and you're going to continue to scrimp and pull nickels out of the corner of the couch and everything else to have a good strong down payment yes i would do that um if that's your goal but make sure you're living on a really detailed written budget get on every dollar.com and get every dollar loaded up get your detailed budget going because if you'll do the detailed budget, your money will feel like it's working harder because it is. And that changes the deal completely. It's a big, big deal. Folks, thousands of ladies are realizing their dreams by using their God-given talents to start their own business. And guess what?

You can too. Business Boutique is all about equipping women to make money doing what they love if you don't have all the answers well it's okay nobody does when they start a business man or woman are you a little bit scared well that's pretty smart actually because you don't know everything you should be a little bit scared and um i was and ladies often are too it's not you know it's not a thing that's unique to ladies but all everybody's there for years christy wright has been coaching ladies on how to make money doing what they love she created the business boutique academy which is our online

learning center that will train equip coach encourage you to start and grow your own business. Never been a better time, folks. Business Boutique Academy. Check it out. You're going to see the knowledge. This is a strong learning center for you ladies that really want to excel in business. Go to businessboutique.com. You're going to love Christy's teaching and content. This is the Dave Ramsey Show. I get asked all the time about what people need to do to improve their family's money situation.

Two of the most overlooked things are term life insurance and disability insurance. Both plans make sure that you have income to pay bills and take care of yourself and your family if something were to happen. For term life, you need to carry 10 to 12 times your income, and I recommend 15 or 20-year plans for most families. Stay away from cash value or return of premium plans. They're just a ripoff. Disability insurance is just as critical. How are you going to pay your bills if you're unable to work?

Disability is the leading cause of bankruptcies and foreclosures. And that's why I send you to Zander Insurance. They've been helping my listeners find the right plans at the lowest cost for almost 20 years. Call 800-356-1780 or visit zander.com and compare online. That's 800-356-1780 or zander.com. In the lobby of Ramsey Solutions, Martin and Tanya are with us. Hey, guys, how are you? Hey, I'm awesome.

Welcome. Where are you all from? Joplin, Missouri. Cool. Good to have you. Thank you. And all the way down here to Tennessee to do your debt-free screen. Absolutely.

Love it. How much have you paid off? We've paid off $125,000 in nine and a half years. Oh, look at that. And your range of income during that time? We averaged about $110,000 to $115,000 and peaked last year at about $125,000. Very good. And the $125,000 that you paid off in nine and a half years, would that be your house? Yeah, baby.

I'm looking at weird people. Amen. Very cool. Very cool looking at weird people. Amen. Very cool. Very cool. So tell me your story. What got you started? And you did your baby step six, and that took about the normal amount of time. It usually takes about seven, eight years.

So tell me what happened. Well, back in 2007, I was sitting and talking to a friend of mine that we go to church with, and he knew I was a talk radio junkie. I'm a letter carrier, and so I get to listen to the radio all day long. And he's asking me about, have you listened to this guy about finances? And I had heard you. You were kind of new to our market, but you came on after Rush, and then came Sean. So I just switched from Rush to Sean, and I'm like, no, I don't listen to this guy.

I don't need this guy. I've got my finances in line, and we're doing fine. And he said, no, you need to listen to him. I said, okay. So I started listening a couple days later, and I'll say I was immediately hooked. From day one, I said, you know what? This guy is making sense. And I went about probably a week before I came home and talked to Tanya and said, you know, I've started listening to this guy on the radio. And he makes a lot of sense.

And I think we need to do what he's teaching. And so we started to formulate the plan, getting our budgets together. And then as I was listening, I started hearing about this Financial Peace University. And it started piquing my interest. And I was like, okay, what is this? And as I listened, I started learning, hey, that's a class that's taught in the local church. Well, immediately, God said, you need to teach this

class in your church. And I'm like, well, I don't think so. Number one, I've never taken it, much less feel competent to do it. And of course, God's pretty persistent, as you know. And so I said, all right, I'll teach it. So what I did is I contacted your organization, and I was put with a wonderful advisor. I found out recently she's not with you anymore, which really saddened me because I was wanting to meet her. Leanne. Oh, Leanne was awesome. She was with us for a long time. Yeah, exactly.

She's a great lady. She made the whole thing awesome. Yeah. Laid it out for me and said, do this. Okay, do this. Okay. So we brought it into my church. And I'll tell you what, when I walked into that first night of our class,

two things went through my head. The first one was, holy crap, look at all these people. Because I'm looking at the back of 50 people's heads. And the second thing was, all right, God, you want me to do this? You're going to have to help me because I don't know what I'm doing. And so we started the class. And so then as the time went on throughout the weeks, I started seeing the need for this subject. And so that class led to the next class, to the next class. How many classes have you led? Twelve. Wow!

Thank you so much. Well, you're welcome. And that was from 2007 to 2011. And here you stand after all those classes with your house paid for. Exactly. So, Tonya, he walks in the door and says, I've been listening to this guy on the radio. And then he, this guy doesn't do anything halfway. I mean, when he jumps in the pool, he gets wet, doesn't he?

I mean, all over you know so he goes wide open what were you saying um you know by that point we had really been working on our marriage and so i was emotionally at that point ready to be the submissive wife for women that understand that not to be a doormat for him to walk on but to be his helpmate yeah so i didn't even question it i just knew it was something that obviously was right and we just we both jumped in yeah so it wasn't a hard decision once you uh once you decide to step in did you see it as well um yes i i saw it more from the emotional side obviously you know you you teach the nerds and the free spirits obviously i'm the free spirit okay cool i'm married to the nerd um

so wouldn't have guessed it so you know once i'm once i um was able to make that emotional connection and emotionally tie our finances to how emotionally I tie our marriage together. And for me, I had to treat them the same. It's a commitment. It is. And when you make a decision, life doesn't stop there and it just happens. You have to work at it and work at it. And so I made that commitment to work at this with my husband just as I work with my husband on our marriage. I bet you guys have been fabulous coordinators.

You sound like a great tag team. You really do. I'll brag, yeah. So tell me, how much fun is it to teach that, lead that class, and have a front row seat to watch these other people change their lives? Well, I think it's real important to be excited to do something no matter what you do. Exactly. And you've got to buy in, all in. You can't sort of kind of do this stuff.

And so watching probably 250 families go through and we were in a smaller church too so this this eventually became an in-reach to an outreach i was bringing more people in through outreach than i as the time went on because we had such a big influx of people at the beginning that wanted to do it but to sit there and get to dive right in the middle of their lives, it was all the more assurance of this is why we need to do this. And that's led into the coaching. I've went from doing FPU, God kind of moved me in 2011 to do the one-on-one. Oh, really?

Cool. And so I've probably met with a couple of hundred people in that time. And that's where it's really gotten more exciting for us is to do more of the coaching, the one-on-one. It becomes more personable, and you can really dive into somebody's life. And it's crazy to think we're old enough to be the mentors instead of the mentee. It's scary and crazy at the same time and awesome. We love it. It's amazingly rewarding. It the same time and awesome. We love it. It's amazingly rewarding.

It really is. How does it feel to not even have a house payment? Oh, my gosh. So here's, again, I'm the emotional one. So we had our house paid off in February. And the last week in May, we did the big family vacation. You know, obviously, we paid cash for it. So we went to Navarre Beach,

rented a condo on the 17th floor, glass walls, mind you, because I wanted the view. Love it. I am so emotionally overwhelmed. When we walked in that, my daughter will testify, because she was standing right there next to me. When I walked in, I started crying.

It was just, I can't even describe the peace and the excitement and just the joy of being able to do something like that for our family. And not have any stress of any kind of finances tied to that. You know, that was going to follow us home and be this huge, ugly cloud, you know, hanging over us when we're done. Well, that's living like no one else. So later you get to live and give like no one else. I'm so proud of you guys. Thank you. I want to throw in a couple of things from my aspect. You got just a second. You better go fast. Well, all right. Today is our pinnacle point. Right. You know what the pinnacle point is? You teach about it. Today is our pinnacle point. Right. You know what the pinnacle point is? You teach about it.

Today is our pinnacle point. So I'm ready to enjoy the ride down. I love it. Well done. And now I'm going to get up tomorrow and the next day and the next day. You know what we're going to do? Anything I want. Anything I want.

Mic drop. And save for that retirement house. I love it. I love it. I love it. We're proud of you guys. We've got a copy of Chris Hogan's book for you signed. That is the next chapter where you become millionaires now and outrageously generous along the way. You guys are a lot of fun.

Thank you so much for leading all those classes. Thanks for having us. What an incredible, incredible story. $125,000 paid off in nine and a half years, making $110,000 to $125,000. It's Martin, Tony, and their daughter, Emily, from Joplin, Missouri. Count it down. Let's hear a debt-free scream. All right, you ready?

Yes. Don't hold back. Okay. Three, two, one. We're debt-free! Woo! Love it! That's how you do it right there folks That's as good as it gets

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It is not the mountain we conquer, but ourselves. Of course, the first person to climb Everest, right? You knew that, didn't you? Brenda is with us in Phoenix. Hi, Brenda, how are you? I am good, sir. Thank you so much. It's a pleasure to speak with you.

You too. How can I help? I am getting ready to retire. At least I'm looking at it in the face at this point. In a couple of years, I have a 401k that has $1.6 million in it. Way to go! Thank you. I have about $225,000 in debt, including my house. I don't have new cars. I paid $10 for my last pair of jeans, and I'm starting to get a little nervous. How did you get all that money in that 401K?

Just pouring it in, pouring in as much as I could. Just working. Are you single? I'm married. Okay. And we've both been in our jobs a long time. We both are business sales reps. What kind of household income have you had?

We started at about $50,000 a year. We're at $210,000, $115,000 now. Okay, is that the most you all have ever made? No, actually, with bonuses, it's been about 200 okay all right occasionally but you just kept loading you kept loading the 401k and you're how old i am 64 awesome and you 1.6 congratulations very well done thank you your classic your classic millionaires soon to be multi-millionaires so very very well done definitely before i retire i hope to be multi-millionaire So very, very well done. Yes, definitely. Before I retire, I hope to be multimillionaire. There you go.

I do have questions about annuities. I have an appointment this Saturday to go talk to a gentleman who is a fiduciary, his company is a fiduciary. I've been listening to some of his information. I looked him up, did some research on him. They seem like a very reputable company, but I don't know enough about annuities or how that's going to work in my retirement years. That's why I'm going to see him, but I thought I'd get your thoughts. Okay. I assume you've had the money in mutual funds inside your 401k, right?

Correct. Very diversified. Yeah, that's how it's grown to that. It wouldn't have if you didn't. So with the numbers you gave me anyway. Okay, so there are two types of annuities. One you would never do, and that's a fixed annuity. That's more like a CD, okay, and that's just a bad rate of return, and you don't want to do that. Okay? You wouldn't move all this 1.6 into CDs.

That'd be stupid. You dance with the girl that brought you. You don't abandon the thing that's been working right so exactly when you're 401k when you turn 70 you have mandatory minimum withdrawals that have to begin okay um as a side note by the way i probably just go ahead and pay off your house pull out enough to pay the taxes and pay off your house today okay that's a side note now what the annuity is the only kind that you would consider is a variable annuity and that is mutual funds inside of an annuity now what that allows is a couple of things one is it grows tax deferred well your 401k is already growing tax deferred.

Right. You don't have any taxes on the money as it grows right now until you pull it out. So that is worth nothing because you've already got that. The second thing a variable annuity can do is you can name a beneficiary and the money passes directly to them outside of probate and avoids Arizona probate tax. That might have some value. That probably does have value. The third thing is, and fourth thing go together, is most of the better variable annuities now have a feature where if you leave the money alone a long time, seven years or more, they

will promise you a minimum rate of return and promise you your principal at least so it becomes i think that is what his advertisement is saying because it's a yeah they're offering a 10 matching deposit at your first deposit and a guaranteed 10 per year if you leave it alone a long period of time and invest it like they tell you to invest it. Okay. Right. And so that's the deal. The deal is that's kind of mathematically a joke because if you leave it alone in your 401k that long, you're going to make the money anyway.

Almost 100% of the 10-year periods have given you that kind of a rate of return and have not lost principle. And so they're not really giving you anything. It just makes you feel good. Okay. Okay, in that regard. So it's a little bit of a benefit because you do have a guarantee, quote, unquote, right? Right. But then you get charged extra fees.

And so the question is, are those extra fees worth it? And the reason the guys in the business sell the crap out of these things is their commission on them versus just mutual funds invested. Like if you took your 401K and roll it to an IRA and put it in similar mutual funds and just controlled that, their commissions would be about four times as much on an annuity, a variable annuity, as they are on a simple mutual fund purchase. Really? Yeah, so they push the crap out of them. I'm not a big fan, as you can tell, but I wouldn't just tell you never do it. If you understand the things I talked about and you want to do it anyway, then it's an okay thing to do.

I know I wouldn't do 100% of your money in that. No, I would not do that anyhow. But if you wanted to take, you know, $500,000 of your money or that no i would not do that anyhow but if you wanted to take you know 500 000 of your money or something and set it over there so you had that uh because that that much being guaranteed you'd pay some extra fees for that gave you some peace of mind and helped you with a you know naming a beneficiary outside of probate that'd be valuable you might want to do that maybe but you want to spend some time understanding it and if they're trying to push you to move everything into there that's a sign to stay away from them as far

as i'm concerned okay that gives me so much more that gives me a point to investigate further because trying to figure out on your own the difference between what i'm doing with my 401k which it took me a long time to to figure out what I was doing with that as well. Now trying to figure out what the differences are. You did. I'm sorry? You did figure it out, and you have $1.6 million as a result. So don't discount your ability to understand these things.

Okay. You have the ability to understand them. You are a multimillionaire as a result. And that guy over there probably doesn't have the net worth that you do you know so they're very nice and i thought i would investigate yeah i'm sure he's very nice i don't doubt that he wants a million six in his account over there to manage i'm sure he's being nice but okay let me teach you let me teach you one last thing okay the word fiduciary is a joke in the financial world. The word fiduciary literally means that you act in someone else's best interest,

not in your own best interest. And so the word fiduciary, if you had a real estate agent, they're supposed to give you advice that's good for you, even if they don't make as much commission. That's what fiduciary means. Okay? Now, in the financial world, it's become a big buzzword because it now comes down to some people that charge commission don't qualify to, quote, be called fiduciaries.

That doesn't mean they don't give trustworthy advice. So just because someone is a fiduciary doesn't mean they're superior in the financial world to someone that isn't as long as the person is trustworthy and you understand what you're getting into makes sense okay so don't just because i mean if there's nothing wrong with somebody being a fiduciary they're not it doesn't make them bad but it doesn't automatically it's not like a holy it's, okay, this guy's holy and this guy's not holy. Okay. It's not, but the financial people sometimes put it out there that way, especially the ones that are, that do fall under the legal guidelines to be called fiduciaries.

But the definition of the word just simply means someone who treats their customer's money as, you' money in the customer's best interest. And that's all you want them to do. It's that simple. So the last thing I would tell you to do is I would meet with the guy you're talking about meeting with, and I also would get another opinion or two if you want to. If you want to find the people we recommend in the area, click SmartVestor, because you're a smart investor, SmartVvestor at DaveRamsey.com. You'll fill in your name and stuff, and it'll drop down a list of people in your area that we recommend.

Very few of those are going to really be pushy on the annuities. They have them available. If you want them, they'll explain them, but they kind of take the same stand I do. Sometimes it's okay, and sometimes it's not okay. And you can walk through that with one of them if you want another opinion and find the people we recommend. So we're in a good call and really good discussion. Thank you, and congratulations.

You've done so beautifully. That puts this hour of the Dave Ramsey Show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus. Hey, it's Kelly Daniel, associate producer and phone screener for The Dave Ramsey Show. Did you know that in 2017, Dave Ramsey Show listeners paid off $50 million of debt? That's pretty impressive, and it could be you this year.

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