The Ramsey Show - App - When Disaster Strikes, Facts Are Your Friends (Hour 1)

Episode Date: February 29, 2024

🎵 Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships. I am Jade Warshaw. I am joined by Dr. John Deloney, and we are taking your calls. Yes, our powers combined are taking your calls for the next three hours. The number is 888-825-5225. Hit us up. We will do our best to give you our take on advice for your situation. Some say the advice is worth what you pay for it. So give us a call. We're going to go straight to the phone lines where

we've got Hannah in Salt Lake City. What's going on hannah hi there thank you so much for taking my call it's such an honor to to be here and talk to you guys i feel the same how can we help oh thanks um okay so to preface my question with just a little backstory my dad recently passed away and he left me and my thank you he left me and my three siblings his house house. Um, we love this house. It's our childhood home and it is in a really great area of the Valley. So ideally we'd love to keep it in a family by having one of me or my siblings move in or by keeping it as a rental. Um, the only caveat is, is there still a $250,000 mortgage on the property? So my question for you guys, is there any way for us siblings to

successfully co-own the property or are we just kind of romanticizing this idea of having a rental and keeping our childhood home? Just what would you do if you were in my shoes? I think it is a little romanticized to think that you can all three own this property and kind of like be twins on it and everybody's ready to sell it at the same time and everybody's happy with the way it's being managed and who's living there and what they're paying and um ideally it would fall to one sibling and you guys would just say hey um this person is going to take this we're either going to sell it right now and we're going to split it or one person is going to kind of take this on and it's, it's, it's their property. They're paying the mortgage and from

here on out, it's, it's theirs. My bigger concern is that you've got, you've got a $250,000 mortgage, but there's probably some accrued equity in that house, right? What do you, what do you, what have you accrued in it? Yeah, absolutely. So it's probably just because of the area, it's probably worth six, six and a half. So I've never seen this situation and I'm sure it exists. So this is just my experience. I've never seen this situation where there isn't one of the siblings, wife, husband, or girlfriend who's saying, Hey, this $200,000 would change our life. Let's sell. And so sometimes the siblings are all lock stock. It's one of their kids gets in trouble and they suddenly need $50,000 or that one brother that always left his underwear out, his kids are going to leave their underwear out all over this house, right? And it just becomes a management way and so yeah you end up you end up causing more internal

family challenge as jade said if one person said i'll take ownership of this i'm gonna manage it i'll make i'll pay the whatever and if y'all want to rent the house or if you want to airbnb it i won't charge you but your family will just have to to say we're going to be there for this week this particular year. Maybe that would work. But there's still a piece of it that when they sell, people are going to want their cut of what equity was. That's right. So how many siblings is it?

So it's me and my three other siblings. So it's four of you. Yeah, there's four of us. So essentially right now, sorry, I'm just trying to get my head around the numbers essentially right now with the equity there after you know before fees and stuff you'd each have a hundred thousand dollars in equity right okay okay what were you saying yeah no i was just saying um i know one of my siblings would just want out i don't think that they would want to manage it so it'd be like up to the three of us. But again, we'd have to like buy her out somehow. I know it sounds messy. I was just wondering if I'm, you know, I'm kind of deep in the grief and the emotion. So that's the bigger

picture. How long ago did your dad pass? It's been about four months. Okay. My rule of thumb is six months to a year. Do nothing. Okay. So continue to pay this bill. And as you said, y'all are just now slowly starting to come out of the fog, right? Right. And some of y'all will come out in different stages. And so maybe say, hey, brothers and sisters, we're going to put a date on the calendar for seven months after dad passed. And we're either going to get together in person if possible, or we're all to have a zoom call and we're going to talk about a how everybody's doing

and then be next steps and if there's usually in this situation there's one sibling that is to the death we will never sell this house right and then it's like cool then you get to buy it and there's one or two they're like oh kind of or wishy-washy i'll kind of go along and then there's one that's like no i want my, kind of, or wishy-washy, I'll kind of go along. And then there's one that's like, no, I want my money right now. And because that's usually the dynamic. Is that the dynamic in your house? Dude, that's the exact dynamic. So usually, and it just turns into, oh, you don't care about dad.

You just are throwing away our whole life all the way to, hey, dad left me this money. I want my money. And so a way to just do away with all of that is that one person who's just diehard can buy it from everybody and we'll sell it and we'll get a mortgage and you can, you can take it over. Um, or we're going to get a realtor and we're going to split it and we're going to sell it. And it's just going to be, it's going to be painful and we're gonna have to vote on it. Is there an executor to the will that gets the final call? Um, yeah, my brother is the, I don't, I don't know if it's an executor.

I'm not 100%, but like I know my brother, he's the one that's kind of like in charge of like my dad's financial end of things. So he's the one that will actually make the mortgage payment for the next three months

while y'all are waiting. Yeah. Okay. And like my dad has money and we'll have, you know, there's still money in the bank. So luckily the mortgage

is still coming out of there. So, but yeah, he's been in charge. Okay, that's good. Does he want to keep it? Yep. Okay. He's very much like he has a rental and he has a primary residence and then he used, you know, a HELOC to buy his residence now.

And so I think that's kind of his plan with this next property is the HELOC. And then obviously I am a fan of the Ramsey Kool-Aid, so I don't, I'm not a hundred percent with that, but. Well, he's a grown up. He gets to make his own financial decisions. What you get to decide is whether you're going to participate or not. Right. And I think the best thing for your relationship with your family moving forward is to not have a business relationship on top of the sibling relationship. Right. And if he's going to keep it as a rental, I love the idea of, I've got some friends that have properties overseas. They've got properties in lake houses.

Their brothers and sisters just put on the calendar when we want to go. And that's awesome. That's great. And then it's rented out the other parts of the year. So you still get to hang on to it a little bit here and there. I just think that wound is so fresh. And then after six months, after a year, it just becomes more and more just a house, right? It just becomes just a house. And right now it feels like I'm hanging on to dad. We're really not, but that's just hard to do right now. It's so fresh. I'm sorry you lost

your old man, dude. Thank you. Yeah, it sucks, but yeah, that's life. Great question. Thank you so much. You bet. That's tough, man. You know much you bet that's tough man you know it's i think it's hard enough when you try to do business with family members but then when you add a layer of grief yeah to it it's just it's a disaster i feel like waiting to happen that's why that rule that six months to a year if you can avoid doing anything um sometimes somebody passes away on a friday and you got to go work on Monday, right? You got to pay bills. But if you can avoid selling something, moving away,

immediately jumping into a new relationship, if you can avoid and just sit with your grief for six months to a year, the fog begins to lift. Your new priorities begin to come into clarity and it just gives you some direction on what's next. Yeah, it's really, really good. Oh, I feel bad for them, but I'm happy that, you know, a good man leaves an

inheritance. So I'm glad that he left an inheritance and in a way that it's being paid for out of his money until they decide what they want to do with the asset. This is The Ramsey Show. You're listening to The Ramsey Show. I'm Jade Warsharshaw next to me is Dr. John Deloney we're taking your calls it's your life your money this show exists honestly solely for you so give us a call the number is 888-825-5225 whatever's going on we'll help you sort it out your neighborly question of the day is brought to you by neighborly your hub for home services no more scrolling through pages of internet results. Neighborly is the one place you'll find a variety of home service professionals

you can rely on to do the job right, or Neighborly will make it right. That's the Neighborly done right promise. Learn more at neighborly.com slash Ramsey. Today's question comes from Mason in Washington. Mason writes, when I started college, my parents took out a Parent Plus loan, which I verbally agreed to help pay back. Now that the loan repayments have started, my parents said they are only going to help for one year. The loan is now over $71,000 and the payments are $800 a month. My wife and I have another loan for $60,000, which we are starting to pay off, but we do not have money to pay the loan under my parents' name. I'm literally shaking while I'm typing this email. Please help.

All right, Jade, I'll go first and then you can tell me if I'm off base here. So mom and dad, Mason wanted to go to a school that the family couldn't afford. And so Mason took out all of the student loans he could under his own name. And then the government said, hey, that's the most you can take out. If you have to go to this school, if you just are out of your mind and unwilling to stop at any of the breaks we're putting on for you, your parents can also take out money. And then Mason turned around and told his parents, hey, I'm going to help you pay this off. And they said, okay.

So they took out this loan. They shook hands or verbally agreed. And then the repayment started. There's no plan. There's no map. There was no, hey, we're going to do it at this rate over this period of time. So mom and dad put down a map and said, we're going to help you for one year. Then you're going to take over repayments.

And now they've created a world where they can't live. It's $131,000 in what looks to be undergraduate loans. And so my two thoughts on this are, number one, maybe mom and dad put down plan one because there was no plan. And maybe sitting down with your mom and dad and saying, look, I get it. I did say I was going to help pay this back. I don't have 800 extra dollars a month to do this.

So it's going to have to go in order of what I'm able to do. Right. That's number one. Number two, Mason, you said you'd pay it back. So you got to pay it back. This is the agreement you made now i'll help you when you were 18 probably meant something different than to you than it did to your parents i mean the thing with the debt is in this case he's feeling like man my parents they changed the terms it was supposed to be

them helping like for life and now they've decided they're only helping for one year. There were no terms. And now you're like, just going to put terms on this. Yep. It's a $70,000 transaction. But the bigger discussion here, and I hope what you learn from this Mason is debt always changes the terms. Like the terms always change, whether you took out a student loan and you had the right job

to be able to make the payments. And then the terms change when you lost your job and now you can't make the payment. Like when it comes to debt, there's always something that to be able to make the payments, and then the terms changed when you lost your job, and now you can't make the payment. Like, when it comes to debt, there's always something that has the ability to change the terms and make it unaffordable or inconvenient, and that's why I hate debt. I hope that you learned a lesson from this, which is if you can't afford it, don't sign for it,

and don't let anyone else sign for it either. If I'm you, and I have been you, by the way, I've been in a situation where there are parent plus loans and we just paid them back. Like we just paid them back because think about the other option, right? The other option is I don't pay it or I don't try to make inroads to pay it. And I can continue to just erode this relationship with my parents because my guess is if they've tried to bow out of this, it's because also they can't afford it. And so there's really no good scenario that allows you to not pay this bill and still have some form of intact relationship with your parents. Like,

I just can't see a road where you just go, okay, fine. Well, I'm not paying it either because it's in their name. And so it's's gonna erode their credit and their their good names so there's just you got to pay it at the end of the day if you just kind of roll it back to its simplest form you needed money to do something that you wanted to do and you let somebody sign for it but at the end of the day all the money still went to you. Like it still went for you. And so in that way, I'd be like, man, just pay it. And sometimes we get this call, we get this call parent and parents say, Hey, we're going to take this from you. We're doing this. And then they change the terms two years later. I'll tell, I'll tell Mason, Hey man, they said they can't, they told you this was going to be theirs. Right. But here we are.

I think it's also important to note, I don't know a relationship in the world ever that is not changed by you owe me money. Here's a good example. The other day we were getting together for ballad bands. We ordered some pizzas and I told the guy, hey, pick up the pizzas. I'm going to be in a meeting and I'll Venmo you. I haven't Venmo'd him the money yet. He texted me last night for something totally unrelated and you felt and i felt it yeah like i owe that dude money even though it's like 18 bucks it's pizza right and it's not like i'm in debt to him but it it whether you were that guy who had a friend who was always like hey you owe me 428 for wendy's right or you owe your parents 70 000 debt always causes cancer in a relationship period end of story The bank tells you what to do. The

car finance companies tell you what to do with your life. Your father tells you what to do with your life, even though you have your own new family because of owing them money because of debt. And let's just put this in terms that anybody will be able to understand because this is what's just really rich about this situation. You took out the student loans so that you could have the dream job or that dream career that you thought for sure would be enough to be able to make the student loan payments. And now you're, and I quote, I'm literally shaking while I'm typing this. And I just want anybody listening who's thinking about taking out student loans because they think, oh, I'm going to land that career. Like I'm definitely going to pass my, the bar and I'm going to pass the LSAT and I'm going to be able to do this job and make

so much money. It's going to ROI in no time. We see it every single day. This guy's like, I don't know what to do. I have a $70,000 student loan. I can't make the payment. My wife has a $60,000 student loan. If we do like, we can't live like this. And so I want you to hear real people saying real things about how loans and how debt works. It's always, it always sounds like a good idea on the front end. And it always comes back to bite you in the butt on the back end. So here you have it. Sorry, Mason.

Yeah, I wish we had, I wish I had a better diagnosis, but you're in debt. You got to pay it. That's it. All right, let's go to Trevor who's in Grand Rapids, Mason. Yeah, I wish I had a better diagnosis, but you're in debt. You got to pay it. That's it. All right, let's go to Trevor, who's in Grand Rapids, Michigan. What's going on, Trevor? Let's make it quick. I only have a couple minutes. I'm sorry about that.

No problem. Hello. Hello. Quickly, then. I started a new job early in September or September of last of 2023. Okay. I made in about four months from September for the middle of September to the middle of January, I made including a bonus about $42,000. $42,000. Okay. Before taxes, but so about $30,000 afterwards. Okay.

My question right now is I have an opportunity in my hometown, which is a couple hours from Grand Rapids, to purchase a house for, the house is $41,000. $41,000? Yes, and it's a two-bedroom, one one half bath with hardwood floors and a partial basement. Okay. My, my, my stress here is that I have $6,000 still saved for that. I could use towards a down payment and have about another six for safety and payments and everything. Wait, why are you, why are you only working a seasonal job?

Why aren't you working another job right now? I am, but it's a lot less. The payments in my hometown, it's very rural, so income is a lot less than my seasonal job. What would you make per month on the other months? I'm sorry, what was the question? What would you make on the other months that you get just other work besides the seasonal job?

It's about $1,000 a month. Okay. Hey, I'm going to hold you over. Tell me a little bit more. I'm going to hold you over until the next segment because I want to hear more from this. So the house is $42,000. I'm sorry, the house is $41,000. In the last four months, you've made $42,000. But out of that, you've only saved $6,000 for a down payment? I used a large portion of it to pay off other debts.

Okay. All right. Hang on the line. Hang on the line. I'm going to bring you back for the next segment so we can hear a little bit more about this situation. This is The Ramsey Show. This is The Ramsey Show. Thanks for listening. I'm Jade Warshaw. Next to me is Dr. John Deloney.

So if you want to speak to us about what's going on in your life, your marriage, your finances, your job, your relationships, give us a call. The number is 888 eight two five five two two five and we will chop it up with you uh before this segment we had a a guy on the line his name was trevor he was talking to us

about his situation he's in grand rapids michigan and uh he uh is thinking about buying a house for forty one thousand dollars and uh he's telling us about the fact that he has a seasonal job at this point over the last four months or so. He's brought in $42,000. It sounds like he's used that money to clear some debt. And he wants to know if it's a good idea for him to purchase this property. Trevor, are you still there? Yes, ma'am. Awesome.

So did I get that right? Yes, pretty much. Okay. So tell me a little bit more. You've got the seasonal job. You're bringing in around 10,000 bucks a month for this job. And then on the off season, you have another job that makes you how much per month? About a thousand. About a thousand. So that's a big, that's a big difference. And there's no way that you can think of that that number would go up, right? Because of the ruralness of where you live and to my my point i i'm asking is there something online that you can do that doesn't necessarily um limit you to your location where you can make um normal money i i hadn't thought of that before but it's definitely something i probably should look into

so thank you for pointing that out and by the way ah maybe i'm wrong i live in a really rural area yes sir and whether it's mowing or picking up sticks or my 14 year old shovels horse cha-cha out of the barn all summer long and then spreads it over the fields for our neighbor like i feel like there's always work to be done out in rural areas it's not fun work and it's it can be miserable but there's always work right absolutely so is it a possibility that like from just before it gets light outside to just before the sun just after the sun goes down you can get out there and find $1,500 worth of work a month yeah I'm sure I could and I probably will yeah I think it's I just got home a little bit ago I think it's important I don't

think you can I don't think that you can go seven months out of the year and only make a thousand dollars a month yeah that's pretty tough so that's's thing one. Let's find out more about this house situation. So you let me know. And by the way, let me clarify, it's five months out of the year, right? That you're doing this seasonal job. So over the last five months, you've made somewhere around 8,000, 8,500 bucks a month. You told me that you were putting that towards debt. What kind of debt was it? It was a car loan and student loans. Did you pay it off completely

there's about two thousand dollars left on my student loans okay and that's the only debt you have to your name yes cool okay so here's the framework that i would use to decide if it's time for me to buy a house and go ahead correction i only worked four months the season starts in March and ends in January. And there's like a one year, you're supposed to work a one year break sometime in there. You said it starts in March and ends in January. I thought you told me you worked from September into January. Yeah, that's when I got the job. It was a brand new job. So I started near the middle of the season. So it's about a nine-month work season.

You're supposed to take like a month off to relax because you're out doing this. I'm a sailor, so you're out there for about four months at a time, four to five months at a time. And are you going to reliably make about $8, bucks a month? Yeah. For those nine months? Yeah. Okay. Got it. Okay. So now I've got it. Back to the framework, the framework that I would use for you and honestly, anybody who called in here to decide if it's time to buy a house is number one, I want to be completely debt free. Like that's the number one caveat. You've got to be debt-free. And number two,

you need to have in your case, I'd have six months of expenses saved because you do seasonal work because of the nature of where you live. I just want to make sure it's ironclad if there's an emergency. And then from there on, in this case, I mean, were you planning to finance this house or try to find a way to buy it out, right? What was your plan? I was planning on financing. Okay. So at that point, then it's like, okay, I'm going to try to put up to 20% down and do

a down payment. So I've got to save up money for that. And then if you're financing it, you know, you're doing a 15-year fixed rate mortgage like everybody else where the payment is no more than 25% of your take home. And that's where it's at. Now, if I can be completely honest, in your situation with the money that you're making and with the money that you have the potential to make, if this is what real estate costs, I'm trying to pay for this bad boy in cash. $41,000? It is very discounted. Why? For my area. Why is it so discounted?

Currently, my best bet is it is a foreclosure. So you're paying off the mortgage and then you have the house. And then it needs a bunch of work? No. From what I saw, no. Yeah, the key there is from what you saw. Interesting. Just make sure you're doing some research on this property.

Yeah, you can get into a $40,000 house that needs new foundation and floor and walls and roof. And that $40,000 house suddenly costs $200,000 and you're in a mess. I mean, a good way to test. I mean, obviously you can get a foreclosure for a lot less expensive, but I'm still wanting to know what real estate in that area costs. Because I'm like, is there water damage? Is there a mold? Is there,

how long has it been sitting empty? Like there's a lot of questions that I would have if I were the buyer of this property. Yes, ma'am. Um, that house should probably go for, uh, anywhere between a hundred to $80,000.

Okay. So yeah, I mean, my, my thoughts remain the same. Once you pay off this $2,000 of debt that you have remaining, you know, stack up that six months of expenses as quickly as possible, and then you're saving up that down payment as much as you possibly can. I mean, we always say 5% to 20%, but in this case, it's such an inexpensive property. Get as much as you possibly can and uh do it like that

and honestly if it goes off the market it goes off the market it like don't get it if you're if those areas are not in place don't skip the steps and try to get this house i wouldn't yeah because it's not a deal then yeah it's not a deal um and if i know you you often can't do this or usually can't do this with foreclosures but if there's any way you can take somebody who knows what they're doing, a construction friend or an inspector, and even take a lap around the house and look under the house and look through the windows just to see what you're biting off. Man, $40,000 in a neighborhood that normally goes for $100,000 to $125,000, that tells me the bank's just not going to concede $60,000.

That tells me there may be some work going to concede $60,000, right? That tells me that there may be some work that needs to be done in there. And man, I'd hate for you to have a $40,000 house mortgage, even though it's basically nothing. But now you've got to do a bunch of stuff to even make it livable. And now you've got a problem. Yeah. I always tell people that if you're, if you're trying to buy a house, there's just a lot of cost that goes into it that we don't always talk about. And you do yourself a big favor, A, by doing your research on the front end before you even make an offer. But then when you do make an offer, yeah, there's this money has to be in place. Number one, you do have to have three to six months of expenses because home ownership is expensive.

And then I tell people to go in with a stacked deck. And it's just an acronym. The D is for down payment because that's a lot of money, you know, five to 20%. And it's just an acronym. The D is for down payment because that's a lot of money, you know, five to 20%. And that's a lot of cash to have on hand. And then understand that if you had a contingent to sell, you also have to put down earnest money. And if your down payment and all that money is contingent on the sale of your other house, that earnest money has to a lot of times go first. So you have to be, even though it becomes part of your down payment, you have to have that money on hand when you make the offer. And then C, of course, you've got closing costs that are in there. And then for the K, you've got to keep in mind costs of appraisal

and costs of moving, right? So you got to get a truck and you've got to buy boxes and bubble paper and all these things that really jack up the price more and more and more. So, you know, I feel like it's worth talking about, John, that buying a house is already expensive because of the way the world is right now. But don't get caught slipping because when Sam and I bought our first house, I was shook. I was like, I didn't know about all this. It's just like most people just talk about that down payment and you're good to go. And as my husband and I learned the other day, homeownership, you got to have that emergency fund in place. We were sitting in our recliners and just watching. One minute you're watching suits, the next minute you have a leak, right? And we're just sitting

there watching suits. And my husband looks up at the ceiling. He goes, hey, what's that? And I'm like like it's water water and now there's a giant hole cut in our ceiling oh boy and you gotta call Hiller to come over or you know whoever it is come fix it up and you know what you gotta dig into the emergency fund and so there's a way to do this where owning a home is a blessing and not a burden and when you do it the way that we teach it's's just that it's a blessing. This is The Ramsey Show. You're listening to The Ramsey Show. I'm your host today, Jade Warshaw. Your other host for the day is Dr. John Deloney. If you want to give us a call and talk about your situation,

you can do just that. The number is 888-825-5225. Man, we're just happy you're here. We're happy that you're listening. And if you love The Ramsey Show, if you didn't know this, we have a really cool headquarters here in Franklin, Tennessee. You can come hang out in our lobby. People come almost every day that we host, and they fill up the lobby. We have free coffee and cookies and snacks. And Ms. Janelle is probably one of the nicest ladies that you're ever going to meet at the door.

It's pretty awesome. So if you're in the area, we'd love if you stopped by sometime. That would be amazing. All right. Let's go to the phone lines where we've got Adriana in Philadelphia, PA. What's going on, Adriana? Hey, thanks so much for taking my call. You're welcome.

How can we help? Um, so I am 40 weeks pregnant tomorrow. I'm due to have my baby anytime now. Wow. Wow. It's super exciting. It's our first baby. Congrats.

Congrats. We're really looking forward to that. Thank you. Today was supposed to be my last day of work before maternity leave. However, when I logged on, I had a message in my inbox inviting me to a meeting with HR. In that meeting, we found out that they're shutting down our branch. I work in corporate travel, so the whole Philadelphia office is getting shut down and we all lost our jobs today. Shoot. Oh, man. Yeah. I mean, I'm beyond shocked.

I'm devastated. I'm scared. No one saw this coming. I should be worried about pushing a baby out, and I'm worried about what the heck I'm going to do for money after this, because I don't have a job to go back to. Yeah. So I just need some help navigating what to do moving forward. I can kind of give you guys the bullet points I'm going to have Jade watch through the money part of this

but here's what I want to tell you whenever you get these flash everything just caught on fire real fast I always want to go down to a phrase that gets me through all the crisis response stuff

talking to families who just lost someone or about to lose somebody, wild situations, a guiding phrase for me is, facts are my friend. And I'm going to be angry tomorrow. I'm going to be outraged next week. But today, I need to know if we have food for the next 30 days. See what I'm saying? Right.

And so, facts are your friends. Jay's going to walk that through, but I want you and as you and your family, y'all go through this, your whole life's about to be different. You're about to have this amazing moment. You're right. That takes all your priority.

Unless of course, we don't have enough money, right? And we got to figure this out. And so maybe the next three months we're going to be you staying at home maybe suddenly that's changed facts are your friends that doesn't mean it's great doesn't mean it's good that means we're going to cry we're going to be angry we're going to grieve but what do we have to do moving forward right right right so let's let's find some things that we can cling to as facts um because i i do think that's a great idea so it's you and your husband does your husband work outside yes he does um he does and

he makes um about 50 or he makes 100 000 after taxes uh take home it's about 6 000 a month um between his job and then he does side work as well he's a mechanic so okay and what addition does he bring in live off his income so that's right there that's the fact that you need to cling to that now we're just talking baby that's it yep that's it yeah just knowing that i mean of course it's always nice to have extra money especially when your family is expanding but in my mind like i'm looking at this right now, Adriana, I'm going, oh God, this could have been so much worse. Like you could have been telling me that you're a single mom and you just got laid off and there's no money. But the fact that you're here,

you've got a guy who's working, he's making enough money for you guys to live off of, that is the big exhale. Right. And it's going to take, so we've never lived on a budget before. I actually, I caught your live segment with George a couple of days ago and I just downloaded the EveryDollar app and signed up for the trial for premium. And we just put together our first budget for March. Great. That's so good. I'm so proud of you. That's exactly what you should be doing. Very, very good. And so this is going to be an experiment for you guys. exactly what you should be doing um very very good and so this is going to be an experiment for you guys it's going to be new because what were you earning at the at the job before you were laid off um about 60,000 a year um take home was about 3,000 a month so um

like give or take that's like conservative because i'm a lot of my income was commissioned so um it was like most months we were bringing in between like nine and even 10,000 on really good months. Yeah. So it looks like, you know, that's, that was probably if we look at it just in chunks, that was probably a lot of your fund money. Like a lot of the money that you guys spent just being able to do whatever you want in there and it not being, yeah, it not being a thing. a lot of that money is gone right now but the good news is like you said his income is enough to cover you know the things that need to get done and the necessary requirements and when you look at that budget is there I mean

is there margin for what you feel needs to take place in your life with a baby coming up so I you know I don't know how to even plan for that because we don't have neither of us have kids um I I don't know like how much diapers are going to cost a million dollars fifty dollars a box a million dollars and by the way we tell your sweet husband babies poop more than once or twice a day they go like a thousand times a day and I did not know that they do you go in in the first six months you go through a thousand times a day. And I did not know that. They do. In the first six months, you go through a lot of diapers. We're just going to be honest about that.

We do have a nice stash. We have a little diaper party. So we have a nice stash. Good. And your friends and family, they're like, hey, what do you guys need? And they're not really being serious.

You can just be look at them with that look of wild, exhausted desperation and say, diapers, send diapers. Send diapers. Yeah. Yeah. Can I give you an experiment? We did say, diapers, send diapers. Send diapers. Yeah, yeah. Can I give you an experiment? We did also.

Oh, go ahead. Go ahead. Do your thing, and I'll tell you at the end. Well, I was going to tell you, we did also, like, we have been kind of budgeting because I was originally, it's going to be an unpaid maternity leave, so we do have our little stork fund, I think is what you guys call it. Yes, right. So we have that, and the plan with that. So, and this is kind of where I need help. The plan with that, we were going to use that to pay whatever the hospital bill ends up being. Um,

that's great. Who knows what it's going to be because the insurance company has given me help with that. Well, you're most likely going to, you're almost most likely going to meet your deductible. Like almost always, I feel like. And by the way, if you call the hospital administrator and request a walk out the door number, they'll give it to you. I would not rely on the insurance company. I would talk to the hospital.

Okay, so that's a really good point. I didn't know you could do that, but. On both of my kids, I walked into the hospital to have the kid now barring like you know there's a complication in the pregnancy or something an emergency or something but i walked in with both kids um knowing exactly the check i was going to write walking out okay and we should we should still plan on just paying that in full with our little stork fund, right? Absolutely. That's what it's for. What is your stork fund? How much is there? We have like a little less than $10,000. It's about $9,500.

Okay, good. Here's the other thing. So I was told since we're being laid off, I do get a small severance. It's about $5,000. Okay. And they're also going to pay me out for the next 60 days, which is a bonus because I wasn't even going to be making any money. Okay. How much is that? So another $6,000? Yeah, like when it's all said and done, $6,000 plus the five.

So I'll make like an extra like $11,000 in the next three months. Great. And I want to know, because our plan, we wanted to use our savings to pay off some debt. We have about fifty six thousand dollars in debt. OK. And I'm wondering if now that I don't have a job, like, should we pause that and just not necessarily that? Not necessarily. If you know that you can live off your husband's income at this point, I wouldn't pause it. It would be one thing if you said, hey, like my husband's income is not enough to make ends meet. Well, then it's like whatever money you have, like we're being we're counting every bean where, you know.

But you said, listen, we can live off my husband's income. We've got I've got an extra 10 or $11,000 coming. I'm throwing that towards my debt. Now I'm keeping a thousand dollars saved just for that, that starter emergency fund. But everything else, once the baby's here, once the baby's bill is paid for, I'm, I'm, I'm throwing all of this money into debt. That's exactly what I would do. And here it is. Facts of your friends. You're safe.

You got enough money to pay for everything. You got extra money coming in. I'm not giving this company one second of my grief while I'm bringing this beautiful new baby into the world. They don't get that vote in your life. We're going to have fun now because we're all good. We're all good. Oh, love that. Yeah. When it comes to babies, I'm always saying like save up for your deductible, save up your out-of-pocket max. It just helps you sleep well at night regardless of what takes place. Thanks for listening. This is The Ramsey Show. We'll see you next time.