The Ramsey Show - App - When Does It Make Sense To Refinance Your Mortgage? (Hour 2)

Episode Date: May 9, 2023

Dave Ramsey & Jade Warshaw answer your questions and discuss: Helping an adult child with emergency medical bills, Knowing when it makes sense to refinance a mortgage, from the blog: Should I Refinance My Mortgage? Trying to sell a camper to family, "Should I buy a new car of pay off my house?" Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Join a Personality-led FPU class. Click here! Enter The Ramsey Cash Giveaway for a chance at $3,000! https://bit.ly/TRSgvwy Shop our bestsellers during the $10 Sale! https://bit.ly/TRS10Sale Want a plan for your money? Find out where to start: https://bit.ly/3cEP4n6 Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Interested in advertising on The Ramsey Show? https://ter.li/s64ye3 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

Live from the headquarters of Ramsey Solutions, broadcasting from the pods, moving, and storage studios, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Open phones at 888-825-5225. Jade Warshaw, Ramsey personality, is my co-host today. Greg is in Sacramento. Hey, Greg, welcome to the Ramsey Show.

Hi, Dave. Thank you. Sure. What's up? Well, my adult son had an event two years ago in which his heart stopped, and he had little to no blood flow for 15 to 30 minutes or so. And as a result, he suffered a brain injury and was in the hospital for six months. Wow. But the amazing thing is he survived and he's actually doing remarkably well

even though they didn't expect him to survive. He's still in recovery, but he's hoping to be able to work and live on his own again and hopefully within a year or so. But he did incur a lot of medical debt given that he's not working yet and he had some debt before that. Um, fortunately the hospital itself forgave $2.5 million for which we're extremely grateful. So he had no insurance? Uh, no, that was with insurance. I mean, the insurance covered whatever they covered, and then the hospital said the total bill was $2.5 million.

Yeah, but they got some money out of these. They got a lot of that from insurance. They got some money. They got a lot of that from insurance. Yeah. And then they forgave the rest. That's very nice. Okay.

Right. Yeah, we're grateful for that. But he does still have about $45,000 in medical debt, and that's to about 30 different providers. Additionally, he had, I think, about $15,000 in personal debt prior to that. Most of that's all in collections right now. And I'm just trying to, I'd like to know how I can best help him deal with the debt. So how's he doing with the brain injury? What is he back?

Is he 70% back, 89% back? How's he doing? Well, it's hard to tell. In some areas, he's probably 100%, but in other areas, he's got difficulties. He's taking a course at a junior college right now, and he's actually doing really well in the course but it's hard for him. He says it takes me a lot longer and it's very draining physically on him but anyway he's doing well. He's actually 39.

How old are you? He's starting over kind of. I'm 67. Okay. What does your wealth position look like? We're in pretty good shape. We've got some... Did you ask about my position? Yes, sir. What's your net worth? Oh, if I count the house, probably $200,000, $250,000, and then 401k, about $250,000.

Okay. So half a million to a million dollars. Okay. All right, good. Something like that. And actually, we started following you in 2014 because my daughter introduced us to your show, and she actually used to groom your dog. Oh, wow. Okay.

And that's how she met you guys and then told us you should follow this. And so it changed things for us. Okay. So can you help him financially? Well, we have been in that he's living with us and we did cover everything everything for him and all of his uh like medical co-pays and things up until he just started getting ssdi a little bit ago and now he's um paying for for most of that um um okay so how can we help you? Well, I'd like to know how best to deal with his debt that's gone into collections. He has some money saved up since he's been getting SSDI.

How much? And he's hoping to get out of us on about $15,000. Okay, you can settle $45,000 for $15,000 on bad medical debt. So, now, if he has the emotional strength, if he doesn't, then you help him with that. Yeah, he really does. Okay, he can sign over the rights for you to discuss this account. And here's how this goes. You call the collector that $1, is owed to and you say we do he does not have

but 25 of what is owed so we are offering you 25 of what is owed and if you do not take that you're going to get nothing so it's up to you Do you want to do this or not? No, we're going to give you 25 cents on the dollar, or you're going to get nothing. What do you want to do? No, we're going to give you. You're going to have to repeat it because these people are dumb. Okay? Over, you're going to have to just stand there

and just over and over and over and over. If they want to get nasty, say, no, we're not going to have nasty conversations. You're going to get to talk to a dial tone. I'm going to push that little end button on my phone if you get nasty, but we're going to do 25 cents on the dollar. And if you don't want to do that, I'll call you next month and see if you've changed your mind. And until you want to do that, you're not getting anything. Oh, and by the way, you're not having electronic two things under no circumstances do you give them money until you have the agreed amount in writing right and under no circumstances do they have electronic access to accounts so they cannot have give me your checking account number we'll just draft it absolutely not they

will clean him out they lie yeah you're gonna have to call a couple of times to get this locked in yeah you can tell a collector is lying if their mouth is moving yeah i'm i'm usually not the person that yeah you're not gonna be you're not gonna be comfortable finding out that this level of humanity exists in our culture it is the underbelly of what's going on out there but you just got to be really tough and really firm you can have a little fun with it and be sarcastic and mean back if you want or you can just be really tough and really firm and go look we're through talking now i'll call you next month beep okay you're gone next hey we have 25 cents on the dollar you want to take that give it

to me in writing i will give you i will send it to you certified mail, return receipt requested, cashier's check. We'll get a prepaid debit card for that amount, whatever. We can find some way where they can access his account and clean out the 15K or clean out 100 cents on the dollar after they agreed to 25 cents on the dollar. And you got how many of these creditors you got to deal with, Greg? About 30. Yeah, this is going to be fun. Not.

I know. Not. And I heard that once you do, then they all start hounding you again, hounding my son again. No, no, no. Once it's settled in full and you have it in writing, he's done. Just keep that forever, though. Keep it in a file. You're settling this on his behalf he's giving you he's going to give you a sheet that says in writing that you

have permission to settle this account for him because he's meant he's disabled he's got a brain injury right and so you could get nothing people but we're trying to give you what he does have so you're being honorable because all you're going to give you what he does have. So you're being honorable. You're going to give him everything he's got. You're being honorable and settling it. So, you know, and just keep talking to him and talking to him. But you're dealing with people that couldn't get a job shoveling out a septic tank, and so they're sitting on the phone being a collector instead.

This, that's honorable, by the way. That's not. This is The Ramsey Show. Hey, you guys. Health insurance costs are only moving one way, and that way isn't down. And if higher costs aren't enough, the wait times to see your doctor are longer, and it's harder than ever to get anything approved through the bureaucracy. So if you feel

like the system is working against you, try a biblically-based alternative to health insurance, Christian Healthcare Ministries. CHM is a health cost-sharing ministry that's helped hundreds of thousands of families like yours take care of over $11 billion in medical bills since 1981. And CHM has also helped them stay true to their values and avoid miles of red tape. And CHM support goes far beyond meeting financial needs. They'll also help meet spiritual needs. Members become part of a family who will pray with them and for them when they experience a medical event.

So listen, y'all, there's no better way to take care of health care costs. CHM programs start as low as $98 a month. So learn more today and join at chministries.org slash budget at chministries.org slash budget. question of the day is brought to you by neighborly your hub for home services with 19 service brands nationwide neighborly's network of providers have trusted local service professionals to handle more than a thousand different services in and around your home. Go to neighborly.com and find a schedule and service today. All right. Today's question comes from Jim in Arizona. He says, we pay extra on our mortgage each month

so that we can get rid of it more quickly. Very good. We're wondering if refinancing while still paying extra will put more towards the principal and help us pay it off faster, even though the interest rate would be slightly higher. So here's the details. Our current mortgage is a 15 year at 2.75%. The balance is 103,000.

Our current monthly payment is 1,700 a month and we're paying 2,500 a month. Very good. Right now, we would pay it off in four years and the house is worth over 600K. If we refinance, our monthly payment would be $760 a month. And from what I've read, the interest does not apply to the overage amount paid and is directly applied to the principal interest free. Is this true?

Dave, have you ever read something and it makes so little sense that it makes you question your own level of intelligence? Everything on the Internet is not true. Abraham Lincoln said that. So, yeah, there you go. Yeah. No, I wouldn't refinance. Number one, you have 2.75%. Why would you go up to a six plus interest rate for this? Because he thinks that the interest is all

charged on the front end and he doesn't understand how this really works. That's why. Yeah. Okay. So here's how it really works. The interest is calculated on a mortgage just like a simple interest loan. Now, what does that mean? It means you take your annual interest rate in this case 2.75 you divide that by 12 when you do that you're going to get 0.22 so about a quarter of a percent per month okay and so whatever balance is outstanding that month one quarter of 1% or 0.22% is going to be multiplied by that, and that is the interest that is owed that month. Now, let's say that's $100,000, okay? And so if you paid that tiny little bit of interest and you paid $5,000 more towards your mortgage the next month the amount of interest would be 95 000 times 0.223 okay and if you pay down one thousand dollars the next month it's going to be the interest is $94,000 times 0.223.

And so the only way a mortgage gets paid off faster due to a refinance is if you get a lower interest rate, not a higher interest rate. It's mathematically impossible for your mortgage to be paid off faster with a higher interest rate. There is no scenario in which that works. So whatever you read confused you or was just wrong and the most of what you read these days about finance on the internet is just wrong because it's just really basic math the amount outstanding that month the balance the principal balance that month times the monthly portion of the interest your annual rate divided

by 12 okay that tells you how much of your payment is going to interest yeah everything else is going to reduce principal so let's do some quick dirty math okay a hundred thousand bucks at two and three quarters that's twenty seven hundred and fifty dollars per hundred thousand yes per year That's $2,750 per 100,000. Yes. Per year. Okay. Okay. If you pay $2,500 a month, which is what he's doing now, that's $30,000 a year. Mm-hmm. 30,000 times three is 90. Mm-hmm. Okay.

During that time, we've had around $3,000 in interest build up per year. Mm-hmm. So he should be debt-free in three and a half years if he just pays $30,000 a year. Wow, that's not bad. In three years, he would have paid off $90,000 plus a little interest. Okay. Or minus a little interest, so call it $85,000. Right. All right.

Which will leave him about $15,000 more. So in about three and a half years, he's debt-free with a two and three-quarter percent mortgage. That ain't bad. If you just keep doing what you're doing dude if you add more to it of course it's going to go away even faster right and if you add a lump sum to it today it'll go away the next month you're not going to pay interest on anything except what is left that's how simple interest is calculated and that's how simple interest is calculated, and that's how a mortgage is calculated with any standard mortgage that's out there. Now, there are some ripoff finance company mortgages that use the rule of 78s, which has a prepayment penalty built into it, and you do not get credit for the interest by prepaying principal on those but that's if you've got an 18 interest rate and you

went to the storefront like beneficial which is not um or something like that right you're going one of these rip off it's right next to the pawn shop oh you know gracious little personal you know you get a 38 interest rate on a personal loan of 5 000 bucks in there those kinds of places right yeah so you can go in there but and get a different mortgage but all fha va fannie mae home equity loans with a traditional bank or credit union they're all run on simple interest with no prepayment penalty and so you do not prepay the interest the reason that your payment is x and most of it goes to interest when you have a 30-year mortgage on your first payment is because your balance is so stinking high still. And when it's multiplied by your interest rate, divided by 12, it takes up most of your monthly payment. That's right.

That's why it starts out. But if you look towards the end of paying it off, almost all of it is almost all your payment then if you're just paying your regular payment is going towards principal why because your balance is infinitely small at that point you got five grand left on your balance and you're you know you're paying a thousand dollars a month so of course most of the thousand is not going to be interest because there's not a lot of interest on five grand that's right well dave this is this is why you've got the goat status i think that was a great job of explaining that wonderful i mean it's just it's yeah and so jim thank you for coming to us because the problem with this kind of stuff is it causes people to do stupid butt stuff it does here's the thing here's

what's scary there's people in the mortgage business that don't know what i just said i guarantee it and they will sell you a six percent mortgage as a method of getting out of debt when you have a two and three quarter percent mortgage well they're also going to get paid off of that so well there's that some of them but some of them do it out of ignorance not not malicious i mean they just don't know people this is really basic stuff but you know the other let's just take it one step further just be real nerdy okay okay you're you and sam ever get your uh amateurization schedule yes yes you got the columns of the interest in the principle it's if you go take your calculator and do what i just said to do it's exactly what

you're going to find that's how that's. That's the spreadsheet formula that I just gave you. You plug in the spreadsheet formula, and it creates those AM tables, those amortization tables, all right? Because that shows you the portion. I got a payment of $1,000. This much is principal. This tiny little bit's principal at the first. The whole big thing's interest.

And then it goes to the bottom and to the bottom. That's why it's exciting to look at because you start seeing more of your money go to it. And so if you take your AM schedule and you say, okay, I'm currently owe $200,000 on my AM schedule. You find that place on your AM schedule. And you say, what would happen if I paid $50,000 in principal next month? Well, you slide down to where you find $150,000 balance. And you'll see how much of your payment is going to go to interest and how much is going to go to principal.

Yeah. So what you're literally doing is you're sliding forward in the AM schedule by prepaying principal to the next level or to the next place that that principal amount equals that. That's how it works. But it's all based on the idea of the interest that is charged only on the outstanding balance monthly. It's not biweekly. Right.

Once a month. So you could pay four times during the month. Doesn't change a thing. Doesn't change a thing. Because they only reset once a month. And so at the beginning of the month, whatever's outstanding, times your monthly interest rate is going to give you your interest charge. And so that's how this process works. That's a good question.

That was, and a great explanation. And I'm glad, Jim, that you sent it in here. We're not making fun of you for not knowing because most people don't know this. And a lot of people think that because the interest is so large on the front end that they're paying all the interest up front and you're not you're only paying the interest that you owe each month that's all this isaw ramsey personality is my co-host today thank you for joining us america the phone number is 888-825-5225 this is common sense for your dollars and cents gwen's with us in tampa hi g Gwen. Welcome to the Ramsey Show. Hi. Thank you so much for taking my call. My issue is my husband and I restored a 1966

Airstream and used it. Unfortunately, he passed away and it's time to let it go. My question is, my niece and husband expressed an interest in it a long time ago and said, hey, if you're ever interested in selling it or that's the way they put it, you know, let us know. So I had written them a letter. My question is, we're supposed to talk tomorrow.

And I thought, you know, I don't know how this is supposed to go. What's fair? I do have another niece and another nephew. And we have a trust as well. But bottom line is, I thought, you know, I just want to be fair. I don't know. Whoa, whoa, whoa, whoa, whoa. Slow down, slow down.

How long ago did your husband pass? Pardon me? I'm sorry? How long ago did your husband pass away? He passed away four years ago. I'm so sorry. And you guys rebuilt this camper together. Well, we had it restored.

Oh, you had it restored. Okay. So what is it worth if you were just to sell it on the open market? I actually, it was valued at, surprisingly and shockingly, it's valued at $33,000. Why is that shocking? Is it shockingly low or high? Well, it is high. For me, it's 1966, but my people that we have at service regularly said,

oh, my gosh, these are really in demand. It's kind of a cool rebate. It's a fad right now. Yeah, it's a fad. That's a cool thing, yeah. All right, so you have a $33,000 camper, and one of your family members wants to buy it. Yes, they expressed it probably three or four years ago and said,

hey, if you're ever interested in selling it, please let us know. Okay, I'm letting you know it's $33,000. I'm letting you know. I'm getting ready to put the camper up for sale for $33,000 in two weeks. Would you like it before I put it up for sale for $33,000 in two weeks. Would you like it before I put it up for sale? Did you already do that, Gwen? I only said that we were going to talk. I asked them if they were interested. I'd like to give them a first crack at it.

And they said, can we give you a call tomorrow? And I said, absolutely, let's talk tomorrow. And I thought, I don't want to offend them, but I also don't want to be. If they're offended by you shelling your camper for what it's worth, then that's their problem. Do you think they're expecting some sort of a deal because it's family? Is that what you're worried about?

I would guess that. I would guess that. Why? I don't want to presuppose, but I don, but I'm not very good thinking on my feet. I get a little flustered. Well, you don't have to think on your feet. You don't have to think on your feet. You're going to sell your camper for $33,000.

Or if you want to give them a deal just because as an act of love and you've got a pile of money and you don't need any money, do you need money? Well, this is the thing. I would like to use that money. We're establishing a scholarship in my husband's name at the high school. Then they're helping with that if they buy the camper.

And you can tell them that. Yeah. I'm going to sell the camper, and whatever I get out of it is going to go into his scholarship fund over at the school. And the guys at the camper place tell me it's worth $33,000. So I'm going to put it up for sale for $33,000. If you want to sell it to him for $30,000 and just say that, that's fine. But you don't have to think on your feet.

This is not a negotiation. This is you just putting a price on something and what it's worth. There's nothing to be flustered about. Is selling this camper, is it making you feel some type of way? Is that what it is? Because you feel like it sounds like this is just ringing you out right now. Well, you know, it's the uncertainty of it. I know it's the right thing to do. I truly do. We enjoyed it, and I haven't used it in a system for it to just sit. So it feels like you're selling a little bit of what was your husband's

and your dream. Yes, we loved it. Yeah, it's going to be kind of emotional the day it leaves. Yeah. Well, I have to tell you,'s uh it's beyond me it's beyond me and i mean and he would love he would love it to go to them if indeed that's the thing okay but i don't think he meant for you to give it to them for free do you i think he would i was sure not sure my husband was extremely generous

he was do you think he was expecting you to give this camper away for free I don't think so I don't either it's not an act of you're not being mean

when you sell something to anyone for what it is worth. Now, if it's worth $33 and you sold it to them for $43, that's being immoral, right? Okay. Okay? But when you sell something for what it's worth, you have done absolutely nothing wrong. If you choose to discount it slightly, not as an act of being pressured or feeling some kind of guilt trip but just as an act of generosity then that's your choice it's your item and you can do that too so you say you know they the guys at the store tell us it's worth 33 that's what i'm

gonna put it on the market for but because my husband would love it if you guys had it and knew and we knew that you were using it, we'll sell it to you guys for $30 instead of $33. And the money is going to a scholarship fund, so it's still generosity. Yeah. Does that make sense? It totally does.

But I don't think we're going much lower than that. Okay. And if they have an expectation of that, that's their problem. Because no promise was made ever in any conversation to these people that they were getting a free camper. Yeah. They said when it goes for sale, let us know. Not when you give the camper away, let us know. Well, can I add something?

A family member that was kind of involved. There it is. There it is. This is what's called nunya. Nunya business. I don't know who this family member is, but they're not in this transaction. But I just figured out what you're worried about and what you're feeling guilty about and what all your feels are about that jade was smelling it's this family member who was a member of his family not yours correct

um actually um your husband's family member of my family oh of your family okay then you can really tell him where to yeah exactly this is called good boundaries and i don't think i asked you and i don't think i will be asking you and this is none yeah that's what you call it a taco burrito conversation nachos nachos nachos i love that i have never heard that that is fabulous henry cloud will love that the author of boundaries nachos okay mic drop right there last time i looked at the title it says nachos nachos it says mine that is so good oh i don't know if i'm gonna get out of here or not

get me to a commercial lord oh that's so good that's the ultimate boundaries joke right there it is i'm gonna email that to henry right, man. I knew something was going on in that, though. You're right. You smelled it, and I thought it was the grieving over her husband. At first, and then I'm like, there's something with this. It's her mama or somebody that needs a nachos burrito. Nachos. You don't get to speak into this.

That is so great. Whoever it is has been sniffing around that camper for a while now, too. Yeah, they got their own little game going, don't they? Or they just like to screw around in other people's business. True, which some folks are like that. Nachos is so much better than Nanya. Nanya dadgum business works pretty good. They're cousins.

Mind your own. Mind your own. It's a full-time job. This is Nanya. They're cousins. That works pretty good. They're cousins. Mind your own. Mind your own. It's a full-time job. This is Nunya. Nunya. And it's nachos. It's so great. Well, I'm glad I introduced you to something new, Dave.

I bet Deloney doesn't know that. Oh, well. We'll hear that on the mental health show, the Dr. John Deloney show, when he's helping people set boundaries. This is the Ramsey Show. Jade Walsh, our Ramsey personality, is my co-host thank you for joining us america we're glad you're here this is the remsey show uh when you graduated from high school did uh anybody give you a copy of a dr zeus book as a gift uh i hope not high school oh the places you'll go oh that's the one that's my guess anyway yeah

okay i was thinking what the crap at first i went to green eggs and ham for high school okay but here's the let's just try something let's do a graduation gift that actually matters oh the places you'll go okay the? The Get Clear Assessment is built specifically for teenagers. They spend some time answering questions, and in just a few minutes, they get customized results about their specific top talents, passions, and mission, and that is the kind of guidance that gives them confidence about the major they choose, the career field they lean towards and avoid wasting years and tens of thousands of dollars on courses on degrees they don't need want or hate people spend years of their lives trying to figure this stuff out

and you can give them the get clear assessment for students for 30 bucks at ramseysolutions.com go to the store or you can give them dr zeus your choice so now we're trashing dr zeus in our head well you know is that how un-american is that the point is it's better to get the i'd rather have the assessment though than the book i would too but why can't we pick on somebody other than dr ze Seuss? Do both and. I'm like Anchorman. I just read whatever's put in front of me, apparently. Oh, my God. This is awful. No, I'm not going to trash Dr. Seuss anymore. Tell those mean people in marketing to rewrite their copy.

They're just meanies. Just big old meanies. So, seriously, all joking aside get get your kids to take this assessment wouldn't you have loved as a high school senior to have a freaking clue about what you were leaning into love it would have loved that ramsey solutions.com slash store what's the name of the book we're telling them not to buy oh the places you'll go oh i think you ought to get that too not to be confused we need to just throw that in with the get clear assessment we don't have any of those so we can't oh the places you'll go rodney's in washington dc

rodney how are you i'm very good thank you for taking my call sure what's up um well i'm 58 years old uh my brain and i'm retired bring-home pay is $3,800. I have about $36,000 cash in the bank, $135,000 in one retirement account, and $230,000 in the other retirement account. I owe $43,000 on my house, and I want, want, babe, to buy a new car. I'm not 100% needed right now, but I want, want, babe, to buy a new car. I'm not 100% need it right now, but I want to. So I'm trying to figure out, should I take a little bit of money out of my retirement account and buy the car outright,

or should I just pay the house off first or something else? How much are you thinking about spending? Actually, the car is going to be approximately $40,000. So about close to the same amount that I owe for my mortgage. Well, I mean, you're certainly allowed to do that. It's not against the law. But you called us and asked us, okay? Yes, sir.

And you said you're how old i'm 58 okay all right i'm a car guy so i can relate i mean i like a great car i got my my big raptor with loud mufflers and my sports cars and i love that stuff so i'm with you on all this but the the problem is is that these toys are going to cost you parts of your future that you don't want them to cost you. So we don't, A, number one, we don't recommend buying a car, a brand new car, unless you have a million dollar net worth, because they go down in value so fast. So we don't do that. And you're not there. So we're not buying a new one anyway.

So let's talk about a used one. And a used one, we don't recommend buying anything you can't pay cash for and that the total of all of the items that you own that has motors or wheels does not equal more than half your annual income. And you said you make what a year? Again, I'm retired. My bring home for my pension is about $3,800. Oh, yeah, that's right. Okay. And you're retired at 58.

Yes, sir. You don't work at all. I got very lucky. I sell some stuff on eBay, but that's it. Okay. Are you married? No, sir, I'm not. Okay.

So what do you spend your time doing? Besides looking at new cars. Right. I sell stuff on eBay. Nothing much of anything. What's the car you're thinking of? Probably like a Hyundai Santa Fe or something like that. Okay.

All right. Well, what I would tell you is that I would do if I woke up in your shoes, what are you driving now? What's the car worth? You're driving now. Um, the car I'm driving now is a Santa Fe and it is probably worth around 15 to 12 or 15,000. Okay.

All right. Again, you're more than welcome, sir. We'll still be friends if you do whatever you want to do, but you called us. What I would do is I would drive the car you're driving and pay off my house, and I would pick up something fun that I make money, really money, good money doing. And you're only 58 years old. You're just a pup. Yes, sir.

I mean, you could go make 50 grand and not even think anything about it and then use that money to upgrade the car after your house is paid off. I love that plan. You got all this potential right in front of you. And so if I'm you, I want the car. I agree with you. But I'm going to do it smart. And that way, have you ever bought something, Rodney, and by the time you finish paying with you. But I'm going to do it smart and that way.

Have you ever bought something, Rodney, and by the time you finished paying it off or by the time you owned it a little while, you knew you shouldn't have bought it and you hated the stupid thing that you thought you were going to love? Yes. That's what this is going to be if you do this wrong because you're already too smart to do this. Yeah. Hey, you're not done. I think that you've still got something to offer. And I think the longer that you sit around, you're going to be looking for more things to buy so you gotta go make some money if you're sitting around all day figuring out what you're spending it on you know you know what

that's gonna be me i have to do that i have to be careful because if i'm sitting around i'm planning the next trip or the next car purchase i'm just like that i i didn't even thought of that oh my god i've got the money that's different but yeah i used to work from home before i came here and now that i've come here to ramsey i come in here every day you don't spend as much i don't spend as much money yeah you don't you're working man i used to sit around it's like you're sitting looking around your house just looking for things to replace yeah it's what happened during covid man while home depot stock went up man it's so true so yeah that so rodney let's go ahead let's keep an emergency fund of three to

six months of expenses let's start chunking down on that house let's get that house paid off and then let's save up beyond that and the best the fastest way to do that is just make some more money you could double your income without a lot of effort. You're only making about $45,000 a year with your current retirement income, and you could easily go make another $35,000 or $40,000 just screwing around. I mean, really, you don't have to work that hard. But just go do something, all with the idea that when I get my car and I got the emergency fund and I got the house paid off, I'm going to quit that. And I may sit around and do nothing again, except you'll be trying to spend again.

But yeah, that's how I would do it. If you'll do this after you have figured out a way that's fun and reasonably easy to make some more money and you have paid off your house and you have your emergency fund and then you pay cash for the upgrade on the car, if you do it then and buy a one or a two-year old one you're going to feel really good about rodney you know so many people treat work like it's a sentence and when my sentence is over i get to and it shouldn't feel like like that you know you should be able to find work that you enjoy doing and not for him it doesn't have to be eight hours a day you know all this time it doesn't have to be a grind yeah it doesn't have to be eight hours a day, you know, all this time. It doesn't have to be a grind.

Yeah, it doesn't have to be a grind. It can just be something you enjoy doing. The weird thing is your highest income potential across the board. Now, that's not true of everybody, but I mean, the average is people in their 50s. Wow. Between the age 50 and age 60, you make the most money of any decade of your working life because all the stupid stuff you did in your early years is now called experience and you and you got it dialed in and you hit the sweet spot every time you hit the ball that's cool

you know and then 60 you start to slow down and calm down but most people make the most of their money in their 50s so you got a real opportunity rodney still got two of those years left this is the ramsey show This is The Ramsey Show. Dave here. You can find all of our shows with the Ramsey Network app on your smartphone. It's the only place to listen to the entire back catalog of episodes. Download the Ramsey Network app in your favorite app store today.