The Ramsey Show - App - When to Fix the Car and When to Sell for Salvage (Hour 1)

Episode Date: March 12, 2019

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Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studio, 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 am Dave Ramsey, your host. You jump in, we'll talk about your life, your money. It's a free call at 888-825-5225. That's 888-825-5225. Kevin is with us in Newark, New Jersey. Hi, Kevin. Welcome to the Dave Ramsey Show. Hi, Dave. How are you doing?

Better than I deserve, sir. What's up? I've waited two years to hear that. Well, you should have called sooner. I try every day. How can I help? Well, I'm glad to be here. Anyway, so my soon-to-be wife and I are getting married in exactly 60 days. Yay!

And so I have, you know, the major question I'm asking is, her parents retired from, or her father retired from Nissan. And along with Nissan, they have, I guess, a benefits plan where you get a new car every seven months. Yeah. And you pay a very, you know, cheaper rate every month. Oh, it's almost nothing, and they provide maintenance and tires and gas and oil and everything. Yes, sir. Yeah, it's a wonderful benefit.

Yeah, so, I mean, right now with a Nissan Altima, a brand-new one, it'd be no money down, and I think we'd have to pay about $200 a month plus the insurance that the Nissan offers, which is around $100 a month. So, in total, it would be about $300 a month. You cannot, but the $300 includes, it includes gas even, doesn't it? No, not so much the gas. It's tires and all maintenance, though. Yes, sir. Wheel change, everything.

And she's eligible for this as the daughter, the grown married daughter of a retiree? You know, that's the minutiae details that will have to work out. But as of now, I've asked that question to her father, and it seems like he, as the owner of, not the owner of the car, but the owner of the benefit, writes permission to the daughter to drive the car as her primary vehicle. Okay. If you can get that and you can do it with integrity and do it legally, it is an awesome deal.

Okay. All right. Very good. This is not leasing a car from your car dealership, which is not an awesome deal. It's a ripoff. But this is a benefit for an employee of a car manufacturer, and it is a wonderful benefit.

Yes, sir. Because you cannot operate a car this cheaply. That car is going down in value more than you're paying for it every month. Yes. Not to mention all the fact that you're driving it for free, in other words. Yeah. And it's not a lease. It's an employee benefit.

It's a rental agreement that is discounted by about 90%. Everything that's offered there would be about $1,000 a year. Yes, that's very true. If you just went in the open market and said, I'm going to finance this car. I'm going to do this. I'm going to take care of my own tires. I'm going to put the oil. I'm going to do all the maintenance. I'm going to pay for everything. And you bought that care of my own tires. I'm going to put the oil. I'm going to do all the maintenance.

I'm going to pay for everything. And you bought that car. It'd probably be $1,000 a month. Well, without a doubt. Without a doubt. And, you know, I got real nervous thinking about that because, you know, she does have some student loans. No, this is not. This is cheaper than you can drive a used car.

Yeah, definitely. 100%. Okay. So this is a deal, regardless of where you are in the baby steps. This helps you build wealth because you not only have a really nice vehicle, but aside from that, you have a very inexpensive piece of transportation. Yes, sir. It's a deal. Do it.

Thank you very much. Congratulations on your marriage. Very cool. Open phones at 888-825-5225 rachel is in boise idaho hi rachel what's up hi dave how are you better than i deserve how can i help oh i'm super nervous oh well we've never lost a patient hang on how can i help um okay so long story short we are on baby step number two, and we just did the every dollar budget a couple days ago and sat down as a team, me and my husband,

and allocated every penny we have coming in, and we're very excited to get the snowball rolling. But my mom is disabled. She broke her neck about 15 years ago at work. And she lives off of disability and social security. And we moved in to help her out, not financially, but physically, she can't drive, she can't mow a lawn, so on so forth. Well, she has brought to the table that she has some equity in the home and she's willing to sell her home to get it out of her name. And she wants Matthew and I to buy a home with,

and she would provide all of the money to pay off all of our debt and the down payment. She's deathly afraid that if something happens to her, her only asset is the home and the equity. And she's proxies of security and Medicare, and they'll essentially take it. So my question to you is, is that something that we should take and take a gift from her? I mean, it's kind of like her thank you for taking care of her. Are you the only heir um no my brother she i have a brother and the original deal when she got the house that we're currently living in he was actually on the home and this deal was presented to him and everybody has crazy in their family.

We'll just say that. It didn't work out. And so she refinanced, got the house out of his name. He moved out, and we moved in is essentially how that worked out. And so now we're living with her. So when you do this deal, he's going to be mad the rest of his life. It was a deal that he was aware of that he was away from but you got all but you got all the money from her estate it's nothing right right

right okay you guys just need to think through that part of it because this is everything's still kind of up in the air right now i mean there's chances for reconciliation there's everything else but when you do this you put this, you put a nail on this relationship. It is over. Right. He's not going to talk to her anymore. He's not going to talk to you anymore, ever. Right.

That may be the cost. I mean, I'm not positive, but that might be the cost. And that's one of the things to consider here. This is not just a mathematical transaction. Now, if we're doing that uh if we're going to go ahead uh how old is she she is she'll be 59 in december okay and so you're willing to do this for 20 more years yes absolutely you're committing to that. Yeah, this is a little long. I mean, because she could live to 79 pretty easy. Yes.

And you're how old? No, we have a solid relationship. I know. And Mom. You're how old? 29. Okay. So you're going to be 49 and be taking care of your mom?

Yep. Okay. All right. I'm okay with that. It's wonderful that you're willing to do that. But I just want you to count the cost here. Because what happens in a situation like this is, brother and you taking care of mom, the weight of that is not considered. Because all we're looking at is we're just doing a house deal.

We're just doing a house deal. Right. And the problem is we're doing a whole lot more than a house deal here. And so, yeah, if you guys do this and she does that, you know, she can gift you that money and see an estate planning attorney, a unified estate or unified estate tax gift you can do. And, you know, you need to see an estate planning attorney. Otherwise, she's going to get gift taxed by giving you this much money. But you can do this. You can pull it off, but it needs to be very carefully written out. There's nothing smart about smartphones if your wireless plan is blowing your budget each month.

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Enter promo code SAVEDAVE and receive 50% off your first month. That's puretalkusa.com. Thanks for joining us. We're glad you're here, America. Hey, I'm going to be in Atlanta this Thursday with Anthony O'Deal doing one of our Smart Money events. The event is over 3,000 folks. It is completely sold out. Thank you, Atlanta. We appreciate that.

I'm going to be in San Diego in a couple of weeks, March the 25th, doing a solo smart money event. I have not done a solo smart money event in five years. And I get to do this one all by myself. And I am looking forward to it. I love doing the stuff with the personalities. It's a lot of fun trading off and tag teaming with the Anthonys, the Hogans, the Rachels of the world, and the Christys and the Coleman's and all that.

But this is going to be fun. San Diego, there's still some tickets left for March the 25th. Smart money. You ought to come out. It's going to be a special event. We're doing some very special things. I get to reorganize the curriculum, the content. We're going to really laugh.

And you're going to walk away with something that no other smart money event in history has ever seen. Whoa. There you go, San Diego. Just calling you out. I mean, we could do like an anchorman impression right now, but we won't. Okay. Open phones at 888-825-5225. Speaking of Anthony O'Neill and Ken Coleman and Ramsey personalities,

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And the book is $19.99. We are going to throw in all kinds of extra goodies when you pre-order it because it comes out in May. Now, we have an answer. And we also have an awesome gift for high school graduates, the Graduate Survival Guide, best-selling book already. This is the second or third year we've been doing this one. Five Mistakes You Can't Afford to Make in College by Ramsey Personalities,

Anthony O'Neill and Rachel Cruz. That one's $18.99, and this is a bestseller as well. So be sure and check it all out online at DaveRamsey.com or call Ramsey Concierge at 888-22-PIECE, 888-227-3223. Lavinia is with us in Fort Worth, Texas. Hi, Lavinia. How are you? Good afternoon, Mr. Ramsey.

How are you? Better than I deserve. What's up? Yes, sir. So we are, my husband and I, we're in baby step number two. And last year, right around this time last year, actually, we purchased a second vehicle cash money. We paid $2,400 for a 2002 Nissan Maxima. And I know Nissan, they're pretty good cars.

Yeah. Back in December, we had some issues with the transmission. There were some issues with some emissions. Some things that are a little bit above over my head. But when we look at repair bill, we're going to be paying close to $2,000 in repairs. You don't spend $2,000 on a $2,400 car. Really? Have you already done that?

Yes, we pay cash money for the car. No, did you already do the repair? No, not yet. Okay. Now, then just sell the car as is. Here's the thing. If you spend $2,400 on this car or $2,000 on this car, you've now got $4,400 in this car that would sell for $1,500. So you don't do that.

A hoopty like this is a throwaway. And so you sell it as is for salvage. It'll bring about $1,000. And you take the $2,000 you were getting ready to spend on it, put it with the $1,000, and you buy a $3,000 car. Another one. Start again. Okay. You don't put that much money into this car.

Now, did you take that to the dealer for repair? No. Good. He has a guy that knows how to work on cars and stuff, but it just kind of, you know, threw me for a loop that it's going to cost us almost $2,000. I'm like, well. No, it's not because you're not going to do it. It's not going to cost you $2,000 because you're not going to do it.

It doesn't make sense. You see why? Now, if it was a $10,000 car and not fixing it made it worth $5,000, well, you'd put the $2,000 into it. But not fixing this makes it worth $1,000. And you've got $1,000 of junkyard for it. The mechanic might buy it and fix it himself and sell it, you know, or whatever. But, you know, you spend maybe $500, maybe up to $1,000 on this car, maximum on a single repair.

But this car just didn't make it. It didn't cut the mustard. And so you are looking for another good Nissan or Toyota, another good Chevy Ford, whatever. I mean, a basic car, something simple, not an extravagant vehicle. You don't buy an old Mercedes. They're too expensive to work on. So you get just some kind of old, reliable Honda, something like that. You know, the Camrys, the Maximas, you know, the basic stuff, the Impalas, that kind of stuff.

You get something that you can just count on. It's going to keep going and going and going and going and going. You're just trying to get transportation. But the money you were getting ready to spend on it, put that with the salvage money you get for it and buy a better car than you would have ended up with than this one fixed. And that's how you do it. Cameron is in Knoxville.

Hi, Cameron. Welcome to the Dave Ramsey Show. Hello. Can you hear me? Hi. How can I help? Okay. I got a question.

I was wondering, where do I start? Do I start the budget, or do I do the baby steps? Where do I start at? The baby steps are what you do with the money when you find some money the best way to find money is start doing the budget and so the budget's your plan for your monthly income what do you make a month uh i make around four thousand dollars good what do you do i'm an emg very. Very cool. Good. All right. And so, you know, you put $4,000.

You jump on EveryDollar and use the EveryDollar app for free, and it'll help you lay out. What you want to do is give every one of those $4,000 an assignment. When you start doing that, you're going to go, hey, I got some money left over. I'm spending. There's a leak here, and it's called disorganization. And when you don't have a game plan and you haven't predetermined where your money is going to go, it leaves. And so you've got to be very intentional on paper, on purpose, before the month begins, give every dollar a name,

and that's how we named our EveryDollar budgeting app. And there's now 6 million people using the ever dollar budgeting app and that's what you're doing so you want to jump in there and get that done and then as you find money in that process then the baby steps are how you take the money that you can find from working and from managing it well and how do we most quickly, most efficiently build wealth. And that's what we're doing. Sarah is with us in Richmond, Virginia. Hi, Sarah. Welcome to the Dave Ramsey Show.

Hi, Dave. I'm so excited. I'm going to talk to you. How can I help? Yes, hi. So I just was wondering, is it a good idea to go back to school and be in more student loan debt just so I could relocate and be closer to family?

No. You can relocate and be closer to family without going back to school and going into student loan debt. You just load up the truck and head to Beverly. Where is family? So I live in Richmond, and they live in North Carolina, so it's about a three-hour drive. What do you do for a living now?

I'm a surgical assistant, so I work in the operating room, but it's a very specific field, and it's only really... Surgical assistants in operating rooms is a specific field? In Virginia, they don't have it in North Carolina. They have, like, surgical technicians. It's a little complicated, but trust me, I've already looked, like, for, like, jobs in that field in North Carolina, like where my family lives, and there are none over there. What do you make now?

It's about, like, $50,000. How old are you? A year. I okay cool cool all right well what i would do is systematically live on nothing and save up a pile of money because it sounds like you probably have the basic skills you just need to get certified for the nuanced differences between virginia and north carolina to be able to work in the operating room there might take you a year of living on nothing and saving up money to go take the extra class or two to get the extra certification and then make the move. But no, I'm not going to put you in student loan debt to make a move when you make $50,000 a year. In the lobby of Ramsey Solutions, Matt and Melissa are with us. Hey, guys, how are you?

We're doing great. We're good. Welcome, welcome. Where do you guys live? Wichita, Kansas. Wichita, Kansas. And welcome to Nashville, all the way over here to do your debt-free scream. Yes, sir.

Very cool. So what's the angry bumblebee on your... That's a wooshock from Wichita State. It's a what? The wooshock. The wooshock. Yeah. I don't even know what that is.

That's the mascot for Wichita State. Okay. So it's a made-up animal. It doesn't exist. It's like a bundle of wheat. Oh. Okay. Okay.

Well, there you go. That's the shockers. Yeah. Okay. Fun. That's neat. Well, glad you sported the wear here, the good stuff. So debt-free, how much did you pay off?

$160,000. All right, $160,000. How long did this take? Six and a half years. Wow. And your range of income during that time? Started around $77,000 and up to $150,000. Doubled it.

Look at you. What do you guys do for a living? Well, I guess you could consider me a full-stack developer for a consulting firm, and I also do some Ubering and other side work. Wow. Everything in the world. Okay. What about you?

And I stay home and take care of the five kids. Wow, that'll work. Good for you guys. Fun. So I'm going to guess and say six and a half years 160 000 in wichita you paid off your house no unfortunately no this is not it's student loan debt is student loan debt mostly oh man and crunched and crunched and crunched with five kids yes and you get through it hustle and grind yep way to go you guys that's a long track it was a very long track so how long have you been

married 17 years okay so after 10 years of marriage something lit the fuse on this dynamite what happened well at the time melissa was working for a christian bookstore and i think she saw the books and the cds and stuff and she gave me the dumping debt cd yeah and i listened to it and pretty much hooked from there on. And we eventually took the FBU home course. And then we took it in person. And now we're coordinators. Wow.

The whole journey. Yep. We started coordinating a second class next week. Well, thank you. Thanks for leading. It also makes you do it when you're coordinating. Yes, it does. Nothing like teaching something or leading something to make you not be a hypocrite.

You've got to be game on so i'm guessing that the intensity as your income came up your intensity also was coming up so i'm gonna say half of this was done in the last two or three years yeah about three years yeah okay it's about the time we started uh student loan. It was about three years ago. So it wasn't really, mathematically, it wasn't linear. It had a curve. Yes, it did. Yeah, that's what I was going to guess. Well, that usually happens with your income coming up.

But also, you began to believe and you could see the finish line and that kind of stuff, right? Absolutely. Very good. Well, congrats, you guys. Thank you. So you come home from the bookstore with this book or CD, and he said what? Well, I think I had the total money makeover book for about a year before we read it. And then we just needed to do something.

We needed to change. We didn't have any money left over, and we just wanted better for our children. Do you remember the night that you were looking at the stuff, and you're, like, scared or frustrated, and you go, okay, something's got to change well we started doing the budget and um our bills were pretty much all we had i mean we didn't have any money left over at all so we started cutting things like cable and started listening to you and just following you and everything just seemed to work out yeah well you worked it out why look at you to go. So what do you tell people the keys to getting out of debt are? I think for me, you just have to want it.

You know, I didn't spend 60 hours some weeks in an Uber driving drunk people around just to kind of sort of maybe get out of debt. You know, dealing with people when they're having a fun time when you're not. Yeah. You know, and, you know, just being away from the kids and everything. You know, for long, long periods of time. Yeah, you've been game on, haven't you? Yep. Way to go.

Okay, so extra work. Yes. And wanting it. Yep, definitely. Okay. And the budget, you said a minute ago, right, Melissa? Yeah, the EveryDollar app is amazing. We use it every day.

I look at it, and we use it in just making sure that the five of these kids don't get student loans is the most important. Amen. That's a good why right there. So outside of the two of you and your kids, who was your biggest cheerleaders telling you you can do this? We had a little bit of support from family and stuff. I think at first they were kind of just like, okay. And then, you know, it got better and better as they went. And actually, I eventually convinced my parents to come to the class. And, of course, we went to several different FPU courses, and we met a couple different coordinators.

One for Chris Roth and another one, Casey Phillips. Casey I actually met as an Uber driver. So we were both hanging out and found out we both do the same thing. Wow. Yep. Okay. Very cool.

Good for you guys. Well, well done, guys. Well done. We appreciate you, man. We're proud of you. Thanks for leading the class. You did it. How's it feel now that you don't have any more data for six and a half years?

It's awesome. I mean, just this trip. We've been able to do whatever we wanted to do because we saved up money for the trip, and you just pay cash. I think even last night when we were paying cash at a restaurant, they were like, cash? I don't know how to count this. You want to change? Pretty much. I love it.

Well, well done, you guys. We got a copy of Chris Hogan's, not retire-inspired, Everyday Millionaires for you. How ordinary people built extraordinary wealth and how you can too. That's the next chapter in your story to be millionaires. You're on your way. And you're going to be there to send these five kids out to school, right? Yep, that's right. That's good stuff, man. Well done.

Very well done. And you brought them all with you. Tell me their names and ages. We have the oldest is Clayton. 16. 16. Then Allison. She's 11. Graham's 10.

Yeah, 11, 10. Blaze is 4 and Ava's 9 months. So 16 down to 9 months. Look at you guys. That's awesome. Very cool. So all the way from Wichita, Look at you guys. That's awesome. Very cool. So all the way from Wichita, Kansas, have they been practicing their debt-free screening? Oh, yeah. So they know how to do this?

Yes, sir, they do. All right. Now the question is, are they going to do it? We're going to tell right now. We'll find out. Because they're the reason you did this. Yep. This is a family tree changed right here in front of you, folks.

You're looking at it. Excellent stuff. All right, Matt, Melissa, Clayton, Allison, Blaze, and Ava, Wichita, Kansas, $160,000 paid off, six and a half years from 77 to 150 with five kids. Count it down. Let's hear a debt-free scream. Three, two, one.

We're debt-free scream. Three, two, one. We're jet-free. Love it, baby. Absolutely love it. Man, that's amazing. Now, if you're a millionaire, oh, by the way, let me tell you what that means, that they're going to be millionaires. It means they have a million-dollar net worth. That is the definition of a millionaire. Around here when we were doing the millionaire study with our research team

and Chris Hogan, people started saying net worth millionaire, net worth millionaire, and I kept going, guys, you can't say that because that's redundant. It is the same thing. There is no millionaires that aren't net worth millionaires because that's the definition of a millionaire. It is not a million-dollar income. The definition of a billionaire is not a billion-dollar income. That is not what it is.

It is a net worth. Your net worth is very simple, what you own minus what you owe. Assets minus liabilities equals net worth. When you have a million dollars in that column, you are by definition a millionaire. Doesn't necessarily have to mean investable assets. Doesn't have to be income producing assets. You could have a million dollars in antiques in your house that don't produce a dime in revenue every month,

and you'd still be a millionaire. That's simple. So that's how we're doing this. So if you are a millionaire, regardless of how you got it, whether you inherited it, whether you – I don't care what you did. The deal is simply if you're a millionaire, regardless of how you got it, we want to talk to you. We're going to be doing another Million how you got it, we want to talk to you. We're going to be doing another Millionaire Theme Hour, and we want to hear from you.

So email us at DaveOnAir at DaveRamsey.com. That's DaveOnAir at DaveRamsey.com. Put millionaire in the subject line. Tell Kelly a little bit about your story, and she will contact you, and we will set you up for doing that, doing the hour with us, the Millionaire Theme Hour with me and Chris Hogan.

We want to interview you. We want to let people know where millionaires come from, regardless of where you got your money. We want to hear from you. This is the Dave Ramsey Show. Thanks for joining us, America. It's a free call at 888-825-5225. John is in Sacramento. Hi, John. Welcome to the Dave Ramsey Show. Hi, Dave. How are you?

Better than I deserve. What's up? Great. So my company has offered me an opportunity to move overseas for about two to three years for an assignment. I have a house here that I bought only less than two years ago. So my question really is mainly what would you do with, for example, my house, maybe my cars? What would I be doing with something like that? You single? No, I'm married.

I have a five-year-old. And just all of you are going? Yes. Where would you go you are going? Yes. Where would you go? What country? Japan. Oh, okay. Very neat.

And so an adventure and an increase in pay for a couple years, huh? Yeah, that's the expectation. Everything will be paid for, housing, schooling. We're working out the details, but that's the expectation. I wouldn't do it for less. Yeah, got it. So your home uh is it a home you love medium or don't like it at all um it's a home that i don't love or dislike media uh what about your wife medium she's she's she's uh impartial to it as well All right. Because I'm selling the cars for sure. I wouldn't sit on cars and let them sit in the driveway or the garage and collect dust for two years and go down in value while you pay them insurance on them.

Okay. So they're gone. Even if they're paid for? Yeah, they're gone. Unless you just love one of them and it's just like a classic or something and you just love the car. But the typical generic car, car i mean it's going to lose substantial value while it collects dust and you got to keep insurance on it because a stupid thing might burn or something right you know so i i wouldn't keep the the loss of value and

insuring something that's just sitting i wouldn't keep those unless there's a compelling reason to keep one of them okay now as far as the house goes, I'm kind of ambivalent. If you rent it out, you're going to move back into it when you come home. Yes. And you're going to move the renters out. Right. Okay, so you're going to spend some money to refresh it after the renters leave before you move back in. You're going to do a little bit of painting, maybe, or a lot of painting.

You might do some new carpet. You're going to refresh this place because it's very emotional to rent your personal residence. Someone else lived there. No one takes care of it like you would have. You know? It's just an emotional thing. Okay? So my biggest concern is because we bought it less than two years ago

and we put some money into renovating it. We didn't know this opportunity would come up. We put some money into it. So I feel like if I were to sell right now, I would end up losing a little bit of money. It's more a financial decision. You don't keep something just because you're going to lose money. You would keep it because the future is right.

Yeah, because the expectation is I would come back to it as well. Yeah, that's the expectation. But you need to budget in some emotional margin for someone having lived in your home, okay, and maybe didn't take care of it. Certainly didn't take care of it like you would have. Hardly anyone will. Hardly anyone will. So, you know, you've just got to go, I got to run a cosmetic fire hose through this thing

and refresh before I move back in. And that's got to be in my budget. But in return, I'm going to sit here. Now, you put cash into the renovation. Do you have a lot of equity? So I put down 20%, which was about 80 at the time, and I put in about 15K. What's the house worth today if we put it on the market? I think it's about $420,000.

Okay, and what is owed on it? About $300,000. Okay. So you'll make a little money on the renting, but more than anything you'll just get your payment paid. Yeah, I'm looking to maintain the payment, and then I want to hold on to the interest rate that I have right now. And you're going to pile up a little bit of cash to do the

renovation again before you move back in that I'm talking about a cosmetic renovation. Yeah, I have money in the bank. I'm not concerned about that. I'm talking about just the rental. I'm just looking at this thing as a self-contained project. So the point is it's not going to make you any money. Right. Why do we want to fool with it for the interest rate because i really want to live there when i come back there needs to be a reason i mean because there's not a money reason to keep it even just to not lose money in the future well you, you're not going to lose a bunch of money, period.

I mean, you might lose a little bit, but this is a small part. It sounds like a lot of hassle to me to break even. I feel like if I could sell this house today at a profit, I would instantly sell it, if that makes any sense. But I feel like I would sell it a lot. But it's not much of a loss. Okay. I mean, what would it be?

$5,000, $10,000 or something? I've been calculating that, including my closing costs and all that stuff. Yeah. You need to get in touch with an ELP, have them come out and give you a value of what they would put it on the market for. We can't go by Zillow, okay? You need to get an actual comparative market analysis from an actual five-star, excellent, world-class real estate agent. Click ELP for real estate at DaveRamsey.com.

Have them come out and then use that accurate information to make this decision with. I think I'm selling it just because I don't think I want to screw around with a renter while I'm in Japan, and I've got stuff. I've got a water heater going out in Sacramento, and the property manager is trying to contact me with the time change and everything else to get approval for the fix. I just don't want to go through all that. It's not for no money.

There's just no money here. I want to make money if I'm going to engage in hassle and there's not money to be made here so there's nothing compelling no compelling reason to keep this avoiding a slight loss of five or ten thousand dollars is not a compelling reason so i'm probably selling it but get gather some information look at it it's an interesting discussion. We appreciate you joining us. Open phones at 888-825-5225. You jump in. We'll talk. Monica's in San Francisco.

Welcome to the Dave Ramsey Show, Monica. How are you? Hi, I'm doing well. Thank you so much for taking my call. Sure. What's up? I'm calling because I live in the San Francisco Bay Area. It's really expensive. I'm currently living at live in the San Francisco Bay Area. It's really expensive.

I'm currently living at my father's home. It's the home I grew up in. I'm there with my husband and our 14-month-old son. My father lives, he built another unit, so it's kind of like a duplex. So he lives in his his unit and my husband and i are living in the main house and i'm we're on baby steps four five and six and i'm not sure if i should help my father pay the house off um it's in a trust right now and i'm going to be the beneficiary of the trust as an only child so he he keeps telling me it's yours, it's yours.

It's not yours unless it's in your name. Right. He can change the terms of the trust as long as he's alive. Right. And you don't pay off somebody's house, somebody else's house. If he puts it into your name, you can pay it off. Okay. But until that happens no um so no i would not pay off someone else's home under any circumstances so how old are you guys i'm 36 my husband's 38 um and i i know that it's not a good idea to be renters forever. At the same time, I just don't see us being able to afford a house in this area.

Now, what's your household income? What's your household income? I bring in about $75,000, and my husband just started a part-time job where I'm not sure how much he's bringing in. Why does he not work? He's a stay-at-home dad. Because of daycare being so expensive, we did a little cost analysis, and it would just make more sense for him to stay at home with our son. It's very difficult.

What part of San Francisco are you in? We're in San Jose. Okay. All right. Yeah, the South Bay. Yeah, gotcha. All right. Well, I mean, it's fine if you guys want to stay in this home

and it becomes your home and you want to pay it off that's fine and so for baby step six i would just pile up cash and then be in a position to write a check and pay off the mortgage the day that your dad is willing to deed it to you but no you do if it is not in your name, you never pay it off. That puts this hour of The Dave Ramsey Show in the books. Hey, it's Kelly, associate producer and phone screener for The Dave Ramsey Show. If you would like to do your debt-free scream live on the show, make sure you visit DaveRamsey.com slash show and register. We would love for you to come to Nashville and tell Dave your story.