The Ramsey Show - App - When You Have Debt Your Money Is Not Really Yours (Hour 3)

Episode Date: January 25, 2024

Live from the headquarters of Ramsey Solutions, this is The Ramsey Show. It's where we help you win in your life, specifically with your money, in your work, and in your relationships. The phone number is 888-825-5225. That's 888-825-5225. I'm Ken Coleman. My fabulous colleague and friend, Jade Warshaw, joins me, our money expert this hour. I'll help in any areas of work and pipe in, and we both weigh in on all the issues here that you've got before you. Here's what we know.

You can win because there's a clear path, and we want to help you see what that is. All right, let's get to the phones. New Orleans, Louisiana. win because there's a clear path and we want to help you see what that is all right let's get to the phones new orleans louisiana man it just makes me crave a little cajun a little bit of cajun food i don't know why po boy yeah that's very nice lewis or louis how do we say it uh lewis sir thank you lewis excellent how can we help um yes sir yeah i appreciate you guys for taking my call. Sure. I just wanted to start with that. So I'm actually calling in on behalf of my mom. About four or five months ago, she was just completely misinformed about bankruptcy. We don't have, like, really no financial. Like, I just started listening to Dave Ramsey about a week ago and been learning a lot.

So she was misinformed about bankruptcy with the info she got she was convinced that that was going to be her best option for her situation but what she didn't realize is that once she went to go see the lawyer he basically let her know that she had to sell her house which basically caused her to have a, like a mental breakdown. And immediately she looked for option B, um, a little break that like, so like my mom's all about just family. Um, other than like human beings, her house is like the most important thing to her out of anything. Um, my mom and dad actually like built that house with their own hands. My dad passed away in like 2010, but the house was built

in 2005. So like, she can't like, she would never like sell a house. That's not like that. She would never do that. So it kind of, so with that four or five months, she was kind of like, because she thought that that's what she was going to do. It kind of led her to like, you know, she did like home improvements and like had dental work. She did some things that she would have never did had she not thought that would be wiped away, if that makes sense. Yeah. So where how where is she now? Like the bankruptcy is taking place. They've sold off her assets.

What's what? No, no, no. So she didn't. So she she found out about it and she just left. She didn't do the bankruptcy. She just left. Like she had she she she she didn't go through with the bankruptcy. So now we're kind of looking for option B, which kind of. So they didn't sell the house?

No, she never did nothing with it. She went to see how it worked and then they told her, all right, well, you have this and this and this. So they're going to definitely make you sell your house. And then once she heard that, her heart dropped she was she was out of there so nothing's happened yet nothing's happened yet other than me reading the total money makeover and trying to like beat everything in her head okay good good good um good keep going yeah right. So kind of where she's at, you know, I've been watching the show. I kind of have an idea which I'll ask for. So a consumer debt, which is the only debt she has other than the mortgage, is $100,000.

OK. OK. Can you break it down? The mortgage is just all credit cards, $100,000, all credit cards, different credit cards cards but just credit cards only okay this is a course of like you know like you know leading up to this last four months she had probably like a 700 credit score so she obviously she could get credit anytime that's what she would do she would help people let her family go on vacation mom i need to borrow this But now she's deeply in debt because of it. Exactly. What kind of income? What kind of income does she have? She makes about $4,000 a month.

She brings home $4,000 a month. Okay. She has about $26,000 in cash. She also has another $9,000 in Bitcoin that she can liquidate. She has retirement for work she has no student loans no other debt she has three vehicles paid off completely can do you know what each of those cars are worth um so she has a slingshot that's probably worth about 16 000 she has a corvette that's probably worth about 10 to,000 to $12,000. And then she has her everyday Yukon truck that I think she bought it for $6,000 last year or something.

That's the three vehicles. And that's her daily driver, the third one? The third one is kind of like the car she uses. My mom's a school bus driver, so she really don't. She just needs one car. So my mom's one of bus driver so she really she really don't she just needs one car like so my mom's one of those people when i listen to the book she's like she don't want to like you know that whole don't want to give up all the things i have yeah really do what you got to do like i know what she needs to do as far as like she should definitely sell a slingshot sell a

corvette but she rather like she's like you know it like, you know, it's only $8,000. Like, that's not a big deal. No, it is. Because when we're looking at it, she's got $35,000 of money she can get a hold of, the cash plus the Bitcoin if she sells it off. Then she's got these vehicles, $34,000 in vehicles. Listen, that's $70,000 right there. Exactly.

And if she does that, now she only has thirty thousand dollars of credit card debt with her income which suddenly this becomes a quote-unquote more normal situation and a much more easy to tackle situation here's here's what i want you to understand um number one you're a good son like you're great and you get it like, there's no argument from you. I can tell. So the person we've got to get on board here is your mom. And so we can like, I can sit here and tell you, listen, make sure she sells these vehicles. Make sure she liquidates that Bitcoin. You know, make sure she pays off this debt. Keep a thousand dollars aside. But you know all that. The question is, when you come to her with this is she going to do it

and what are you going to do if she says no um so basically like like i said this is my mom she's done a lot for me so um given the fact that like i know she is um that kind of like like so basically what i'm doing to help my mom like i don't have a house and then I just like rent. Like my bills are like $1,700 for like my monthly expenses for my house. Right. Okay. My mom's expenses at her house are probably like about $2,200. Okay.

Okay. So next month, like starting March, my family's like my mom has a really like nice size house. And she's the only person that lives in the house like it's a five-bedroom house please don't tell me you're about to move into this house it's what it sounds like and that you're gonna pay that bill right so like i'm moving into my mom's house yes so i'm moving into my mom's house and basically i'm gonna just instead of paying like the landlord that i have right now no my rent. No, nope, nope. I got to put my foot down.

If you're calling Lewis and asking us honestly what to do, it's not this. Your mom, I know you love her and she's the most wonderful woman in the world to you. And she is and she should be. But it doesn't take none of that takes away from the fact that she's an adult and she has she is made these choices. She's not disabled. You know, she's not without mental function. She knew what she was doing and she made those choices. And it's very hard for us as kids to accept that. We want to say, well, they needed me. No, they were grown.

And if you move in, you're getting yourself tangled up in a way that you don't need to get tangled. And you're going to end up setting your personal family back trying to fix your mom's financial situation. Give her the information. Do your, you know, you've been a good son. Keep being a good son. Give her that information. But also understand you cannot make her do this. And you inserting yourself in her life is only going to make it worse for both of you.

It's called enabling. This is The Ramsey Show. Welcome back to The Ramsey Show. Jade Warshaw joins me. I'm Ken Coleman. We are here for you. 888-825-5225. Let's go to Dallas, Texas next. Adam is there. Adam, how can we help? How's it going? Good. How are you guys doing today? We're having a blast. What's going on with you?

Everything's going good. Everything's going good. Hey, so I was just calling because I wanted to get a little bit of advice. So I am currently contributing in a 401K and a discounted stock purchase program with a company I work for. But I feel like I kind of maxed out as much as I can do for myself. I want to kind of figure out what I can do more to kind of make my money work for me and sort of set me up for the future a little bit better. Okay. Tell us more. So I'm 23 years old. I currently about uh eighty five thousand dollars a year before tax

okay uh i i have no debt uh except for a car loan which is about ten thousand dollars okay so you do have a loan okay i do have debt yeah uh but no credit card debt, no mortgage or anything like that. Okay. I have $14,000 in a 401k and about $11,000 in savings. Okay. And about $5,000 in that stock purchase program. Okay. How familiar are you with our baby steps? Not too familiar. I've kind of browsed a little bit but not uh not not too extensively okay um

what's your living situation are you renting do you have roommates you bought something uh so i'm renting uh all alone uh i live in a studio my rent is about uh fourteen hundred dollars a month okay great all right um sorry i'm just writing writing this down okay great so listen i think that you're 23 like honestly for 23 i'm glad that you don't have a bunch of debt laying around you know the ten thousand dollars on a car not bad i like i love that you've got some money saved i love that you're interested in investing and thinking about your future so very good in way of i don't know just kind of like the practices that you've kept. So I'm looking at this and for me, it's cleaning it up and it's just making it a little bit more neat and getting a little bit more organized so that long term it's going to serve you the best.

Fair enough? So if I were you, if I were you, my first, when I look at this, I go, okay, I see debt. And when I see debt, I immediately want to clean it up. So my first thought is, let's pay off this car. You've got $11,000. The car is $10,000. If I were you today, I would pay off the car because for me, debt equals risk. And why have risk when you have the cash to be debt free and have that piece, right?

So I would reach over and pay off that car loan today. So when I say that, what does that make you feel? So I actually thought that crossed my mind a couple of times. But the way that I was thinking about it was, okay, would I rather have this money in this account that makes about 5% a year? Or would I rather have it tied up? Well, it's not your money. That's my biggest thought is we think it's our money, but it's not. Just because we're choosing not to give somebody their money,

it's still theirs. Does that make sense? So I do think reframing your mind of going, okay, net worth-wise, it's not really my money because I owe it. I'm just choosing to hang on to it. So it's kind of a false sense of security. So what I would recommend if you are, because we're going to get to that savings point, because I know you're like, listen, I'm earning a nice percentage on it. What I would do, so once you've paid off that car, how much is your car note? It's about $500 a month. Okay. Suddenly that frees up $500 a month that you can start to

throw back into that high yield savings account and build up that savings. And for real this time, it's yours. You can build that up to six months of expenses and think how quickly you could do that. And now you'll have $11,000 or $12,000 sitting there, and it will actually be yours, and you won't have a car note. I love that plan. And let's keep it going. So that's – Jade just walked you through baby steps one through three, right? So $1,000 in savings for emergencies is baby step one. Baby step two is paying off debt smallest to largest.

You've got the one debt. You pay it off quickly, immediately, actually, as Jade said. Now watch this. The $500 that she just walked you through that you're going to start building up that emergency fund three to six months, now all of a sudden that goes into you investing 15% of that income. And at your age, how old are you again? 23. 23.

23. You started the question, how do i build wealth for the long term jay just told you but you've got to own baby steps one two three and for you you're at baby step two you're immediately in baby step three the 500 car payment that you're going well why don't i keep it it's such a low you know that goes into your investing your your 401k plus 15% and all that stuff. And all of a sudden, my friend, Jade, paint the picture for him. He's 23. I'm plugging these numbers in now.

You told me that right now you've got $14,000 in your 401k? 401k. Okay. And you're 23? Yes, that's correct. So in 40 years, you'll retire at 63. Let's do an annualized rate of return of, I don't know, let's say 8% for all the haters. Yeah, yeah, yeah.

All right? And let's just pretend that you're doing $500 a month every month. All right? Let's see what this calculates to. Boy! He's going to be excited. Listen! Should I do a drum roll?

Listen, drum roll that out. When you decide to retire at 63 years old you're gonna have 1.9 million dollars wow just by you just by you putting your car payment 500 dollars that's just the 500 on top of your 14 that's what she did yeah so do you so the answer your question is you're maxing out your 401k what's your max is, you're maxing out your 401k. What's your max yearly contribution? You're maxing that. You're going to max it, and then you're going to invest. And that's just the $500 a month that we cleared up.

My friend, you're loaded. You will have only put in, if you only do the $500 over that course of time, you will have only put in $240,000 of your money, and it will have grown to $1.914 million. And that's at 8%. Listen, I don't know about you, Kim, but I've been looking at my annualized rate of return and it's juicy.

Oh, I am very excited. We're having our meeting next week, our annual meeting with our smart investor pro, the person that we work with. And it's exciting. Listen, Adam, I don't know if you caught that. That's if you do nothing else. That's if you do nothing else. That's if you do basically nothing else. So you're in a situation. That's $500 a month.

That's $500 a month. And all I did here is we, there's a million investment calculators. We here at Ramsey have one. Pull up that investment calculator and just plug in those numbers. Have fun with it. I put your starting amount in $14,000. I put in 40 years because you're 23. You know, most people retire in their 60s. So I put 40 years. I put 8% rate of return. And I said that it compounded annually. And this is you putting in $500 a month.

So you can check those numbers. Got you to 1.9, Adam. So the answer to your question is live on less than you make and invest. And stay out of debt. Yeah, stay out of debt yeah stay out of debt kill the debt live on less than you make and you're excited adam did we answer your question yeah you did you did um so this is this is separate also from the the 10 percent that i'm this is just 500 a month right this right? That's not even you at 15%. We didn't even get your 15% number. Yeah.

We're just showing you the power of the compound interest. You can't be playing small ball with your little interest rate on your car. That's a joke. Jay just blew your mind. Blew your mind.

Listen, I blew my own mind because I'm looking at this like, wow. I'm excited for you. It's not even my life. Very, very good. So, Adam, what are you going to do? What are you going to do when we end this phone call in 30 seconds? What are you going to do? I'm going to go ahead and pay off my car loan.

I think that's what I'm going to go ahead and do. Tell him what he's won, Jay. He's won $1.9 million. It's that simple though. It is. I love that. He literally was the example that we tell people all the time. $500 invested monthly over the course of 30, 40 years, you're going to be a millionaire. And in his case, two millionaire. Bananas. It's bananas. B-A-N-A-N-A-S. I can't spell it. That's impressive.

I tell you what, I can talk live on the air. I can do all the things. That one word is the only word I'm not sure about when I spell it on the air, which I'm not going to. You did a great job. Don't try it. Great advice, by the way. All right.

Well, we've just helped Adam see a clear path to being a multimillionaire. What can we help you do? Call. We're here. Don't move. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm Ken Coleman.

Jade Warshaw joins me. And we are here for you, taking your questions about your money, your work, and your relationships. 888-825-5225. Noah from Kansas City is up next. Noah, how can we help? Hi. This is a weird question, but I just came out of trade school as a welder. I have zero debt.

I'm going on to my first job here in May on an offshore oil rig, and I just don't know how to split my budget up to make good financial decisions coming through as I get out of trade school here. Right. Hey, before Jade takes over on the budget, I'm just curious, because I want America to hear this. What did trade school cost you, and then what is your starting hourly rate or salary? Do you know? So I outright paid for my trade school, and it was about $5,000 for two years. Fantastic.

And what are you going to make? I will make, I think it was $75,000 as an apprentice. Listen. Ding, ding ding all right jade to help this man spend that money wisely because he has no debt and i just wanted to say america you've been told for decades that a college degree is the only way to success and noah how old are you noah i'm 20 years old 20 years old he's apprenticing Jade okay for 75k. Making more than some of these folks with their degrees sitting on the shelf. All right very very good I'm just going to ask a couple of questions because I kind of have in my mind like offshore oil but I don't

really know like if I'm. Is that like a platform in the ocean? Like you go away for a couple of months and then you come back, right? Yeah, so how this is going to work is I'll be working seven 10 to 12 hour days for about a month straight. And then I'm off a week to kind of just go and do whatever I want on land. And how far away? So you go to the oil rig, that's out of one of these ports, I'm guessing. And then where do you live in relation to where you have to get onto the oil rig? So that's the thing. I will be most likely living at a hotel room, but my company does pay for those hotel rooms

while I'm off work, just so I don't have to commute back to Kansas, to Louisiana, and back and forth. Okay. So you're living on the rig, I guess, until you take your off week. Yep. And all that's covered. Yep. Everything's covered from food to rooms to even laundry is even covered. So on for a month, off for a week. And when you're off for the week, everything's covered. So are you cutting all ties then? Are you like, listen, I have an apartment. I'm letting it go. That's that. I mean, that's what I would do. This sounds very much like I used to work on cruise lines. Obviously your work is far more dangerous, but it's the same idea. You just go

away and they pay for everything. And I just got rid of my apartment. I sold my car. Like we sold our cars. Like we, we offloaded a lot of things because we didn't need them anymore. So I'm guessing you're doing the same? So I do have a actual pretty nice truck that I have paid off already. Okay, good. So that's about $20,000 sitting here. I was living with my parents while I went to trade school.

I agreed with them. They agreed with it, especially as long as I got out of the house, as soon as I came out of trade school, they were good with it. So, and you're doing just that. So the question is with this truck, you know, it's paid off. Is it going to be in a place where it's secure and taken care of? You know, it kind of feels weird to just have it sitting in the parking lot of a hotel for months on end. What's your plan there?

Honestly, as soon as I get out of trade school here in about a month or two, I'm just going to sell it, buy a little beater car. A little beater. Yeah. Dude, I am liking this situation. You're going to save so much money. Listen, my sights for you, I mean, do you have any money saved yet? Any money saved at all?

I've got seven grand sitting in savings and about $2,000 in checking. Okay. So how does he do a budget, Jade? I mean, he's got some spending cash. My guy is stacking, just stacking, stacking. So this is a very different kind of budget because he has very little living expenses. Yeah. I mean, it's great that they're covering your living expenses.

I'm sure. Is it to a point or is it no matter what, like you turn in a receipt, they cover it? Like, is it a stipend that you get? No, no, no. I mean, I pay for like my car insurance. I pay for like phone bills. It's just the only thing I don't pay for is food and lunch. I mean, I'm not even home enough to eat groceries.

So, I mean, just kind of. Okay. Yeah, but Jade asked a very good question though, Noah. In that week off, do you have a per diem or are you just spending whatever you want? I'm steak dinner. I'm at Ruth Chris one night. Morton's the next. That's what she's getting at because that's where we got to build.

We have 150 a day per diem. Okay, perfect. So, that's where we got to build we have a 150 a day per diem okay perfect so that's probably just enough for you what i'm doing you're you have a budget just like everybody else yours just has very little line items which is awesome so you're going to put on that budget that every dollar budget everything you can think of you're going to put your income at the top and then you're going to put your insurance whatever else else you pay for, a haircut, new shoes, whatever those things are that you can think of. Put it all on the budget, but you're just going to see a whole lot of margin there. But here's the key.

I don't want it just sitting in your checking account. We're going to have a plan for that. So number one, you are going to be investing 15% every single month. You're going to stack up this savings a little bit more. Let's say stack up your savings to $25,000. I'd love that for you. And then start investing 15%. Every time you get a paycheck, 15% goes into a Roth IRA first and then into your 401k. Do they offer you anything like that? A 401k or anything? Yes. Yes, they do. Is there a match? I don't remember the number off the top of my head.

Okay. If there is a match, your first contribution would be into that account up to your match, which is probably a certain percentage of your salary, right? And once you hit that, you can go and invest $7,000 into an IRA, a Roth IRA. And then after that, if you still have money that you're like, listen, I haven't hit 15%, go back to the 401k. And you should be, honestly, you should be maxing out your 401k and a Roth IRA, like if that hits the money for you. But after you hit 15%, if you're like, listen, my next goal is to save up at some point, maybe you're not going to want to do this again, and you're going to want to have a home. So then you're going to just start socking money away for a down payment.

And you can do that in a high-yield savings account. Or if you think this has got like a five to ten-year track record, then you can invest that money. But you, my friend, are about to be loaded. And this is what's crazy. This message doesn't exist. There's no national marketing message. I know, right? You know why?

Because the federal government, they don't make anything off of Noah. The college and university system doesn't make anything off of Noah. Come on, Ken. The man's going out there, and he is going to be worth, what would you take a guess if he starts at 20? I'm so obsessed with what you did with our last caller. Can we blow noah's mind as well noah wait for this watch what she's gonna do so if you're taking home what was your take-home pay 75 000 yeah so what do you think realistically that you'll have

to put aside like if you wanted to put aside some money for investments for sure a thousand bucks i mean honestly if you guys make up a number i can make it happen i'm pretty easy to live with let's just pretend it's a thousand bucks and you said you're 21 and this is modest 20 000 you're 20 okay so for 40 years you have a zero dollar starting amount we're going to put it there for 40 years eight percent annualized you're putting a thousand bucks a month. Let's see. Stop it. What's the number? Stop it. It's way more than I thought. It's 3.2 million. Noah. Noah. Now listen, she put in a thousand to teach you something. You should be putting two grand a month minimum away because you have no expenses. You have no expenses. Who knows how

long you're going to do this? Double it. Hit the put two grand in let's say you get to two grand because you have no expenses two grand let's say you put two grand a month for 40 years which you totally will do because your income is only going to go up okay and you have no debt you're gonna you know you might slow down to save for a down payment but if we put it at 2000, 6.4 million. That's insane. That's insane. You're at 60 years old. Oh, I'm slow clapping for Noah. And here's the thing.

We're talking about 60. 60. But at 50, he's still going to be there. And at 40, where's he going to be? Way beyond everybody else who's 40. With their fancy degrees, by the way, still probably in student loan debt. Noah, let me tell you something. I'm going to tell you you're the American dream.

Because there's no nightmare of student loan debt for you. You sure are. Wow. How about that, Jade? Y'all better play around with these investment calculators and get your hopes up. I could do that every call. Every call.

Go, Jade, Jade, Jade. Show them, Jade. I thought that was fantastic. That's crazy money. Great stuff. All right, quick break. We'll be right back. This is The Ramsey Show. Welcome back to The Ramsey Show. Our scripture of the day comes from Psalm 127, verse 1. Unless the Lord builds a house, the work of the builders is wasted. Unless the Lord protects a city, guarding it with sentries will do no good. Our quote from President Teddy Roosevelt, far and away the best prize that life has to offer is the chance to work hard at work worth doing.

Ooh, great. Great stuff there. All right, to the phones we go. 888-825-5225. San Jose, California is where Luke joins us. Luke, how can we help? Hey, how's it going? Good. So I'm in a little bit of a pickle here. I make a pretty decent income.

I'm able to save a lot, and I want to buy a house. But the trick is I live in California. So even the, you know, the worst house in the neighborhood around where I live is going to be, you know, about $600,000 or more. What does that get you? How big, what's that? How big is that? Maybe, I mean, it's probably 1500 square feet. Goodness. Wow. Wow. Maybe, I mean, it's probably 1,500 square feet. Goodness gracious.

Wow. Wow. Yeah, and even though I make a pretty good income and I'm able to save, it just feels like the goal of owning a home is so far away, especially if I want to go the route of doing the 15-year fixed-rate mortgage. How old are you, Luke? I'm 28 years old. 28? Are you single or married? I'm engaged.

Engaged? When's the big day? In September. Does she work? She does work. She's a small business owner, but she just started her business, so a little setback in terms of what she had to invest in the business. What will be your combined income? This year, I would estimate probably $170,000.

Okay. Listen, you know, I'm thinking about this situation. I think everybody wants to own a home, and yours is a situation where you've got to just like John Deloney would say, Dr. John Deloney, you have to face reality. And when you look at your situation, you have to ask yourself, OK,, how long will it take for us to afford a $600,000 home? And are we happy with the fact that $600,000 only gets us 1500 square feet? Like you have to really honestly make a checklist. And I would make a list of those questions and I would write down my answers because there's something about seeing it on paper versus it floating around in the air above your head. And when you see it on paper, I think that it can help you go, okay, do I want to stay in this area? What gets us to the

life that we want? Because I can tell you, I remember my sister-in-law, they lived in California and LA for the longest. And she was a school teacher and he worked, I think, at Nintendo. And they were like, like listen we're never going to have the house and the life that we want out here we just can't afford it and we love our careers and they moved to north carolina or they moved to you know north florida later on and i'm like listen that's the choice they made when they saw their life on paper and i would suggest you do that because that's really what we're looking at like Of course, I'm going to say, yeah, save for a down payment. Try to get 20% down.

Buy a house where the payment's no more than 25% of your take home. And you've got to look at that and go, is that possible with my income where I live? Yes. That's the question, Luke. That's beautiful, Jade. That's the issue. Like, you guys move anywhere else in the country and all of a sudden this is not daunting. Yeah.

I think with my current income, to get to the 15% of my, or sorry, 25% of my take-home pay, I'd have to have maybe a $400,000 down payment on that $600,000 home. So let's run this out like Jade just laid this out for you. How long would it take you to save up $400,000? It'd probably um i don't know 10 years yes now you're 38 so how's san jose feeling for you well i don't even like uh the the area that's really because my family lives here i want to be around them well those are the that's these are the decisions you have to kind of weigh those pros and cons, because we want we all want to have it all like that's just and I'm not saying that that's a wrong or bad or anything like that. But again, in the in the vein of reality, there is going to be part of you that goes, which do I want more to live near my family or to be able to have a home that we can afford? Is there something that we can meet in the middle? Because it's not to say that you have to move on the other coast, you know, and move to North Carolina, but maybe I go to Utah, maybe I go to Nevada, you know, one of these other states

where maybe I can find something where I can still see my family on a regular basis. Maybe it's a six hour drive or an eight hour drive, but I won't lie to you those are tough decisions to make but they do have to be made otherwise you're going to look up and you're going to be spinning your wheels and like i never moved forward why didn't i move forward it's because you never made that tough decision and if you decide hey i want to be by by my family then you're also choosing something which is you're going to live in a very small home. Yeah. And waiting 10 years, I would like to buy sooner, but that's not so bad.

Waiting 10 years? Great. Great. Listen. That's not bad either or wrong. If you want to stay in San Jose, then that is determined. So it's like, it's looking 30 years down the line. And now we come back, we work backwards into what is it going to take to have this life in 30 years.

So if you're in San Jose and you don't want to have been massive amount of debt and good grief, why would anyone settle for the norm, which is to pay $600,000 for 1,500 square feet? Such a bad value proposition. It's crazy. I would never just accept the norm for a bad exchange. I agree. I'm always going to let value drive what I think should be normal. And I get to determine value. And so if you're willing to wait, great. But listen, I don't know what that's like, Jade, because to be fair,

I never one time thought for a second when I was young about staying near my family. I was just thinking the same thing. Didn't even cross my mind. I was literally, you know, as I stay, stroking my beard thinking, what must it be like to be willing to wait 10 years in order to live by your family? Because I'm like, how do I get out? Yeah, no chance. I'm just kidding.

I love my family. But you know, y'all know. I do too. So we're wired the same way. I feel like you and I made the big decisions absent of whether it was near family or not. And if it was a big decision and somehow family was near, bonus.

Yeah, bonus. Like I moved here to Nashville. It just so happened that my parents live here. That was a bonus. I wasn't like, I have to move to Nashville because I have to live near my parents. Well, you had already started and led an amazing life a long way away.

So I don't know. It's listen if he it's got to make sense for him if he and his wife or they decide listen we're we're worth we're willing to wait 10 years listen sam and i waited 10 years before we bought our first house so yeah definitely not poo-pooing on that now that the value that, the exchange for me was worth it because the way the market was, I'm like, yeah, I'll live in South Florida. We'll get a nice piece of property. You know, San Jose is very different. And, you know, he's not wrong for wanting to wait.

I would still be looking and seeing, okay, where can I live that's within driving distance to my family it was just a 12 hour drive and a 10 hour drive I was thinking a six hour drive three even just like I'd start with a I'd start and go okay on a map and kind of go all right let's just look and see 360 degrees start with three hours yeah that's an easy morning drive get you drive, and start looking and go, okay, I can still be very involved. Because I actually wonder, unless you're one of those families, and I don't know what this is like, okay?

Unless you're one of those families that just likes being around to each other all the time, how much do you think he's going to see his family, even if he lives within 15 minutes? Listen, I know families who see each other almost daily. I do. Yeah, but I mean, do you think the average family does that? I don't, but I do know that there's families that do that. Like I wanted to ask him, is it just his mom and dad or does he have lots of brothers and sisters?

Or maybe like culturally certain families, you're all kind of in one home and maybe he's the one that moved out. And so he's still trying to stay close. Like I get that. And by the way, there's nothing wrong with that. Culturally, everybody does it different. We're just here about the money. So we're going to tell you the money stuff. And that's what would drive me. I'm not kidding. It would drive me to live somewhere else. I would go, it's just too daggum expensive when you're buying what amounts to a starter house for $600,000. For $600,000.

Yeah. It's tough. Forget it. It's tough. Forget it. Interesting stuff. Great call. Luke, I love

your constitution. Me too. That you're willing to wait. We're challenging you to not have to wait that long, but good for you. No debt, man. It's going to pay off

in the long run. Jade Warshaw, always fun, my friend, to be on the show with you. Thank you so much to James, the entire crew. Thank you guys for keeping us on the air. And to you, America, thanks for listening. This is The Ramsey Show. Thank you.