The Ramsey Show - App - You Can Build Wealth No Matter Where You Are in Life

Episode Date: January 22, 2025

Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people with their money, their relationships, their work, just about any and everything. I'm John Deloney, joined by my great friend, Jade Warshaw, and we are taking your calls live, toll-free. And if you don't know what toll-free means, it's because you were born in the 2000s. All calls are toll-free, John. I know, I know. We're taking your calls, we're taking your emails, your texts,

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Or if you're listening on podcast or YouTube, you can click the link in the descriptions. And we're going to put all the names in a big hat, and we're going to give you a $500 gift card if we draw your name out. So thank you for doing that for us. And BT dubs say nice things about us. Okay. Let's go out to Sacramento, California and talk to Julia. What's up, Julia? Hi, good afternoon guys. Hey, I really, um, it's such a pleasure to be able to speak with someone and get some advice. You got it. Well, it's an honor to talk to you today. Thanks for calling.

What's up? Oh, thank you. I'm calling to get some advice on retirement, please. I'm 66. My husband, 67, and he's an automotive service director. So we do okay. But as you know, California is so expensive. We bought a home, and it appreciated in value, luckily.

So we have a little bit of equity, but we still owe $300,000 on it. And we didn't buy it at a high price. You know, the thing is, we're still paying it off. He's working. I teach school. I'm not working right now, but I thought maybe it would be a good idea to move out of state and, you know, get somewhere less. And I could work, you know, as a teacher. Maybe I'm older, so it's hard to get a position.

I already had an offer in Texas. I'm certified there for fourth grade. I turned it down because we were here. I don't know. He just refuses to think about retirement. We have no savings. He's thinking he's going to get Social Security, keep working,

put that money into the house payment. I said, well, what are you going to live on? I thought maybe we could start a little business. I'm not talking a dealership. I told him, because he said, oh, yeah, you have money for that? Well, I like the idea of you guys. A coffee shop or a daycare.

Sure. I like the idea of you guys moving out of an expensive area like California, because the truth is that that's a cost of living you may not be able to maintain, but maybe living somewhere less expensive. You mentioned Texas. That could, you know, depending on the part of Texas, that could be good. The problem about living in Texas is you're going to have to figure out how to spend that extra money because there's no state income tax there.

Hey. I don't know how you're going to spend all that, Julia. I bet there's a very high property tax. Yeah, they do. I know. I know. There's the other side of that teeter-totter, but I'm just like taking my digs where I can get it.

I don't know. The thing is, you know, he's also afraid that he won't be able to get a home at our age i know he won't get a job well let's look at the let's look at the facts like let's look at the money because right now it's like a bunch of question marks around our head um so you mentioned that he kind of has this plan of living off social security do you guys have any clue like you're 67 or he's 67 you're eligible, but if you begin taking it now, obviously you're taking it at a cut as opposed to waiting. So when you wait and take that later distribution, do you know how much it'll be? No. He's thinking about $35, a little less. Okay, so let's say it's $35. You can check in and find out what you think, what that number is going to be on the IRS.

But then let's look at your budget and so it's really about taking these numbers out of the air and getting solid facts of what it will be can it work if it doesn't work how much do we need to be earning does that make sense and i think that's going to give you a lot of peace when you can find the facts around it won't work you know you're right it won't work. You know, you're right. It won't work. I told him, what are you going to work on? But do you know that or are you guessing that? Julia, do you know or are you guessing? Do you have a budget? No. Okay. That's what we need. So before we get off the call, we're going to set you up with, Christian's going to pick up and get you an every dollar budget. And it's really just going to be you plugging in that income and then plugging in what you guys spend money on. You've got this mortgage. How much do

you pay a month for the mortgage? $3,000. What? Okay, you're right. It's not going to work. So, Julia, here's a common thing. I want you to know this. You're not crazy. Your husband's not crazy. Y'all are facing a very common dilemma that millions and millions of 60 plus year olds are facing, especially married couples, is A, there's an ecosystem that has descended upon you the last 25 years, telling you that everything in your life is coming down. Everything's going to end. And you grew up in the era of Walter Cronkite and Tom Brokaw,

folks that people trusted. And now that same ecosystem is telling you, you're not going to have enough money. You're going to die. You got to move it all into silver and go. The whole world has shifted on your generation. My generation just assumes everybody's lying to me. Even the people telling the truth,

your generation is stuck assuming these people are telling us the truth it's all coming down so number one i want you to know your fear is is is okay it's normal but also as jade said here's what you desperately need with your husband you all need actual facts remember this line facts are your friend you have made up a story in your head that you're too old to be a teacher. That is false. My mom is in her 70s, and she's still a college professor. My dad's a teacher. He's 70. You can do it.

Really? Okay. Yes. It's just a story. Because when you were a kid, 60 years old felt like a million years. And now you're there. You're still fun, exciting. Your students love you.

They could definitely use your wisdom. No, it still feels like a million years. I know. I know. But listen, you and your husband, this idea of like, I don't know, I think social security, that's not enough. So instead of talking about, what are you going to do?

We have to move. I want you to sit down and use this line with your husband. I need to know what our money situation is because I'm scared to death. Will you help me be less scared? And very few husbands will look at their wives when they say that and go, nah, I don't care.

If you say, I need to know. He thinks he's got it all planned though. Then he needs to show you the plan. And if you use the words, I'm scared because I don't know the plan, I need to see the plan. Okay, that's a good way to phrase it. Okay. Because you're scared.

My parents were factory workers and children's workers. I mean,'s a good way to phrase it. Okay. Thank you. Because you're scared. My parents were, you know, factory workers in General Motors. I mean, we grew up in Detroit, Michigan. Yeah, of course. So, you know, everything was, I don't know, I want to say easy, for lack of a better word.

Well, hold on. You grew up in Detroit, just like I grew up in Houston, and you grew up in Detroit when it was all golden and great, and it all went away overnight. And I grew up in Houston where Enron was the greatest thing in the world until one morning Enron didn't exist. And so you have both of those things going on.

It's just going to all work out, and then you also have that understanding in your nervous system. There's a day when everything, the factory shut down. You got to address that fear with him. And then, yeah, it's a math problem. You want to move to Texas? You want to move to North Carolina? You move wherever you're going to move. Jade was right.

You can't afford $3,000 more. I thought about Houston. I applied to Houston. I got a call. Listen, the world is desperate for great teachers, especially licensed teachers. So you're not going to have a problem getting a job. What you might have a problem doing

is convincing your Californian husband to move somewhere else. So that's a whole different story. And just remember, wherever you move, whatever housing situation you choose, you don't want that payment to be any more than 25% of your take-home pay. That's what's scaring the pants off you right now. It's just too expensive. So we're going to send you every dollar. We're going to send you the budgeting tool and we're going to send you Financial Peace University, the whole digital class. It's nine lessons, and you and your husband commit to watching them together. And then you can sit down and talk about your plan together.

Statistics show that half of Americans don't have enough life insurance, or they don't have any at all. I don't understand this, John. Why don't people want to take care of their family? They think they're not going to die or something? Well, I used to be one of those guys. I didn't even think about it. And one of my buddies said, hey, the only reason to not have life insurance is if you hate your wife and kids. And I immediately went and got term life insurance. That's a gut punch. For decades, Dave, I've sat across people who've lost a spouse. They've lost somebody important to them. Me too.

They don't know what to do next. You're going to have a crisis here. You know, you got two options while you're sitting and talking to a young widow. She's concerned about how she's going to invest all this money properly and not mess this up. Or she's concerned how she's going to eat tomorrow. That's exactly right. These are the two options. It's saying I love you to your family.

Term life insurance. Jeff Zander and the team at Zander Insurance makes it easy and affordable. I've used them personally for 25 years. They're the only people I trust. Go to Zander.com or call 800-356-4282. Welcome back to the Ramsey Show. Are you ready? Tomorrow night is Ramsey's biggest free live event of the year.

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It is still what it is. You look at your savings account. Overdrawn. It is still what it is. Yeah, overdrawn. You look at your savings and, it is still what, yeah, overdrawn. You look at your savings and your heart stops. I understand.

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Maybe you went to the live stream last year. I also want to say we're showing EveryDollar, but we're also answering all your money questions. That's right. We're talking about how to get out of debt. We're talking a little bit about investing. George and Rachel are joining us later, and we're going to do a Q&A. So this will be worth your while. Trust me.

It's going to be really, really, really good. And I don't care how much money you have, how much money you make. Okay. This is for you. Yeah. All right. Let's roll out to Pittsburgh and talk to Emily. What's up, Emily?

Hi, I'm so blessed to be speaking with you guys today. I've been kind of struggling with this question. It's more of a family matter than mine personally, but I'm really looking to get your insight on it. So we had estranged family members for like the last 15 years that recently reached out within the last two weeks because one of them passed away and the other needs financial support, but they're not

explicitly looking for it. So basically what it looks like is the relation to me is that my grandmother passed away and my uncle had been living with my grandmother and it was just the two of them for the last period of time. And uncle basically had no job so they were living off of her social security and her life insurance that we found after she passed and essentially there's nothing left and he's dropping hints to us as the family saying well I don't know how I'm going to like make these payments I don't know like where my grocery bills are coming from. He's not explicitly asking for things, but it's the way that he's phrasing things that is making us concerned that he's looking to us to be his savior.

I wouldn't be concerned at all. Like, cause I know how this, I know how I can get his groceries paid for. He can get a job. Ta-da. Yeah. Right.

Well, he's, he says that he can get a job. He's not sure that he's going to be working cause he does have a health condition that is prohibiting him. I'm not exactly sure. I don't know all of the details on exactly what it is. I personally don't even believe that it is a health condition. I think he's just trying to use it as a guilt trip.

Exactly. But that's my personal view on that. I don't have the facts. You're probably right. So let me ask you this. Why are you letting this person you haven't talked to in 15 years suddenly have a voice at your kitchen table about your integrity, your character, what you do next? Like, why are you giving him a voice? It's a moral issue. Like, I always want to try and be, like, the best that you can be, right? And so I see this person that needs help because they were honestly just poor planners.

They put themselves in this position, and I get that. But I'm also kind of like the person that's like, well, I do have a little bit that I could contribute towards this. What would you— But I don't want to. What would that be? Yeah, I don't— What would that be? If you did help him, what would that be if you did help him what would that look like it would probably look like um well maybe i can give you um like so much money towards like

her burial or something like that because they're struggling even to come up with funds for that okay listen if you wanted to this is grandma right that we're talking about if you wanted to help you know grandma's funeral costs i think that that's fine. I don't, that part I don't have an issue with, but Uncle Boo Boo is the one that I'm like, okay, what would it look like for you to help him? In your mind, if you thought this is my job to step up and help him, what would that have been? Or what would that be in your mind's eye? I think what I'm looking for would be just like knowing that I didn't just leave him and that he's just withering away with nothing. No, but he hasn't even asked you.

No, he hasn't. And I guess that's kind of where part of my, my struggle coming from too is that he's not asking for it, but I think he's too proud to ask for help, but I think he needs it. And I don't know another direction to point him in. How old is he? He's probably, I want to say 62. Where's your parents?

Where's your mom or dad? They're right there with him. And they're trying to kind of keep distance as well. They don't want to be the ones that are saving him either. But I think they're looking at it and they're asking the same question. What is our obligation? What should we be doing as Christians? What should we be doing just as family members? I mean, to me, he truly is a stranger, but even a stranger on the street,

I'd like to assume I would help. Yeah, there's two things that are going through my mind here. Number one, I would take my cues from a struggling uncle's brother and sister. That would be number one. So I would look to my mom and dad because they're going to know, whoever he's related to, they're going to know better than I do. Right.

The second thing is, is I am all about helping and supporting and walking alongside and being there for the people on the margins in our world. I also have been humbled dramatically over the last 20 years because of my arrogance and my savior syndrome. Okay.

And so when you see somebody that you in your head, tell yourself a story that he needs this, this and this, and I can be the person to come, that's less about christian value and that's more about you in a weird way using him to make yourself feel whole and okay he hasn't asked you for help he hasn't said we need your help he's done some passive-aggressive dribbling of things here and there and i would leave that to my mom or my dad his brother and or his sister to step in and say hey man what do you actually need like let them have that communication together and i maybe if

i was in your case i'd probably reach out to my dad or to my mom whoever's closest and say hey i can we're in a position where we could contribute 500 bucks or a thousand bucks to the to the funeral if y'all need that and i'd go that way instead of going to basically a stranger, a guy who opted out of his niece's life for a decade and a half before I need to go in there and feel like I need to save the situation. Does that make sense? Yeah. It does make sense. of it that the reason I was asking you before what would that look like is because sometimes we get in moments where like okay you know if I'm going to help them and what we're trying to help them do is really not sustainable in long run it's not helping at all like if the issue is he

doesn't have income coming in and he's not looking to get income coming in you stepping in and paying an electric bill one month long termterm is not really a sustainable thing. So it's like, okay, what can we do? What would it look like to help in a real way that's long-term? Well, that's probably going to help him find options for him to work, right? So just reframing, if you did want to help, what that help would be. It might not actually be financially, if that makes sense. Yeah. And I think that that makes a lot of sense. I think that's kind of what I was kind of sitting on, but I was really debating because like, I feel sorry for him because of the situation that he put himself in. And I, and that's what I'm struggling

with. Like he did it to himself, but I can help sometimes, but I don't want to help all the time. Like you said, I don't, I don't want this to be a long-term thing because as he so nicely put, he did opt out yeah so it is kind of like this struggle which again which is why i was just be speaking with otb today because it's just such an internal struggle for me i would work through my parents and just know that feeling uncomfortable does not mean your decision is wrong that's right thank you if you if you're a person of compassion like hopefully all of us are anybody who's hurting and we'll go one step further okay so we'll help out here emily hang on the line we're going to send you an electronic version of financial peace university

if the call ever comes that hey um i need some help with some of this stuff you can say hey we got you i'll send you Financial Peace University Uncle for free. And here's all nine lessons. And it's going to walk you step by step how to take control of your financial future. And that way you're giving him a fishing rod and some bait and a place to fish. But he's going to have to bait the hook and actually throw the line in the water. Thanks for the call. We'll be right back. Rachel, do you ever get these sketchy text messages that are like, hey, you need to update your address and verify so we can get you the package you didn't order? Yes, I have, George.

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Make sure to check it out, you guys. Welcome back to The Ramsey Show. I'm John Deloney, joined by Jade Warshaw. Let's go out to Dallas, Texas and talk to Mary Mary. What's up, Mary? Mary. Oh, whoops. I pushed the wrong button.

I'm not the smartest. That's all right. What's up, Mary? Hi. How's it going? I pushed the wrong button. Sorry. James is rolling his eyes in there at me. I'm not the smartest guy. That's all right. What's up, Mary? Hi. How's it going? I pushed the wrong button. Sorry. James is rolling his eyes in there at me.

I'm getting better, James. I promise. What's up, Mary? Hi. It's going good. So we moved to Dallas, Texas last summer. My husband's work relocated us here. There was no way out of it.

He tried to find another job in California and was unsuccessful and so now we're here we're in the Frisco Texas area I'm just wondering if this is if this was a good move because it's the houses are expensive here it just seems expensive and we're currently renting right now and we rented our house in California. And we have some savings, but the houses are just expensive. Did you guys do any research before you loaded up the truck and moved to Beverly? We did, but, I mean, it was we move or my husband doesn doesn't have a job and then I would be the breadwinner. Yeah, this doesn't sound like it's about houses though, because it's expensive in California too.

This sounds like you haven't found a community or a connection or there's a cultural fit or something like that. It's okay to say we moved and we tried something and we don't like it. That's okay. That's also true, yeah. Well, I'm trying to like it. My husband likes it. He likes Texas. Okay. So what is it that you don't like about it?

He doesn't like the politics of California. Well, my family's all in California. There you go, okay. And then just the prices are here. They're in the $600,000, $700,000. Well, you're also in a very, very expensive part of Dallas. Yes. Very expensive.

And so it's both true. Frisco, Texas is a very, very expensive place to live. And it's not super all the way 100% honest when you can move over to Arlington 30 minutes away or 40 minutes away. There's places where you can move that are less expensive. And I think I heard you say that you kept your California house and you're renting it. So I'm assuming there's equity there that would have gone into rolling over into a house. Is that playing into it too?

Were you planning on selling the California house and using the equity to buy a home in Texas? Or what was the plan there? No. So our plan was to just keep that as an investment. So we owe about $289,000 and the house is worth about $620,000. Okay. And we're renting it out. We don't make very much. We come up making about maybe $300 every month. But we just wanted to keep it as a rental property. And we do have about $294,000 in a high yield interest account right now. And then about $40,000 in our checking and savings. So we don't, I don't know if we should just pay off the house in California

or use that for a down payment. Yeah. Your money issues are not money issues. Just hold that. Because you are investing in your right hand, and in your left hand, you're renting. Mm-hmm. Mm-hmm. Right? So you have this one dream, like we want to have a rental property, as some people in America, like so many people think that that's-

But it's at your expense. Yeah. But you're the one suffering from it. And so you could sell that, have $400,000, plus you got a couple of hundred, you could write a check for a house where you are right now. And so it's not about the money.

What is it about Texas you don't like? Or about your area that you don't like? Or about the changes in your husband that you like? What is it besides, I miss my family? Or I miss the weather? Or or i miss which are big things i don't know those are all real things but be honest about what you miss i miss my job back in california i was making a little bit more over there too than i am here yeah oh okay so have you had like a this sounds cheesy have you had a funeral for what was because it sounds like keeping the house in california also allows you to keep a foot there it's kind of like you

broke up with an old boyfriend you're dating somebody new but you kept the photos you kept all the photos and y'all still talk all the time yeah and so you're never going to give this new boyfriend a full shot because you're still longing for the old stuff and the old stuff was great it was awesome right hello yeah we're waiting on you to sift it out air it out i mean i want to ask the question so you made this move the purpose of it was it just tell me the the full purpose of it what you were trying to accomplish okay so this my husband's job the headquarters is moving to Dallas Texas and um he kept telling me you know it's going to be great over there you know you'll be able to I'm a nurse practitioner so you're going to be able to get a job, you know, it's going to be great over there. You know, you'll be able to, I'm a nurse practitioner.

So if you're going to be able to get a job, um, you know, we'll be able to rent this house in California and it'll be our investment property and then we can buy something else over there. It'll be good. It was, you know, this big old dream. So it's working for him. Right. Yeah. Cause he didn't lose his job. He has his job. And he's still loving his job. No, he doesn't like his job. He has his job. And he's still loving his job. No, he doesn't like his job. He doesn't.

Listen. The job market right now is so bad that he's having a hard time trying to find something else. Yeah. I mean, I'm thinking about the first thing John said, which is you try something, it doesn't work. That's okay if it doesn't work. Yeah, call it. I do think you're talking about, let me leave you with two thoughts. A, when my husband and I moved here to Nashville for this job from South Florida, we've been here two and a half years and I'm just married, like just starting to be cool. Like it takes time. So I want to say that, that they're like, you're not going to move from an area, uproot your whole life, leave your family, leave your friends and be good in six weeks or six months. Like it takes time to like get in and get settled.

So there's that side of it. But then there's also the side of it is if you're looking at him and he's looking at you and you're like, listen, we made a mistake or I hate my job. You hate your job. We don't even like the price of the houses. We don't even like the people. Like if you're really checking all those boxes, I like, I'm the type of person, John, I'll sit down and make up a checklist, like old school style and check the things that are positives and check the things that are negatives and like weigh it out literally and see,

okay, of all the things that we said are important, we're not checking any of the boxes or we're only checking one. And California was checking nine, you know, and that helps you get a clear read on what's really going on, like real time and not just how you're feeling in a moment because something happened at work. And sometimes when people say the job market is so bad, it's so bad, it might be in your field or in his field. And that's when you have to ask yourself a bigger question. And you got to do what I did. You got to do what Jay did.

And that is shift your entire career trajectory into another job. The job I have right now did not exist. There was no such thing as a podcast or YouTube when I graduated from college. And so the world has shifted, right? And so y'all might have to ask yourself that question. I love Jay's, you know what would be awesome? If'all two just went on a a year one retreat yeah and just did a retrospective i

love you you love me we're on the same team we're gonna make this we get to pick whatever we want to do with our one wild and crazy life we have half a million dollars in equity and a quarter million dollars in cash we're okay let's be honest and don't you can't be deceitful mary you gotta be honest about what you have loved about this move and you gotta be honest about what you don't like and both of y'all make your list you'll talk about it and then you can put your hands together and say all right i've been a nurse practitioner forever i'm gonna start looking at home health or he's been i I don't know, he sells oil products or something and now he's going to start selling jackets. I don't know, but that's because our priority is we want to go back to California. Can I also throw one other little variable in there?

Yes. Mary, you there? Yes. Let me throw one more thing in there. When I left my childhood area of Houston area and I moved out to West Texas and the first big giant storm came through Houston, I remember being glued to my phone because those were my people and that was my home. And I felt so powerless being that far away. And if you are finishing up year one and you've been glued to your phone for the last month, watching these fires ravage parts of your home, then I want you to be honest about it just feels weird not being there with your people and with your family and being able to put eyes and hands on those that you love. And that's normal. That doesn't mean you uproot everything if everything else isn't need to be uprooted. But that feeling of powerlessness

because you're not right there with it, that's real and that's good and that's holy and that's right. And you just have to acknowledge it. So y'all go on a one-year retreat. Go through it all and say, what do we love? What do we not love?

I love Jade's idea there. And then y'all make some fact-informed decisions about what you're going to do next. You get one shot at life. Go live it well. What does the future hold for business? Ask nine experts and you'll get 10 different answers. Economic growth or a recession.

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what's next, download the CFO's Guide to AI and Machine Learning at netsuite.com slash Ramsey. It's free at netsuite.com slash Ramsey. Welcome back to The Ramsey Show. I'm John Deloney, joined by one of the greatest people on the planet, Jade Warshall. Today's question of the day is brought to you by WhyRefi. WhyRefi refinances defaulted private student loans. Defaulted means when the borrower can't make the required payments. So if that describes you and your private student loan, contact Y-Refi. They can

offer a low fixed rate loan built just for you. Go to Y-Refi.com slash Ramsey today. That's the letter Y, R-E-F-Y.com slash Ramsey. And this is not available in all states. All righty. Today's question comes from Mark in Pennsylvania. He says, I'm engaged to a wonderful woman. We earn about $150,000 combined. We have a joint bank account because I want it to be our money and not my money. Love that. The problem comes up when we have our monthly budget meeting and she sees that we have $1,000 extra in the account once everything is paid. I know by the next payday in two weeks, there will be zero. We have gotten our total debt down from $75,000 to $35,000, but I want to get that to zero.

What can I do to regain some financial peace? So if I'm understanding this correctly, John, they've got $1,000 of margin, but it sounds like it's just getting spent on whatever. And in two weeks, it's zero. That thousand bucks isn't getting a sign. Yeah. So exactly. John just hit the nail on the head. When you do an every dollar budget, let me just clear up a common misconception. A lot of people think that when they do their budget, the budget is just for the things that I'm supposed to plan for. Like those, the things that make me an adult, right? My rent, my electricity, my phone bill, like I got to plan for groceries, but then they see the extra money and go, okay, like that's treat yourself. Like that's up for grabs. We can do what we want. And in a way it is up for

grabs, but you decide what you're going to grab it for, if that makes sense. So when you do an every dollar budget, you decide how you're going to spend every single dollar ahead of time, not just the important dollars. Does that make sense? So I say to people all the time, it's not to say that it's got to be like this negative thing. When you're planning every single dollar, you're still planning the fun stuff too. So if your wife has a fun category, although in this phase, I would say not yet because you're paying off debt, but let's just pretend, yeah, you're spending that thousand dollars as well. So you're saying, okay, $70 is going to go to get nails done. $100 is going to go towards entertainment. $200 is going to go towards restaurants. And you're deciding how all of that is spent. That way, if your wife rolls out to

Target, she's got a $75 line item that says, yeah, this is like my blow money at Target, right? And then you walk away from all of your spending for the month feeling fine about it because you didn't break any rules, right? Because there were guardrails there. How important is it, Jade, as you're talking, this is probably the worst analogy I could think of, but I'm thinking back to like middle school and high school with the youth pastor who says, you need to make a decision about your boundaries

before you go on the date. Because if you wait till you're on the date, it's too late, right? It feels like it's important to make a decision with this quote unquote thousand extra on the first day of the month. Because if you just know it's in there, it's so easy to go out to eat and be like, let's get appetizers and drinks too. Yeah. Because, and then you wake up and it's gone, right?

You spent it on stuff that you wish you hadn't spent it on. So it feels important to when everybody's of sober mind and they're being less emotional and more rational we're just looking at a budget let's go ahead and assign this to where it goes that way on the 21st when we're out of eat out money yeah we gotta figure it out we gotta eat at home yes it's too hard when there's a thousand bucks is there absolutely you're exactly right taking it out of the heat of the moment is great because nobody makes good decisions when they're feeling the emotion of like, I want this now. So that is a great thing. Also, I feel like when you do that ahead of time as in a spousal relationship, for sure, it takes the sneakiness out of it. Do you know what I'm saying?

When there's just a lump sum there that's up for grabs, anybody can do it. If you get to it first and you spend it, you kind of feel this thing of like, I don't want to show them that I did it because they're going to be asking questions. So I'm going to hide it over here. I'm going to like bring it in in pieces into the house. Right. You're doing all these things to kind of hide that you've spent the money as opposed to being a grown adult and saying, no, I have $200 I get to spend or we assigned this to

that. And then you're like you're golden after that. You don't have to be feeling bad now. In his case, he's like, I want to use all this to put it towards the debt. My guy, Mark is absolutely correct. And baby step two, now's not the time to be spending on a bunch of extras. Margin should go towards debt, the smallest debt. It's funny you mentioned that in my marriage, when there's extra money like that in the past, I was such an idiot i might spend 40 of that and then if my wife spent 60 bucks i would somehow feel superior like like you did better

where are you spending all this money yeah exactly like i only keep in score it's so stupid that's yes but people do that just budget it and budget it and you can spend whatever you want that's right that's right all right good deal let's go out to little rock arkansas and talk to mark hey mark what's up man oh not much how you doing good sorry i messed up the phones there earlier on earlier call what's up brother uh yes um we're trying to get out of that got about 250 000 including our mortgage and doctors and credit cards and uh so we're working on that. And we just wondering where both I'm 51, wife's 48. So we know in the next 10, 15 years, so we'll retire. So is it still wise to hold off on investing and pause that and pay the debt? Because also we have an opportunity that if we can sell our house, we can move on to some family land and put a trailer there to cut down on calls.

So just to know what the best plan is. Okay, so we've got a couple of things on the table. We're talking about debt, we're talking about investing, and we're talking about future home settlement, right? Like living on land, living in a different house. Okay, I love this question because I think what you're facing is a flurry that all of us are facing, right? What do I focus on first? They're all really, really important things. Enter the baby steps because it really helps us focus on the right thing at the right time. Because everything that you're talking about are important things, but you got to prioritize them in order of

importance. So first off, in order to be able to do the things you want to do, you want to be able to invest in this land one day. You want to be able to invest the things you want to do, you want to be able to invest in this land one day, you want to be able to invest for retirement, that takes cash, that takes money. And Dave Ramsey would say all the time, your income is your biggest wealth building tool. Therefore, how can we get more of our income back in our pocket?

Pay off your debt, right? Because you're probably giving away, I mean, if you were to calculate how much you're giving away every month in payments, what do you think it would be? Oh, it's close to 60%. We've already done that. Yeah. So that's a lot. So that points to your first answer. Yes. I think you should clear the debt first. So how much is it? About $240,250, something like that. And is that including? Including our mortgage.

Okay. So let's pull out the mortgage and tell me what you have in consumer debt. What's a hundred and take about 180 out of that. I'm not good with math. I'll stop there. Okay. That's fine. And so tell me what type of debt it is. Credit cards, a personal loan and medical bills. Okay. Tell me how much the credit cards are. Tell me how much the personal loans are. And tell me how much the medicals are. The credit cards are, they're probably close to $20,000. Okay. And that personal loan?

Personal loans, probably about $23,000. Okay. And then that medical debt? I don't have an exact number on the medical debt because I just figured it all up as one. Because there's a bunch of little different doctors for price say if you had to guess I don't know probably uh probably about 2,500 okay okay so of course that's going to go first since it's the smallest debt in this whole thing and tell me about what you guys earn what's your income combined uh combined we make about 115,000 before that is if I don't get any overtime or anything.

Okay so monthly what does that look like? Every month what does it look like you bring in? Probably about 3,000, 2,600. Okay. 2,600 plus 3,000 so about 56,000. Okay good. So off the bat my first like thing for you and it's always going to be the budget, I want for you to know these numbers. The budget's going to make you know the numbers like the back of your hand. There's not going to be any guessing. There's not going to be any, because you're going to be so dialed into it because you're focused on taking every little bit and throwing it at this debt is what it's going to amount to. So with your income, assuming that your current housing situation is in its proper place, what are you paying every month for rent or mortgage? About $1,600 a month. Okay, yeah,

you're good. So there's no reason that you shouldn't be knocking this debt out going very quickly. $2,500 on that medical debt should be gone super fast, right? How many kids do you guys have? We have three still at home. Okay. So this is going to be everybody, the whole family, we're sitting down together. Dad and mom are saying, here's what we're doing next. We've got to get out of debt because we've got to get our life together. And here's how we're going to do it. You guys are going to see us cutting back big time. Once you cut that, once you knock this debt out, you're saving up three to six months of expenses, and then you're going to start investing 15% for retirement. You're in your 40s. I promise you it's not too late, but you've got to get on this now. And don't go move into a trailer on family land just yet. This is The Ramsey Show. Live from Nashville, Tennessee, it's The Ramsey Show.

I'm John Deloney, joined by Jade Warshaw. We are taking your calls on money, life, building wealth, your savings and checking accounts, your relationships, your work, whatever you got going on in your life, we are taking your calls live. 888-825-5225. Let's go out to Orlando, Florida. Orlando, Florida. I was just making up stuff. Orlando, that's right.

Orlando, Florida. I called it Orlando, James, because it's snowing there right now, which is very strange. Let's go to Orlando and talk to Jessica. Hey, Jessica, what's up? Hi, how are you? I'm fantastic. How are you?

I can't complain. Well, I can, but it does no good. Right? I was going to say, lots of people complain. Just doesn't do anything. What's up? Okay, so my question is, my husband and I, we were in the process of buying a home. Found out we can't do that. We let our apartment go so we could save up for clothes and cloths.

And now we are, I guess, technically homeless. How can we... Wait, why can't you buy a house? Yeah. Or get another apartment. Right. Well, he had an eviction from a few years ago. We let our apartment go, which is, I guess, technically, according to the courts in Florida, like an eviction. When you say you just let your apartment

go, you mean y'all just moved out and quit paying on it with a signed lease? We broke the lease because the lender that we were working with completely assured us that there was no problems we were going to be in our home in 30 days just make sure you have the closing costs we had the down payment um covered yeah but that doesn't answer the previous question the department would have sued you because you broke your lease like you have to pay the lease out they actually were very very good about like the whole situation except that except that they have y'all y'all y'all have a broken lease on your credit eviction yeah right um help us understand because what john and i are hearing is that you're saying hey we let the lease go and it's all good

but at the same time you letting the lease go is what caused the eviction, which caused you not to get in your house. And people might have been nice to you, but you can't just walk away from your lease. Right. Well, we explained the situation that we were in, that we, you know, we weren't going to pay the rent for the last month. And they said, OK, as long as you're out by a certain date, it'll be fine. So do you have a name and number of the person who said that and the date they said it? And in writing? Yes.

Yes. They sent you something in writing? Yes. Then I'd go back into the office, into the main office and say, hey, I have this documentation here. It says it's good. Y'all filed on my credit report. You have 15 days to remove it.

Okay. Or we're going to have to get an attorney because y'all are violating what you told us. Okay. Yeah. I think it's as simple as that. I mean, if you have it in writing that said that your lease is terminated and it's

all good and you owe $0 and it's terminated on this date. Yeah. That's that's, that feels simple to me. I don't know why, but I feel like there's more to it than that. Is there? Okay.

Um, not really. No. Cause here's the thing. A bank, if they pull up your credit report and you've been evicted from a house,

you have just bailed on a lease because you don't want to pay it anymore and somebody somewhere told you, no, it's cool, man. It's cool. It's totally cool, dude.

Of course they're not going to loan you money because your track record says you just don't really care what you sign your name to. You just do whatever you want to do. Right. So that makes sense. So do whatever you want to do. Right.

So that makes sense. So yeah, you need to go fight for your credit report on that front end. And then I don't know what your husband does about the eviction. Did he actually get evicted from a house? He did, yeah. Okay. How long ago was that? 22.

Okay. And what caused that? Was this before you entered the picture? No, we were together at that point, but the apartment was in his name. Okay. What happened to cause that? Was this before you entered the picture? No, we were together at that point, but the apartment was in his name. Okay. What happened to cause that? It was like right at the end of COVID. Okay. So his income wasn't...

He couldn't afford the apartment. Right. He couldn't afford the apartment. Right. He couldn't afford the apartment. He had qualified for rental assistance, but the place that we were living in just refused to take it. Okay. So they were just like, all right, you guys got to go. Okay. I hear what you're saying. I want to make sure. I would just check and double check that this home purchase that you're making coming up is a great fit,

that you guys are crossing all your T's and dotting all your I's, because I don't want a pattern. I see a pattern. Yeah. I don't want that pattern either. And I, you know, I'm a stay-at-home mom, and we only have one income. So it's like i just want to make sure because when i go to buy a house and don't get me wrong when you buy a house it is a eye-opening experience you're learning something new at every you sign a phone book's worth of papers and it's a whole thing but

there is also a level of due diligence that you want to do ahead of time before you start getting other folks involved and a lot of that is reviewing your credit, reviewing what your numbers are, looking at the income, all of that stuff. I want you guys to take so much control of this and not make rash decisions like getting out of your lease before you've even checked your own credit, right? Because you would know that that eviction is there. And that's kind of of what i mean by that i want you guys really dialed in doing your due diligence getting ahead of things and not letting it just kind of happen and not making rash choices like we love this house let's get out of the lease forget the payment we don't have to like i just john i'm not trying to read too much and i just i just i feel

like i'm here i'm hearing part of the story just cause there's, there's another layer to this. Um, no, there isn't. I mean, you know, the, the lender that we were working with, you know, we asked all these questions. Is there going to be a problem? Is, you know, can you assure that we are going to get into this house? Cause otherwise we were, we weren't going to do what we did. Yeah.

And she was like no no no everything is fine on my end everything is fine okay and then you know it wasn't so so tell us uh okay well if that's it then it's as simple as john said before i mean i'm not going to beat a dead horse uh yeah go to them say you need to remove this from my credit contest it on your credit and then once it's removed go back through with the situation. If you want my advice, which I know you didn't ask this, but I would not be buying a house unless I was completely debt free with three to six months of expenses saved in a high yield savings account. And I'd want to make sure that I'm putting down anywhere between five to 20%. You could do more, but no less than 5%. And the payment doesn't need to be any more than 25% of your take-home

pay. That's wisdom in this situation. I hope that you take it. Well, and here's one layer deep. Again, you didn't ask for this, Jessica. I hear something in your voice and man, I don't mind being wrong that you know you're married to a guy who all of your eggs are in this basket, not just relationally, but financially. You're at home, and for a second time, he assigned his name to a piece of paper and just walked away from it. And rarely does that pattern of behavior exist in only one sphere, that you're a person of integrity everywhere except when it just comes to leases. I don't really care about them.

And so if that's the case and you have just doubts in your gut about buying a house, because, dude, they will come for both of you if you buy a house. They'll take your home from you, right? And that's a scary, scary proposition. So before you buy a house, make sure we got the money. And if we sign a 30-year note, we're prepared to be here 30 years or pay this thing off. Or a 15-year note, we're prepared to sign this thing and not leave because you can't just walk away. You can't just walk away.

Jade, it's frustrating when life changes and I have a new idea, but I've signed my name to a contract. And the right thing to do almost always is to, I said, this is what I said I was going to do. And I'm going to honor that thing. It almost always comes back to bite you. We'll be right back. This is the Ramsey show. Hey, you guys, I'm not a fan of the big banks and you probably already know which ones I mean. But I do like credit unions because they're non-profit organizations that focus on their members. And I'm proud to endorse Fairwinds Credit Union because they share the Ramsey mission of helping people get out of debt and live generously. In fact, they design products to help keep you from going into debt in the first place.

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they created just for Ramsey fans to help you take control of your finances. That's fairwinds, F-A-I-R-W-I-N-D-S dot org slash Ramsey. Welcome back to the Ramsey Show. Are you ready? Yes, we are. Tomorrow night is Ramsey's biggest live stream, and it is totally free. It's the Ramsey team, Dave and Jade, in your living room, on your phone, on your iPad, on your big screen, however you consume it.

350,000 people have already registered and they are ready to do something different with their money. And so listen, Jade and Dave are going to give you practical tips and the motivation you need to start building wealth, find margin, get out of debt, do all the stuff. We're going to give you a step-by-step playbook. And Jade, I take calls, like personal calls, on my cell phone from folks all over the country who have incomes that I can't even wrap my head around. Yeah.

And I can hear the courage. It's building and building. And they say, hey, okay, walk me through this budget thing. Yeah. Right? And it's embarrassing. It's embarrassing. Right? It shouldn't be. It shouldn't be, but it is. walk me through this budget thing. Yeah. Right? And it's embarrassing. It's embarrassing.

Right? It shouldn't be. It shouldn't be, but it is. Yeah. It is, right? Yeah. And so this is a way you can learn step by step and you don't got to ask anybody anything. But if you do want to ask, at the end of the live stream,

Rachel Cruz and George are going to join you guys for live Q&A. Your questions are going to get answered and you're going to help a whole, whole bunch of people. Yeah. This is going to, I mean, to your point, this is one of those almost like asking for a friend, right? You don't have to put yourself out there. You can put on your pajamas and heat up your lean cuisine and just watch it on the couch and get all the answers you want. But, you know, I hope you do get involved. Get involved in the chat. Ask questions. I would love to remove the stigma from, you know know talking about money and

being real with your money because chances are the way you're feeling the person next to you is like oh i guarantee you me too and then your question becomes a blessing for everybody yeah right yeah it makes people feel not so alone and one question answers it for everybody that's right go to ramsay solutions.com slash live stream we're also giving away five to five different people four thousand dollars in cash and there are a few things in the world more fun than giving away dave ramsey's money so sign up and if you create a free every dollar account you'll get a bonus entry into the givey giveaway we're going to be using every dollar throughout the live stream and they're going to show you immediate ways you can take control of your money. So, go to RamseySolutions.com

slash live stream tomorrow night, 7pm Central for free. No more excuses. Bluff called. Get right with your money in 2025. Let's go out to Nashville, or let's go right down the street and talk to Johnny Five. What's up, Johnny?

Hello. What's up? I have $40,000 in debt and I have been put on short-term disability, and I'm at a breaking point to where my credit card bills are going to go behind. Oh, man, what happened, brother? Mental health issues. I had to have medication changes, and they took me out of work for it, and it's been a month and a half I had a thousand

dollars saved up for it and I floated all my bills for that month and I'm out of funds and I'm at the point to where everything's about to run behind yeah is there any chance you I'm assuming you've you've looked into this any any chance you had disability insurance through your job? Yes, I'm on short-term disability right now. So you're getting some money, just not enough? I'm getting $300 a week, and my wife does work, but she's only bringing in $1,000 every two weeks. Okay.

What does she do? She works in a weeks. Okay. What does she do? Prior, she works in a factory. Okay. Okay. And she's getting $1,000 every two weeks. Okay. So you guys are at $3,200 a month. Yes. Is she working full-time or is that part-time work?

No, that's full-time. Prior to me going on short-term, we were bringing in roughly $5,000 a month, but me being on short-term has cut my funds by about $2,000. How long are you going to be out, brother? I'm dated to go back in March, but it could be sooner, or they could decide to extend it. I don't really know. It's up to my doctor.

How are you feeling? I'm all right right now but like i said this gets you know stressing me out sure absolutely okay um i'm looking at this and there's a there's the issue of the short-term disability um you're going to be off of that soon. When are you projected to be back full in action? Three, two. Three, two. Okay. So in March, the clouds part and you can start to see a better day. But in that meantime, I still think that there's an income issue here. You know, your wife's working full time to make $24,000 a year before, you know, after tax. That's tough right there for 40 hours a week. I'd love to start looking at a trajectory that gets you guys' income up so that you can start making headway on this debt. That's what

I would be interested in long term. So before you get off the call, I want to get you guys set up with King Coleman because he's got a lot of great materials out there just for career projection, whether this is for your wife or for you. I want to get you guys in a better situation to where you're paying off this debt faster, you're doing work you love, and you're really getting to that point of financial peace that we all want to get to. Here's a couple of things, Johnny, you can do, okay? If I'm just trying to project myself, I'm your neighbor, I live here in Nashville. If I'm you, if I woke up and found myself in your exact spot, the first thing I would do is I'd sit down with my wife

and y'all have to figure out a way that at least for the next 30 or 60 days, she can make some more money. And no husband wants to have that conversation, but that's just a financial reality y'all find yourselves in. So if she goes and does this job and then she delivers pizzas in the morning or in the evening and drives Uber, people to the airport in the

morning, she can be exhausted in 60 days, two months, but y'all aren't going to get buried underneath this deal. And you can say, hey, I'll take care of the house. My purpose for the next 30 days while I'm getting well is I'll make sure we got breakfast and dinner. I'll take care of that. But y'all need to get some cash in your home quickly. The second thing I would do is I would call those credit cards and just, I don't know if this and five cents will buy you a cup of coffee, but you can plead and say, I need a 30 or 60 day stay on my account. I've had a medical issue. I'm on short term disability. I'm scheduled to go back March 2nd.

Can I roll these things and that might um they might do that for you see i did that with one credit card and they cut my bill in half but they canceled the card and put me on a 60 month plan okay and by doing that dropped my fico score by about 70 points. Could care less about my FICO score right now. That's the least important thing in this equation. Could care less. Okay, so here's my next question. One of my ways of thinking was I don't care about my credit cards.

My house payment's only $300 plus land taxes plus insurance uh that's i not counting my debt for credit cards um my the bills to run the house is about two grand okay now um i don't care about my credit cards i don't care about my debt my house is five years out from being paid off. Great. My car is 10 months out from being paid off. Okay. I want to keep my house paid. I want to keep my cars paid.

I was willing to let my credit cards get behind and then call them and see if I can get the same deal off them once I get back. Don't do it after it's already sailed. The ship's already sailed. And why would you need to do that? Because you told me as it stands right now on disability, you're at $3,200, but then you just told me it takes $2,000 to make your house run. So what's happening to the other $1,200? It's more like $2,300. That leaves us about $700 for food. Okay. When you said it's more like $2,300. That leaves us about $700 for food. Okay. When you said it's more like $2,300, what happened to the other money?

Because before you said $1,200 for you and your wife brings home $2,000, $1,000 a week. Or I'm sorry, $1,000 every two weeks. Yeah, she's bringing in $2,000. I'm making about $1,200. The light, the gas, all that added up together on top of my car payment and my house payment coming out just over two grand okay so what i want you to do i want you to throw this in every dollar because you're doing the type of budget that i the type of budget where you only plan the things that you think are important but you forget to add the other stuff i want you to budget every

single dollar of this money so before you get off the line we'll get the other stuff. I want you to budget every single dollar of this money. So before you get off the line, we'll get it for you. And I want you to put your income at the top, your wife's income at the top, and then go through line by line. Every dollar, I'll have some default categories there to kind of prompt your mind and get you thinking of what you're spending money on. But be sure to add everything in there. I'm talking about grandma's birthday. You know, you stopping off at Wawa to get a snack, all of that. Put it into the budget. And I think you might find that there's more money than you think. And that might give you a little peace in this situation. And that $700 in food for the next 30 or 60 days, y'all are beans and rice in it. Yeah. And you can bring your kids in there to help cook and make the food,

but y'all are eating as cheaply as possible. Thanks for the call, brother. We'll be right back. This is The Ramsey Show. There's a time in your life and in the baby steps for renting, but you don't want to do it forever because when you rent, you're still paying for a mortgage just somebody else's. Plus, rent means instability in your budget because it always goes up,

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1749 Mallory Lane, Suite 100. Rent with Tennessee 37027. Welcome back to The Ramsey Show. I'm John Deloney, joined by my great friend, Jade Warshall. Let's go out to Raleigh, North Carolina, and talk to Jake. What's up, Jake? Hi, thanks for taking my call. I'll get right to the point. I live in an expensive city, and my question is regarding buying a home.

Am I better off liquidating my brokerage accounts to put down a down payment? Or should I aim for the, you know, I know Mr. Ramsey talks about, you know, 15-year mortgage, 25% of my income, which would be a very, very, not a very good place where I live okay when you so the question is you know how do I save up and hope that I can save up to buy a home cash do I liquidate these brokerage accounts that I've saved up over my years I'm almost 50 years old by the way to lower that mortgage payment I'm getting very advice from friends and family and so forth and online as well. Okay. That's a good question. So first off, what are you looking to spend? Do you kind of have a range that you're like between here and here, or does that depend on what we... Yeah. So I mean, I'm in a good financial situation. The houses I'm looking at are

probably in the 1 to 1.5 million range. And the reason why I can't, I would love to move out rural, but I have a special needs child. All the resources and the schools are in the city. It's just not realistic to have to drive 45 minutes or to have my kid wake up early. And we can't make a lot of business appointments that are in business hours. So I'm kind of stuck in this range. I'm renting right now. So yeah, that's the kind of range I'm at, the $1 to $1.5 million.

Well, what's in the brokerage account? What's non-retirement? $500K. $500,000. Now, when you put that money aside in that brokerage account, in your mind mind was the purpose of it to buy a home or was it for something else? No, this is just lifetime. It was just for savings and to add on to retirement. Got you. And what do you have in retirement? 401k plus IRA is probably around a million.

OK, nice. Let's do it today, dude. Yeah. Cash in today. Yeah, i'm with john i think that this money of course i'd keep three to six months in your case i keep six months of expenses liquid or in that you know you could i i wouldn't keep it in the brokerage i'd throw it in a high yield savings do you have any money liquid in a high yield savings yes uh i i sold

my old home uh to move to the city we recently moved here. So that's why I'm asking this question now at my age. What's in that? I took that money, about 250K. I put that in a high yield savings, you know, four point something percent, you know. Yeah. Get what you can get. So what else? Any other money we should know about? No, that's it. That's it. So, yeah, just... Just $750,000 you could put down on a house. You're good, homie. You're good.

I get it. Now, you might decide based on how you're trying to keep your expenses low. It sounds like you are. You might decide, yeah, I'm going to go more for the $1 million range instead of $1.5 because the truth is that's a big swing. That's a $500,000 swing. That's your entire brokerage. So if what you're looking for

is to get as close as possible to a cash home, yeah, you're looking at a $1 million. And you're going to want to keep, like I said, six months of this out. So you got $700,000 to put down on a $1 million home. How do you feel about carrying $300,000 in a mortgage? Well, I'd feel much better. It's just, you know, people are like, why would you give up all that brokerage when you can just do a 30, you know, I know 30-year mortgage, pay less, you know,

long, take advantage of compound in the market, blah, blah, blah, you know, that can go on and on. You'll be losing compound on the other end with a 30-year mortgage at 6%. Right. You get what I'm saying? So the net compound is, I call it my sleep tax, my soul tax. If I'm earning 8% on one end or 10% on one end and I'm spending 7% on the other, that 3% to not have a mortgage, I'm glad to pay that. Especially with a special needs kid because no one could take our house away from us.

Yeah, I guess it's just a little scary to lose my non-retirement account because I kind of treat that as untouchable, right? I got you. And that was another question. Do I also stop contributing to my 401k? No, you need to continue to contribute 15%. And I want to be really clear here. If you say to yourself, listen, Jade, I have my eye on the house I want. My down payment's going to be 20%. I'm happy to put $250,000 down on this and the payment's fine for me. This is your money and You can make the choices you want to make, right? So you have to decide, what do I value most?

Do I like this money in the brokerage sitting there and waiting for, you know, working for me? Do I only want to use half of it? You know, you have options here, which is the wonderful thing about your position. Your back is not against a wall in any way. So you kind of have to decide, what am I comfortable with parting with? And also keeping in mind that long-term, the goal is to not have a home payment, like John said. And so run those numbers out and go, okay, when do I want to retire? Because by the time I want to retire,

I want this thing paid off. And so does that make sense? Yeah, I guess generally speaking, most of the advice I've gotten has kind of been along those lines, figure out what you're comfortable with. But I think a lot of people are like, you would be crazy to liquidate everything and reduce that mortgage. So Jake, let me just tell you,

can I just tell you, I just did that. I did that less than a year ago. I didn't have it in a brokerage account. I did that less than a year ago. Yeah. I didn't have it in a brokerage account. I had it in a high yield savings account, but I growing up in the house that I grew up in, um, it was very uncomfortable with,

with money. And I accumulated a chunk of change and I did not realize how much of my identity and safety I was putting in that savings account. So when my wife and I, for reasons not quite similar to yours, but very similar to yours, she's one of these newfound wives that wants cell signal and she wants to not have to drive an hour to drop the kids off in school, stuff like that, right? And so, yeah, I took that money out. And here's the thing. I had two or three months of, oh my gosh, I took that money out. And here's the thing. I had two or three months of, oh, my gosh, I put all of my faith and all of my safety and security not in my faith, not in my family, not in my work, not in – you have a million dollars in savings, by the way, in your retirement account, right?

Yes. And so nobody's starving here. You're good. You're fine. It became, oh, this is all about me and me putting safety in the wrong things. Yeah. Maybe you run the numbers out. If I were you, I would sit and go, okay, I've got the million dollars,

and what's that going to look like 10 years from now when I'm 60 if I continue to contribute 15% of my income? You already know a lump sum is going to double every seven years, but continue to add your contributions on top of that. Knowing that retirement wise, you're going to be fine is also going to play into the decision that you make here. And then, yeah, run it out with, okay, well, what if I take, what if I keep 250 of the brokerage in there? What is that? How does that change the numbers? And then ultimately, yeah, run that through. Okay, what's my legacy going to be? I've got this special needs child.

What do I need to leave to them? Like run those numbers and you're going to see all of your options and what makes sense, what you're going to feel like, you know, at the end of the day is excess and better serve, that would better serve you now today in this new house. So I think that's going to give you a lot of insight. There's not a wrong, there's not a wrong answer here. The only wrong answer is to, you know, go into debt and do it at 30% and do it to the point of you're never paying it off and that sort of thing. So. And I think the other thing that I would classify as quote unquote wrong here,

and I don't like to use that language all the time, is don't not do something because you're scared yeah that's good yeah you have 1.5 million dollars not including a cash account with 250 000 in it and i i missed it what's your take home what's your salary uh after taxes and contributions about 15k a month yeah Here's the thing. You're playing on house money. The thing, I wonder how much of it is just fear. It's just fear. A lot of it's fear. A lot of it's fear because I don't know how long I'm going to be working and what my daughter is going to need when she's older.

How old is your daughter? She's nine. I'm older. I'm an older parent, obviously. Sure. But it sounds like you guys are on board with, if I decided to just put it all in,

that is not an unreasonable or insane decision to make. If I were you, I would do that. And I'd keep a good emergency fund, maybe a little bit more because you do have a special needs situation. Right. Yes, I wouldn't be all $750 750K that I have in cash and brokerage. It would be, you know, 650 or something like that. Yes. Thank you so much for the call. That's awesome, man. This is why we do this show. So the people who have

curveballs in life have options. This is The Ramsey Show. Hey, guys, I'm Jade Warshaw, and I want to talk to you for a quick second about student loan refinancing. If your payment and your interest rate are burying you and you feel like you can't dig out, refinancing your student loan debt might make sense. That's because a lower rate could free up more money in your budget and a shorter term could help you pay down your debt faster. So reach out to the student loan refinancing experts today at laurelroad.com slash Ramsey. There you'll find helpful resources like a student loan rate table, a refinancing calculator, and other tools. Plus, you can get an initial rate in just a few minutes. Laurel Road offers low competitive rates starting under 5% and you

can get your interest rate even lower if you sign up for auto pay. But if your situation is more complex, sign up for a free 30-minute consultation with one of their student loan refinancing experts to get your tough questions answered. Listen, not everybody should refinance their student loan, so make sure you run the numbers. But for some people, it is the right move. Learn more at laurelroad.com slash Ramsey to find out more about their student loan refinancing. That's laurelroad.com slash Ramsey. Laurel Road is a brand of Key Bank National Association. All credit products are subject to credit approval. Welcome back to The Ramsey Show. I'm John Deloney, joined by Jade Warshall. Hey,

we have this rad new segment on the show. It's called Sorry We Missed Your Call. And here's the deal. People call and leave us messages. Sometimes the messages are hilarious and sometimes they are critical in a good way. Like they, they point out some things and sometimes as they usually are, they are questions like people are asking for help and they try to call into the show. They couldn't get through because so many people were calling in or they called in after hours or they got caught the show, not on radio, live radio, but they caught it on YouTube and they just wanted to reach out and ask a question. So we have a new segment called Sorry We Missed Your Call. Here is the question from Amber.

Amber writes, hey, my name is – oh, oh, we're going to listen to it. Okay, we're going to listen to it. Sorry, James. Go ahead. Hey there. My name's Amber, and I just have a question about donating to the needy. I know that kind of biblically and morally it's good to help out those that are poor and needy. I know that kind of biblically and, you know, morally, it's good to help out those that are poor and needy. I have this one family that phone me all the time asking

for money. And I'm just wondering, you know, if I should keep giving them money or if there's a limit to when I should be giving them money. So that's my question. Thanks. Okay, bye. What do you think, Jade? Ooh, I always love a generosity question. Listen, I will be the first to tell you that I think that generosity is one of the five pillars of personal finance. Super duper important.

And it really is the concept of going through life with an open hand, right? Money comes in, money comes out. It's not too tight of a grip on it, which means it's in its rightful place. I'm fine with it leaving or coming in as it sees fit. I do think that creating boundaries around anything is a wonderful thing.

And just having a clear intent on what it is that you're trying to accomplish is a very good thing. So this kind of like limitless, it's just an open well that never stops could be detrimental at some point but if you've also gotten yourself to a point financially let's say you've uh john you've you've paid off all of your debt you've got your three to six months of savings you're doing your investing you have secured yourself and your family's back then if you say hey uh like a lot of people will decide to give 10 to their local church love that

if you're not a you know religious or affiliate or anything like that you say you know what my thing is i just pick a family and i give 10 of my income to supporting these families in need fine i just think that you need to create some sort of rhythm and boundary around whatever it is that that is and it's not so much of a hey whenever you call me up you know i'm here to you know that's right right what you need yeah we we get to bypass reality sometimes because we'll just call you yeah right so i love what you asked i want to always go back to that question is why of why are you giving right um and if you're giving because you think you're superior to somebody in need then keep your money right if you're giving because you think you're superior to somebody in need

then keep your money right if you're giving because you um have just been insanely blessed or even a tiny tiny bit blessed and like you said you live life with your hands wide open um and by the way we're all in a season all of us are in a season right yes um and it might be really cold in your season or it might be that the harvest may have come in, but we are all in a season. And if you happen to be in a great season and you want to be supportive and you have your eyes open and you can help people, and that could be tipping really well, that could be strategic giving, that could be giving to local school, church, anything. In this kind of situation, after one, two, three, four, whatever number is in your head, sounds like she has reached a point where she is no longer comfortable. I'm giving money and it's not helping this family

or this person. And that's where the harder thing I think to do is to have a personal conversation. We're going to go to coffee and you just talk to me about what's going on. And then to say, okay, this is the last time I'm going to give you cash. I'll give you Ramsey plan.

I will help you get a job. I will walk you. I'll take part of the time off my job and I'm going to walk you over to a local, one of those like day ready places where you can get you a job. Like I'll walk with you. I'm going to walk next to you. But the cash ATM part of our relationship is going to come to an end. And so I think it just expands what quote unquote help means and giving means um and there is some time um dude like right this second is not the time to get a lecture my light bill's about to get cut off

right right there's those moments you step up and you help help out your neighbor yeah the larger conversation is i'm not gonna pay your light bill for the rest of your life yes let's have a deeper conversation about what's actually going on yeah and i think that i mean, that's the whole kind of like nature of benevolence is like, hey, I'm going to get you out of this jam. But ultimately, we're making sure you don't end up in this jam again. There you go. So that's kind of how it works. Yeah.

Yep. I guess. Covered it. Yeah. And I guess the last thing I'd say is. Don't give out of guilt. Yeah. Yeah.

The thing here, I guess, is you have to look yourself in the mirror. That's right. Right? And probably if we took me and you and Dave and Rachel and George and Ken and we all sat down and said, what's our philosophy of giving? It'd probably all be different. A little different, yeah. And so I think all of us are united like giving is just a way of being. It's a responsibility all humans have to each other.

What that looks like day in, day out with each family in each situation that's just different so um it's easy in this situation to go around and ask person to person to person amber if it's just you at home look yourself in the mirror and be honest and then set your own boundaries and then go give recklessly within those boundaries and then if you're married so y'all sit down and decide who we're going to be this year financially with what we give and go get it. Right. Yeah. And just another note to that, I think typically, I mean, we could all come up with a situation where that's not exactly been the case, but typically financially, the best time to give is from overflow so that you're making sure you're taking care of your family, your own home situation. And if you're not in

that point, there are so many other ways that you can be generous that aren't directly dollars in your pocket, right? Like there's so many ways with your time and your effort and your words. Your expertise. Yes, your expertise. You can trade skill sets and things like that or do a trade or something for free for somebody. So there's a lot of ways to be generous that don't put you or your family in a situation where you're not paying your own bills. It's amazing. All right, let's go out to Atlanta, Georgia and talk to Michael. Hey, Michael, what's up? Hey, John, how you guys doing? We're doing fantastic, brother. We're up against the clock, so hop in right on top of your question. What's up? Hey, I was just wondering if I could give you some of my financial life insight

and help me figure out the two-part question. You got it. The first question being, how can I budget mine and my wife's irregular income? And the second question being, where should I go next? So my wife and I's income, I make about $80,000 a year. And she is a stay-at-home mom, but she has a side hustle where she's watching children. She makes anywhere between $100,000 to $400,000 a week. Okay.

I'm currently working on making more money. Within the next month, I'll probably be making um working on making a hundred thousand dollars a year okay and I'm saving for retirement at the moment um six percent matches something I'm with now is doing okay and um uh yeah that's where I'm at I've got a one-year-old and I've got a seventeen hundred dollar mortgage all right thanks for the information that's super duper helpful so you mentioned the first issue is kind of like figuring out how to do this irregular income, which is such a common question. It can be befuddling. So tell me every month when you guys kind of tally up your paychecks,

how much is it when you get paid? I make no more. Usually every week I bring home about $1,100. Okay. And on most weeks you bring home about $2,000. Okay. So what I suggest when it comes to a regular income is you kind of take and you plug that $6,000 into your budget and you're going, you're first starting with the idea of priorities, right? The most important things, we call those the four walls, right? So number one, you're always going to make sure your rent's covered, your utilities, your food, your transportation. And then quickly after that are the things usually associated with our kids, right? Whether it's childcare, insurance, that sort of thing. And so you kind of have this

prioritized list of when the money comes in, these are the things that sort of thing. And so you kind of have this prioritized list of when the money comes in, these are the things that must be covered. And if I have enough money to cover all of those things, then I can go to the next most important things. I can start talking about, I don't know, cell phone bills and keep going down that list, right? And if you look and you realize, okay, I have enough money to cover everything, that's a green light. That feels great knowing that even on a lower month, you can cover everything. Now, if you're in a situation that you go, hey, I've kind of looked back on 12 months and on my lowest month, I still can't cover everything. Then you know that when

you have a higher month that comes in, you need to kind of pull some reserve and set it to the side. So we kind of call that peaks and valleys. When you have a great month, you keep a little extra aside. And when you have a valley, that money is there when you need it. A better tool for you probably to utilize is going to be an every dollar. It's a premium feature. It's called paycheck planning. A good budget tells your money where to go, but paycheck planning tells it when to go. So you're planning when you spend every single dollar. All right. That's the second hour in the books on The Ramsey Show. You can find the rest of the show live on the radio or behind the Ramsey Network app. We'll see you there shortly, right here on The Ramsey Show.

Live, welcome to Nashville, Tennessee. This is The Ramsey Show. Sorry, James, it's Franklin, Tennessee. Here, I'm John Deloney, joined by Jade Warshaw. We're taking your calls on money, James. It's Franklin, Tennessee. Here I'm John Deloney joined by Jade Warshaw. We're taking your calls on money, life. Did I mess that up, James? No, it was great. I didn't say a thing. Oh, I thought you said,

why does he always say Nashville? Sorry. We're in Franklin, a suburb of Nashville right outside. But we're taking your calls behind the Ramsey Network app and still live on radio. 888-825- 5225. I'm John Deloney joined by Jade Warshaw. And hopefully the rest of the show will be less clunky that funky than that

intro was. I look right at James through the thing. And sometimes I can't tell if James just disappointed in me in general, or if I just messed up. James is dad. Like James is like, you look to your dad for approval and he just shakes his head slowly. No, I need to talk to Sheila and see if like like you you act this way around her at home too just like if

you're constantly looking to her for approval well it's just when you're told that you're not very good at your job so much i just want to catch a glimpse of hey i did a good job on that one let's go out to seattle home of pearl jam and talk to Ryan. What's up, Ryan? Hi. I am currently debating whether or not I should go back to school for engineering or keep working my job that doesn't require a degree, but it's a pretty good job. Tell us more. So the current job I'm working, I'm making about $80,000 a year. I work a good

bit of overtime, 50 to 60 hours a week. So I can't really go to school while working this job. What do you do? What is the nature of the job? So I work in aerospace manufacturing, building satellites. Wow. Okay. Yeah. It's pretty cool. What I'd like to be doing is designing the very same things. It's what I've dreamed about since I was a kid. Okay. But that requires, you know, going to school for an engineering degree, which I have not done pretty much any college. Is time the limiting factor or is time and money the limiting factor? It's time and money for me.

Like, I struggle with the idea of, I'm gonna take four years where I'm not we're going to be making less money and spending more money on getting this degree and I'm like I'm already making 80,000 and I have the opportunity to continue to make more and more it almost seems like it wouldn't be worth it financially. What would you make once you got the degree in design? At least currently, what that pays is around like $120-ish. And what does it cost to get the degree? um so i when i budgeted it out um taking a pay cut for a job that i'd be able to have better hours to work with school um i should be able to come out costs um i i basically be able to pay for all my college but i wouldn't be able to save for much for retirement yeah that's okay that's. That's all good, man. That's fine. I mean, how much is it going to...

I mean, I love that you can cash flow this. How much is it going to cost? Like, what is that number? For just the degree or to live while getting the degree, too. Just the degree after the four-year degree. Yeah, so I cashed that out at about um about 80 000 factoring i was trying to factor in like textbooks and stuff like that trying to take most of my classes at a cheaper community college and then going to a more expensive thing to finish out okay so you're doing're doing $20,000, you're cash flowing $20,000 a year

to get this degree in four years. That causes you to work less, so you're making less money, which means you won't be able to retire, but how old are you? I'm only 26, so this is like a good time to do it, because I'll have plenty of time

to be able to do those things. Can I tell you what I think the problem is, and tell me if I'm crazy? because I'll have plenty of time to be able to do those things. Yeah. Can I tell you what I think the problem is and tell me if I'm crazy? Go for it. I think that you have told yourself a story that you're not a college guy. Wow, I feel... Some company...

Yeah, most definitely. Some company thinks you're worth $80,000 plus, which tells me you're smart, you're capable, you're a very hard worker. You'll get through college with no problem. The thing I would tell you is I think there's probably a way with a guy that works as hard as you do

and that is single-minded and focused as you, you can get done in three years. You can take full loads in the summer classes too. You can take full load in summer one, full load in summer two. You can take Janmesters, Maymesters, and I think you could sit down and map out a way where you're done in three years or three and a half years. Here's another thing I think you can do. I think you could take out one of your supervisors for coffee and say, hey, I really love this company and I really, it's been a lifelong dream. I want to design these things. Is there any sort of path here that y'all could help out? Is there any tuition assistance program? Anything like that. Because if you're a great worker, they may try to hang on to you if they can. Maybe not, but a lot of companies will try to figure out a way to keep you if you're a great worker.

Okay. And then here's the last statement I'll give you. You're 26 years old? Here's the main crux of it. Jade and I will both tell you, all the research tells you, up to a point making more money and more money and more money is not worth

spending your life at a job that you don't like that doesn't give you the life that you actually want so here's the question you need to ask yourself at 31 years old do i want to be an engineer or do i not want to be an engineer that that's definitely something to think about that's it but forget the money part of it because you don't know as well as I do if tomorrow AI comes and makes starts they're like oh by the way replacing all the robots that may happen tomorrow who knows but with an

engineering degree if you if you know how to build satellites I mean you're going to know how to build other things and you know how to build other things it just feels like a really extraordinary tool you have to be an engineer. Yeah. Yeah. And can I tell you one more crazy thing?

Absolutely. If you go to school for one year or for six months and you absolutely stone hate it, what would keep you from going back to the same place and getting this job back? Probably nothing. They're standing a lot. There you go. So I want you to realize you're in the driver's seat of this decision, and there's really not a wrong decision you can make.

I want you to go in. If you decide to take a college class, go in with your chest thrown back. Sit at the front row, take notes. You're 26 now. You're not going to be sitting with a bunch of 18-year-olds in the back of the room laughing. You are there for one thing, and that's to get an engineering degree, to learn, not just to get the paper, learn how to be an engineer. Because one day you want to help build and design satellites that are going to help save humanity. Yeah, yeah, okay.

Okay? Thank you. The money part will work itself out. And the other side of it is, if you choose, dude, I just don't want to go to college. It's okay to not go to, like, you're making 80 grand, you're going to get to 100 grand. That's a good life. That's a good, good life. John, that was like a locker room, pep room talk.

That was, you know, like halftime, and everybody's like getting their hands in the center. Yeah, dude. Strong side. Weak side. Man, that was good. What a great movie. That was great.

Go get it. The question you're going to ask yourself, you're going to turn 31. Do you want to be an engineer or not? And if you're like, yeah, I think I do, then go get it, man. And you will knock school out of the park. This is The Ramsey Show. Welcome back to The Ramsey Show, live on radio and behind the Ramsey Network app.

I'm John Deloney, joined by Jade Warshaw. We are taking your calls on life and money and relationships and work. Whatever you got going on, we're here. 888-825-5225. Let's go out to Omaha and talk to Ashley. What's up, Ashley? Hey. Going good.

Thanks for your time. Excellent. Thanks thanks for calling in what's going on my question is basically how to save up a down payment for a home when you have a low income without pushing off investing in kids college for too long that's a really good question. Great question. So tell us how low is a low income? Well, this year, just like for tax season, it's about $36,000. But the previous years before that, it was like $27,000 and $24,000. Okay. How old are you guys? We're 27. Okay okay and what kind of work do you do my spouse is in the military and i stay home with the kiddos okay so um what i want to i should preface oh sorry no go ahead i just wanted to preface this we thought we were ready to buy a home we're super excited because we've been saving up basically since we've been together um and then we realized our reality might not be what we thought um we have a 30 down payment for

a 250 000 home but the monthly payments were still pretty too high and so we just got kind of discouraged we're like maybe we're doing something. We don't want to keep saving and saving and saving and then we're out of time. How long did it take you to save the 30% down payment? I would say like five to six years. Okay. How many kids do you have? Three. Okay.

So I'm going to say something and it's going to sound harsh, but it's all love. I promise you. Okay. Okay. So I'm going to say something and it's going to sound harsh, but it's all love. I promise you. Okay. Okay. Everything that you do is a decision, right? So if you get married, that's a decision. And it translates to a financial decision is what I'm getting at. You say, we're going to have one kid, financial decision.

We're going to have another and another financial decision. And I'm going to stay at home and be a stay at home mom, financial decision. And my husband's going to be in the military and work this job for X amount of dollars, financial decision. And what's great is when you can get ahead of that and make those decisions on purpose because you know where you're trying to get to. What happens many times is it's just life and we're just, you know, living life. And you make these decisions. And then after the fact, you realize how it's affecting you financially. But it doesn't change the fact.

Whether you figure it out in the beginning or after it's all happened, it doesn't change the fact that it has and is affecting your financial situation. That being said, you're a stay-at-home mom with three kids on $36,000 a year before taxes. It's going to be tight. So that's just a realization. So which string can we pull to make this happen faster? Because to your own volition, you're like, listen, it took us five years to save up what we have. get it more it's going to take another five years do I is that is that a road I want to walk down so you've got to figure out what levers you can pull to make this thing go faster and if you're willing to pull those levers does that make sense yeah definitely there's part of this that I guess what I'm getting at is there's not an easy button right John that

goes and push this and you'll be right where you want to be um no I love what you said it's it's just a series of choices and every choice we make has trade-offs it has trade-offs and so right now the trade-off for you is if you want to do this thing and do it right which I I value and I love that the fact that you're wanting to do this the right way it's gonna take time like there's no getting around that there's a time factor when it comes to reaching our money. Like there's no getting around that. There's a time factor when it comes to reaching our money goals that we can't get around unless we say, I'm either going to work more or sacrifice more. And with where the boat that you're in right now, you probably have limited areas at this point because you can't go back in time. You can't put

the baby back in the basket. Right. So they're out, they're out now and you're taking care of them. So, you know, maybe, you know, maybe there's a transition point they go to kindergarten you're able to pick up more hours there's probably something that you can do now to start making some money but just putting this in its right framework and going okay here's the reality of the situation this is what i can do to earn money it might not be much it'll make us go a little bit faster now we're looking at husband is there something that he can do he's in the It might not be much. It'll make us go a little bit faster. Now we're looking at husband. Is there something that he can do? He's in the military.

I don't know how, you know, what the restraints are there. Is there something more that he can do to make money on the side? Yeah, not with his schedule. No, it would be on me.

And so there's part of this where you've gone, when we made this, these series of decisions without realizing it, we also made the decision that we're going to be renters for a while until we can afford this. And unfortunately, it's more than five years or six years. The good news is, you know, there's people who rent longer than that

and they go on to be homeowners and everything's, you know, all good, baby, baby. And that, you know, my husband and I did that. We were renters for 10 years until we could afford to buy a house. And know no shame in that game actually do y'all live by base yeah and that might be another lever y'all can pull which nobody wants to do that but man if we said okay for two and a half years we can move on base um kind of like my wife and i moved into a residence hall for a year like we're we're going to do this thing short term

and we're going to pocket every penny of this money. And maybe your living stipend is far and above what your rent is. And I missed earlier, you stay at home, is that right? Yes. How old are your little ones?

They are five, two, and a couple months. Good Lord, on a stick. You got a busy house don't you yeah yes so this is one of those weird things where not weird things but just uncomfortable truths um that jade was talking about that you and your husband go out and say okay is it a bigger value of ours that come what may um we want to own a home. Or come what may, no one else will ever, ever, ever watch our kids other than me. And if that's the case, then you all sit down and have that hard conversation, and then it will give you some peace.

Because right now, you have no peace because you all haven't had that deep values conversation. And then, like, so I'm saving up for something right now and so i'm driving a particular car right now and a car that i really want will drive by and i still feel it like oh gosh that's so rad but i made the choice me and my wife sat down and talked about our values and our plans we made the choice to save up for some things. So I'm not at peace with it. I can be annoyed and frustrated by it. And so you, if there was a mom on base that would watch your kids for 30 hours a week and you could go get another job and escalate this thing really fast just for three years until your kids go to school, that'd be awesome. Or actually we're just going to

do this until the kids start going to school and then I'll start working a little bit more and a little bit more. And that means we're going to put off buying a house for five years. You get to pick what that thing is, but I think being super honest about values, having that values conversation. Jade, I have found most couples, myself included, have all kinds of proxy wars. It's about a car, or it's about a house, or it's about a about a car or it's about a house or it's about a daycare, it's about a job. And most of those things would be solved and or answered if you would have the real conversations, which are about values. That's right. And putting your values ahead of, how can I put this, where we think we should be by now based on cultural status, right?

Because like cultural standards will say, you get married, you get the great job, you get the car, you get the kids. And so we start making that like this checklist in our life. But, you know, when she's 27, she's like, I gotta get this house. I gotta get this house. I'm like, you're in your 20s, who cares?

If you valued, it sounds like you valued starting your family and taking care of your kids more than that. And that's okay. Of course it is. There's nothing wrong with that. Can we call this out? Yeah. I would assume that a couple could get married and one of them could be employed full time by the U.S. military.

And they would have three young kids and they should be able to buy a house. Yes. But they can't. That's a problem. They should be able to. Yeah. In any functioning world, they should be able to buy a house yes but they can't that's a problem they should be able to yeah in any functioning world they should be able to do that and yeah it's a math problem right now it's not a math problem i love it's not a math problem that i ideologically agree with but it is it's a math problem reality and so i get ashley sitting there going oh i married somebody who

dedicated their life to this country yeah he goes to work every day and he gets deployed randomly and we can't even we can't afford a home? A three bedroom, two bath house for our three little knuckleheaded kid. Like seriously? Yeah. That's the world we're in right now. That's the world. Yeah. And so there is room to be frustrated. There is room to grieve a dream, but man, the faster you can get to, okay, we are choosing reality. This is our reality. We get to choose. Do I stay home or do we not buy a house for a while? That's right. And a dream deferred is not a dream denied. It might not happen today. That's a good one. You should write that down.

Listen, I didn't say it. I think it was like Langston Hughes. That was good. I like some Langston Hughes. This is The Ramsey Show I'm John Deloney listen there's a ton that goes into buying and selling your home and all those decisions can feel overwhelming but you shouldn't have to tackle the process alone that's why we created Ramsey's real estate home base it's a place with all the tools and resources you need to get prepared to buy or sell your home with confidence. You'll find calculators, start to finish guides, how-to articles, a podcast, a book, and even a video course all packed with actionable steps to help you navigate the buying and selling process. If you're ready to take the next steps, by the way,

don't get your home buying checklists from freaking Instagram. Don't get them from TikTok. Don't get them from the mortgage company. Gosh, dude. Ramsey is just. Unless it's Churchill. Like you could get it from there. Yeah. Just listen.

But there's so much to it. Like all of the stuff that goes into it. It's such a mess. Jade, I just don't get nervous by about much of anything. Nothing makes me more nervous than going through the home buying process. It's just like it makes me into a crazy person. It's a lot. Listen, if you're ready to take the next steps with your home goals, we got you.

We'll give you peace of mind. Go to RamseySolutions.com slash real estate or click the link in the description. If you're listening on the YouTubes or the podcast. All right, let's go out to Columbus, Ohio and talk to my brother, Frank. What's up, Frank? Hi, John. What's up, man? I'm completely debt free.

I got the money in CDs that I invest in. And I was wondering what I could take that money and do with it other than just keep rolling it over and over again into CDs. What's your plan with the money? Retirement. Oh, so you're using CDs as a retirement vehicle? I have retirement through my work, but this is just cash that I've accumulated since being debt-free

that I'm trying to invest to go towards my retirement. Okay. So you're not saving, you're not putting cash aside to like buy a house or buy a new car or something like that? No, sir. I'm 100. My house is paid for. All my vehicles are paid for. Okay, cool. All right. Yes. You definitely need to get that money out of CDs. Outstanding. Outstanding. Yeah. How old are you? 42. Okay. So you're 42. You did say that you have some retirement through work. Do you know what's in there? I would say probably around $80,000.

Okay. $80,000. And your thought is, I've got this money in CDs. It's far beyond my three to six months of expenses, I'm guessing. How much is in there? $95,000. Yeah, that's a lot. How much of that would you consider three to six months of expenses? Well, I have additional savings and additional checking accounts also with money in those. Oh, so the additional savings, what's in there? Approximately $18,000. accounts also with money in those that oh so the additional savings what's in there uh approximately 18 000 okay is that what you would call your emergency fund that's what i

keep it for yes okay so that's would you call that three months four months what is that i would say that probably approximately eight months that's eight months okay cool and then you said there's other extra money in a checking account. Tell me about that. I have one with $3,000 and it's saving separate for my daughter and I have a $3,000 checking. Okay. And the $3,000 checking, is that just like your bills, your month to month? Is that the account you use for that? Yes. So that's the money you got this month that you're working through yes yeah okay so what i love about this is you're a baller like you you've paid off your debt and you're just stacking it like scrooge mcduck got 20 blades on your man

you got money everywhere coming out the wazoo that That's wonderful. What I do feel is that it's not parked in the best places for you and for your intentions. So if I were you, I love that you have eight months of expenses. I'd love to back it down to six months so you can get more of that money working for you. The 3K for your daughter, is that for her education? Is that what you're thinking? Yes, ma'am. Okay. So let me give you a step-by-step, a couple of things you could do today or tomorrow before business hours close. The 3K for your daughter, I would open up a 529 for her. And that way, you're investing that money for the purpose of education. And you get to decide how much you're going to fund in it. You don't have to overfund it but that money is there and if you ever want to roll it to other beneficiaries you have the ability to do that that money is good uh for k through 12 private school all of it not just college right and if you ever want i don't know if you plan on going back to school but it's you know you can

change the beneficiary is what i'm saying so 529 for your daughter that money is going to be better suited there for as for the CDs, I would move that money. At this point, it's up to you. I don't know what your dreams and your goals are. If you're thinking, I'm trying to buy a house, do you have that money earmarked for anything? No, not necessarily. Just, like I said, retirement. Okay. Then I would get with, if you feel comfortable,

you know, investing in, in the same funds that you use through your work, you could do that because you've picked those funds for a reason. If you wanted to, you know, open up a brokerage, you know, go through a brokerage and do that yourself in a Roth IRA and just pick those same funds, you could do that. Or you could get with a smart investor pro, open up a Roth IRA and let them help you choose funds that you feel good about and reinvest that money and get a better rate of return. I think right now you said you're getting like 4.4%, which is pretty accurate for what high yield savings accounts are getting. But if you throw it in the market, people have been making bank. I mean, we talk about 10%. It was 24% last year.

Yeah. I mean, that's ridiculous. That's not always normal. It'll go down. Trust me. But it was a good year last year. Yeah. I mean, that's ridiculous. That's not always normal. It'll go down. Trust me. But it was a good year last year. The average is between 10 to 12% when we're looking at an average annualized rate of return. So that's a much better placement for it. And so, yeah, max out. The key here is 15% of your income every single month going into retirement. First, you start with whatever. First, you're going to start with whatever Roth option you have. So your Roth IRA, max that out first. If your 401k at work is a Roth option, great. And then you go to whatever your match option is. If you have a match at work, you go to that. So that's how we're working and playing with this money. And yeah,

for the money with the CD, I would do do the same thing I would filter it through those same purposes and yeah that's what I would do how does that hit you yeah that's kind of what I was thinking um yeah because I I don't have a lot of bills and you know every paycheck I get I usually just throw it into savings so the majority I, I can snowball some money at, you know, some investments. I just didn't know which route to go. Yeah. I mean, if I were you, I would definitely make that call. And then I'm just like, if I throw your numbers into an investment calculator, just to know, okay, if I turn around and invest that 95,000 along with the 80 that you already have, you're going to contribute something. If you did your contributions every month, what would they be?

Contributions as to what I put into savings? Uh-huh. Like from your paycheck into your retirement, that 15%. I don't know I know uh I know I get I bring him about eighteen hundred dollars about a thousand of it I throw it a savings every two weeks okay so let's just say instead of throwing it in savings you invest it so over the course of time listen you're going to be over three million three point four million dollars if you continue this now until age 67, and you're just putting that $1,000 a month, that's pretty sweet. Okay. Hey, Frank, have you internalized what kind of position you're in?

Excuse me? Have you let it soak in that you've done pretty dang well? Not really. Okay. This is a crazy thing I want you to try. I can hear it. Your voice is very clinical. And will you do one crazy thing, and you can just tell your friends and family just some knucklehead of podcaster asked me to do this?

Sure. Will you write your 21-year-old self a letter and just a letter of gratitude for the dumb stuff, the good stuff, their trajectory to get you where you are right now. And then if you really want to be awesome, write your 60 year old self a letter and just say, Hey, I made some choices right now. That's going to really make your 60 year old life. Awesome. And our kid's life. Awesome. You're in a season of blessing right now. And it's sometimes we just blow past those moments and we just wait for the

next crisis and the next crisis. And Jade and I, most of our show is dealing with people in crisis and it just is awesome. Every once in a while when someone like you calls and says, Hey, everything's working on all cylinders. How do I optimize this? And it's almost like you can't hear what a great job you've done. So let me and Jay tell you, you've done a great job. You're doing a great job. And I want you to internalize this and have

a spirit of gratitude about it because we're, for whatever, Jay and I are proud of you. And I want you to tune into the Investing Essentials Workshop so you can learn and not be afraid of the stock market. That's right. That's right. We'll be right back on The Ramsey Show. Today's scripture of the day is Ecclesiastes 5, 4 through 5. When you make a vow to God, do not delay to fulfill it. He has no pleasure in fools. Fulfill your vow. It is better not to make a vow than to make one and not fulfill it.

William Arthur Ward says, Opportunities are like sunrises. If you wait too long, you'll miss them. Facts. All right, let's go out to Reno, Nevada and talk to Lisa. Hey, Lisa, what's up? Hi. Okay, I have, we're in a mess. I owe $215,000

to IRS. Oh Lord. Good gravy. What happened? Okay. Well, we've been in business. My husband's a contractor for 30, 40 years and 2008 hit and we went he went and worked for somebody else for this we should have got out sooner but for 13 years um about 2016 we lost our our accountant and just one year went by and then another year went by and then then we got panicky and you know here we are and so we didn't file up until just we just finally got it all together and filed. My husband just come back this year. We started our business. It's going very, very well. We're, he's 66, I'm 59.

It's going really well. We've paid off all of our debt, except for I owe $3,000 on my car. We owe $101,000 on the house. You owe a quarter of a million dollars to the federal government. Yes. We're wondering if we should refinance our house and pay the government off and make them go away and go from there. Well, let me say this. I want to make sure y'all are metabolizing this.

Tax evasion is a crime that can send you to jail. We are working with an accountant. They've done all of our accounting. So now that's how we know what we owe. Do you have an agreement with the government, like a repay schedule? Not yet. We just finished getting, we still have two more years that have been filed, but we're waiting for them to come back with what the penalties and interest are,

because it was about a hundred and something thousand before the penalties and interest. So could it be more than 212? Is that what you're, more than 215? No, we're looking at with the two, with the two years that are left, those are the worst years because 2016 and 17. And the last, the last three years of that we were actually having taxes you know he was getting paid as a salary instead of as a sub and so we were actually having taxes taken out so it wasn't as bad there was a time that i put i did deposit some money in um right but

let's talk about how to get out of it let's talk about that um my my that's my question okay so uh uh the the construction business that you have now is it just is it just your husband and he's hiring a bunch of contractors and he's kind of a one-man show but hiring other people on or do you have employees we have employees and we are we are taking um a salary now and um and paying taxes on it we're taking it we're taking a salary now and paying taxes on it. We're taking it. We're taking it. Okay. So what do you guys earn every year? Just you guys as employees, what do you earn?

Well, this is like I said, we just started back in April with this. I'm just trying to get a sense of what your income is so that we can know how to pay this off. So nine, our, our,

our monthly income after we pay the tax after taxes that take home is 9 144 a month okay and then uh you know talk with your accountant but do you guys is your business how much retained earnings do you have in your business um well like i said we just started it back up in April, and we're doing really well. So as far as retained earnings and all that stuff, I don't know yet. So I guess what I'm saying is after you pay everyone, what's left over as profit?

Well, like I said, right now we have a couple of jobs, and they're ongoing. We get paid ongoing as we do them, and then we pay the employees. I mean, we don't know what the profit is yet. Okay, then you keep saying the jobs, the business is going great, things are going well. You have no idea. It is. Well, here's the thing um uh it i do put books on and i i i don't know what the profit is yet we have fifty six thousand dollars in the bank and we don't have

any other bills right yet okay fifty six thousand dollars would be profit if if you have i don't know what's coming yet right as far as as far as invoices and things like that? Right. He hasn't billed anybody yet for this next month. So that is what we had from the last payment from the last two jobs. But didn't you say you've been open since April? Yes. Construction, you know. Yeah. Okay.

I'm just trying to get a sense. Why haven't you written a $50,000 check to the IRS? That's my question. Oh, because we have to be able to keep that money in there to pay the payroll. So then it's not profit. Then it's not profit. Then your business may not be doing great. Here's what I'm going to suggest.

Here's what I'm going to suggest. Here's what I'm going to suggest. And then we have a contract. Hey, this is what I'm going to suggest. Okay, go ahead. I don't think you should be running the books. Correct. Because just trying to get a piece of basic information

has been very difficult. And I don't mean any harm, but it shouldn't be like that. And I think that's also what's contributed to some of this issue over time. And so if I were giving you a piece of advice today, it would be to hire someone to do your books that is that you're, you know, also overlooking with them. I'm not saying you take it off your plate and you just, you know, don't think about

it, but I'm saying that that's their job and they're reporting to you and you're also seeing what's going on. But I think that's going to help this enormously because the truth is right now, the time is not, you know, I would say the time is not to take profit and reinvest it into the business if it truly is profit. It would be to get this debt cleared so that you can keep your business and keep your life. And also you also taking some of your personal monies and starting to clean up this debt. Well, this is what I'm trying to ask. My question was, because I'm proud of the way we've come across. I don't, I'm not getting a lot of, we're still working on trying to get, it's, and my accountant said I'm doing a good job.

Okay. What's your question? That goes. So my question was, um, we have, I, my house, I owe $101,000 on it. I'm wondering if the best way to go to get rid of that debt is to refinance and pay, pay off. No, I wouldn't put your house on the block too. Yeah. You're rolling that equity into your personal home, which means you're leveraging your personal piece for a business. But we still have equity in the house after that as well. I don't care. You're now rolling that onto your most prized and heartfelt. That's your home.

I would not do that. I would not do that. I would not do that. I think that you're not going to listen to me and I think that you are going to do it. No, I'm trying to figure out. I mean, you know, like I said, our business just started back and we, you know, we were doing better than we've ever done in it before ever. Okay. So here's what I would do.

If it's new and you'll have $50,000 in the account and your husband hasn't even billed out for what's coming. No, no. Okay, we work. They're working on a job. We work so many weeks that he can make a bill that's good enough. We give it back. They give it back.

He's got two more jobs that he's going to be starting. That's where it's at. This is what I think we're trying to get to. Before you go borrowing money and leveraging your home, I want you to know how much of that $50,000 and how much of any invoices they're going to get paid in this month, I want you to know how much of that is profit because every single penny of that right

this second needs to be house on fire emergency. We got to pay the US government back before they put us in jail. And that's what I think. I think I'm not doing a great job of communicating. Great that your house is doing good. Great that your business is back and doing great. Y'all are at risk of going to jail for tax evasion. And I know that you sat down with an accountant and they gave you a number. You don't know what that magical IRS 10 key is going to print out and say you owe them. There was a guy that called in yesterday. I think they owed like $5,000 and they were already levying their assets. So I don't know how you've gotten away this far.

Right. But here we are. And so what I would tell you is before you start borrowing money to try to solve a problem, let's see what kind of situation you're actually in in sum. It may be that you have $30,000 a month in quote unquote business profit and you could pay the government back in just six months and call it good. That'd be amazing. Or it may be that all $50,000 of that is already spent for future payroll and things aren't that great. So let's get those real numbers before we start doing anything bananas. It's another show in the books. Thanks for joining us on The Ramsey Show.

We'll be back soon right here.