The Ramsey Show - App - You Control Your Own Path Forward. What’s Your Next Step?

Episode Date: November 6, 2024

Welcome to the Ramsey Show America. This is where we help you win with your money, win in your work, and win with your relationships. The phone number to jump in today is 888-825-5225. Alongside the fantastic Jade Warshaw, I'm Ken Coleman, and we're here for you today. And speaking of today, if I might speak to a very large and diverse audience for just a moment. Come on, Ken. Because it's the morning after. And the reality is, Jade, is all morning and even late last night,

I have been receiving texts and communicating with friends who are deliriously happy with the results. I have also been communicating with friends who are devastatingly sad. And I think it's important for this large audience to sit with that for just a moment and understand that's okay and that's normal to have those emotions. That is what makes a free society. Free is the opportunity to express with great passion, also show up and vote. And the reality is it matters a great bit, and we know that. So I was thinking of four words, Jade, to challenge our audience and encourage our audience. If your side won last night, be classy.

If your side lost last night, be classy. If your side lost last night, be hopeful. And if I could take those last two words, be hopeful, and challenge both sides of the aisle today, be hopeful, but be careful what you're hopeful in. I want you to be hopeful in you and your free will and your ability to achieve why you come to this show. And here's what you come to this show for. Freedom. You come for freedom in your finances so that you can create the life that you want to create,

that you can spend money on the things you want to spend on. You can solve the problems that you must solve problems in your life. When they arise, you come to this show because you want to have an opportunity to climb the ladder, to make more money, to be able to do those things, to make the difference in the world through work that you desire to make. And you come to the show because relationships are hard and you want healthy relationships. Because if we don't have a healthy relationship we have nothing and so that's why you're here and that's why we are here is to help you get that freedom jay so see i want to give it to you that's why i voted for you ken i i uh add your thoughts because you understand this situation as well.

Okay. I mean, well put. Well, Ken, you were created for this moment. Very well put. I think it's an opportunity for both sides to just be magnanimous and be a good winner and a good loser, if that's whatever side you're on. And begin today to focus on what you can do, which is what we preach here. What can you do to make your life better?

And to that end, we want to hit on some of the fundamentals here, because we believe that no matter who's in the White House, you can control the things that happen in your house and ultimately your life, Jade. Listen, truthfully, the blueprint doesn't change, regardless of who's in office. The good news is that what we teach is kind of based on principle and principles don't change. And so the baby steps don't change. And so just a reminder, especially for those who are maybe new to our show, or maybe you just need to brush up because you've been freaking out in your mind a little bit. Let's just, let's bring it back for a second. All right. So baby step one, you still need a thousand dollars saved. If you don't have it, get it. It's going to make you sleep better at night. You're going to be ahead of 56%

of Americans if you get out and get that thousand dollars saved. Baby step two, let's start focusing on our debt. The lowest possible rung of that ladder is just to decide that you're not going to borrow any money anymore. And so let's not make the problem worse. Maybe you don't feel like you're in a situation to start paying it off, but at the very least you can say, well, I'm not going to borrow anymore. Okay. And then once you move past that step, start paying it off using the debt snowball. And then baby step three, let's start saving up some savings. Three to six months is what we recommend. That's a fully funded emergency fund. And let me tell you something, Ken, when you have that, then things start to get good. You start to feel a lot better. That's that margin. By the way, that's where that emotion

of freedom pops in with that emergency fund, doesn't it? It does. Because you kind of go, no matter what hits, I feel prepared. And so you have that preparedness. And then baby step four, let's start investing. You start investing for the future. This is preparing you for a time when maybe you won't work because that time will hit all of us eventually. So we're investing 15%. All right. Hey, I got to jump in because you're the queen of this. What? I want you to give a real example. Maybe get your investment calculator. I didn't prep you for it.

That's all right. Come on. Get your calculator because I'm going to set a scenario up because I want people to get this. What Jade's talking about is, let's say that you're in your early 20s, Jade. I'm going to give you a scenario. So take somebody early 20s yeah maybe they're fresh out of college right now first job first presidential election let's make it real okay they're going what does this mean you know what i mean yeah and you go come on just pay attention to the baby steps right now and and they get it they got a good job and let's say that they have no debt uh-huh or they're thinking okay if i follow what jade says I'm going to start putting some money in.

You create your own scenario of what Baby Step 4 really looks like for every American. You take it away. Okay. So let's pretend. I mean, set me up better than that, King, because I don't know exactly where you're going. I'm sorry. So let's say we've got a 27-year-old. Okay. So I'll put 27 in the calculator. All right. Okay. And let's say that they can put that they're in baby step four. Okay. Or that they see what would it look like in baby step

four? Let's put it that way. You're not there, but you go, okay, what if I could put away, let's say 15% on a salary of, I'm going to make this up. Let's say we're going to put away two grand a month. Two grand. That's a lot. Go a thousand. I told you, you're the queen. A thousand bucks. Let's do 500. See, this is why I defer to you. You're the queen. Well, let me see what I'm going to base it on. I'm going to base it on the average salary, which is 67,000. Like what you're doing. And then I'm going to say 15% of that, because we take it off the gross, which is 10,000. And then I'm going to divide that by 12. By 12 months. I love it. And that's going to be $837. So we'll do that. And to be fair, I threw this

honor, but that's okay. You see where we're going? I want people to not just hear that. I want them to see what you're about to do. The idea is that you've not had anything in retirement up until this point, you know? And so you say, okay, I'm going to start doing that. And lo and behold, you retire with $4.1 million. okay there it is that's all i wanted yeah so the dream is the the dream is alive and well all right keep going baby step five i'm sorry i interrupted your rhythm but i like that i i like that people need to see that the the dream is free the hustle is sold separately you got to do the work all right baby step five now you're saving for your kids college and you're getting them into education which is good uh baby step six let's pay off that home early, Ken.

Wow. That's a game changer when that happens. Yeah. And by the way, we have a really cool stage here at Ramsey Solutions. It's the debt-free stage. And people come in and they tell us when they become debt-free and they scream with just that intensity. And half the time, they've also paid

off their mortgage as well. So true. And so this happens every day. And then baby step seven is living and giving like no one else. This is us prioritizing generosity because it's such a foundation of everything we teach here. Usually your why lives in baby step seven. Come on. So here's what we want. Jay did a masterful job of laying out the fundamentals that lead to financial freedom. There's more. Our team has put together a great blog post. It's in the show notes.

And here's what's going to encourage you. Emotionally, it's going to encourage you that no matter how you're feeling about who's going to be in the White House, you can take all that stress and worry and put it into steps to actually take control of your life. And we are here for you five days a week, cheering you on. Go get the blog. It's a deeper dive from what Jay just did, and it's going to really equip you, not just encourage you. Go get it in the show notes, however you take in the show.

All right, quick break. We'll be right back with more of The Ramsey Show. 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, 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 invest all this money properly and not mess this up, or she's concerned how she's going to eat tomorrow. 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. Alongside Jade Warshaw, I'm Ken Coleman. So excited you're here with us on the Ramsey Show, helping you win with your money, win in your work, and win with your relationships. That's our aim, and we'd love to coach you today. 888-825-5225. Also, big news. It's like Dave is like the financial Santa. Guy loves Christmas.

You know this about him. Dave Kringle. Yeah. He gets a bad rap about being tough on callers. Guy's just a big jolly giver. And to look at this, 50 days of Christmas. Wow. Is that not enough, Dave? 30 days not enough? No, we got to go 50 days of Christmas. That's a lot. That's the big Christmas sale. And it's happening now. Whether you're shopping for yourself or you're looking for that gift that keeps on giving, a la Christmas Vacation, those of you, if you know, you know. You can get up to 30% on our best-selling products. That is including monies, not a math problem.

Tell them about that, Jade. You know what that's about. If you're caught up, if it's your mentality, that's a problem. If you're always, we ain't got no money. I don't have a way to get ahead. This is the book for you. I love it. I love it is that we ain't got no money. A lot of people are going, when I say that, they're like, that's what's in people's brain all the time. I ain't got it. So that's a great book from Jade. And then the Get Clear Assessment. This is for that person who's going, I want to figure out what I want to be doing with my professional life or I'm stuck. Any sense of doubt or lack of confidence around your work and

your money, this Get Clear Assessment. It's about 18 minutes. It's going to change your life, give you self-awareness, which is a superpower. You can get both of those products and so many more at ramseysolutions.com. Ramseysolutions.com. For those of you on YouTube and podcasts, you don't have to remember any of that. You know why? Because James Childs and his beloved show notes. These show notes are chock full. It's like Christmas under the tree. Just go to the show notes. Lots of good stuff ramsaysolutions.com slash giveaway is another location and this is also in the show notes because this is our five thousand dollar cash giveaway okay show me the money we're giving away five hundred dollars a week wow that's dave's

money gone just giving it away wow uh and there's a grand prize of five thousand dollars you can enter to win daily and again uh the show notes best to go, ramsaysolutions.com. All right. Corey's going to start us off in Des Moines, Iowa. Corey, how can we help today? Hey, Ken. Hi, Jay. Thank you so much for taking my call. You bet. And so I started out, I don't know how far back I should go. I buy and sell real estate, not as an agent, but as an investor. Got pulled in many years ago with the OPM, other people's money, borrowing and taking out HELOCs and all sounded great, buying a lot of properties, and it has all caught up with me. Oh, no. Yeah.

What does that mean? Tell us what's happening currently. Well, I'm currently sitting with all my monthly expenses, sitting at about, well, total debts of about $1.1 million right now. Woo! Woo, hello. My goodness. Where are my Tums?

Okay. Well, hopefully these are worth something. Got a lot of my properties are bundled. It's not like every single property is its own mortgage. They're bundled. So I've got $480,000 in one mortgage, $199,000 in another. Got a HELOC at $189,000. Another mortgage, $173,000. They add up very, very, very quickly.

So can I just ask you just a crazy question? If you were to sell, I don't know how many you have, but if you were to sell them, would you clear the million with their equity? Potentially, and I have already started that, which brings me to another one of my questions. I did get the EveryDollar app and have everything in that. Still struggling on how to figure it out 100%. That would probably be another call for another day. But I am showing with my current budget. I've got, because I have sold, I've sold a couple of them.

How many do you have total? 22 units total. Wow. Okay. 22 units total. Um, some of them are sold on contract, just waiting to be cashed out on, uh, one. I just, uh, did fully sell, um, put that money out. I sold another one on contract, had about 50 fifty thousand down payment on that one with a good cash flow every month on that one. Listen, you're going in the right direction. The solution here is that the debt, which is what you opened with, is what's causing you anxiety. And rightfully so. One point one million dollars is a bag. That's a lot of money. Okay. And so it makes sense that that's weighing on your chest or on your shoulders or in your gut, wherever it is that you're feeling that

on a day-to-day basis. And the solution here is let's offload it. Luckily, you have a bunch of assets that you can sell and sell for more than what you paid for, right? That's the whole point. And so what I would do if I were you is I'd go through these 22 units and I'd figure out what's going to give me the most bang for my buck when I sell it. And are there any of them that are cash flowing well that I can keep and, you know, kind of continue to do this. But from now on, I'm paying cash for my properties. And so you had this kind of dream. It sounds like a being, you know, some sort of real estate mogul. And you just went about it the wrong way, you know, and I think that estate mogul. And you just went about it the wrong way, you know. And I think that it's not too late to go in reverse and get this thing right side up.

Ken? That's exactly what I was hoping for. Get some of them sold and maybe I can end up with three or four of them that's fully paid for. And let's just caveat, That is far more successful. I'd rather you have three properties that you're not in debt and you feel good about having them. That is far more of a place of success than being able to say, I've got 22 properties, but you're carrying all this debt and stress attached to it. So where I'm at right now is my account in the every dollar shows I have left a budget $21,000, which is great. Great to have that

cushion right there. But I do have that $180,000, $189,000 HELOC. I do not have a first mortgage on my home. So I've just got the HELOC on it. What my plan is, and correct me if I'm wrong here, what my plan is, is it's a HELOC. It what my plan is is it's a heloc it's just an interest-only payment i'm not making any interest any principal payments or not at all i haven't been for several years but i've thought about yeah but of all the properties here i'm going to emancipate your personal property first like that's the one that needs to be paid off free and clear so that you can live without stress. And then everything else is being sold for parts. Like, all right, this one, it doesn't cash flow very well. I can get 80,000 for it. I'm selling it. This one, you know, it does okay, but I hate the location. I'm going to sell that.

I'm going to make 120 off of it. Right. And that you're going through the order of priority. Your home is the most important home. And then everything else is on the block. The chopping block that is so you don't think it's a good idea to just put that into a regular mortgage i mean uh in this case no because you're going to sell a property and you're going to have the cash to pay it off immediately so at that point the interest rate the mortgage you're not going to have a mortgage on your house gotcha because the steps i've been using was to pay off some of the uh uh credit cards and stuff like that oh well how much other debt do you have we didn't talk about that tell me more we we didn't

yeah the uh let me just do a little check here just in the property debt is a million so the other 200 000 the other 200 000 is like the credit cards the other $200,000 is like the credit cards, the vehicles. Okay, so here's the order you're going to go and Ken, jump in at any point. The first property that you sell, let's pretend you clear $200,000.

You're going to pay off this debt and you're going to keep $1,000 aside for emergencies. By the way, do you have any money saved anywhere yes i do i've got uh it's not a thousand it's 2,500 because i've got so many properties fine i'm not i'm not concerned about that right now that's i'm not going to take you to task i've got 2,500 status side and a separate account that I don't mess with. So we sell off the first property. We clear the consumer debt.

We sell off the next property. We keep three to six months of expenses. We sell the next property and we clear our house. And then we pay off. We sell enough properties to clear all of this $1.1 million of debt. And I think you have it out of these 22 units if you've done it anywhere close to right. Follow the plan, the debt snowball.

Let's give him a copy of, excuse me, Total Money Makeover. Yeah. Just follow the process. Read that, it's classic. She's laid it out for you. But yeah, the thing I was going to add is I like his attitude.

Yeah. What could hinder somebody from getting out of this mess is feeling like they're just idiots and they're not. They're normal. This kind of stuff happens. And he admitted it. I think his mindset is good. Yeah.

He's not beating himself up. Corey, don't fall prey to that. Just follow the plan. And before you know it, shoulder's going to go back even further. Head's up. And you know that you're walking out of this. Great advice, Jade. All right, quick break.

We'll be right back with more of The Ramsey Show. The Ramsey Show continues. Alongside Jade Warshaw, I'm Ken Coleman, 888-825-5225 is the phone number. We'd love to take your calls. Jade's our money specialist today, and I'm the work and leadership guy today, helping you in those areas. We're both going to tag team on these financial and relationship issues as well because they're all tied together. Greenville, South Carolina is where we go next.

Stephanie is joining us there. Stephanie, how can we help today? Hi. Thank you for having me, Ken and Jade. You bet. What's happening um i am reaching out to ask a question about i own a business and i'm trying to implement a 401k or a simple ira plan and i'm wanting to know the best things to look at what to look for what are the pros and cons um just some direction with this okay um

what kind of business is it in, you know, is it just you or do you have employees? Tell me more. I do. I have a team of seven that includes my husband and I, the business was started in 2016. It's for pest and wildlife control. We are mainly as far as income is concerned, wildlife is about 80 percent of our income and pest is about 20 percent we added that on about two years ago um but yes seven 17 members total okay um if i were you there's a couple of different routes you could go um and i i don't want to lead you astray i think that it all depends on how much like what the max contributions are how much the business is going to match that versus the uh what you what the employer puts in or what the employee puts in i'm sorry

and so for that reason i'd probably work with a i'd work with your bookkeeper or i'd work with a somebody who's going to be able to give you better tax information than i would i could tell you kind of on a basis if you're kind of more of a solopreneur what you might do. But with this, I'd want somebody to really look at the numbers and tell me what's going to work best for me tax-wise and investment-wise for me and my employees. Yeah, I think Stephanie, neither one of us are great experts on this, but I think we can tell you what to do. what Jade said. And I think, again, a tax pro, somebody who works with businesses. So you can get tax pro information at ramseysolutions.com in your area. Go talk to a few. They want to specialize, obviously, in small businesses and how they

help with some of this stuff. They may have some insight into this. Investment pros as well. And then you know what I would be doing? I would also be talking to small business owners. Do you happen to know of two or three people, top of your mind right now, that run companies around the same size as yours in your area? I do. I've talked to several people about this. Y'all are actually one of my last phone calls. So I went down the road to implement a 401k. And when I walked into my bookkeeper to just kind of talk to, or my CPA, who does my bookkeeping as well, she immediately said, you need to go with a simple IRA. Now, this year we've experienced about 150% growth.

Good for you. That's awesome. That's my only concern. Yeah, I mean, it really has been amazing, but making a good decision, I guess maybe I'm viewing a simple IRA as a little more limiting than a 401k. In what way? So just looking in the way of like a 401k, you get vested. There's matching in both programs, but you have to match with a simple. That's right.

You don't have to. The opt-in happens with the 401k. So some of those styles of the plan make more sense to me with the 401k. And that was the road I was going down. Why did she say simple? She said simple because she said, why are you going to pay the fees of a 401k? Just put the money into your people's plan.

That was the first word. I like that too. I was going to give you a formula to go get answers on this. What's best for the business? What's best for the people that you've hired? And I think that that's your, I always try to take complexity and I simplify it and I go, if I'm looking at all this, I'm going to have a simple piece of paper and I'm going to draw a line down and I'm going to go, okay, which one of these plans is best for this business? And which one of these plans is best for the employees? And we want to try to find a solution that is good for both. I think that's the rubric. If she's right and the math

is such as whatever you're paying in fees is pretty much comparable to what you'd be paying in a match, yeah, it'd be better for the money to go to your team members that's what you want to get to what's good for both okay and if we can get best for both great but if there's a give and take we want to we want to land that way because you got a great heart for your people i love what you're trying to do and by the way i just want to give stephanie a shout out real quick uh this is awesome to talk to a small business owner this is a female small business owner taking care of the critters. Yeah, very, very good. And growing 150%. That's awesome.

So yay, Stephanie. Can we give her some love? I mean, that's really awesome. She's providing jobs. This is the American dream. Yeah. That right there. She's a small business owner solving a real problem.

And so I love that. Good stuff. All right, next, let's go to Richmond, Virginia, and Jennifer is there. Jennifer, how can we help? Yes, thank you. My situation is I have $275,000 to buy land, build a house, and everything, furnishings, everything. That's all I have. And it's cash.

I'm not going to have a mortgage. And it's proving difficult to budget for that. I'm wondering if I should rent for a year. And what I do for a living is I buy real estate. I improve it and sell it and do that for a year with the cash that I have to try to build up a little bit more for my ultimate home. Well, yeah. How much do you need? Well, you know, it's land is so hard to find and so expensive so i would be more comfortable at 375 okay and you've run out the

numbers because what i want i want to make sure we're fully in with detail counting the cost of this so that you don't enter in and realize oh gosh i don't have enough money and now i am kind of considering debt when that's not what you said you wanted to begin with so i really want you working out the numbers to go, okay, if I spend X on this land, what can I then spend on the build? And is that enough to get me what I say I want plus furnishings, right? So we're doing a detailed, in many ways, just a detailed budget on this that's directly for this home build.

Right. The tricky part is I'm not tied to any specific area, so I'm looking in four different states just for something available. Inventory is very low right now for raw land that's decent. Are you operating with cash? Jennifer, when you say I'm going to rent for a year and I've got to buy some more properties and flip them and then create more cash, are you doing that with cash?

Yes, I am. I'm in my early 60s debt-free. My monthly expenses are $1,500 a month. I love that. They will double with rent. That's all I wanted to know. Yeah. I like that strategy.

You have such a low burn rate and you're debt free. And I love that you're going to be patient, flip a few more properties, stack some bigger cash, get the house I want that I've earned. Come on, Jennifer. I'm totally fine with renting in this situation. And listen, what I want you to do is we have a really great real estate home base that could probably help you out when it comes to finding the land that you're looking for. So if you go to ramseysolutions.com slash real estate, they're probably going to be able to get in there and help you find the attractive land that you're looking for. Yeah. So. Okay. Yeah. I've averaged 75K take home over the past seven years. So it would take me, you know, a little over a year to get what I need. But then,

of course, expenses are going to go up too, probably. They are. And I do think that you have to balance that carefully. And just hear me say, I think the best way to buy a home is cash. That's great. A lot of people can't do that. But no one would fault you, Jennifer, if you ended up having a $30,000 mortgage or a $70,000 mortgage. I just want to give you that piece of this that if you don't want to wait another two years, you'd be all right. You wouldn't yell at her? I wouldn't yell at her. I also thought about buying the land and just parking an RV on that.

And that way I'm not spending money on rent. That's where I and that's where we drift away. That's where you and I drift away on ideals only because the goal for you right now is to save up money. And with the RV, you are having something that's depreciating and I'd hate for you to tie even more money up in that. Um, I mean, obviously it's your life and if you're the RV type, you know, buy something very, very used and very, very inexpensive. But I tend to like the idea of you renting a little bit better. Yeah. There you go. All right, Jennifer. Love that call. Boy, she's making things happen. Yeah.

60 years old, debt free, got her own little real estate empire. Would you do the RV or the rent? You know, I was thinking if it's a nice piece of land that I'm going to do, I might put a... Airstream. No, a cool little shelter that could be multi-use. Live in that for a little while. A shelter. Then it makes the property better.

A shanty. This is The Ramsey Show. Welcome back to The Ramsey Show. Alongside Jade Warshaw, I'm Ken Coleman. Phone number is 888-825-5225 to get coached up. The Ramsey Show question of the day is brought to you by our friends at YRefi. YRefi refinances defaulted private student loans that other places won't touch and gives you a low fixed rate loan built just for you.

Sharice Kay, she took advantage of this and lowered her payment from $2,000 to $680 a month with YRefi. So you need to go to YRefi.com slash Ramsey today. from $2,000 to $680 a month with Y Refi. So you need to go to YRefi.com slash Ramsey today if that's you. And you can learn more there. That's the letter Y, R-E-F-Y dot com slash Ramsey. It may not be available in all states. All righty. Today's question comes from Andy in Delaware.

My fiance had a lot of debt related to a prior divorce. She's currently living with her parents and her parents used a little cash and 10 credit cards to pay off her debt. So now she owes them close to $75,000. I know legally most of this is not in my fiance's name, but morally we owe it together when we get married. I didn't agree with how her mom put this debt on credit cards, and it doesn't sound like they are paying much more than the minimums right now. My plan is to take out a personal loan after we get married to pay off her parents in full, so I have control over the debt completely. This would drop down the interest significantly. We could then attack it with both of our incomes to pay it off as quickly

as we can. Would this work or is there a better plan? Okay. So just to clarify, there was a divorce. She had debt. Her parents said, we'll take care of it, but we're doing it with credit cards. And you're like, no, when we get married, we're going to take out a personal loan to clear it. I don't necessarily like that method. I like that you're saying, hey, after we get married, then we'll tackle it together. That is right. So green check on that. I would not do the loan. The truth is you're only on the hook for the $75,000.

You're not necessarily on the hook for any interest that is in crude because of their method of paying for this. That part is on them because they chose that route. They chose that card with that interest rate. Unless there's a conversation that I don't know about, in my mind, I'd be like, I owe you $75,000. Ken? I couldn't agree more. It's a lot easier.

They've already assumed this debt for her. This is not something that she put on them. They did this. I would pay the parents directly, and I agree with Jade. I wouldn't worry about the interest. That's their problem. I think they'll be thrilled that you guys are serious about paying it off, and I think it's a lot easier to pay them off.

Now, I would only say the caveat to that is you both need to agree, you and your fiance, that we aren't skipping this. We're going to treat this like it is a private loan, like our credit would be affected, like they'd come after us with collections, all of the things that people that loan money put in place as some sense of accountability. And I think that's the key or else this could create tension. And I don't think that's the case here. I think this is like, we want to get this out. I love the urgency, love the character and the integrity here but i agree with jade 100 pay the parents directly here's the problem i do foresee is that he he's already noticing hey her mom put this on credit cards

and this is him speculating it doesn't seem like she's making payments so or he says something there were you know the minimum yeah they're minimums. So I do foresee a problem of down the line, them saying, well, we did this, but it's the balance has grown. So I do think you need to have some sort of really, really clear conversation about how interest is handled and how that part is

not pertaining to you. And, and records, records, records, records, records, I would treat every payment that's sent to the parents.

However you choose to do it. I would have that in a's sent to the parents, however you choose to do it, I would have that in a journal, a financial record. Your bank would easily give you that. I would do that so that it is tracked if you have the conversation that Jade is recommending, and I agree. Because again, they could do something dumb with all that $75,000 and not pay off the credit card. But at that point, ain't my problem. And let it be known, when Ken and I talk about you having this conversation, we really mean your wife, not you. You need to stay far from this conversation and let her speak for both of you because otherwise this could get grisly.

Let's go to Detroit, Michigan, where Nick awaits. Nick, how can we help? Hey, Ken and Jed, thank you for taking my call. I had a question about having dual employment. The reason being was we have three boys, seven, six, and three.

So we're in that messy middle and I wanted to give my wife the opportunity to be a stay-at-home mom. She was a nurse to begin with and then once we had our third child I just said might as well stay at home we can survive with my income. Now that she took advantage of her or she took advantage by herself going through her master's to get nurse practitioner and And she just completed the program.

And you told her to stay home? Yeah. Hold on, hold on. I did. Okay, so can you go ahead? Yeah, keep going. I'm sorry, go ahead. Yeah, keep going.

Get to our question. Yep, okay. So I work for a fire department, and I make about $110,000. And then I also have a family business where I make about $100,000 as well. Obviously the fire is pension and then the family business is just straight salary. There is a simple IRA that I can contribute to. My question is, now that she has her nurse practitioner license and we have no student debt, am I crazy to leave my fire department employment and give up my pension opportunity and allow her income to supplement my loss and, you know, obviously strive to make more of the family business or do I just grind it out with both employments if I can manage it? All right, so how much is she going to make as a nurse practitioner?

I would hope about $140,000. Okay, so $140,000. And the family business where you're making $100 right now, do you own that, or are you working for another family member? For my dad. Okay, and is that what you want to do long-term? Let's go 15, 20 years from now. Do you want to be a fireman and be in the business,

or do you just want to be running that business or not in it at all? No, and so that's the unique part is in about five years, I had the opportunity to leave the fire department under a full pension, or I'm able to be, I can pull out from the pension. I know, but I'm not focusing on that. I'm asking, do you want to be long-term owner or involved in the family business? Yes or no? Yes. Yes. I mean, that's the dream. That's what you want, right? Yes. Okay. So what would benefit you leaving the fire department right now? Forget the pension. I know you're all hung up on the pension. I don't really care about the pension.

I'm not minimizing the pension, but we don't make decisions based on pensions. Okay. So my question is, if you leave the fire department, that's a certain block of hours every week, and you just focused on the business, would that allow you to do more and get paid more in the family business? Yeah, there would have to be a discussion, but yeah, absolutely. I'd have the discussion. Dad, if I walk away from the fire department and I start full-time and I'm all my energy in here, what's that look like? This is very simple. Stop thinking about the fire of pension because if you walk away from the pension to make your life better in the now and the next, nobody cares about the pension. I want to know where does the stay at home mom

who was going to be a nurse practitioner fit into all this? Because that was the thing that made me be like, wait, what, what, what? It sounds like she's back in, right? To work? Yeah, no, and that was the goal. I mean, that was her personal goal was to become a nurse practitioner. Okay. And being a stay-at-home mom, it gave her the opportunity to just focus on school and nothing else. So she's excited to get back in, and does she have a gig? She's currently seeking. Okay, cool.

Okay, okay. Yeah, I walk away from the fireman position. You're only in it because of this pension. It's the only evidence you've given us as to why you'd keep doing it, and I just don't think you need to keep doing it. Now, you can if you want to, but if I'm trying to grow in one area, which is for you as a family business, every second I'm spending in the fire station is taking away from that long-term goal.

And if your wife makes $110,000 and she's replacing the fireman salary, bingo. This is a no-brainer if it plays out the way that you want it to play out. Maybe wait until she gets the gig. I'm afraid to pull the trigger. Well, don't pull the trigger until she starts making the money and she's in. No, absolutely. Yeah, man, you got this. That's interesting.

Yeah, I was confused in the very beginning, but I also jumped the gun, so that's why I was confused. Yeah, you got a little fired up there. I know, I did. You thought that was going a different direction? I did, I did. Don't tell me what I can do. Is that what I heard?

Yeah, yeah. I digress. She's a strong woman. Hear her roar, folks. Good hour. 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, never down. So when you're ready to buy, make sure you work with a mortgage partner you can rely on. Churchill Mortgage. Churchill is Ramsey trusted to help you make the move from renting to home ownership wisely. Churchill understands that when you buy

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Welcome to the Ramsey Show where we help you win in your life, America. We're going to help you win with your money, win in your work, and win with your relationships. Alongside the fabulous, the incomparable, Jade Warshaw, I'm just simply Ken. Ken Coleman. You get a last name. Coleman. Yeah, there you go. Glad to be with you, my friend. Always fun. How are you feeling?

How you feeling about the future today? You know what? I am quite hopeful, but I would have been hopeful regardless of who won this election. I know you would have. You know, I'm all about that. I know. You know why? Because you and your hubs paid off almost half a million dollars.

Okay. In debt. You're a former D1 volleyball player. You are a mom. You're a wife. You're a successful person. You just. You are a mom. You're a wife. You're a successful person. You just ran a marathon. Thank you, Ken Claremont. For crying out loud. Why we haven't talked about that

enough? I don't know. Did you set a PR on that? America wants to know. It was my personal best. And my only best. And my only marathon. Oh, I thought for some reason that you had run one before. I've done many halves. So as of right now, it is a personal record. That's right.

And we will call it that. Yeah. I was impressed because, folks, I saw her Instagram post on the day of the marathon. I believe it was a Saturday, as I recall. Yeah, it was. And you posted that you were laying down. You're like, I ain't doing anything. And I laughed.

Listen, I had my hair tied up. I was out. But Monday morning, I was at my desk. And who comes confidently striding in to her desk? Yeah. No limping. Yeah. You want to know why? Because I did the training.

I know. I trained. But I also think you might just be a little bit more blessed, athletically and physically. Because I was really in pain after mine. Half marathon. You did a full. I'm trying to build. You didn't remember I said to you, I was really in pain after mine. Half marathon. You did a full. I'm trying to. You didn't remember I said to you, I was like, are you not sore? And you

looked at me like I was like, no. Ken, I'm trying to build an analogy here for the listeners. Help me build. I don't know what it is because I don't know where your head's at. I'm saying that I did the training. I did the steps ahead of time. So when the race day hit. Yeah, it didn't wreck your body. Yeah. Regardless of the outcome outcome i was all right i agree well i'm proud of you you and sam both do you see my analogy that i'm building here ken yes okay you did the training the baby steps yes i'm with you sorry so when the race i didn't want to step into your thing i thought you were gonna finish it i didn't know you were looking for me to like jump in on i wanted you to be like jay that was great oh you threw me a bounce pass and i was supposed to dunk

it yeah i missed it when the race day came no matter the outcome i was prepared you were prepared and that's you american people you had the emergency i was trying to make this so it wasn't just you and me rambling well i'm proud of you all right aaron is up next right here in the neck of uh i don't know what i'm saying i forgot how to talk our neck of the woods n Nashville, Tennessee. Aaron is joining us. Aaron, how can we help? Yes. First off, great to be on the show. Y'all are great.

Thank you. But I have just filed for Chapter 7 bankruptcy. I was working three jobs. Now I'm down to two. And I'm about to have my car repossessed just now i've got a turn on my bills and i'm really wondering what i should do next did you already file has it already been approved it's been filed okay so i should know when the next month or uh back next month uh when it gets strong. How are you doing real quick?

Let's just get a quick check on your head and heart. How are you holding up? I'm doing okay. I've just been working 70-plus hours a week trying to work my way out of it. Oh, man. Okay. All right. Well, we're going to help.

Hang in there. Here's my point. Your life is not over. You can come back from this. So you filed the proceeding. Can you and they said the next step is 90 days after it is filed. I should have the dismissal of everything. How much was it? How much was in the bankruptcy? bankruptcy so uh i had about 43 000 in debt uh about 33 of it is going to be uh dismissed from the bankruptcy okay so that leaves you on the hook for 10 about 11 with student loans yes oh yeah

because yeah student loans are not bankruptable so man tell me what caused you to get in a situation where you'd file bankruptcy over $33,000. Tell me more. Well, I was pending over $1,000 a month between the car payment and insurance. And then I was working a restaurant job at the time that just hit the slow season, started making $300 or $400 in a paycheck instead of $1,000 plus. Okay. So where I went for a new job at that point

and to get more steady pay, I actually still work at that restaurant on Saturdays only now. Okay, and what do you bring in every month? Because what I'm getting at here is I want to make sure whatever caused this has been rectified because otherwise you'll be here again. And I don't think people realize that. I think sometimes they file bankruptcy and they go, okay, I've solved it. But what I found is people who do it, a lot of times I've done it more than once. And so I want to make sure we solve that at the root.

What are you earning every month now? Right now, I just now got off a training pay, so it should go up. But I'm making about, I'd say, $4,000 a month between the restaurant and the exterminator job now. Okay. And that's more than what you were making before? I was making more during the high times. It just wasn't steady. Okay. And tell us about your living situation. What's your rent or mortgage? Rent is 950 utilities included. Okay, good. That's at a good spot. Um,

yeah, I just, I mean, you're in this now. Tell me again, did you say chapter seven or chapter 13? I was, it's chapter seven. Okay. Yeah. So they're just liquidating everything. Um, yeah. I mean, at this point you're in it, you're not going to be able to stop it. They're going to give you a payment plan. They're going to take whatever they can sell and sell it and pay down this. And then you're going to be on a payment plan basically for the rest. There's no payment plan with chapter seven. It's just dismissed. Are they giving you a plan for the student loans or you're on your own for that? I'm on my own with that. Okay. Yeah. So you're 10K in. and so the plan now is let's pay this off as quickly as possible. The big kicker is the vehicle.

Part of the bankruptcy is that I lose the vehicle, and they hadn't taken it yet, but it actually just lost an axle while I was driving it the other day to where it's not usable right now. Oh, my gosh. I do have a work vehicle for the exterminator job. Yeah, but you have to use that only for work. Are you going to be able to get to the restaurant? I have a guy who lives in my neighborhood that's been giving me a ride there and back. When I don't have a ride, it's anywhere from $70 to $100 to Uber there and back.

Well, the good news is the $33,000 was dismissed. And so with your $4,000 a month income where your rent is right, where it should be at around 25%, now you've got margin back. So how quickly can we save up to get something in cash? Because that debt is gone. In many ways, you got what you wanted and that debt was cleared. But now it's at the expense of you completely rebuilding from scratch yeah so the we we cannot and i i can't stress this enough we cannot do the same actions that caused this so you cannot go into debt for this vehicle you've got to figure out what that means is that i'm getting a ride from my buddy until i can save

up three thousand dollars to get the most beaters beater that i can find is that i'm ubering is that i'm picking up a third job? Whatever that is, you cannot create the same problems that got you into bankruptcy again. All right, quick commercial break. Back with more of your calls, America. She's Jade Warshaw. I'm Ken Coleman. You're listening to The Ramsey Show. This show is sponsored by BetterHelp. All right, so I was born and raised in Texas, and I love the myth of the lone cowboy. You know, the guy who doesn't need anyone or anything.

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slash Ramsey Radio. Welcome back to The Ramsey Show. I'm Ken Coleman. Jade Warshaw joins me. The phone number to jump in for you today is 888-825-5225. 888-825-5225. Okay, short quiz for you, Jade. All right. What is the best way to make the most of your money? Every dollar. All right. What is every dollar? Every dollar is the best budgeting app in the world. Nice. Even though I just said it in the rhythm of Ja Rule, it's still the best budgeting app there is. We created it here at Ramsey and it truly is. If you're a person who was used to pen and paper, if you're a person who was a spreadsheet person, this covers all of those bases. It gives the simplicity for the pen and paper person, but it also gives the nerd out feeling for the spreadsheet person.

And so I think it covers all those bases. And then if you're a couple, it's great because it covers the communication part of it. I like it. That's a good break. You know what I'm saying? I like that. Download Every Dollar for free in the App Store or Google Play, or click the link in our show notes if you are on YouTube or podcast. Yep. All right, let's get to Grace in Cleveland, Ohio. Grace, how can we help

today? Hi, you guys. Oh my gosh, thank you so much for taking my call. You bet. Okay, so my question for you guys is my husband and I are on baby steps four, five, and six, and we know that you're not necessarily supposed to be gazelle intense all the way through steps four, five, and six. But we are wondering since we're such a young age, if there's ever a situation where it is appropriate or makes sense to stay gazelle intense through paying off your mortgage. Yeah. You know, it's funny. We get this question a lot and I'll tell you what I, Jade's opinion. My opinion is if you were a person like sam or i who you know baby step one two and three took you an inordinate amount of time right you were doing it for four years or five years or even three three years of really being laser focused you got your head down you're sacrificing at a deep level

yes when it's time to go to baby steps four five and six you need to chill out you need to take a chill pill you need to move intentionally not with intensity you deserve because you deserve to enjoy some of the fruit of your labor life is life is your life and you don't enough it's hard enough like you've you've done the hard part now you get to say okay let's enjoy this a little bit we go on a vacation we buy a new couch but we're still being intentional and figuring out the rhythm of when we're going to do extra payments whether it be to 529 or to the house. Now, if you're a person who you're like, you know what, I kind of just automatically avoided debt and I didn't have much of it. And when we found the baby steps and figured out that there's this idea that you could pay

off the mortgage too, we never really had that head down laser focused time period spent on debt and savings. Then yeah, I could see where you could say, you know what, for us, this is kind of our baby step two vibe for this mortgage. And I'm not mad at that. And I don't think, do you see what I'm saying? As long as you and your spouse are on the same page and you go for us, this is that moment. I'm not mad at that. But- What's at the root of that question, Grace? Because I think it's interesting that you ask us, can we remain? It's almost like you're looking for permission, or maybe your spouse is looking for permission. Tell us what's behind that question.

Yeah. So it took us about a year to get through baby steps one, two, and three. So we did it pretty quickly. We are on a two-income household income right now. And we had a surprise baby. He's six months old now. And I would love the opportunity to stay at home with him like my mother did with us. But right now I am the breadwinner of our home. So it's just not possible with our expenses for me to just completely stop working. And I want to be financially responsible for just the future of our family. But if we have another kid, I would love to be able to stay home. So kind of the root of that is we calculated that we would be about three and a half years out if we are gazelle intense to finish the mortgage. So it would take us four and a half years total to get to baby step seven. And then at that point, we wouldn't have a mortgage and I'd be able to stay home if we decide to have more kids well then of course why then if that's that's all I asked for that you know what the answer is you were calling us kind of looking for permission yeah this was a question of values you don't need our permission uh it's your life I love how Jade answered it I agree with what she's

saying there I think in this case you're okay you don't feel like you're overheated and you've got a really great why. And I just think motivation is not an issue for you guys. So yeah, I'd go as hard as you guys want to go on that. How old are you? Yeah, my husband, I'm 27. So you'd be 30 and a half with a paid off mortgage? Yeah, we'd be on baby steps seven at 30 and a half. My husband was like, his income's kind of uncapped with what he does. So he was like, I mean, from age 30 to whenever he decides to retire, he's like, I could put more than 15% into my retirement at that point because we wouldn't have a mortgage because we busted our butts. Now, do you guys have a plan to replace your income with his growth or get close to it?

Yeah. So right now we're at $170,000 between the two of us. I'm 27, he's 28. And his income should definitely easily hit that throughout the course of his career. Well, but how soon? So let's fast forward your timeline. Do you think he could get to a place where he's almost or has replaced your income or surpassed your income by the time you got the house paid off? Surpassed mine? Yes. Surpassed both of ours total? Probably not. But he also, we both have like side hustles that we have started doing on the side. And I think we're starting to get a little more intense with them.

So we have the opportunity to add an extra two thousand. And I may not have asked it well, but I heard what you said. By the time you pay the house off in this timeline, he's not going to be making what the two of you make together. So my follow-up question is, and I think I know the answer, will you guys prepare for that and adjust your lifestyle so that doesn't put you under pressure? Because what you don't want is to be jacked and excited about coming home with the babies but then feeling the pressure of the squeeze so we want to adjust our lifestyle so that he also doesn't have pressure is that going to be the case yeah so um that's a really good question so we have figured it out that if he kind of continues at his

trajectory when i'm done working he should be at at about $5,500 monthly income, but our expenses are only $2,500 a month. So we should still have like a $3,000 cushion every month. And that's no house payment, correct? Yes, that's with no house payment, correct. Okay. See, that's the margin. That's all I'm checking you on, and it sounds like you guys got a great plan. Jade, I feel great about this decision.

I feel great about this. This is maturity in a young couple. Thank you. We actually did Financial Peace University. Our church in college had offered it, and my husband and I wanted to do it before we ever got engaged. And we just think it was the best decision we ever made because we were both very aligned on values and financial literacy and everything. And I just have to say, too, before I go off, Jade, you and Rachel are both like my role models.

So I'm super excited to talk to you today. You're the role model. You're sitting here. That's fantastic. You've done everything that we could possibly hope someone would do. And this is the outcome. You have choices and you get to live your life based on your values. To say it like Rachel Cruz, you've created a life that you love.

And I think that's excellent. So you're the role model. And I'd like you to receive that, though. I receive it. Definitely my parents. My parents are definitely the thing, not me. You and Rachel deserve that. Grace, that's phenomenal.

How old are you again? 27. Wow. 27-year-old Grace looking up to you and Rachel Cruz. Holy smokes. Grace, you have picked two fabulous role models. I'm blessed to know both of these ladies. And you are on a great track.

So thanks for sharing that. Sometimes, you know, people need to hear that. So how does that feel? Does it make you feel old? Does it make me feel old? Why do I have to be old, Ken, to be a role model? Oh, boy. There, I just stepped right in.

America, this is a classic male error here. I was trying to be nice. I just was showing you some honor. And then I go and ruin it. I'm an elder. I'm asking if you feel old. No, she's 27. I'm not going to reveal how old you are.

I'm 40. I feel this is the reason I came here. There we go. Good. You deflected that really quick, and I wanted you to receive that, because that's a big deal for someone that sharp to call in and trust you with advice, but then say that nice thing. So that's very nice.

Do you feel old? After pickleball tonight, I will. At this very moment, I feel very fresh. I didn't get a lot of sleep last night. How late did you stay up? I stayed up. I tried to watch till the very end. I didn't get a lot of sleep last night. How late did you stay up? I stayed up. I tried to watch till the very end. I stayed up till about 1.30.

Well, for the audience who doesn't know me, I'm used to, in a very long ago life, used to work in politics. And so I'm just an observer now. I'm a junkie. I watch both sides. I just take it all in. I'm very quiet and sit there. I don't go high or low.

I just kind of like watching the game. So I will tell you, I got home at 2.45 a.m. last night. Okay. That's nice. And had one too many cigars. So the voice is cracking on me a little bit today. All right. I'm a little jealous.

I had popcorn, no cigars. Next time, include Sam and I. All right. We'll do it. Quick break. We'll be right back. This is The Ramsey Show Hey you guys

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and it was given to all of us by my parents. And it's definitely been a blessing. And it's getting to the point where there wasn't really a long-term plan put in place. So it's starting to feel less like a blessing and more of a point of conflict. So me and all my siblings have lived there. It's a house. And me and all my siblings, our names are on it. And we have all lived there at some point while paying rent, except my brother is now, he's been in the house for about six years and he hasn't paid rent and he's currently on leave with the military. And I tried to reach out to make a plan before he left and he didn't respond to anything. So I'm wondering how to navigate this asset and keep it a blessing

while preserving our relationship. How many siblings total? There's four of us. And how did he get this deal? How did he just start living in when everybody else has lived in it and paid rent? I'm presuming you guys have rented it to other people as well. Is that true? I think we've rented it to one other family. How did he get away with living rent-free for six years? So it was kind of like on your integrity, there was an account set up and you put a certain amount in that account every month. And he decided he didn't want to use that same account. He wanted to do his own thing, which we're like, that's fine. You know, you can pay rent how you like.

What is the rent? What is it? It's $250 a month. Oh, man. Oh, my gosh. This is a joke. And so he's not been paying it? No.

Not once. What do the other siblings think about this? So basically, like, we don't know how to resolve it. The communication's not great. They kind of want to be like, well, yeah, we'd like to talk about it. They've kind of written it off as like, oh, like, we're just never going to see money from that. It's just never going to, nothing's that it's just never gonna nothing's going to change how how'd you arrive at the 250 is that like an arbitrary amount or is that maintenance

what is that so that was set up like over a decade ago like a long time ago um mate and it was it was but the purpose of like oh this is affordable so we can live in it and save money so we can kind of get ahead. It doesn't include like utilities or anything like that. So all four of you are on the deed? Yes. What's it worth, the asset? Probably $200,000 on the bottom side, the low side. And there's no debt on it, right?

No, no. So do the other three siblings, I'm sorry, there's four of you, so the other two plus you, are they all wanting to get out of this as well? Are you there? I'm sorry, I couldn't hear the end of that question. Okay. I'm here. I'm asking, do the other siblings, are they in agreement with you about they want to get out,

or are you the only one thinking, going, how do I get out of this? No, the other siblings were all in agreement. Okay. Okay. Well, that helps. Majority rules. So I don't know. I want to say something, but I'll first say I don't know.

I've never experienced this before. So I would be seeking counsel, actual legal counsel on this, on what your options are when you've got four people on a deed, three want to get out. I just don't know enough legal on that. But I would say this. However this goes down, it's time for three of you to stop letting him bully you. This guy's a bully, and I know it's your brother. I'm just telling you like it is. He's not returning your calls. He's just acting like a

school ground, like on the playground bully. I'm not going to talk to you. I'm giving you the silent treatment. I'm creating all this tension, and I'm not playing ball. I'm just creating all this, and I'm daring you. He's daring you guys to do something, and I think he's doing it because he knows you're not willing to do anything about it. And I think that's the only little thing I wanted to put in there because I think however you resolve this,

Jade, I'll get out of the way if you've got a point on this, but I think whatever needs to happen, he needs to realize the gig is up. Yeah, I think. You've long outstayed your welcome. You've taken advantage of us. It's over. Yeah, so just for clarity for me, so you guys, the plan was when you live in the house, you put the $250 in the account and that split amongst the other three siblings, right?

No. So that amount goes just towards repairs. Like, oh, something like breaks. You have money in the account to pay for it. And so while he's been living in the house, if something broke, what happened? I'm not sure. Well he there are things broken and they're just not fixed so he just didn't take care of the place while he was there either right oh wow okay so yeah i mean the majority rules here if you have to get a judge to force this i don't think it would be that difficult to do it um we could talk about the idea of him buying you guys out but i don't think that's going to happen. It's just not going to happen. So, yeah, you might have to sit down. All of you guys sit down and try to make it light. But for me, the fact that you're calling, it's no longer light. So you can try to keep that a light conversation.

But I think the longer you let this go on, the worse it gets. So to Ken's point, yeah, I think you guys get together. Somebody talk to a judge and say, how do we force this? Because we're ready to sell it. We've kept it this long. He's not paying rent. And the truth is, I kind of like the fact that he doesn't owe each of you. Because I mean, if you guys are splitting this money, truly, he'd owe each of you $6,000. But he doesn't, since he's not even taking care of the place. Although, who knows if that'll affect the resale value, but I'd get out of it immediately. would too because if you look at this but let's say they sell it for 200 it's less than 50 grand each yeah it's just not enough money to be dealing with all this garbage so amy i'm with you i think your instincts are right let's get out of this

thing no messing around it's not worth spending a bunch with a lawyer to the judge thing whatever i think jade's right let's clean efficient force his hand we're selling this thing and we we we avoid all the tension and then thanksgiving and christmas takes care of itself but yeah i'd get out quick i really would that's that's an unfortunate situation i mean when you get and see that's okay so i'm sitting here and i didn't ask okay i've already put on hold but like i didn't ask i guess i should've already put her on hold, but like I didn't ask. I guess I should have. If mom and dad are still alive,

I got the picture they aren't around. I got the feeling they're not around. But I just, and for that reason, I just, I sat there and I went, note to self, if Stacy and I want to bless our three kids,

I need to bless them individually, not try to do a, hey, we're going to do this asset and work the three of you into it I just sit there and I went note to self cash money and individually yes you're not in it together yeah I'm blessing you this way I'm blessing you this way this way and it's not this like joint thing where this is it's just what I don't see what the value is in that it's probably the family home is my guess and I think think they probably had the option to sell it early on,

but they weren't ready to part with it yet. And so it probably just became, listen, I am adding all sorts of story to this that I don't know are true. So I'm sorry if that's not true. But you agree, right? To give four kids a house. All right, you guys, here you go.

Yeah. Even if there's not a problem, it just feels like it's easy for a problem to exist because then you have four different people who have four different views of life. Yeah. Money. It's like when you get a gift card

to a restaurant you don't really like. You're happy for the gift card, but now you're forced to eat at Applebee's. Oh, jeez, you just went there. Just saying. A shot across the bow. I'm just saying. Eating good in the bow. I'm just saying. Eating good in the neighborhood.

You're like, thank you. I mean, there's a lot of people that like an Applebee's. Hey, note to self, team. No Applebee's gift cards for Jade. That would not go over well. Yeah, it's happened. Where would one get you a gift card to? I'm with you.

Asking for a friend. Visa gift card. Cash. No, no, I want it. I'm putting you on the spot. 20 seconds. If I'm going you. Asking for a friend. Visa, gift card, cash. No, no, I want it. I'm putting you on the spot. 20 seconds. If I'm going to get you, Stacey and I are going to get you and Sam a gift card to a restaurant, where do you want to go?

It has to be national so people know it. Yeah, I know. Okay. Come on. I don't know. Jay Alexander's? Do you guys have that? Yeah, do you guys?

You live here too. I'm not going to lie. Do you guys have that? Are you do you guys. You live here too. I'm not going to lie. Do you guys have that? Are you aware you live in Middle Tennessee as well? I wanted to say Red Lobster. I don't mind that at all. I love a good lobster. Alright, quick break. This is the Ramsey Show. What does the future hold

for business? Ask nine experts and you'll get ten different answers. Economic growth or a recession. Business taxes will go up or down. AI will help us work or it will replace us all. But there's no such thing as a crystal ball. That's why more than 40,000 businesses have future-proofed themselves with NetSuite by Oracle, the number one cloud enterprise resource planning system. Ramsey Solutions uses NetSuite, and you should too. Whether your company's earning millions or even hundreds of millions, NetSuite helps you respond to immediate challenges and seize your

biggest opportunities. With one unified business management suite, there's only one source of truth for the visibility and control you need to make quick decisions. NetSuite's real-time insights and forecasting help you see into the future with actionable data. And when you're closing the books in days, not weeks, you can spend less time looking backward and more time focusing on what's next. And speaking of 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 alongside Jade Warshaw. I'm Ken Coleman. Thanks for being here, America. We're here for you. 888-825-5225.

Before we get to the phones, quick question from the Ramsey Network app. This is from Jared. I started following your program about five months ago and have paid off two out of five credit cards. I lost my job two weeks ago but was given a severance package. Should I continue attacking my debt or pause until I gain employment again? I'm actively looking and have been interviewing. Good question.

Very practical. Yeah. I mean, 100% I would pause it. This is something we would call a storm. So you're in storm mode. So I love that you're working the baby steps. I love that you were just starting to get some momentum there. But let's pause it for a second, get a job under our belt, and then we can push play once things normalize.

Yeah. By the way, a real quick reminder, if you are listening via your favorite podcast app or you're watching via YouTube, this is the last segment of the show that you'll hear unless you go over to the Ramsey Network app. And you can do that by just clicking the link in the show notes and get to the app. And that's where you get the rest of the show for free. Of course, those of you listening via radio, of course, we continue on. So just be aware of that programming note. Trent joins us now in Wilmington, North Carolina. Trent, how can we help today?

How are you guys doing? Good. How are you, sir? Doing well. Doing well. What's going on? How can we help? So, I got some money in the stock market and stayed with my wife. And I was wondering if I should take that money out to pay off some

of this house debt. I have a couple rental properties and a primary house. One of the rental houses is completely paid off. And the next one has 180,000 I owe on it. And then of course, I just bought my primary residence a few weeks ago. Okay, so you've got a paid off rental,

a rental where you owe 180. And what is that one worth it if you were just to sell? I'm just curious. It's probably worth about $430,000. Nice. And then your primary house, what's the mortgage on that? It's about $3,000 a month. No, what do you owe?

Like the big picture. Sorry, sorry. That's okay. I owe about $500,000 on it 500 on it okay okay and tell us about these these stocks is it single stocks there is mine's in uh index mutual fund and i have 260 in mine and then my wife has an inherited uh roth ir, and she's got 360 in hers. Wow. Okay.

So the Roth IRA, is she required to take any distribution of that or not yet? Yes, she has to take out, I believe it's like right at 500 a month. Okay. She's required to take 500 a month. And you're talking about liquidating that? You said there's 360 in that? Yeah. I didn't know if I should pay off that second rental with, you know, some of my money that's in the stock and maybe some of hers, or should I just keep it all in there and just keep letting it grow as is? I just, I don't have a passion for rentals

and stuff like that. So I'd like to get back into that. I wouldn't liquidate the Roth IRA because you're going to have a penalty, I believe, if you do. Now, the mutual index fund, that's non-retirement. It's just a brokerage account? Correct. Okay, and how much did you say again? Tell me again. $260,000. Okay.

That one, if you wanted to to do you have any other consumer debt um no okay so no consumer debt do you have any other retirement funds just that one rental that's paid off that's part of your retirement you think yeah and what's that worth right now it's worth like 230 around there okay and how old are you uh 37 sorry i'll be 38 in a week or so listen i just grilled you i understand that um yeah i wouldn't touch this um you don't have any other retirement. If I were going to do anything, I would liquidate the other paid for rental in order to do this, to clear some of this out. Or I would keep the paid for rental and I'd liquidate the one that's worth $430,000 and get that and put that $250,000 or whatever you gain from that onto the house.

That's what I do. That way it keeps you with the paid-off rental that you're hoping will continue to add value, and then when you're ready, you sell it for lots and lots of money one day, and you're paying off half of your house by selling this other one that you had debt on anyway. You're saying liquidate, sell the one that I owe $180 on, and pay down my current house? Is that what you're saying? That's what I do. Okay, okay. Because I don't want to keep around a rental

that I've got debt on at the expense of me living in a paid off house. And I think that this mutual fund that you have, for all intents and purposes, I'm treating that as a retirement account. And from now on, I would, unless you're self-employed, I would be trying to invest in my 401k at work. I'd be looking at a Roth IRA instead of just a brokerage account.

Okay. Yeah. I am self-employed. Okay. Yeah. And even setting up something like an individual 401k, something where you're getting more benefit than just this brokerage account, it's not a bad place to start, but even Roth IRA is good for you. So that's just a side note. But yeah, in your case, let's get rid of that rental and start knocking out this house. Okay, okay.

Sounds great. Too easy. Yeah. There you go. You know, if it ain't broke, don't fix it. I got nothing to add over here. Nothing? I was going to say I concur.

Yeah. There's a lot there. I thought you did a great job. Thank you. Nothing to add. Thank you, Ken. I'm sorry. America doesn't need to hear any more on that. You nailed it. Thank you. Yeah, a lot there. I thought you did a great job. Thank you. Nothing to add. Thank you, Ken. I'm sorry. America doesn't need to hear any more on that.

You nailed it. Thank you. Yeah. Thank you. Nicholas is up in Phoenix, Arizona. Nicholas, how can we help? Hey, guys. Thanks for taking my call.

You bet. What's happening? So I've got a health insurance question for you guys. Love this. Me and my wife, we've got our open enrollment coming up this Friday, and we're trying to decide between an HSA, which I know you guys are a big fan of, or a PPO. The one factor that's making this difficult is we have a baby due, our son, in February. So we kind of have like a known hospital expense going into this whatever account or whatever insurance we choose but we kind of got burned this past year with a PPO and I just

checked it yesterday with the low deductible between my entire family we've only spent a hundred dollars towards it with like five thousand in premium so. So I'm just trying to decide whether or not, you know, with the baby on the way, that's so complicated, or you guys would still recommend the HSA? I love an HSA because of the savings component to it. And there is a part of this where you know you're having a baby, you know that you're going to hit the deductible, possibly. I mean, there's a good chance. And so there's part of that where I like the known, if you've done the PPO and it didn't work out for you and you know that you've kind of, it's burned you, then this might be a good opportunity to switch lanes. Yeah. So we did the, for our daughter, for our first child, we were on a PPO plan, and it seemed to help out there because between all the appointments going up to that and then the labor and the delivery, we hit that deductible pretty quickly.

And so the actual hospital bill was only about $800, but because it's at the beginning of the year, I kind of feel we're going to run up our deductible either way. I guess I can give you guys some more details on the numbers. Our deductible for the PPO would be $4,600 for the family, $23 per individual. And then for the HSA, it'd be $4,600 per individual and $9,800 for the family. So we're basically for sure going to hit the PPO deductible and then between 30% coinsurance after that. And then on the HSA, after we hit the deductible, it's 25% coinsurance. So a little bit more coverage after we hit that high deductible. I like having the higher coinsurance because like you said even after you hit the deductible if there's

any other cost you're still on the hook for a percentage of that um and so i'd want to be on the hook for the lower percent what's the out-of-pocket max the out-of-pocket max yeah so the out-of-pocket max for the ppo um is 13 800 and then for the HSA, it's $12,800. I like that better. Is that for individual or that was family? That's for family. Individual, it's probably half that.

Are you healthy? Yeah, my wife's 23. I'm 24. She's had two beautiful pregnancies so far. I'm making this choice based on her. and I'd probably go with the HSA. It's got the lower out-of-pocket max, and it's got the better co-insurance. So for that reason, I'm out.

Judge Jade, folks. She does it well. Good hour. This is The Ramsey Show. This is The Ramsey Show. It's the place you come to get advice, coaching, encouragement on how to win with your money, win in your work, and win with your relationships.

Thrilled to be alongside my colleague, my friend, Jade Warshaw. I'm Ken Coleman, and the phone number for you to jump in is 888-825-5225, 888-825-5225. David is going to start us off this hour in Atlanta, Georgia. 825-5225, 888-825-5225. David is going to start us off this hour in Atlanta, Georgia. David, how can we help? Hey, how are you doing? We're doing well.

What's going on? Awesome. So I just got engaged with my beautiful fiance. Congratulations. Thank you. I appreciate it. Now, we can't really decide whether we should rent, start out getting an apartment and renting, or we also have kind of looked into and been interested in potentially getting a house with another couple friends of ours, or just two friends of ours who are also engaged.

Oh, boy. Oh, boy. should see judge jade right now and i don't like it either i'm scared i like that how do you spell that oh s-c-u-u-r-r-r-r-r-d yeah are you talking about going in on a mortgage together with this what does that mean tell me more more. Well, so we are. What we have talked about is potentially putting one person, and these are two people that have been friends of ours since middle school. You're about ready to blow that up. Well, so what we were saying is we put the house in one person's name and we all kind of get money to them.

And you live in the same house with this other couple. Yes. Weirdly enough. Whose idea was that? Yeah. Under very different circumstances. We'll get to that. Whose idea was this?

Well, so we're only, I'm only 20 years old. Um, now I, I am in college right now, but I also do have a pretty decent full-time job for my age. How much are you making? I make about $5,000 to $6,000 a month doing sales.

And how much school do you have left? I am technically a junior, but I'm in my senior year. So I got about a year and maybe a summer last year. And when is the engagement? Excuse me, when is the wedding? We're still in the process of planning, but probably somewhere shortly after we graduate. So in about a year to a year and a half. And what will she make by that time? What will she be making? She is doing property management right now. And she makes about, I want to say, $4,000 to $5,000 a month, somewhere in between that range. And will you continue in the same

type of work or will you get a bump and move into something different? Yes. So I'm going to continue in sales. I do have a pretty decent job lined up in the pharmaceutical side of sales for when I do graduate. Yeah. But for the next year, year and a half, until I get the piece of paper, I'll probably continue doing what I'm doing. Okay, so real quick, whose idea was this? It was, I'm throwing myself under the bus here, but it was my idea. Was it, or are you just taking one for the team? No, no, it was my idea, because the way that we looked at it was my idea. Was it, or are you just taking one for the team? No, no, it was my idea, because the way that we looked at it was,

you know, if we get a house, we get the house, and then we live in it a couple years, and then you can flip it, make a little bit of money. Oh, best laid plans. Can we just be, yeah, and I'm so glad that it's you.

I had a hunch. This is why I was going there, and I had to get some other information so that Jade, I was digging, doing my investigative questions. Now, here's the thing. Okay, you're cheap, and this was an idea, a creative idea that comes from, you got to know where the source of the idea comes from, and it's because you're cheap, and you're trying to cut corners, and I would say you're're only 20 and so I'm going to leave my

comments to I think it's very creative I will tell you that it will turn into an absolute disaster because you cannot go in with another couple and we're all paying and one person's name's on it and all this thing and then we sell it and it's going to be all lickety split and I'm going to I'm going to game the system and I'm going to get ahead and we're going to be lifelong friends with these people. Man. And I would never recommend a young married couple to go live with anybody. Number one. Number two, this is going to ruin the friendship.

It won't be as clean as you think it will be. Number three, you don't need to cut this corner. We're talking about a young couple, Jade, that I think we've got a really nice combined income combined income. And if they relax a little bit, I'm going to hand the baton to my partner because I needed to get that out of my system. David, you're a really good guy and I think you're really smart. And coming from a guy who I'm not very smart. That's a lie. No, I'm really not. But I am very creative. I'm very creative. And some of my worst ideas come from bad places. And this is a bad idea because you're trying to save a buck or two and you don't need to do it.

So I rest my case. Jade, help this young man out. This gives me indigestion. You're just trying to go too fast is all. There's no foresight here. Your foresight is with rose colored glasses. And so I think Ken and I have done enough life to know that things rarely end up exactly the way that we planned. And so in this way, there's the understatement of the year, you know, I mean, in this way,

I would say, don't do this deal. These are really good friends of yours. And there's a chance that if you did this, it could go just as you thought. But there's a greater chance that it doesn't go just as you thought. And the implications of that are really quite scary. So I wouldn't do that. What I think is Ken is right. You guys have a great income now. Imagine what it'll be in a year and a half. And what would happen if you just rented for a while and you saved up that really great income and you put a down payment on a house that's all your own, that you don't have to split the equity four ways and you don't have to kind of go through this, you know, dog and pony show with a set of roommates. And so that's what I would do. It's definitely the more traditional path. And I think it's

traditional for a reason because it actually works. Yeah. Okay. That makes sense. I mean, the reason, um, the reason that we want to, or even considering doing it, um, like I said, or like you guys said, number one is, um, we are kind of trying to move fast, but why are you trying to move fast? Well, I mean, I wouldn't, we, we both got lucky, um, in getting pretty good jobs for people our age um and i've been with her for four and a half years so i knew that i know she's the one so we i proposed to her so i guess you could say we're just quote unquote um moving a little quicker than but do you want to know what's fun do you want to know i'm i'm you're still trying to explain it to us you're 20 i'm 40 do you want to know what's fun and can chime in here oh i can I can't wait for this. It's fun to, the journey is fun.

Yes. It's fun to dream about a house. It's fun to let that marinate for a while. It's fun in the pursuit to get it and you're saving and you're saving and then you finally get it. It's fun to have an empty house for a while and you're dreaming about the furniture you want to put in it. That's a great point.

Do you know what I'm saying? So there's a journey here that I want you to enjoy. You don't have to just knock it out. It's not boxes that you check and you try to check them really fast. And here's the other thing, young man. Listen, marriage is amazing. I got married young too, but I got news for you, pal. Learning how to live together for the first year is a lot harder than anybody tells you.

Well. So why don't we just get a nice apartment that's got great amenities, super nice pool, got a weight room, no mortgage, just paying rent, learning how to be a husband, man. It's hard, dude. And I don't mean hard and don't do it. It's just, this is a different deal, bro. And trying to rush into the next level of adulthood, which is home ownership. Okay. How about we just learn how to be married for a year? Yeah. That would be my advice to every young couple. Just learn how to live together for a year because you're bringing in your way of way your parents lived. She's bringing in the way her parents lived. And here's what nobody tells you.

It's a rude awakening. Yes. Let's manage that. Let's save some money. The American dream of the house is going to be there. Appreciate you, David. You're a good dude. This is The Ramsey Show.

Welcome back to The Ramsey Show. I'm Ken Coleman. Jade Warshaw is alongside. 888-825-5225 is the phone number. Let's stay right here in Nashville, Tennessee, and Dawson is joining us. Dawson, how can we help today? What's going on, guys? How y'all doing today?

We're doing well. What's happening with you? I'm super pumped to be on the show. This is a huge, huge bucket list item, so thanks for having me. Oh, that's very kind. Yes, I was listening. I've been listening for years, of course. I was listening to the day and I just thought, had a road trip, just call in.

And really my heart today was just sharing, I mean, honestly, the wins that I have experienced the past, I guess you could say 10 years applying just all the principles I've learned from my dad who really followed, you know, Dave. I love this. Yeah, I got to hear Dave. Are you on a road trip now is that what i'm understanding no no no whenever i heard you i was listening a couple days ago um on the road and i was like you know i'm gonna call in just you know why not you know it's a bucket list thing glad you

did um yeah so a little bit of background on me is um you know i am not a math guy at all i've always hated talking about money and my dad you, you know, always was, he actually just passed away, um, a couple years ago. So this means a lot to me to get to talk to you guys, but he was always, you know, um, you know, show me Dave Ramsey things and talking about those principles and, you know, retirement and spending cash, not opening credit cards and living now so that we can live like no one else later type thing. And then I got super lucky, um, and, uh, and married, you know, a wife who is just a genius and really good with money. And so graduated from college and, you know, was able to apply those principles, you know, year after year, begrudgingly until now it's starting to get fun. It's like, holy crap,

this is really has worked. And so, you know, I really wanted to kind of give you guys my financial situation and just, you know just see what you guys think. Am I heading the right track? And then maybe a question or two on what I can do after that. Go for it. Lay it out for us. What's your question? Yeah, so do you want me to just tell you where I'm at financially type thing, like take home and all that?

Well, I'll tell you what. Why don't you start with a question, and then we'll dig on what we think we need to know. Yes, I want to know this. Am I, especially in the economy now, you know, praise God for what happened yesterday, but am I okay to start thinking in a direction of having fun and, you know, investing in an RV and, you know, I need a new, not a brand new, but a truck soon. Or, you know, am I in a place I need to be, you know, pension still, you know, and being a little more cautious with my money for another season.

Do you have any debt? Zero debt except for mortgage. What is your income? So my income is 76. My wife has a part-time job, and hers is 28. Okay, so 96, 104. And then what is your mortgage payment? So we've put 67 down.

We have 364 left. No, no. What is your monthly pay? Oh, it is 2250. 2250. And your take home on that 104 is about what? Take home each. Yeah, that's correct.

Something like that. Okay. You said you take home about 8,000 a month? I don't have that number written down. I have my overall yearly take home. And then my wife's. I don't, I didn't write down the monthly.

I can look that up, but it's around something like that. Okay. Just, we're just trying to see where your mortgage falls in, like what percentage. Tell him why. Tell him,

well, do you know our rule of thumb? Your dad told you all this Ramsey stuff. Do you know what our rule of thumb is on that? I do not. All right. Okay. So the idea is that your mortgage is no more than 25% of your take home at

any point throughout the baby steps. It doesn't even matter if your baby steps seven, right? Before you've paid it off, you don't, you didn't want it to be any more than 25%. Um, and you're pretty close. I mean, if you're give or take 8,000 a month, you're, you're, you know, you're right on it. Um, if your mortgage is around 2000, um, you tell me, I mean, I mean, you're baby step six for all intents and purposes. Do you have three to six months of expenses saved? I didn't ask. Yes. Yeah. So, I have $23,000 in savings, a couple thousand in checkings. And like I said, both cars paid off cash, just got clunkers, doing really well at that all. Well, of the things that you listed, you listed, should I invest in an RV and I got to buy a truck at some point?

So let me take on the RV thing. We're at Ramsey Solutions, Ramsey Show. We're all consistent on this. We never recommend that you invest in an RV. And the reason is, is that's a depreciating asset. And it's just not an ROI. And I think a young guy, it'd be one thing if you were, you know, in your mid-60s and you guys were it's just not an roi and i think a young guy it'd be one thing if you were um you know in your mid-60s and you guys were traveling all the time and you had millions of

dollars the point is for you to invest in an rv it's a hard pass on that one well it's just not an investment it's really not sure yeah by the definition of it it's not um i was really i was really using the rv as more so just kind of symbolic of just recreation in general like just where i'm at and um you know are like you know i feel like we're really comfortable financially and kind of celebrating that but it's almost like just wanted validation from okay but here's the deal i don't mind it then i guess but the point is is you need a truck you guys are driving clunker so it feels like we're replacing i would be putting money into the car replacement fund not an rv yeah Yeah. To Ken's point, what I would do is sit down and decide, okay, what do we want to do? And then let's list it by priority so that you're not trying to do a bunch of things at once and you don't want to mess around and get yourself into trouble.

I didn't clarify, and I just want to be sure before we go much further. Are you investing 15% every month? Yes, I am. Okay. 15% every month? Yes, I am. Okay. Uh, 15% is a pasture and I've put down 53,000 so far. Okay. But, but it's 15% every month. Yes. Yes, ma'am. Okay. Perfect. Yeah. What I would do is I'd say, okay, what do we want to do? What do we need to do? And let's figure out what that is. And we'll figure out which one we land on based on priority. Ken's right. It sounds like you're going to be in the need of a vehicle soon. And so let's talk you through that

so that you guys can make a wise choice. What are you hoping to get? Is it for you? Is it for your wife? Tell me more. Yeah, it's for me. You know, just began the conversation on a truck, like a used Toyota Tundra of some sort. So it'd probably be in the range of you know 20 to 30 or something like that okay so the rule of thumb for us is we don't want your cars to make up more than half of your your annual salary and so there's two of you so you got to divide that by two and so in your case what are you at uh 103 000 104 000 okay $103,000, $104,000. Okay. So yeah, no more than $52,000. Okay. And that's for you both to split. So you're at $25,500 and she's at $25,500, whatever that is.

So that's what you're looking at and you wouldn't want to pay cash for them. Do you guys have, you know, you've got the $23,000. We're not touching that because this is not an emergency. So at that point, it's just you guys saving up and saying, how long will it take us to do that? And not to say that you have to spend 25. You could spend 13, you know? Yeah, yeah, true.

Yeah, that's good. So would you guys just foundationally, you know, let me know if, you know, I don't, I mean, if I'm running out of time, but foundationally speaking, just kind of running all of my numbers past you guys, would you say, like I said, that we're, you know, the trajectory is headed in a great direction for where we're at, the season we're in. You're doing good.

30 years. Okay. Yeah, you're doing good. I mean, how old are you again? I'm 32. My wife's 29. And we have three kids, all under four. And your total retirement nest egg right now is 53.

Is that right? Yes, sir. Yes, sir. Have you plugged any of your numbers? I always tell people, spend some time with an investment calculator so you can kind of see what your projection is. And then you can kind of know, all right, I feel good about this or I don't feel good about this.

Sure. So you said you've got, you said you've got 53,000 in investments right now? In the 403B. In the 403B. Okay. And how much every month are you putting towards that? in investments right now? In the 403B. In the 403B. Okay. And how much every month are you putting towards that? So it's 15% total.

Honestly, I forgot the verbiage of what we're matching with our church. Yeah, I feel terrible that'll happen. That's okay. Give us a rough number. She's running some numbers for you. Do you have a general idea of what you're putting in?

I'm trying to find the number on my guys I guess what I wanted to make so probably about twelve hundred dollars what I wanted to make sure was that you're investing 15 off of both of your income not just yours since it is a 403b we didn't talk much about that but I kind of wanted to just project you asked am I doing all right and so based on what you're doing now if you didn't do a thing differently nothing grew and nothing shrunk by the time you're 60 years old you have four million dollars which is really great because you're super young and things are not going to stay like this you're going to keep going to the moon is the hope so yeah yeah you're doing good

heck yeah that's what you wanted to know yes the fact that you guys are being very wise you know glad you're calling for advice on this no rvs keep the rvs out of the picture for a long time but other than that jay's right she just painted a really nice picture for if you just continue to walk the steps out and that's what you got to do i'll tell you what we'll do let's just um do you have total money makeover? Did your dad ever give it to you? Yes. Yeah, we have it at home. All right. Nevermind. I was going to give you something. He's set. Well done. Yeah, we're set. Thank you guys so much. Thanks for the call. And thank you for the wisdom today. Yeah. I appreciate you, man. Really fun. Love hearing about young couples that have got the train on the tracks. It ends up in a really good place

as she demonstrates once again. She loves that retirement calculator. I love it. All right. Quick break. More of the Ramsey Show right around the corner. Welcome back to the Ramsey Show alongside Jade Warshaw. I'm Ken Coleman. So happy that you're with us.

Hey, for those of you who like to cruise, you like those warm vacations, you like great food, great content, a variety of opportunities, different ports, you're jumping in and out the whole nine yards. You know, a lot of people love to cruise. I love it. Well, yeah. How many cruises have you done

in your professional and personal life? Unable to count. None in my personal life. This is very exciting because I need you and Sam to mentor me on things to do and not to do. I've only been on one before. Okay. Yeah. Do you really want to know?

Not right now. Okay. No, I just meant in general. Okay. Yeah. And it's otherwise known as a segue. That's what I was attempting to do. It's like a segue.

Got you. Yeah, that's right. Okay. I have something for you later. Because I got to talk about live like no one else, do. It's like a segue. Got you. Yeah, that's right. Okay, I have something for you later. Because I've got to talk about Live Like No One Else Cruise. That's right. We're setting sail March 22 through 29, 2025.

It's a premium Caribbean cruise. Dave Ramsey picked the ship. It's a nice one. Holland, America. And it's all-inclusive, all the food, everything. And boy, oh boy, we're going to have some incredible,

incredible guests with us, including Trey Kennedy, Deanna Carter, Stephen Curtis Chapman, Manit Chauhan, all of the Ramsey personalities, including Dave Ramsey will be on board and speaking, and it's going to be a lot of fun. So if you would like to do that, these are for people who, by the way, in Baby Step 4 and on, because you've got the margin here, we'd love to have you, RamseySolutions.com slash cruise, ramsaysolutions.com slash cruise. Evan is up next in Houston, Texas. Evan, how can we help?

Hi. So I'm 22. I currently go to college full-time online at University of Houston Clear Lake. And my question is I got a job offer to go out to Alabama as a drive-thru manager at a Chick-fil-A for $60,000 a year before taxes. And my parents don't want me to take it. Why? My idea is that I would just go there and do the job during the day. And then because my college is all online, I can take my exams and stuff whenever. So I can do job during the day. And then because my college is all online, I can take

my exams and stuff whenever. So I can do that in the evenings. That would be my plan. The reason they don't want me to go is they just want to make sure that I finish my college here. And you have laid out for them that you are not planning to stop your classes at all. Yes. And you laid out that how you're going to do that. Mm-hmm. And they still said, we are nervous that you are going to get over there and you're going to start making money and you're going to be a college dropout. Yes.

Okay. Do you think that, and I want you to be really honest right now, okay? Mm-hmm. Do you think that that is the primary reason, or do you think that they want to keep you at home for a little while longer? So I actually have dropped out of college before. When I was 18, it wasn't for me. And I went to Dallas for a year and lived there and figured out life.

Figured it out as much as I could. So you think it's that, not just they're kind of projecting a reason. This is actually some history here. Yes. Okay. So are they paying for your college? No. So I'm sure you're familiar with FAFSA.

Oh, yeah. And so currently I get about $19,000 a year with FAFSA. So that pays for my school plus roughly $5,000 a semester. How much school do you have left? So after this semester, I would have three semesters left. Three semesters. That's it. And what are you getting your degree in?

It's just a general business degree. It's kind of like a random BS degree. It's just a general business degree. It's like a kind of like a random BS degree, but it's a bachelor's degree. And like, that's like the main thing. Well, all right, I'm ready. And your mom and dad aren't going to like me and that's okay because they didn't call you did. Uh, so here we go. It's your life. It's your money. And it's your opportunity Sitting here And 60k to go work with my friends at Chick-fil-A

That is an absolute Slam dunk chicken tender Deep into the Chick-fil-A sauce Or your favorite sauce Polynesian maybe your game Barbecue I don't know I like the mixed Chick-fil-A And ranch sauce

So for you all in You're so into that dip I like the mixed Chick-fil-A and ranch sauce. Oh, very good. Okay, so for you, all in, man. Maybe it's so, I mean, you're so into that dip, it's a little bit on your knuckles. You know what I mean? Like, this is an all in. And the reason is you're betting on yourself. I'm hearing a young man who dropped out once, went and figured some stuff out. He's got a great opportunity.

I think he's got three semesters left, and I'm really going to make the so-called controversial statement now. I have the distinct privilege of knowing the Cathy family. I've done work for Chick-fil-A in my previous life. I have a good friend who is one of the most successful operators in the country. Wow. And I have trained his staff for him. I know that culture and I know the ladder of opportunity. And I'm going to say this, this job as the drive-through manager making 60K at Chick-fil-A at Alabama is 10x as valuable as the degree you're about to finish. They will teach you how to serve people better than anybody in the country.

They will teach you how to lead better than any other company in the country. And I'm telling you, whether you stay with them long term or you keep on moving, this is an absolute no-brainer. That's what I think, Jay. Ken Coleman stamp of approval. I think as you say, standing on business, or did I mess that up? Yes, there you go, Ken. I finally used the phrase the right way. Yes, I like it.

I like it. So I do actually have some math for y'all on what that would look like. Well, here's the queen. The queen of the budget is now ready for you. Tell me your math. So currently my income after bills is about $1,000 a month because I do teach piano on the side and I make about $150 a week doing that. Okay. So $1,000 a margin.

So if I were to go to Alabama, my income after expenses would be right around $3,200 a month. Okay, nice. So it would increase threefold. Nice. Very good. Yeah. So the way I calculated it was that like the total income is like $5,000 a month, plus like the extra $800 a month with the FAFSA, because I would still be getting FAFSA throughout the entire thing because like for my 25, 26 year FAFSA checks the 23 fiscal year. Okay. So, and like 23, my 23 fiscal year was pretty crappy. So I will get, I will still be

getting like my 19 or whatever thousand extra. Okay, and where's your question? No, I was just like laying that out and seeing, so like, yes, I will be making that extra $2,000 a month, but the catch is that it would be out in Alabama and I would have a full-time job on top of. Are you looking for more confidence? Where is your decision yeah because i feel like ken laid out why this is a slam dunk for you and it wasn't necessarily the the income

that that played nothing in what he said yeah that that's just a cherry on top are you still unsure so i'm just unsure if the operative like the extra tooth $2,200 a month would be quote-unquote worth it for my parents' disapproval. It's not their call, is what I was saying. Mm-hmm. Do you want this job? I desperately do, yes. Do you believe it's going to make your life better in the now and the next? I 100% believe that, plus Alabama's beautiful.

Say less. Okay, I won't say any more. No, I'm talking to Evan. I know, I'm kidding. I just couldn't help myself. I've made my case. I thought it was profound. I think we all agree, and i think what we are dealing with

is i think you're scared of old mama and papa oh and he should be by the way by the way i get that yeah i get that evan i just was trying to get to the root of it you know i wanted mama jade's perspective on it i get it i get it but you got to do what's right for you or you're going to resent mom and dad yeah and exactly that's why i'm calling into you all because I want a unbiased. Dr. John Deloney would say choose guilt over resentment. You're going to feel guilty going to Alabama. You're going to feel guilty that you didn't do exactly what your parents wanted you to do, but you filtered it through two very old and wise sources

and we gave you the okay. I gave you a sauce analogy. That's all I got. I'll never have any better advice than dipping a chicken finger in some sauce. When you said it gets on your knuckle, I was like, that's relatable. That's relatable content. That's all in. When I'm really

hungry, I'm a little sloppy. I'm not paying attention. I'm going all in. Dunk the chicken tender all the way. Until you hit knuckle. That was my metaphor. Quick break because I'm starving. This is The Ramsey Show.

Welcome back to The Ramsey Show. I'm Ken Coleman. Jade Warshaw joins me in studio. The phone number is 888-825-5225. Our scripture today comes from Proverbs 31, verses 8 through 9. Speak up for those who cannot speak for themselves, for the rights of all who are destitute. Speak up and judge fairly. Defend the rights of the poor and needy.

Our quote from Norman Vincent Peale. Empty pockets never held anyone back. Only empty heads and empty hearts can do that. Ooh. Yeah. That's worth thinking about. You said empty heads like that's pretty extreme yeah empty heads i feel like i went right back to eighth grade i feel like that's when my head was the emptiest somewhere in the eighth or ninth grade oh man some of you would say ken you still haven't recovered it's still empty and i would say you might have a solid point can't argue with you

won't argue with you you stayed up till 2 30 last night okay all right yeah i feel i mean i feel fairly getting a second wind yeah maybe we'll see gotta summon the strength it's pickleball night so there's no can't miss out on there's no griping about lack of sleep it's you got a man up out there show must go on spencer is up in Santa Barbara, California. Spencer, how can we help? Hey, Ken. Hey, Jed. Thanks for taking my call.

You bet. What's going on? Yeah, I'm a 47-year-old single guy. I was a single dad for 10 years. My kids are now married out of the house. Thank goodness. But I was a single income earner living in California for a long time. So it was challenging getting ahead financially. However, I just finished baby step number two. Thanks to you guys. Way to go. And yeah, thanks, Jade. And I just started baby step number three, but my retirement, it looks really bad. It only has

about $2,000 in it with a Roth IRA. So here's my question. I feel like I'm behind quite a bit, you know, starting this late in life on retirement. So is it mathematically worth at least investing a little bit in baby step number three, you know, like five or 10% into retirement? Or do I just finish out, you know, the three to six months of savings and worry about the 15% later, being that I'm 47 years old? That's kind of my question. I definitely understand why you feel alarmed and why you're thinking,

okay, what can I do here? Is there a way to multitask? I would say no, because with your income, you do want to focus on one thing at a time. You're able to accomplish more faster when you just focus on one task. And the truth is you need savings because if you don't have savings, your Roth IRA becomes your emergency fund. And we don't want to put you in that situation. If something were to happen, you lost your job, whatever, you'd be looking at your Roth IRA because that's really the only money that you'd have sitting there.

And the implications of that will end up costing you more long-term. So for that, for that reason and many others, that being one of the biggest, I would say let's stick with the baby steps. How long is it going to take you to finish up your emergency fund? Well, I make,

you know, I make about 90 grand a year. So, you know, I would say if I were to put even just a thousand dollars, $2,000 a, you know, I make about 90 grand a year. So, you know, I would say if I were to put even just $1,000, $2,000 a month in it, you know, what, 18 months? Okay. And if I were you, what you could do is you could say, I'm going to do three months right now. And if that doesn't feel right later on, as I invest, I might stack up some more. You could

do that. I'm not mad at you if you decided to do that since you're a single guy. It's just you. But let's kind of make you feel a little bit better about your situation. Tell me about your home. Are you a renter? Do you own your place? No. Yeah, unfortunately, I own my place. I owe $239,000 left on that and it's worth about $625. $625. Yeah, so I owe. You said you owe $229 on that? Yes, ma'am. $239.

$239. Okay, why'd you say unfortunately? I think it's great you're a homeowner. Yeah, I'm not sure, actually. Okay. Hey, I've been there before. Why'd you say that? No, I'm not sure actually. Okay. Hey, I've been there before. Why'd you say that? No, I have no idea. Well, let's play this out a little bit

because I just want to give you advice, but I also want to set you at ease a little bit. The truth is you're 47. You got a lot of life to live, okay? Yes, young man. Good life to live. I would continue to play out this baby step thing where you're saving up three

to three months. Let's start with three. Then you can reach over and you can start investing 15%. And you can start making extra payments on your mortgage as you see fit. You might be a little bit more intense about that because of the timeline. But the truth is, once you start investing, let's say you start investing towards the end of, let's see, when you're 47 now, let's say when you're 48, you start investing, right? And you're putting away 15%. At that rate, if you were to say, I'm ready to stop working at 65, you'd have almost $750,000 as a nest egg, just that, not including your house. And so the thought is like, okay, what can I draw off of this? Okay, can I just live off of the interest here and also kind of account for

inflation there? And I mean, it puts you probably around $50,000, $60,000. But the idea here is, you would also have equity in your home. And this is not the be all end all for you this is as it stands right now does that make sense and so you have a lot of room to affect this and make that number a lot closer to where you want it to be maybe you want it to be 1.3 million so you can pull off a hundred thousand dollars a year so you need to have in your mind what do i want to live off of and kind of reverse engineer it and say okay if i want to get to 1.2 million in that nest egg, what must be true in order to make that happen? Do I need to pick up extra income?

Is there something that I need to do regarding my living situation? And so that's what I would advise you to do. I don't look at this and go, oh, it doesn't look good for you. I just think that you have to be very intentional with the years going forward and with, with what you do with your income.

Yeah. Okay. Yeah. That makes sense. I, I, I actually rent out part of my part of my home, the downstairs, uh, to bring in, you know, additional income. And I just live upstairs, um, for that very reason. Cause I do, I'm thinking about it, you know, the end game when I do retire I'd like to still continue to have a steady source of income coming in because I've just, you know, I don't know if you can hear my voice. I'm just, I feel, I'm just feel like I'm a little behind.

I can. And I, again, I understand why you feel that. But I want to encourage you that it's, you may be a little behind, but you're in no way too late in no way, shape or form form are you too late. So what I would do is I would, there's two things that I would run the numbers backwards. First, I'd look at this $239,000 mortgage and go, okay, by the time I'm 48 and I'm in a position to put extra on this, what must be true for me to have this home paid off by the date that I want it to be paid off? What does that mean for me? And so instead of this kind of, I think fear a lot of times, Ken, is when we just don't have the information

solid in our minds. I agree. What happens is when you aren't clear on something, your brain starts to try to fill in the narrative. Yeah. And so then it becomes like that voice or voices or myths, if you want to use that word. They become like you're skating, free skating. They just skate around in your head. Yeah. And William James, the father of modern psychology, once said, no matter how absurd something is, if it is repeated often enough, people will believe it. And that's not just true of dictators or religious cult leaders that can do that to people and brainwash.

It happens with ourselves. 100%. And so I think you've just really highlighted that. And I think that's key, Spencer, is to understand that. It's like to the extent that you can get really, really clear and see the path forward, then all of a sudden the doubt and fear goes away and it's replaced by confidence.

And so for you, the two tools that you want, Ken is exactly, exactly right. And so let's eradicate that. I want you to do the home payoff calculator, which is on ramseysolutions.com. You can check that out or we'll throw it in. We'll make sure you can find that. And then I want you to do the investment calculator. And I want you to play around with what do I need to invest to get to the number that I want to invest in. And roundly what you're looking for, Spencer, is assuming that you're invested well, you got a 10% rate of return, you want to be able. And roundly, what you're looking for, Spencer, is assuming that you're

invested well, you got a 10% rate of return, you want to be able to live off the return. So the 10%. So that's just a round way of looking at it. And then maybe take off 4% or whatever for inflation, you could do it that way. But that's just a round way to look at it. Ultimately, I want you working with a smart investor pro because they're going to be able to help you make sure you have the right accounts so you can draw what you need when the time comes But that's just getting you pointed in the right direction and you're asking really good questions I love that you're asking these questions now and you didn't wait till you were 57. Yeah, I agree Give yourself a break spencer. I felt a little bit of shame in here

I did too and spencer you have nothing to be ashamed of. No. I thought Jade was absolutely right. It's not too late for you. Hope that's your new posture going away from this phone call. Thanks for trusting us today. Thank you for the call. Jade Warshaw, she is something else. Force of nature. That's a positive compliment right there. Thank you. Appreciate you, my

friend. You too. James Childs, steady as she goes. Yes. He keeps the ship. Rocking the beard today. I know. James Childs, steady as she goes. Yes. He's just, he keeps the ship. Rocking the beard today. I know. The scruffy look I like. He won't show you though, he's very shy. This is the Ramsey Show. Thank you.