The Ramsey Show - App - You Don't Need To Buy A House, You're Broke! (Hour 3)

Episode Date: February 3, 2023

Kristina Ellis & Rachel Cruze answer your questions and discuss:   How to pay a doctorate debt free, from the blog: How to Pay for College Without Student Loans The things you should take into consideration when moving across the country, from the blog: Ramsey Relocation Guide How you and your spouse can get on the same page with finances when living paycheck to paycheck, from the blog: Money and Marriage: 7 Tips for a Healthy Relationship "I feel like a hypocrite for taking out a mortgage" from the blog: How Much House Can I Afford? Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET Want a plan for your money? Find out where to start: https://bit.ly/3nInETX Listen to all The Ramsey Network podcasts: https://bit.ly/3GxiXm6 Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

🎵 Live from the headquarters of Ramsey Solutions, broadcasting from the Pod's Moving and Storage Studio, it's The Ramsey Show, where America hangs out to help people build wealth, do work they love, and create actual amazing relationships. I'm Ramsey Personality, Christina Ellis, joined today by fellow Ramsey Personality, Rachel Cruz.

We're taking your calls at 888-825-5225. And hey, if you like the show, please consider subscribing, leaving a review, and sharing it with a friend. We wanna continue to reach people and help them build wealth and win with their money. All right, let's go to the phones. First up, we have Nicole calling from Jackson, Mississippi.

Hey, Nicole, welcome to the show. Hi, thanks for taking my call. Hey, thanks for calling. I am calling about potentially pursuing a doctorate degree. I'm not really sure if I can afford it. And if I can, I'm not really sure the best way to pay for it. Obviously, a loan is out of the question. So I have some options and I'm just not sure that it's the best thing for me to do. Okay, so what would you be studying? It would be a doctorate in education. Okay, and what are you doing right now?

I am in the kind of corporate training world. And that's where I would like to stay. So the degree would be in instructional design. And what will this degree do for your career? I feel like there's a lot of hesitation in your voice. You said you're not sure if it's the right decision. Yeah, there's no guarantee that this degree will do all that much as far as, you know, future earning potential and that kind of thing. It's more just something that I've kind of always wanted to do just sort of for myself, whether it pays off financially or not. That's the hesitation. There's not an employer that's saying, you know, if you get this degree, then you're going to get this huge raise or anything like that. What is it going to do for you, Nicole, when you say, I want to do this for me? What is that giving you? It would just be a personal accomplishment, something that I could,

you know, that I could just look at at some point and say, I look at this. Okay. So I'm going to ask you again. So what does that, so you have the degree on the wall. What is, what is that, what does that do to Nicole? What does that do? Um, it's something to be proud of. It's hard. It's hard work. So I think it's, and there's a lot of other hard work out there to be proud of too, right? That's true. So I'm just trying to dig a little bit deeper into your why and what that motivation is, right? Like is there a – there's something under there that's causing you, and I don't know if that's what you've heard in the past from someone that you think that like this –

that this is important. I don't know if it's from someone in your past. I don't know if this is you feel like if I have this, somehow I'm going to be more complete. I don't know. I don't know what it is for you. But usually what we find that if it doesn't have a financial benefit, right, if it has a financial benefit, this would probably be a different discussion that we'd walk through options. But if it's just for Nicole, I think you can find that satisfaction other places that doesn't require going and getting a doctorate for something that you don't need in life. Right. And that's one of the reasons why I think that, you know, paying for it has kind of become a sticking point.

Is that, you know, it is going to be expensive. I don't mind to, you know, save money or whatever it is that I have to do to pay for it. But I think that probably is part of the hesitation is just, is this really the right thing to do? And then if it is, how do I map it out and make sure that it's the most? Well, Nicole, what does the rest of your financial situation look like? Do you have any debt right now? No, I have no debt whatsoever. I own my home.

My salary before tax is about $68,000 and I have about $125,000 in retirement accounts and mutual funds and emergency funds and that type of thing. And how old are you? 41. And how much is, how much will a doctorate be if you just went and did it? With the program that I'm looking at with the financial assistance that I'm likely to qualify for, it probably costs a total of about between 40 and 50,000. Okay. And how much is it per year? Per year, it would probably be $12,000. Okay. And is this an online program or in-person? It's a hybrid program. Okay.

Mostly online, some in-person. Are you set on this specific school? Are you open to other options? No, I'm definitely open to other options. Okay. So hearing all of this and hearing, you know, the doctorate, it's a personal accomplishment that you're excited about. I'm kind of wondering, like, how would you feel about slowing it down, maybe going with an online degree program? Because a lot of times those can be a lot cheaper and a lot more flexible, where maybe you do it over the course of six or eight years and cash flow it. Well, that was going to be one of my questions. Is it

better to do it more slowly and just cash flow it as I can? I do have some things I can sell that could potentially be enough to pay for it over a shorter period of time, but I don't know if that's necessarily the best way to go either. Well, I mean, if there's not like a specific timeline and you're in a program that's pretty flexible where they're not like it's not a cohort program where you have to go with a certain group and take 15 hours every semester, but it's an online program where you just need to finish 60 credits over the course of however long it takes, then that would be up to you. Like if you want to go a little bit faster than maybe you sell those things so you can pay for the next class a little bit quicker. And if you don't, then you don't.

Yeah, that's actually a really good point. I hadn't really thought of it in those terms. But maybe taking longer, since there isn't a hurry to get it finished, maybe that would be a pretty good option to consider. It's just how long will they let me stretch it out for? Yeah. I really do like being in school. I mean, if it was free, I would go forever.

I never thought. Good for you, Nicole. I love that you're admitting that too, that you're like, hey, there may not be an ROI. I just like it. Yeah, I do. I like writing papers. That's great. You know, some people like taking vacations with their money. Some people want to go and get a doctorate, Nicole. So I think that's awesome. But let me just say before we hang up, no debt. Do not take retirement out. Do not be cashing out your 401k or Roth IRA to pay for it. Do not go and put a mortgage on your house.

Like nothing like that. This is going to be cash flowing. This is extra money Nicole has because this is what she wants to spend her money on and do it. And that's awesome. That's great. If you have the cash for it and this is what she wants to spend her money on and do it. And that's awesome. That's great. If you have the cash for it and this is what you want to do, then that's the thing about money.

It's a tool to create a life that you love. And if this is the life you love, Nicole, you go for it. I guess I could just write papers in my free time if I wanted to. Well, also, Nicole, okay, one more just bonus thought, bonus tip is, I mean, maybe you even consider a second career. Like, if you love papers, if you love education that much, maybe you go work at a university. And then a lot of times when you work at a university, you can get a tuition discount of like 80, 90%. Oh, that's a good point. That is a very good point.

I'm so glad I called when you were in today, Christina. Yes. Of course, I'm glad you called. This is my favorite thing to talk about. I was like, don't go to school, Nicole. You don't need it. I just so appreciate the honesty. I'm impressed.

It's great. It's great. We're taking your calls at 888-825-5225. We'll be right back. This is The Ramsey show. ស្រូវានប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប់ប� welcome back to the ramsey show we're taking your calls at 888-825-5225 let's go back to the phones next up we, we have Lorraine calling from Nashville, Tennessee. Hey, Lorraine, welcome to the show. Hey, what's up, guys?

Thanks for taking my call. Hey, thanks for calling. How can we help? Yeah, so my husband and I, we actually live in Washington State. We're relocating to Nashville this summer. And kind of what I wanted to get y'all's input on is what do you think is the best way to go about trying to buy a house as a first-time home buyer when we're relocating? And a lot of these mortgage companies that we've reached out to

and banks are requiring job security in order to get a mortgage in that state in Tennessee. And then we, at least for me, my husband's job is able to transfer my jobs, not, um, not, um, available for me to work at in Tennessee. So I can't get job security. And then, so we can't, I can't get a job without a home and then I can't get a home without a job. I just kind of like stuck in a pickle. Do you guys know, like, have some mortgages that are best for like first-time homebuyers? Well, I would say number one, yeah, you're picking the best city in America coming to Nashville. So I'm so glad you're going to be neighbors with us.

It's a great city. But for anyone that's relocating, I would always recommend renting for a year. Just rent for a year, because you're going to be able to quickly see all the different parts of the city, right? I mean, like even Nashville, it's not a major, major city, but there's enough difference depending on which suburb, if you go north, south, east, west, like you're going to start to feel out, okay, this is what the city's like. And I don't know, I always like not being tied down to a house, especially if it's somewhere you haven't lived before.

So I would recommend you guys rent for a year and then you'll probably find a job. You'll have some, you know, you'll have that job security going in to get a mortgage. Are you guys in a place to buy a house? Do you have debt? Do you have a down payment? What do you guys have?

Well, we're completely debt free. We've been a missionary for the past four years. So we've been living off the court. And so once we stepped out of ministry, we were now working full time here in Washington. I'm actually born and raised in Nashville. So we're moving down there so I can be close to my family. So knowing the area, it's not, yeah, it's very familiar to me. You know, I'm looking at Columbia, Spring Hill, you know, more South Nashville. Gotcha. Um, so living off the port has definitely kind of been a hardship in a sense of trying to save a bunch of money. And then out here in Washington where we live, I mean, we, it's hard trying to save when

our rent's almost half of our income. And just cause that's just how it is out here. Everything's super expensive. So trying to save has been challenging. You know, we're doing financial peace. We got our budget and everything like that. So do you guys have an emergency fund? Yes, we have our $1,000 emergency fund.

My in-laws gave us a gift for a down payment. But once we stepped out of ministry, we had to take some of that out for me to buy a car. But we just, both of us bought our cars just flat out in cash. So we don't have any car payments. So you have no debt. Yeah. Yeah. It's great. So you have the Ramsey steps with going to school. So we're paying for schools to go in that sense. But yeah, just trying to save and everything has just been challenging you know here on the on the show people my age like oh yeah i have a hundred thousand dollars in savings it's like what i know i know totally okay so you have you have

your thousand dollars you have no debt you say you do not have your fully funded emergency fund yet well i mean i thought the thousand dollars was the emergency fund i mean that's just what we kind of been keeping for a rainy day okay so then that's maybe stuff that yep so that's baby step one is that thousand dollar that's your starter emergency fund then you're going to go and pay off all of your debt which you guys don't have any debt so you get to move on to baby step three which is saving three to six months of expenses which is your fully funded emergency fund. So you can add to that $1,000, let that be your springboard, and you guys start saving up a big rainy day fund of three to six months of expenses. And then baby step three B is saving up for a down payment because you guys don't even

have money for a down payment right now, right? We have about six grand right now. Okay. Just because we're trying to pay off that gift that his parents gave us um that we had to use for my car wait the gift wait the gift it's a gift or is it a loan no they gifted it to us so why are you paying it back no no we're not paying it back to them we're paying it back to ourselves like they gave us 10 000 to use for a down payment my husband and i since i needed a car we took five grand of that to them. We're paying it back to ourselves. Like they gave us 10,000 to use for a down payment. My husband and I, since I needed a car, we took five grand of that to buy

myself a car. And so now we're just trying to build that 10 grand back up, but it's still a gift. It's still ours. Okay. I hear you. Okay. So yeah. So I would, um, I would use that for my emergency fund. I would not use that for my down payment. Cause you guys aren't in that place yet. You guys need some cash in the bank for an emergency fund. And then so that 10 grand that they gifted you is so kind and so great. But that's going to be allotted to an emergency fund instead of a down payment right now. And then you guys save up a down payment on a house because what happens is you move, you buy a house, you don't put a lot down, and you have no cash in the bank, and suddenly the roof starts leaking. You notice that the insulation is bad. I mean,

stuff starts breaking and you don't have the money to go and fix these things because home ownership is expensive. And so having that big emergency fund is really important before buying a home because the most stressful thing that you can do is go buy a home and have no money and stuff starts breaking. And then all of a sudden you're like, oh, my gosh, I'm stressed. And this house suddenly has become a burden, not a blessing that I thought. So I would really, really recommend you guys save up that big emergency fund, save up a down payment of 10 to 20% down, and then you guys buy a home. So again, Lorraine, I mean, I would and I would and I would still recommend renting. I mean, even though you know the area, which is great. I just don't think you guys are going to be in a

financial position this summer in six months. Maybe you will. But the way you were saying about your savings, how you're like, Oh my gosh, it just feels like it may just take a little bit. So have some patience. Yeah. But we're going to put in the show notes our Ramsey relocation guide. That's a link and that's going to go through and walk you through a big checklist when you are relocating. But I think that you guys have another step. I mean, you're going to relocate. But before home ownership comes in, I would do these other things first. Yeah. and I would take the word payback out of your vocabulary. Like with that money, I think that just having that,

like that is a gift. And if it's a gift, like put it in your emergency fund, like Rachel said, and don't have that feeling of, you know, you owe them for some reason to allocate it a certain way. I think that they still would be rooting for you

to get your fully funded emergency fund so that you can be secure when you do purchase a house. And I would also just say, like, slow down. I think you guys have been through so many big transitions going from the mission field. Now you're in Washington state. You're going to be moving. You don't have to slow down the moves, but the feeling that you have to purchase a house and you have to have everything sorted out, just the fact that you're coming to Nashville, that's a huge transition. And I think, yeah, I know my husband, he, cause we've, we've rented and he's very passionate about like, you know, he, wherever we want to live, he wants that to be an investment. So my, my husband hates renting cause he's like, he feels like he just thrown his money

away. And that's how I kind of feel sometimes, too. So that's why he's pretty dead set on, I don't want to move to Nashville unless we have a house. And I'm like, do you realize how hard this could have been? But trying to, you know, are there any banks out there that offer, like, relocating loans with a very small down payment or not even a down payment? I don't even know what's right. Lorraine, you guys are broke. Lorraine, Lorraine, you guys don't even know what's right. You guys are broke. Lorraine, Lorraine, you guys don't need to buy a house right now. You don't need to buy a house.

You don't have the money. You don't know what you just asked to put nothing down on a house. It's just not smart. I understand what he's saying. It feels like you're throwing money away, but that's also wisdom. There's wisdom in this. How old are you guys? I'm 26. My husband's 28. Listen, you have a long life to live to be a homeowner. I'm all about homeownership. We took a call in another segment that I'm like,

I think homeownership should be part of everyone's financial plan because it's smart. It's smart to own a home and build equity, all of that. But it's when you're ready. If you guys rush into this, Lorraine, it is going to be stressful. You're moving to a new place. You don't have a job yet. The tension within your marriage, everything starts to just feel like I can't breathe, all because, quote unquote, we didn't want to throw our money away. For a year, breathe. Just like Christina said, just slow down. I'm begging you, slow down. You guys are going to be okay. You're going to buy a house one day. It's in there. It's in the future. But don't rush this.

This is a really, really big, big decision. And Lorraine, hang on the line. We're going to pick up and gift you FPU so y'all can kind of walk through the steps and figure out what slow looks like. Slow and the right way to build wealth in the long run. We'll be right back. This is The Ramsey Show. with debt payments and now inflation stealing more and more of your paycheck we know a lot of you feel like you're just drowning you're scared and you want to take care of your family, but you feel like there's just not enough money. So listen, you do not have to live with that kind of stress. But it takes this I've had it moment to try new things because change and trying new things is scary, right? We are comfortable with what we know.

So in order to change, we have to have this moment of I'm done. I'm done with this. And if you're there, that means it is time to try Financial Peace University. This is our nine lesson course that'll teach you how to beat debt and build wealth. It's everything you wish you had learned about handling money when you were younger. You're like, where was this class? I should have had this earlier. Now, nearly 10 million people have taken FPU and they will tell you that they don't worry about money like they used to. They are in control and that can be you too. So if you are

done stressing about money, take control and start Financial Peace University at ramseysolutions.com slash FPU. That's ramseysolutions.com. Up next, we have Polly calling from Denver, Colorado. Hey, Polly, welcome to the show. Hi, thank you for taking my call. Thanks for calling. How can we help? Just, well, I retired a couple years ago, and so I'm like on half the income that I usually have.

And my husband is still working. He's younger than me. He's probably got another 10 years while he'll be working. We have a 401k. I have a paid retirement benefit, but I had a little bit in a 401k. So I already invested it. And I just kind of want to forget about it and let it do its thing for a while. But in the meantime, we have debt.

And I've kind of been living off my car just because we go paycheck to paycheck. And I'm trying to put together a budget. And there's just a couple things. We had like an $8,000 put aside for home improvements, but it's been sitting there from an old refi a couple years ago. And since we're not using it, I wanted to put it towards my card and get my balance down. But then he mentioned, well, we're going to need to pay taxes and it might be around that amount too. So now I'm not sure if I should use it to get my card down or if I should be what we owe in taxes and maybe use it for that. But with such high interest on the cards, I figure it's got to be better to get that

debt down. But in the process, I also found out that he's maxed out his card. So I'm guessing we're somewhere around $30,000 or $40,000 in debt. Okay. So let's pan out just a little bit, Polly. Okay. So you are retired. You said you are, are you pulling money from retirement?

You said you're making about half of what you did or is that? Yeah. Okay. So I'm making $3,650 a month and he brings in somewhere around $5,500 a month. And he brings in $5,500, okay. Hey, Polly, before we get too deep into the tactical, what we do with the money, where your money goes, are you still spending on the cards?

Yeah, yeah. So it just seemed like every time I went to use our... So I have a separate account because of something that happened in 2015. He thought he was going to leave. So we were separated for a while. So I went ahead and got my account for my own safety to have money. Now we still have a joint account. We're back together.

You know, it's good. But he's not on the same page with the whole financial thing. I think he's still thinking, you know, he's working full time. He's doing really well. You know. But you're still spending on the card too, right? Like you said that you're living. I want you to cut those cards up tonight.

Like get your scissors out and cut them up tonight yeah because if we pay it off if we use that eight thousand dollars and pay it off and you're still spending we're going to be in the same situation in six months yeah yeah absolutely um so step one stop the Yeah, exactly. But that takes care of mine, but not his. And I'm trying to get him on board, and I was hoping that Dave was there so he could tell me how to talk to a man about finances without them shutting down. Well, Rachel's pretty good about couples and money. Yeah. good about couples and money. Okay, so Polly,

for you guys, do you still have separate accounts or are you guys working out of the same account? Well, we have a joint account that I have access to, but then I have a separate account and I've got

a couple thousand dollars saved, but I'm going to put at least a thousand of it towards my card. I've got a couple thousand dollars saved but I'm going to put at least a thousand of it towards my card I've rolled up all my change I've you know I'm trying to sell things as I can okay so let me let me kind of pan let me pan I just want to get a full picture of you guys as a couple so we'll we'll not pretend that it's all separate so all together you guys okay you see you're making a little less than 10 grand a month. How much debt do you guys as a couple have? I think it's going to be anywhere between 30 and 40. I know mine is 19, and I'm just guessing. Okay. Yeah. And that's all on credit cards? Yes.

Okay. Do you have any card? Yeah, that's not including a camper um our cars are all paid off okay how much is how much is the camper how much do you have left to pay for it or pay on it two two or three i don't remember what the payment is and i still need to find out some information from him because he does all the bills but i've been trying to put together a budget. It was $40,000 a couple years ago, so I imagine we're paying at least a couple hundred on it. Okay. Any other debt? What do you guys owe in your home? We owe $411,000, and it goes anywhere between $500,000 and $624,24 when you look at the value online. Okay.

But we've refinanced too many times. Yep. Yep. Okay. So here's the deal, Polly. We are going to help you tactically. We're going to give you Financial Peace University. We've been giving that away all of this show.

But really, if you can get your husband and you guys to do this together, these end lessons, tactically, it's going to help you walk through all of this. But I think one of the bigger problems is that in a marriage, if one person is trying to fill in the hole of debt to get a flat ground level of trying to get out of this financial hole, the other person is digging at the bottom then then yeah it's not going to work right and that's why we really stress for couples to work together so i know that he's hesitant but there has to be something in him paulie that knows we're not in a great situation my wife is retired i'm coming up on retirement age here in the next decade we still owe owe $411,000 on our house.

We are living paycheck to paycheck. We are depending on credit cards. We have $40,000 of credit card debt. We have a camper, like all of this. There is a level to him that's going to feel that. He knows, he knows. I'm sure, deep down. And so what you want-

He's not ready to talk about it. And that's it. So that's where we always say, it's not just a money problem. There is a marriage issue that you guys are not united and probably not just in money and other things. And so if you do have a great church in the area or a great therapist, marriage therapist, I mean, I'm not kidding. If there's any way to go and get a third party involved, this is the time to do it. Because you sitting there trying to convince him may or may not work. I don't know. I don't know your marriage. But I think for him to know where you're at, all you can do is control you. And

Polly, I think it would be probably a helpful conversation and a very maybe intimidating and vulnerable conversation. But to come to him and say, hey, here are the numbers that I've seen. I've tried to pull what we have and this is the situation. And I am scared. I am freaked out. I feel like we should be further along

than we are at our age. And I don't know what to do. And I would love it and long for you to come with me on this journey and us do this together because I want our future as a couple to be stress-free and to be bright and to go and do these incredible things that we wanna do at retirement.

This is what we wanna do. But I think what you're gonna start to find is that there's a lot of marriage stuff under that that you guys may need to heal from that 2015 situation that happened. And I think that's a great thing. But starting out this and opening the door when it comes to money and that conversation, I think is really, really important, Polly. But Polly, I think you need to take ownership for your part in it. He's not the only one digging this hole. You're digging it too. And you need to stop with a credit card and also just look at you and what you can change.

We'll be right back. This is The Ramsey Show. Our scripture of the day comes from Proverbs 10, 12. Hatred stirs up conflict, but love covers over all wrongs. Our quote of the day is, hate is too great a burden to bear. It injures the hater more than it injures the hated. That is Coretta Scott King,

wife of Dr. Martin Luther King Jr. All right, Rachel, I want to go back to that last caller really quick and just kind of wrap that thought up. So she mentioned she wished Dave was here so that she could have a man's perspective. But as I thought about it, I'm like, I think if Dave were here, he'd kick her butt. He would be pretty frustrated because she's sitting there talking about her husband and what her husband is doing wrong. But she has more debt than her husband.

And she's still taking on more debt. And I just think that's such an important call out for couples who are trying to get their spouse on board with Financial Peace University, who are trying to get their spouse out of debt. Make sure you are first setting the example. Make sure that if you want your spouse to stop using credit cards, that you stop using credit cards first. Right? Yeah. Like don't just point and say we need to make all these changes because that basically what they're going to hear is you need to make changes. I don't need to change. Yeah. Yeah. Totally. With her situation, I know there's like you said, they need to go to a counselor. There's probably a lot of trauma and fear and all of that mixed in. So yes, that's all true. But lead the way yourself. Show your spouse what

you want them to embody. Don't just point fingers because that is going to be one of the number one way man or woman is going to put up a wall. If you're just saying you, you, you, and you're not looking at yourself and saying, how can I improve? For wall's gonna be up and i do think paulie what i was feeling too from her i don't think she knew what i don't think she knew what to do they're living paycheck to paycheck they have these bills all she knows is to use a credit card do you know what i mean like i think for her too she was like i know i need out and i don't know what to do to get out too you know what i mean so that's why i was like even tactically we need out and I don't know what to do to get out to, you know what I mean? So that's why I was like, even tactically, we can't like dive in. I mean, what, yeah, you would cut up the card. You would say, here's the, here's the budget and anything that once the

money runs out, we're done. Like we're, we can't pay on anything else. We're going to cut expenses. We're going to work ourself getting out of debt. Like that, that's the tactical side. That's how you do it. Um, which is, you know, know and again we gifted her financial peace university to do that but i think yeah go ahead well i was i was gonna just say that you know in her situation and i think some especially if you're a new listener it's like okay i keep doing the same thing over and over again this is the result i'm getting i don't like the result i'm getting so i what do i do next you know so i love the i'd love that you called it out though to say okay the first thing you have to do is you have to stop going into debt.

If you want to work your way out, you can't keep going in. Well, and part of it is to come at it humbly. Say like, I've screwed up. I am screwing up. I'm spending on credit cards. You're spending on credit cards. Let's lock arms and let's do it together.

Like before you worry about his reaction and what he's going to do, like admit, you know, I'm overwhelmed by this. I don't know. I'm scared. I'm still spending on this. And what can we do together and make it like a together thing versus a, you know, us, you know, pointing fingers. Right. And we have a really great article we'll link in the show notes about money and marriage. So if you are kind of in that situation and you're trying to figure out how to navigate it with your spouse, check that out. All right. Let's go back to the phones.

Next up, we have Greg calling from Virginia. Hey, Greg, welcome to the show. Hello, ladies. Thank you for taking my call. Of course. Thanks for calling. How can we help? My question, I'm 59 years old, looking to build a house.

A little back story. My spouse and I have gone through FPU. I've coordinated it on four different occasions. Thank you. Our income monthly. You're welcome. Our monthly income is north of $9,000 a month bring home. Retirement accounts, we're north of $950.

And that's invested in traditional and Roth IRA 401Ks. Good for you, Greg. Well done. We're saving north of $6,100 a month. Nice. Cash on hand is north of $210,000. So you're Baby Steps Millionaires. Yes, ma'am.

Woo-hoo. Congratulations. Thank you. Wouldn't have been for Dave and his teaching. We wouldn't be looking to build a house that's probably in that six hundred and fifty thousand dollar range, plus or minus. We bought property, paid cash for that. We built a shop, paid cash for that. Put a road in, paid cash for that. We put a septic system has been installed, and that was paid in cash as well. We just need to dig a hole and build a house. I feel like a hypocrite telling people to get out of debt and being successful doing so.

And now we're looking at biting off this chunk. Now, with our income and our commitment to a budget and paying it back, I suspect we'll hold on to a mortgage for no more than five years and it would be paid off. We have no other debt aside from this pending mortgage. And I wanted your opinion as to whether we're nuts or not. Whether you're nuts or not. Well, you know us, we would always say that the best way to buy a house is 100% down, which I know is not realistic for a lot of people. But when it comes to a mortgage, you know, well, you know this, Greg, because you've taught the class of the 15-year fixed rate, all of it. I mean, but you're well under that with the five years of what you think you'll be able to pay off.

What are you, what's your house worth now? Actually, we sold the house we had. It did not have a mortgage. We sold it for $440,000, put the money in the bank uh and add to it every month and that's how we've been able to to pay for the land and the shop okay and the stuff we got of cash but adding to it every month gotcha but but that's that's where the 210 comes from then correct okay i got you i got you um yeah i mean it will be hard You're in baby step seven currently. So you'll go back a baby step, which again, it's like, oh, you know, you hate to do that. But we have talked to people that

they're like, you know, I'm going to take out a small mortgage and we're going to pay it off quickly. And here's the plan. And here it is. And so I think, Greg, if that's what you guys decide that you want to do, you know, that's that's totally up to you guys. I mean, for for for some people, they're like, I never want debt again. Like once I'm in baby step seven, I'm not going back. But but we've had people even here that have done that. They've paid off their house and they're like, you know, we want to upgrade a little bit. So we're gonna take on a small mortgage and do that. And so where you guys at, where you are financially, I think you're in a position that you can, Greg. I mean, you're going to be okay.

You guys have done incredible with retirement. The cash you have on hand, you guys are diligent savers, putting so much away per month that you were saying. And it's going to be in five years, yeah, you'll have it paid off. So I don't think it's... We do have a fully funded emergency fund. And do we continue to save for retirement? I mean, honestly, right now it's a match because we're both fully vested.

On my plan, if I invest 6%, they match at 9%. That gives me 15% that you're 100% vested in. Well, we don't include their match as part of the 15%. They match at 9. That gives me 15% that you're 100% invested in. Well, we don't include their match as part of the 15%. Understood. Okay. So should we bump both of ours up to 15% of this juncture? My opinion, and I'm probably wrong here, the more we're saving for retirement, the less we're able to pay cash on a house. And so it's kind of, it's probably a draw either way. the more we're saving for retirement, the less we're able to pay cash on a house.

And so it's kind of, it's probably a draw either way. I just want to know what your thoughts are, please. Oh, okay. Yeah, I would say, yeah, where you guys are with retirement, the amount that you have, you know, I mean, I would still hit that 15% if it were me. And then whatever you have left is where you would go for the house, what you would put towards the house. That's good, Rachel. All right. Well, thank you for your call, Greg. We're proud of you for being a Baby Steps millionaire. And honestly, I would work through part of feeling like a hypocrite is going to be if

you keep that private. You're teaching your FPU classes. I'd be willing to share that. I'd be willing to say, hey, y'all, this is our situation and we are we're in it with you again. We are going to be paying off this debt. We're going to be working through it. And just be honest about it. Part of that icky feeling that you might feel is if you feel that shame and you're like, oh, I can't share this because it's going to change things. It's not. Just be honest. And then you're back in the FPU class and you're with them through this process.

That's right. And y'all, I just want to call out, we've got a Ramsey Solutions newsletter. If y'all are worried about heating and gas bills, the newsletter this week is going to be 11 ways to save on your heating bill. So go to ramseysolutions.com slash newsletter. That puts this episode of The

Ramsey Show in the books. Thanks to the people in the booth, Emily, Ben, Austin, Zach, and Andrew, and to you, America, for listening. We'll be back soon. This is The Ramsey Show. Hey, it's Rachel Cruz. If you like what you heard in this episode and want to know more about getting started on the Ramsey baby steps, go to ramsesolutions.com and click the get started button. We'll help you figure out the best next step for you based on your specific situation. That's ramsesolutions.com and click get started.