The Ramsey Show - App - Your Debt Doesn’t Scare Me, You Can Do This! (Hour 1)

Episode Date: November 22, 2023

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🎵 🎵 🎵 🎵 🎵 🎵 🎵 🎵 🎵 🎵 Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth, do work that they love, and create actual, amazing relationships. I am your host, Jade Warshaw. Your other host for the day is Dr. John Deloney to my right. Give us a call. The number is 888-825-5225. We will talk about the

things that are concerning to you about your life and your money. I'm here as kind of the money expert and my guy John is here as your mental health and wellness. I still don't know why I'm here. We're thinking about it. We still don't know why I'm here. We're thinking about it. We're figuring it out as we go. But give us a call. Like I said, the number is 888-825-5225. We'll chop it up with you.

Let's go directly to the phone lines. We got Laura in Phoenix, Arizona. What's going on, Laura? Laura? Are you there? Did I get her? Are you there you there okay it was my nails i blame my nails are you there hello okay what's going on laura jade's nails got in the way again what's up laura yeah so i need help on so currently we're on 3030,000 in debt. So we always sit down and talk about our debt.

Say like we sit down on a Monday, everything goes good. And then the weekend starts. We have an issue where my husband likes to drink like Friday, sometimes Friday to Sunday. Wow. And then during that time, he, like, he forgets about our, like, budget. Well, I would think so. Yeah. So then that goes out the window.

And then Monday comes, and it's like. He's ready to start again. Yeah, and he's like... He's ready to start again. Yeah, and he's like, what happened? I thought we had sat down and talked about our budget. How long has that been going on? I would say like six months.

We've tried to get together and try to pay off our debt, but it's just not working yeah you're married to somebody who's really struggling with alcohol this has this is not a budgeting issue at all yeah this is a you love someone who's an alcoholic yeah and it's like he doesn't see it that way. So it seems like I'm the nagging wife. Right. And here's what you've got to do.

Unfortunately, there is no healing in your marriage. There's no healing in your financial life. There's no healing in underneath your marriage and underneath your financial. All that leads to this moment where you don't feel safe in your own house, do you? No. No. No. None of that changes until he chooses to get clean. And so no matter what the issue is, when somebody comes in and says,

hey, I'm struggling with X and Y and Z, and I'm drinking, and I can't quit doing X, Y substance, nothing happens on the mental health side, the marriage side, the emotional, until somebody says, I'm willing to go get clean. And what that means is you have to take care of you. Because you're not safe. And I don't even doubt that this guy loves you. But this guy's got some significant struggles that he at this time is unwilling to deal with. And so you have to

make your safety priority number one. What does that mean? It probably means you need to find somewhere for him or for you to go for 30 days and say, hey, I'm not going to live with somebody who's unsafe anymore. I'm tired of being on eggshells in my own house. I'm tired of not knowing where all our money goes. I'm tired of not knowing where you go. And then you come home on Monday and kind of make it my fault. And I thought we had all this. He's got to decide to do something different. And that means going to a meeting starting tomorrow morning, even though tomorrow's Thanksgiving.

See what I'm saying? Like this is a, this is a way bigger deal than budgets. Yeah. And can I just be honest with you? Yeah. You know this right yeah i mean he doesn't get upset about it and he just says like like what's going on like we sit down and then i'm like well this is what happens and then he's like oh you know what

yeah you're right i'm gonna work. So listen, behavior is a language. And what he's telling you is I don't care what you and I agreed on. I don't care what you and I, um, I don't care about our, our marriage fidelity. I don't care about our agreements. I don't care about our financial health. I care about going on Friday and Saturday nights and doing whatever the crap I want to do. Period. I don't care how you feel in my own house. I don't care if you feel like I'm a liar. I don't care if you can't trust me.

I get to go party on Friday, Saturday, and Sunday. Well, he doesn't go party, but he drinks at home. Okay. Well, he's going to disappear on his own house on Friday, Saturday, and Sunday. Yeah. Yeah. Behavior's a language. And he's talking to disappear on his own house on Friday, Saturday, Sunday. Yeah. Yeah. Behavior's a language. And he's talking to you loud and clear.

Yeah. So this is the point when you go get a friend, you go get a pastor, you go get a therapist, and you sit down and come up with some really ironclad boundaries that are going to be brutal for you to enact. It's going to break your heart. Yeah. And that might be, there is no alcohol in my your heart. Yeah. And that might be there is no alcohol in my home anymore. Period.

If you lie to me and commit financial infidelity again then I'm out. I'm going to go move in with my sister. You have to go to AA. Your boundaries have to be pretty tough at this point.

Is that fair? Yeah. I can hear it on you you're worth more than than what what the life you're living right now yeah jade am i crazy no you're not crazy i i hate this for you it's tough and you know people all the time they call in and they're talking about issues that aren't they're not money issues. And here we're always telling people like, combine your money, combine your money. But there are times where it's like, there are situations where it's like, no, don't combine

your money. Like you said, you seek counsel. And I tell people all the time, like there's this acronym I use about keeping your money safe. And it's like, if you're in these situations, like, you know, our friend calling in here, like, if you're in these situations, like, you know, our friend calling in here, Laura, where you're concerned, the first thing is you need to seek counsel. Like that's the S you got to seek counsel. And the A is if there's abuse and if there's addiction, that's when you got to do it. Or the F financial infidelity, that that's what we're looking at. And then they're going to give you the E, which is you can evaluate your options based on the boundaries you have. Because I'd like to say it's as easy as, all right, move out tomorrow.

But it's not, it's never that easy. And there's always a wake. You know what I'm saying? Always. And so I would just encourage anybody who's in that situation, like I said, abuse, addiction, financial infidelity. Yeah, you're not, like you said, you're not safe in your own home. And that person cannot have continued access to the things that make you safe in your family

that keeps your kids safe. Because if you have somebody who's spending all the money on substance and your kid can't have groceries and your kid can't eat and you can't get to work because there's no money for gas. Yeah, you got to put some boundaries in place.

And you have to say, like you said, that in my home, there will be none of this. And until this happens, you will not have access. And that's probably the toughest line that you can lay down. But that's loving yourself well. And honestly, that's loving them well. And it's loving this thing that we decided to create together, which is called a marriage. That's right. That's right.

Oh, it's so tough. I hate that she's going through that. I hate that it's happening. You know, during a time like this, the holidays where you're supposed to be able to come together with the ones you love. Sometimes you have to create that distance, that separation and create that boundary so that ultimately things can get better and you can find healing. This is The Ramsey Show. Hey, what's going on? You're listening to The Ramsey Show. By the way, thank you for listening to The Ramsey Show. I'm your host today, Jade Warshaw. I am joined by my buddy, bestselling author, host of The Dr. John Deloney Show. The guy's name is Dr. John Deloney. If you were not sure about that, we are going to take your calls all afternoon.

Give us a call. The number is 888-825-5225, and we will help out sort out your situation. Let's go straight to the phone lines. We've got Anthony in Anchorage, Alaska. What's going on, Anthony? Hey, how you guys doing today? Doing good. How can we help? I'm calling. I've been struggling with making my payments every month to try and get out of debt. I've never missed a payment since I've had started building my credit, but I can't afford to make more than the minimum payments and I'm never able to catch up. And that's the problem I'm facing. How many payments are you trying to make? Like how much debt do you have? Between me and my wife both, we've got about $30,000 in consumer debt and another $5,000 in student loans. Okay. So can you sort out for me what the $30,000 is? It's all credit card, vet bills, furniture, credit cards, just bad decisions.

So various credit lines. Correct. Okay. And can you tell me what you guys are earning each month combined? What you're taking home? Monthly take home after taxes. I get about 5,000 from my job after paying for benefits and everything okay um currently i'm a full-time student so i get another twenty two hundred dollars a month um for my veteran benefits okay cool what about your wife

my wife just started her own business back in july right now she's only making enough income to sustain her business to pay her rent pay for her supplies and stuff like that. So she can't pay herself yet. Correct. Okay. Is there a trajectory on that business? Like after half a year, is there like an honesty reckoning? Like, is this a really nice hobby or are we headed somewhere?

We've had that conversation a little bit. We pay for her to go to school and then she just started the business in July. Ideally, she needs to be able to help contribute once I am no longer a full-time student is the plan right now. What's the nature of the business that she's doing? She is an esthetician. Okay. My question is, is there a way that she can do that business and also bring in some part-time income as well? That's a discussion we just had last week in regards to her looking into some part-time work to at least be able to help me pay some of this stuff down. Because I don't have the time to pick up any extra shifts between working full-time and going to school full-time. Right. I don't have any extra income.

And what does she feel about that? She is open to it uh unfortunately she doesn't nothing against my wife she doesn't have any uh college or post-school secondary training so i don't think she needs it i don't think i don't think she needs it to pick up part-time work and when i say part-time like go make 20 bucks an hour like i don't care I just want her bringing in some form of income and I think that's gonna help in many ways a it's gonna help you guys get more income in but two it's gonna help take a little bit of the heat off of her in this thing that she's trying to build right now she can still feel like all right I'm building this thing for

myself but I'm also contributing in another way that my family really needs right now and that's gonna help everybody so that's kind of something put put it on the shelf, you and her, think about it, pray about it, whatever. But the reason you called in is you've got this debt here, $35,000 of debt. And you're feeling the crunch of that because, I mean, it's a lot. It's a lot of payments that you're throwing away. You mentioned it's $30,000 of various credit lines. So each month you're having to keep track of that. And I can tell you firsthand, when you've got all those debtors that you've got to pay,

it's just frustrating. It's just a lot to keep track of. And I think you're feeling that. The advice is the same that I would give anybody, regardless of the amount of debt, regardless of how many debts. What I would tell you to do is list these debts from smallest to largest. So those 30,000, I'd go through each one and be like, all right, what is the smallest balance? And list them from smallest

to largest via balance. All right. And then it's like, okay, now we know what it is. We got to pay these off. And the method to pay that off is simple. You got to get cash on it. Do you have any cash saved anywhere? That's not retirement money. I don't. All the cash I've had in savings has kind of dwindled over the last year between my wife going back to school and me kind of supplementing everything. I've been doing the snowball method a little bit. I had about $40,000 in debt just earlier this summer, and I paid off some small $1,500, $2,000 bills, whether it's to the vet or for furniture or whatnot.

So I've kind of taken care of all the small stuff. It's now coming towards the bigger credit cards. Oh, go ahead, John. I was going to say, is this the time? It sounds like you've got two people in school, you've got a wife launching a business, and you're working full-time. Either one of two things might just have to be true this season. That you're going to finish school and you're going to pause.

Your goal is going to be to get out of school debt free. And then you're going to attack this when you get your full time gig. Or I just need to take six months off from school. I need to take a leave. I had students do that every single semester. I took a number of leaves across all my degrees for various things that happened. I had a kid, wife got sick, had to go do this, wanted to make some more money, whatever the thing was. And just saying, I'm going to go earn 10,000 extra bucks in this semester and get this stuff

paid off or 15,000 bucks or whatever I'm like, I've got to do. Or your wife takes full-time work and says, I'm just doing the anesthetician stuff on the side as a hobby until. That's right. But y'all are all trying, they're all trying to do everything all at the same time.

All the dreams. And dude, I don't want to kick you while you're down, but 30,000 bucks isn't a ton of debt. That's like you and your wife really making some hard calls for a very short period of time. 18 months max.

See what I'm saying? Right. So tell me, what's your world look like if you quit school for a semester short 18 months max see what i'm saying like right so tell me what's your world look like if you quit school for a semester you pause school well the reason why part of the reason why i went back to school is because i get that monthly tax-free stipend yeah but is that just going to school no and it goes directly into my bank account i'm a veteran okay so i get a gi bill housing benefit okay it pays me 2200 a month tax-free and income directly into my bank account. I'm a veteran. Okay. So I get a GI Bill housing benefit. Okay. It pays me $2,200 a month tax-free and income directly into my bank account. What's happened to that other $5,000 then? I have a very large mortgage. I owe $470,000 on a mortgage. I've only been in the

house for a year and a half. What's the monthly payment? $3,200. Dang it. Okay, now there's the problem right there. Lead with that next time. Well, John, you detected that. Okay, there's your problem right there. Sell your house, homie. You can't. You're so far above the percentage. I feel like I'm stuck.

If I sell my house, I'm going to lose money and go into a rental that's going to cost me. Well, let's not just be scared of that. Let's see if that's actually true. So what'd you buy the house for and what do you owe on it? And what would it sell for?

Let's actually ask those real questions and see if that's true. We were renting. I was paying $2,500 a month in rent. This was the beginning of 2022. I looked into purchasing our home. We found a home, this was the beginning of 2022 okay i looked into purchasing our home we found a home purchased it in may of 2022 uh four and a half percent interest it was roughly all the fees ended up being close to 500 000 okay so what do you owe on it 472 000 and what can you sell it for? I don't have a locked-in estimate.

According to my mortgage broker, I need somebody to come out and reevaluate the home to get it up to date. If I'm you, I'm starting to get those numbers, and I am holding on as tight as I can for the next few months because I want you to own it two years so that if you do have a windfall on this,

that you're not hit with capital gains. And I want you to seriously consider, like, if I was your mama, I'd be like, you better do it. Sell this house. Because it's half of, it's half. It's so much. And you're not, there's not a trajectory that you have shown us that gets you there in the next even five years. Your wife's building a business, you're in school, the business is not making money yet, and you're in debt. And I just think that when you get out from under this house, you are going to take a giant deep breath. You don't have any kids yet, right? I have a six-year-old. Okay, you have a six-year-old. So we're finding something, honestly, at this point,

anything that's less expensive than the over $3,000 that you're spending right now is going to help you. And you're a veteran, brother. So think of it through those eyes, through that lens. When you're faced with a whole bunch of variables and they don't all add up, let's begin to pull variables off the table. Things that we thought were absolutes, they're not. Your wife doesn't have to start a new business right now. You don't have to be in school. You don't have to be in a big $500,000 house. All these things can come off the table.

Let's seek freedom. Let's don't seek to try to make, duct tape this chaos together. Let's seek freedom over all else right now. This is The Ramsey Show. Thank you for listening. My name is Jade Warshaw, joined by Dr. John Deloney.

We're taking your calls this hour. The number is 888-825-5225. But quick shout out to you guys, to the folks listening to the show, whether you listen on podcast or maybe you log into YouTubes and you watch it on YouTube, or maybe you log into YouTube and you watch it on YouTube or maybe you go directly into the Ramsey app and you listen to it through there. Number

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We would be truly, truly thankful in this season of thankfulness. So thank you so much. Let's go to the phone lines. We've got Jackson in Grand Rapids, Michigan. What's going on, Jackson? Sorry, Ms. Jackson. What's up? Hi, guys. Thank's going on, Jackson? Sorry, Ms. Jackson. What's up?

Hi, guys. Thank you so much for taking my call. So I'm going to try and articulate my question best I can. Okay. So I'm fairly new to listening to you guys over the last couple weeks, and I've introduced this whole plan to my wife, and we've got ourselves in quite the hole. And my main question is she deals with a

lot of, um, mental illness and she has a really hard time like seeing the big picture. And honestly, it's all very overwhelming for me as well, but I'm kind of like the backbone to everything. And, um, just trying to get her fully on, on board with everything and not thinking that this isn't something that we're capable of doing. Well, when you say she, what's she struggling with specifically? She has depression, anxiety. She's been diagnosed with borderline personality disorder, ADD. So it's just kind of like a handful of things. So the first thing, if somebody, if I meet somebody and they come to me and say, I've been diagnosed with all of these things, the first thing I'm going to tell them,

whether it's my friend or that somebody's in a coaching situation with me or a family member, I would tell them, I need you to go find a new provider and get reevaluated because that's a lot of that's a lot of variation there it's all right it's all over the place yeah um as a part of if i mean there's a very different conversation if somebody truly has borderline personality disorder and their emotional life feels like it's on fire right that's a different conversation trying to get somebody to learn about how their emotions interact with reality with the real world as well as it's a different conversation when you're talking to somebody who's struggling with depression or anxiety right so you're like i would start there the second thing i would start

with is this does your wife know that, her feelings are very big on things, whether they're up or whether they're down? Can y'all agree on that? Yeah. Okay. Will she trust you? Um, I, I, I mean, she does trust me. I think to an extent extent your voice tells me absolutely not even a little bit um i think i think she trusts me but i like i said she just has a hard time seeing the bigger picture like that's not what i'm asking for here asking somebody who has borderline personality disorder asking somebody who's got anxiety disorders to see a bigger picture is truly unfair especially at the beginning what i'll often ask is will you hold my hand do you trust me and you watch somebody's shoulders drop and they go i do and say okay we've got to make a budget because i don't feel safe okay and my body feels like you're taking something from me you're

stealing something from me my body feels like it's on fire i feel like i hate you i feel like you're the greatest person whatever that whatever they're feeling great do you trust me yes to make the next right choice for us yes and that only works if they are seeing a provider that they can get some true clinically based support and help for right right and if you can't get that basic level of trust, then you have to start asking yourself, how can I make sure that we are safe? Because we can't work in partnership together at this moment. We will someday, but we'm trying to over-clarify it because you're allowing your, like, I'm the backbone. I got to do all this stuff. I got to make her happy. With all four of those diagnostics, you can never be quote unquote happy, right? You just gave everyone. I've got a couple of those diagnostics. Dude, sometimes I don't care what I feel like. I just got to do the next right thing. So I haven't spent my life trying to be happy. I've spent my life saying, if I do these things, my body's going to feel good at the end of the day.

Does that make sense? Right. That took a lot of therapy, a lot of counseling. My wife's pretty amazing. I have some great friends, right? I had to do a whole lot of stuff to get here. Yeah. So don't try to solve it all at once.

But I definitely would start with getting a new, having a new conversation. Do you have a particular issue y'all are struggling with right now? I mean, we, I just did the math and we have over $130,000 in debt. We don't even own a house and we make okay money. She works part-time. I'm working two jobs right now. How much? Just trying to, before taxes and everything, I did the math. We made 80,000 this year. Um, I, I, one of my jobs is, uh, 47 and the other one's about 15 and hers is 20. Um, that's all before taxes and everything, but I just don't even know where to start. We did this debt consolidation thing, um, which I just feel like was a bandaid. Um, it wasn't actually, you took a knife and stuck it in the other leg that's what that was yeah and then i did a four i know 401k loan um yeah then you took a knife and stuck it

in your arm yeah what else did you do we we have a lot going on and i just honestly i'm i lost i don't know where to start and i'm trying to get her on page when i don't even know 100 when i'm doing i just know we need to do something so she she's got those challenges. You know what she senses? She feels that you don't know where you are on the map. Jade's going to walk you on the map, but I want you to hear this before she says anything. Jade had way, way more debt than that. Me and my wife, we had way, way more debt than that. That number you just gave me doesn't scare me at all. Not a bit. Okay. You just have to decide, I'm going to go make this thing a priority. Absolutely. And your wife has to make her healing a priority.

You get those two things lined up, man, dude, it's game on. Yeah. Yeah. Yeah. I mean, what John said is exactly it. I'm not blinking when I hear $130,000 of debt. I mean, look, it's not good, but don't be scared. Just go, okay, it's like John said,

what's the next right thing that I need to do? And for you, the next right thing, if you're not on a budget, you need to get on a budget. Are you on one? I did the free trial of the every dollar and like we kind of walked through a little bit together. Okay, good. So we're kind of working through that a little bit, figuring that out. Okay, so this is like new in the last couple of weeks. Okay, good. So we're kind of working through that a little bit, figuring that out.

Okay, so. I guess this is like new in the last couple weeks. Okay, good. So Austin's going to pick up and after this call, he's going to give you a copy of my book, Money's Not a Math Problem. And as part of that, you're going to sign up and you're going to get three months free of every dollar premium. Because I think you need premium that's going to help you walk through this and you'll get three months free of that to test it out. Thank you. That's going to be everything because this budget's going to tell you what's what um i want you guys sitting down and i want you to complete your budget if you haven't already

tonight because you just getting a handle on the numbers even if it's not good like right even if you do that budget and you realize man we're we're negative 75 every month no wonder there's a problem just seeing it and knowing what it is is still going to make you exhale and be like all that budget and you realize, man, we're negative $75 every month. No wonder there's a problem. Just seeing it and knowing what it is, is still going to make you exhale and be like, all right, I know what it is. Now I see we have an income problem. Or you might do that budget and realize, hey, we have a decent amount. It just looks like we're spending too much. And if that's the case, again, you're going to exhale and know, okay, we've got to cut back on our spending. And so, or it's a combination of both. And so just knowing that is going to go,

okay, I see what the game plan is. Now we need to create a plan of attack. Does that make sense? Yes, it does. Because at the end of the day, the math is the same. You still have to make the payments. And this is for anybody listening. Debt doesn't go away unless you make the payments. You can't move it over here.

You can't take out this loan and cover it up with your mortgage. You have to actually make the payments. You can't move it over here. You can't take out this loan and cover it up with your mortgage. You have to actually make the payments. And for most of us, that's called going out and getting an old fashioned J-O-B. Okay. You can't get aside the work. You have to put on work boots, do the work. You have to cut back your spending. No more chilies, no more Applebee's. You got to do the work. You got to make the sacrifice and trust and believe it will show. You can't do this and kind of do it sneakily or do it without anybody noticing. You're going to see it and you're going to feel it and it's going to suck

for a minute, but then you're going to be out of debt. This is The Ramsey Show. You are listening to The Ramsey Show. I am Jade.ade this is john we're with you for the next couple hours taking your calls the number is 888-825-5225 if you want to give us a call i'm kind of hype i'm not gonna lie tomorrow's thanksgiving um i'm excited about that but more than that my favorite part of thanksgiving is actually the day after Thanksgiving, not just because of the leftovers, John. I can imagine the leftovers in your home are pretty amazing. Are you cooking a spread? Look, their own point.

I'm not going to lie about that. But more so, I'm talking about Black Friday. I know. Black Friday, it's game on, dude. Come on. Do y'all go shopping for Black Friday? I go to the woods because I have self-control problems, and so I just take myself out of internet range. John, you're different

man and I'm not mad at that. You're doing right but the rest of us. Listen, the other night I was having dessert with my wife and I couldn't stop and I literally took my fork and I just hit it under the floor and she goes, did you do that on purpose? And I go, yeah, but I'm not eating anymore. Stop eating the dessert? I could have. I didn't want to stop so I have to

put these roadblocks in front of me, man. Well, what was the dessert? Now we want to know what it was do you know what it was just sugar and goo and whatever i don't know so john's in his house like winnie the pooh just gobbling down bags of sugar and honey i love it i love this time of year man i love it me too not gonna lie black friday i love it um we're the type we get up early we go out into the madness. I love it. I will elbow somebody for an air fryer in two seconds. I love the madness. I save up a budget and I put the line item and I just get wild. I love it.

I don't know what it is. Best buy. I don't need anything at Best Buy, but I want to be there at 7 a.m. going crazy. But here at Ramsey Solutions, we are also having a Black Friday sale. And the good thing is you don't have to put anybody in a headlock to get your deal because it's on the interwebs, John. You can just roll over, pick up your phone

and start clicking. You don't even have to get out of bed, but we've got early access to some of our best deals of the year. You can get meaningful gifts for your whole family, your friends, everybody as low as $8. That is nothing. You're about to learn this because you got a book coming out um this is the time of year when dave just starts selling all your stuff just and for those of you who don't know we make a commission off the sales price and we always love it when dave's like how about five

bucks thanks dave thanks dave that's all right because his are on sale too i mean you can get best-selling books like the total money makeover that's his book so if he's putting it on sale for ten dollars look we're all i mean we're all being generous a little bit different place we're a little bit different place really i'm just kidding of course you are uh baby steps millionaires and here's your book john own your past chain your future for just ten dollars why not man that's right put it uh put it for 70 off there you go financial peace university i will say this is my favorite one. The fact that you can get Financial Peace University

for under $60 is madness. Sheer craziness. I tell folks all the time, the principles in Financial Peace University are what helped my husband and I pay off almost half a million dollars of debt. So technically, this product is worth half a million dollars

and you're getting it for 60. That's crazy. Rachel Cruz Wallet is back. That's on sale. And that's a product that somehow is almost never on sale. So the fact that it's on sale is great. And of course, questions for humans cards are on sale cards starting at $10. So that's pretty good. So shop Black Friday. If you're not like me, you don't want to go out into the cold or out there with crazy folks who will just cut you in line. Just roll over in your bed, turn on your Internet and log on to Ramsey Solutions dot com slash store and get yourself a deal and get you some gifts for everybody in your family. But don't go over budget doing it. All right. Is that cool? Cool with me.

Let's go to the phone lines. We got Andrew in Sacramento, California. What's going on, Andrew? Hey, thank you for taking my call. How are you guys doing? We're doing good. I'm cutting up. Are you a Black Friday dude? Are you going to go?

No. I'm just like you. I'll go to the woods and hide away. I love it. You guys are good. Good job. How can we help? So my question is, I'm 32.

I'm debt free besides my mortgage. I have my six months emergency funds already put aside. My question is about the 15% retirement. Is that gross? Is that like on top of your employer sponsored? Or is that including your employer sponsored? What should I contribute to that? So you want it to be off of your gross income period okay so the and then that's it

so gross income so i'm already putting money into my employer sponsored if that already equals close to 15 that's fine right there or should i add more on top of that help me understand tell me again so let me say this let me so if you have if if your employer has a match up to five percent and you put in five percent and they put in five percent we want you to put another ten percent in and we want their match to be gravy oh i see what you're saying thank you john i was confused as as to what you're asking yeah no matter what your company sponsored you were always doing 15 and the reason for that there's a reason for that and that is basically we just want you building the habit of investing and the fact is you might move on and go to another company that offers no match or offers a lower match or offer something different in way

of benefits and we don't we want your budget and your habit used to no matter what, I invest 15%. And so that's kind of the reasoning behind that. Fair enough? Yes. And then my second question was, I want to buy a second home, but I'm not sure if I should focus on paying off this mortgage first before I start saving up for another home because ultimately I want to make this house a rental property and then move into my forever home. Should I focus on paying off this mortgage first or is it okay to start saving up more money for my forever home and then just have renters end up paying this mortgage off? Yeah, if it were me, I'd pay off your current home first. That's what we call baby step seven

is once you've paid that house off and you're completely free. And then think about how much money you would have saved up not having a mortgage that you could quickly save up and pay cash for another residence that you decide to be a rental or maybe you move in that one and make your current one a rental. You've got so many options. The only thing that I would say is whatever you end up buying after your primary residence buy it in cash dude okay yeah so this is kind of like the best thing i can just hear like yeah i know but hey bro this is exactly what i'm doing okay okay we paid off the house that we live in and now we're saving up for um and it's and it

dude it's the worst man because we could go pull a mortgage right now and i'm not putting myself right back in that mess yeah and i hate it because everything in my life feels like it would be better if i just did that except for the one thing which would mean i'm back to being owned by a bank and i don't like that i don't like being owned that a bank. And I don't like that. I don't like being owned. That's true. Andrew, you're 32. Like there's, you know, and you're not the only one.

I think that there's just such this rush that we feel like I got to hurry up and get this. And I got to hurry up and get my rental. And I got to hurry up. And I think sometimes, and I get it. Like we all want to get to this perceived place of success. And like, okay, like I made it with my money. Like we're all trying to get it. We all want to get to this perceived place of success and like, okay, I made it with my money. We're all trying to get there, but we really have to be careful in all of our getting that we're also getting the right understanding

and that we're doing things correctly so that it doesn't end in folly, right? Because the worst thing ever would be if you were like, I'm so excited to be rich and I'm so excited to be successful that I don't pay off this mortgage and I go get this other mortgage and now you're racked with debt and you thought you were going to rent it out but your renters are kind of wishy-washy and they're not paying and then

the roof breaks and then there's earthquake like all these things that have the ability to happen there it will feel totally different had you not gone into debt as opposed to being strapped with debt and I'm like you're in Sacramento so whatever real estate you're talking about buying is not going to be a hundred thousand dollars is all I'm saying. So you don't want that strapped to you. I would much rather approach this knowing, Hey, like I get to control this and time is not pushing me to do anything. I make the call. Does that make make sense and i think that way you're walking along that path and you're doing it with the least amount of risk but honestly the ultimate amount of reward if you really think about it and we just dude we just came out of a scenario

where i think in your state it was illegal to evict people even if they weren't paying during covid that's show you but that mortgage still has to be paid right and so it's not like we're just making this up for fun yeah it's it's just we just take call after call after thousands and thousands of calls of people going what do i do what do i do what do i do and that's a good point john because we just we just went through it that's a good point it's not like we're trying to think of every bad thing that could ever happen no we just take the calls of the real things

that do happen yeah and the fact of the matter is most of our best laid plans are with this assumption that everything will go well even the phrase I'm going to buy my dream home dude no you're not

yeah we don't know we don't know you just don't know what's going to happen and for that reason alone I just love operating with as less risk as I can that's right you know so anyway um thanks for listening guys uh that does it for this hour of the show be sure to hang on with us john and i will be back for the next hour

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