The Ramsey Show - Make Money Choices Today That You Won’t Regret Tomorrow

Episode Date: February 6, 2025

📈 Are you on track with the Baby Steps? Get a Free Personalized Plan Ken Coleman & Jade Warshaw answer your questions and discuss: "I can’t find a job after getting divorced," "We're about to receive $1 million," "Is my direct marketing business going to cost me more than I earn?" "How should we fund our kids' 529s?" "Should I still buy a home with my boyfriend?," "My parents want me to pay them back," Support Our Sponsors: 🌱 Get 10% off your first month of BetterHelp ◎ Get 10% off Byrna product bundles and more! 🏥 Learn more about Christian Healthcare Ministries 🏡 Get started today with Churchill Mortgage 🔒 Get 20% off when you join DeleteMe 🏦 Go to FAIRWINDS Credit Union for an exclusive account bundle! 🥗 Save 15% on your first Field of Greens order with code RAMSEY ⛨ Find top Health Insurance Plans at Health Trust Financial 💸 To find out more about student loan refinancing, check out Laurel Road 💻 Visit NetSuite today to learn more 🗂️ Use promo code RAMSEY for 18% off at The Nokbox 💵 Learn more about Timothy Plan 🏛 Get started with YRefy or call 844-2-RAMSEY 🔐 Visit Zander Insurance for your free instant quote today! Next Steps 📱 Watch the full episode for free in the Ramsey Network app. 📞 Have a question for the show? Call 888-825-5225 Weekdays from 2-5pm ET or click here! 💵 Start your free budget today. Download the EveryDollar app! ☂️Get trusted insurance coverage that fits your budget. 💼 Connect with a RamseyTrusted tax pro for help with payroll and more 🪑 Check out Front Row Seat with Ken Coleman! Listen to more from Ramsey Network 🎙️ The Ramsey Show   🧠 The Dr. John Delony Show 🍸 Smart Money Happy Hour 💡 The Rachel Cruze Show 💸 The Ramsey Show Highlights 💰 George Kamel 🪑 Front Row Seat with Ken Coleman 📈 EntreLeadership Learn more about your ad choices. https://www.megaphone.fm/adchoices Ramsey Solutions Privacy Policy

This is the Ramsey Show where you come America to get coaching to win in your life, winning your money, winning your profession and win in your profession, and win in your relationships. 888-825-5225 is the phone number to jump in alongside the incomparable, the fabulous, and almost happy birthday gal tomorrow. She will be the birthday gal, Jade Warshaw. I'm Ken Coleman, just happy to sit next to her. That's how it goes, folks. That's it. I'm Ken Coleman just happy to sit next to her. That's how it goes folks. Just that's it. I'm easy. I'm happy to be here. I enjoy being with you friend. We always have a good time so Jade will coach you up on what to do with your money. I'm gonna coach you up on how to

make more money. How about that? Pretty simple. Let's go to the ATL Atlanta Georgia. Christy's there. Christy how can we help? Yes, I got a divorce a few years ago, not really by choice, but I cannot seem to find a job. Before I stayed at home with my kids, I had a great job, I have a master's degree, and now that I'm trying to look for a job full time, nobody will really hire me. And I'm currently doing like the small business that I was doing when I was married.

So it's more of a part-time income. But I got my house is paid off, my car is paid off. I have a rental house that's paid off. So I've got that and I've got some cash, but I'm not really sure what to do with it because I don't know what my salary's going to be in the future. Okay. Well, let's get, we'll get to the cash. I want Jay to weigh in on that and help you out, but let's just talk about this, this reality that you're facing. You're saying I can't get hired. Are you not getting interviews or are you getting interviews and you're not winning the interview? what's going on well i started with looking and uh... health care business uh... section that i

was then and because it had been over twenty years i'd just could not get any kind of interviews i've had all kinds of people look at my resume and say it's really good uh... i mean vice president all types of people I've had look at it. So then I tried to, you know, change it up and do more marketing stuff, which is kind of what I've been doing, I guess, part time. And I just can't seem to find anything.

Well, no, again, here, I'm looking for specifics. When you say you can't get interviews, and that's across the board. I have had a few interviews. Okay. But not very many. Like I'm just not getting any calls for interviews. So I'm not sure. What's your process? What is your process for getting these interviews?

What are you doing? I'm going online and filling out. I have different resumes tailored to different types of jobs. And then I'm sending them in. And I've been been looking locally but also I can't really move right now I still have one in high school so I'm kind of a little bit I don't live in a big area. Okay so based on what you did in the past in the healthcare industry what did you do by the way? Oh I was in finance. Okay so on the number side. Okay so based on that, that skill set is still there. You largely, it's not like you forgot how to

crunch numbers and be detailed and all the things and be analytical all the things that it takes to win. So you've had a few interviews but based on all of that, that's what people are telling you in the healthcare space that your resume is up to speed and ready to go? Yeah, I mean, I have had a few people in healthcare, but mostly it's just in other fields. Anyone that I knew that could look at it, I would let them look at it. But everybody said they thought it was a great resume. Alright, two things. One, I want to make sure, Christian, let's get her my Ken Coleman resume templates. They're very, very different and they're designed to actually call attention to what I teach in my bestselling book, The Proximity Principle. So you've gotten a few

interviews but you have tried to get far more. So your percentage right now is, based on what I'm hearing, it's pretty low. So how do we increase the percentage of actual interviews? The way we do that is through relationships. It's not going online. And I'm not criticizing you, I'm encouraging you. You are essentially playing the job lottery when you go through what is now heavy AI format when you go onto a website.

To give you an idea, there are tens and tens and tens of thousands of people that apply at Ramsey Solutions every year. They're coming through our website, but I'm gonna tell you how you get hired here is how you get hired everywhere else. You get it and you make a connection, that's right. And so I'm gonna give you my book,

The Proximity Principle to encourage you, okay? But more importantly than reading the book, what's really important is that you begin to say, okay, as I'm moving forward today, as I'm talking to Ken and Jay today, going forward, when I see a job that I'm interested in, I'm not going to fill out the online resume submission thing. What I'm going to do is, is I'm going to look at that job at company XYZ, I'm going to go, okay, do I know anybody that works at Company XYZ? If the answer is yes, we reach out to them and say, hey, do you know somebody over in

this department? Because this is where I'm looking. Okay, and we walk through that and the goal here is, is to get them to personally walk into Jade's office and go, Jade, I know you're hiring for this position. I want to tell you about my friend, Christie. I've known Christie for this long. This is her story, her background. I've got a physical copy of her resume

in this nice little Manila file folder, if anybody uses those anymore. Or they put the resume in front of Jade and say, Jade, I'm not gonna bug you, I'm not gonna rash you, I'm not gonna bend your arm, but I think you should seriously consider my friend Christy. Now, this is not a guarantee that Jade, who's helping me role play in this situation, is going to go, done, she's hired. Thank you, Ken, I've been waiting for you to walk in and tell me who I should hire.

That's not going to happen, but Christy, you get how that does move you out of the pile, yes? Yes. The digital pile. Okay, now if you don't know anybody at company XYZ You got to ask do I know somebody who knows somebody and now we're playing this old game of seven degrees from Kevin Bacon But I'm telling you as old-fashioned and as simple as that sounds that is the way to get noticed and it's gonna take some time And you're gonna take some time and you're gonna have to keep turning over rocks, turning over rocks, turning over rocks,

and eventually you're gonna get into the right situation where the door opens for you. Now I wanna transition to Jade here because she's got some money she doesn't know what to do with and I wanted you to help her out with that while she's in this season of part-time pay. All right, well let's talk about the money because what you first said sounded pretty good paid off house paid off car paid

off rental what else is going on? I mean I have some extra money like when we sold the Meridith house I wanted to do something with it so I bought a rental I have a great tenant pays on time like it's going great. The problem is I don't have enough to buy another full house. So I'd have to get, of course, mortgage and the rates are not good. And I don't want, if I do that, I don't want it to be too close to what I'd have to pay,

you know, with insurance and taxes and such. The other house is for you? For you to live in? No, no, another rental. My house is paid off. Why are you in a rush to where you're like, I'd have to get a mortgage and I'd have to, why do you feel rushed to do that?

Because I won't be getting any help from my ex-husband soon. Like, I'm kind of getting near there and I don't make a lot with my job or my small business. So you're thinking this is gonna be good income. Like instant income. Yes, I'm looking for income really. OK, well, it's not going to be too too much because you're

going to have a mortgage on the house. I would not do that. I would not go into debt to pick up another rental property. I think you could probably go make more doing something else with less risk or no risk attached to it, just in the form of a job. If I were you, the money that you have left, I would probably sit it in a high yield savings account

and continue to save for it. If the horizon is more than five years, I suppose you could throw it in an index fund and let it grow a little bit faster. But other than that, nothing's on fire here. I mean, Ken gave you the- Just gotta be patient. Ken gave you what you need to get the job you need.

And I would, by the way, be getting solid hourly work if that's what you gotta do to make up the difference here. But hang on the line, Christian, let's get her a copy of the proximity principle. Let me tell you something, the right people will get you in the right place. 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 to take care of their family? They think they're not gonna die or something? Well I used to be one of those guys I didn't even think about it and one of my buddies said hey the only reason to not have life insurance is if you hate your wife and kids and I immediately went and got termed 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. And they don't know what to do next.

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

Term life insurance. Jeff Zander and the team at Zander Insurance makes it easy and affordable. I've used them personally for 25 years. They're the only people I trust. Go to Zander.com or call 800-356-4282. Welcome back to The Ramsey Show alongside Jade Warshaw. I'm Ken Coleman. We're so excited that you're with us. Well it's that time of year. I can't believe how fast the calendar is coming at me. And before you know it, you're gonna have to pay those taxes and you need to make sure that you've got a pro who knows how to navigate maybe some of the complexities or just making sure that you are not paying too much. All of

those things that are associated with taxes, You just don't want to try to do it yourself unless you really know what you're doing. That's why we want you to think about a tax pro. Go to ramsysolutions.com slash tax pro to find CPAs and enrolled agents who have been vetted by our Ramsey team. And I was just emailing back and forth with my local tax pro. And I always tell him, I gave you some love today on the show, because I sleep better because I know he's taking care of business.

I know, that's right. You know what I mean? I do not want to get on the wrong side of the IRS. I know, that's right. Take care of that business, Ramsey. I don't want to do it. I hate taxes, Ken. So do I.

I'm not going to get distracted. Sometimes I hear the word taxes and I go into a rant. We're going to go to Kevin instead. Okay. Kevin is in Charlotte, North Carolina. Kevin, how can we help today? Hi guys. Thanks for taking my call. This fall, my wife and I will be coming into a significant amount of money. It'll be like probably a million after taxes. Wow. Wow.

What's going on? And so I want to be smart about it. My wife and I kind of disagree about this. So she wants to move. There's an area of our city that she really wants to move into. It's incredibly expensive. I know where you're talking about her. If you're in Charlotte, I know. Yeah, so our neighborhood doesn't have very many kids and our oldest has no one his age. So that's a big portion of why we wanna move. How old is he? We owe about 182 on our house.

Kevin, Kevin, Kevin, Kevin, you're going so fast. We got a couple of questions for you. I'm sorry. No, no, you're doing great. How old is your child? My oldest is 11. Okay, so you got 11 years old. And then how are, what is, what is creating this windfall? What's the, what's the 1 million coming from? My wife, she's a rock star. And so she, she's selling, or she's, she's moving a book of business to a different institution.

That's one of her, that's one of her incentives. Okay. Okay, so this is considered income. This is not an inheritance. That's why I asked that. I was curious. Correct, correct, yes. Wow, that's a big deal.

So tell me more about the numbers. You want to move, you gave me the reasons why. I don't know how good those reasons are, but I digress. Tell me the numbers so we can see if this makes sense. Okay, so we owe about 182 on our, on our house. Um, we bought it for a hundred or we bought it for two 65. Uh, it's now, it's now probably worth about 700 on the low end. Okay. Um, it does need a renovation. We've, uh, we,

we bought it when we had nothing. It was kind of an up and coming neighborhood and it has just exploded. So our mortgage right now is about 1700. I could rent it as is probably for about 2700. I wouldn't do that. Keep rolling. Okay. So, and basically that's kind of what I wanna know is,

I kind of wanna keep the house because I think it would be a great rental. I also just love the house. I love the neighborhood if it was paid off I wouldn't necessarily disagree with that if you were also paying for your next house in cash Yeah, so so then that's so the next house The house is in this neighborhood go for like 1.5. Okay, so So, you know we could rent it we, we could sell it. If we rent it, we would need to do some renovations like kitchen, bathroom, our current house.

Well, I don't think you can have your cake. Should we take the million and put it all towards the other home? Should we take 100 or 2 and put it towards renovations for this property and put 800 on the other one? Yeah, I don't think you can have your cake and eat it too on this. I think that there's a really clear path forward, which would be, you're gonna have 1 million, the house you own is worth about 500, a little less

once like fees and everything are accounted for. And the house you want is 1.5, that's the money right there. So without looking at the other factors, cause I have to ask you more questions, but let's just say, hey, I want a house that's 1.5 million. Selling your current house gets you the 1.5 million to pay cash for it. I wouldn't do a situation where I do a little bit

on this house, rent it while it still has a mortgage and then put a little on the next house and have a mortgage there. I feel like there's a way for you to do this really clean and come out on top. The only way, the only other way would be to take the 182 and pay that off and then buy a less expensive second house and then you could do the two things at one time. Does that make sense? Yeah, from a math perspective, it makes sense.

Yeah, but let me tell you why I don't think it makes sense and why I agree with Jade. Wait a minute, what's the other perspective other than math? We're talking about money. That's right, I know, I know. Well, his wife, he wants to stay. So Kevin wants to stay where he is.

The wife wants the nice upgrade of the neighborhood. That's true, listen. That's true, that's true. I know, so let me throw this out, okay, as to why I like Jade's idea. And I want to give you real numbers, Kevin. Okay. But before you do, we have to ask a couple of key questions to even see, does my idea work? Because we don't know. Do you guys have debt? Do you have... Tell us about your debt. Tell us about your income. Tell us more.

Tell us about your debt, tell us about your income, tell us more. Okay, so I do have a car, so we have about 20,000 left on a car. I'll pay that tomorrow. I'll pay it off tomorrow. So that's done. After I pay the 20,000 left on my car, our emergency fund will be down to about 27,000. It should be about 115. For six months? For six months, yeah. Dang. Okay. Yeah, they're crushing it. Love it. What's the income? Our income is currently about $350,000. Let's go. Okay, good. So here's the deal. All right. I've heard everything I need to hear,

Jade. Yeah, me too. Kevin, you don't need to be a landlord, and I just don't think it makes any sense. Here's why, okay? You only are talking about right now, if you owe $1,700 a month, you're paying for it on mortgage, you said it was about $2,700 that you would get in rent, that's $1,000 a month. That is a whopping... That's on the low end, on the low end. Kevin, don't fight me on this one. Don't fight me on this one. That's a whopping

$12,000 a year. Let's up it a little bit. You're going to make $15,000 a year gross on renting this house. Yes or no? Gross. Alright, yeah. Now I know you're talking about putting money in it to renovate it, just to rent it. It's just burning cash.

I would sell it, pay off the debt that you have left, and take, like Jade said, take the rest of it and put it to the down payment with the million dollars and buy a sweet house in a sweet neighborhood, cash, because you're not making much money. Even if you pay it off. Jade gave you a second scenario. You pay off the 182, now you're in it.

You're still only clearing about 25 to 30 grand a year. And I'm being generous because that's gross. That's not including rental costs, maintenance. Dude, it is not all it's cracked up to be. Okay, we talked earlier about money and the math part of it. And you are right, there's more to money than math. It might not weigh as heavily,

but is this like the house that you had your children in? Is this the house, like, this clearly has some sentimental value. It feels like it's more about that than the real estate side. There's certainly sentimental value. I mean, if I'm paying $1,700, right, if I'm paying $1,700 a month for this house, um, you know, and just also looking at trends of, you know,

kids moving back in with their parents and everything, like I could, I could, I could probably in 10 or 15 years, I could probably, you know, afford for my son to live here temporarily, you know, to get his life set up, uh, whenever he graduates from college or, or my, or my other two kids, you know, and it could just be sort of the house that we have that lets the kids roll through. Uh, I also think it's a great investment. Like this, this area that we're in now is just exploding. Um, and it's become very popular. And so I feel like if we were to sell right now,

we'd be leaving money on the table because then then wait just going up in value. So, so, so much. Why then tell me this. I now I'm sensing something else. It's like we've got this million dollars. It's going to be burning a hole in our pocket. We've got to do something with it. What would, what would it look like to just say, hey, let's, let's sit on this for a minute. Cause in any other scenario, whenever somebody comes into a large amount of money like that, we tell them to wait, like chill out for a minute, get used to the idea. I'll tell you what it is. His wife wants it.

That's the challenge. And I know, I think you're moving too fast. She wants to move into this. I mean, our life is in this other neighborhood. All of our friends are in the other neighborhood. It don't matter. All of our kids' friends are in the other neighborhood. But you don't feel right about it.

If you don't feel right about it, don't do it. He doesn't feel right. This is a therapy session yeah I mean it yeah they're gonna both they are both on different ends of the spectrum and boy oh boy I been married long enough to know how that turns out this is the Ramsey show listen people what you call organized chaos is still chaos this year build some room in your budget to get your life really organized. One tool that I recommend is a knockbox, as in next of kin. Knockbox is a complete system that helps you organize

important documents, accounts, IDs, tax returns, insurance policies, estate plans, and other personal history in one secure place. The 15 categories in your KnockBox cover everything from health history and investments to your ancestry and even collectibles. So cut the clutter with a KnockBox. Start getting organized today and receive an exclusive discount at knockbox.com slash ramsey that's n ok box dot com slash ramsey Ramsey show continues I'm Ken Coleman jade warsaw with you as well triple eight eight two five five two two five let's go to air and in august a georgia and how can we help my husband and i a have been married for about four and five years this year

and my daughter in the living and we have a different of opinion on what we should and on her we get along great we communicate great but when it comes to this, we cannot agree. And I would just like some unbiased opinion. It's everything from she needs something from school to school summer camps. I feel like she should be able to go to summer camps and not sit in front of a

tablet all summer when he thinks those are a little ridiculous because they are so expensive and that we should not really spend anything extra outside of what our child support is to spend anything on her. What do you mean? Hold on a second. What do you mean child support? So I get child support from her dad every month obviously Okay, gotcha, but that's the only money that I should use for how much school were like $300 a month. It's so your husband is going outside of medical and groceries and just keeping this child alive

Anything outside of the basics has to come out of the $300 a month from your ex. Yes sir. Interesting. What's your combined incomes? $150,000. Okay. How often does this happen? Yeah. Like is this a weekly or monthly or is this just in some of the bigger things like you described like summer camp and no It's everything. Why do you think he's scrutinizing it so much? Because she She's she is a brat. She's 11. She got has a little bit of an attitude They don't get along do they get along? No, not at all. Got you. Got

you. And her biological dad buys her everything she asks for every single time. Okay, so she's spoiled. Yes. Is she spoiled or does she just get what she needs? Uh, no, she's spoiled when it comes to her dad. Okay, so, okay. There's a lot going on here. I kind of wish Dr. John was here. There's a lot going on here because on the one hand, it's like, as a parent, I don't say to my son, you're acting a type of way right now. And so because of that,

I'm not gonna make sure you have the things you need for school or I'm not gonna put you in summer camp Like that's not my that feels retaliatory. And so I don't feel like that's The spirit that we should be making our boundaries out of that The spirit that we make our boundaries out of is our budget and what makes what's a logical use of? Money for a child, right? That's the spirit that we used to do that right um i'm curious it how old was she when you guys got married six was he this way from day one yes okay that's. That's what I'm digging into. He is very much, I don't want to spend money on anything. So, okay, and so what I was, here's, let me tell you why I asked that question. I'm trying

to figure out if this is because she's a brat and he resents her because she's also not his biological daughter. These are all reasonable things that a human being could be struggling with. And I say that, by the way, Erin, not from judgment, but a sense of understanding. But the fact that you said he was this way day one tells me this is more his scarcity mindset about money. Rachel Cruz wrote a book, Know Yourself, Know Your Money, a few years ago, and it was a genius book, in my opinion. And I think he's got, from his childhood, his... so I would say there's two E's. It's our experience and our environment. So his environment growing up shapes his view of money and then his experience with money up to

this point shapes his view of money. So since he was that way day one, sure he could have still had some resentment, but it would have been very small just in her position as not his biological daughter. I think it's more that he's a scarcity mindset guy with money, he's scared to death, it's hoard, hoard the resources, not a hoarder. But does he do that in other areas is my question. Is he a tightwad in the other categories

or is it just as it relates to your daughter? Both. He is a tight wad, but he will spend things. It's like if I wanted something, sure, I could have it. But he grew up, if he wanted something, he had to work for it. So that's exactly what she did. Okay, so I think he also resents your ex and how he spends so lavishly on her. And I do too. You do too. So you know what he's doing? He's correcting.

He's course correcting whether he realizes it or not. Right. Alright, so? But I at the same time feel like I should be able to buy things for her and not feel any kind of way about it. I agree. I'm not saying going overboard. So it's you guys deciding on what's a normal amount

and what's considered overboard. Yeah, this is a, I think this is a therapy session or a four. I think so too. Because I think you need a, here's what I believe. I really believe that you two need to get with a marriage therapist and it's a safe place. What's great is you guys are not in crisis. You told us you guys get with a marriage therapist. And it's a safe place. What's great is you guys are not in crisis. You told us you guys get along on everything else.

So this should not be too painful. But it might be difficult to get to a middle ground. And I think you need a, I mean, appreciate you calling us. We're not marriage therapists. But I think getting a objective, licensed marriage therapist who can get you two in the room together, and we find middle ground on this. Because hearing what I hear, Jade, I'm in the middle.

I think he's probably way too tight. But I think you also need to come his way, not in giving into his demands, but understanding maybe where he's coming from. I think this is solved with a lot of understanding. And the daughter needs to understand because she feels it and probably doesn't know what that is, right? She feels going over to dad's house and it's like, I get what I want. Then she feels going over to your house and it's like, do these people hate me? It's nothing. Right. Right.

I've told him, I don't tell him every time she asked for something, because I do say no a lot. But all he hears is when I'm in agreeance and she's like, oh, she doesn't ask for stuff. And I'm like, well, she's 11. Yeah. Yeah. I mean, they're going to ask and you can say no, but I mean, the example you gave about going to summer camp, you know, it depends on what summer camp it depends on how much, I mean, they're going to ask and you can say no. But I mean, the example you gave about going to summer camp, you know, it depends on what summer camp. It depends on how much. I mean, there's a lot of well, that's what is that can go.

So, Jade, that's where the budget comes in. Yeah, that's why I said this has to be guided by the budget. Right. It's not just a free for all on any side. We don't just stop it because we just feel like we're going to stop it. But we also don't spend whatever we want. So it's you guys looking at your budget and going, okay, what's a reasonable amount to spend here?

Well, and I've asked him that. I'm like, give me a number. And he was like $500. I'm like, that spends one camp. So you got three months, I get one camp, and she's gonna sit in front of her phone the other. Well, now that part, let's go to the next extreme. Just because she doesn't go to camp doesn't mean she has to sit in front of her.

Where I come from, we went outside and we had to play on our own. And we played basketball. Don't get me started. We played with a stick and a box. Okay, make it happen. And so that part. I agree. The caveat is we work full time, so she's with her dad all summer. Who lets her do whatever she wants, being on the phone is what it happens.

Well, but again, to Jade's point, I think Jade's locked in on something here, Erin. I'm changing my opinion a little bit. I thought the man giving you 500 bucks for a summer, that's plenty of money to spend on her, if that's what I'm hearing. And I think you have to adjust your life and her lifestyle. Like, great, you work. So come up with a better plan than she's just at her dad's all the time getting spoiled.

So make a fix to that. But throwing more money at it doesn't solve all these issues. It just doesn't. You could send her to camp all the time. You still got to come back to, I think, therapy and a budget. And I think this guy is probably a little bit more reasonable than he sounds. I think so. But he needs a good reason why.

Yeah. Yeah. Yes. I think he does, but my reasoning isn't good enough. And I think we argue so bad about it. We just avoid it at this point. Yeah, that's the therapy part of it. I think therapy will change this in such a positive way.

I'm hopeful. Like, I really believe this. If you guys submit to this process and go in and go, okay, we're going to allow ourselves to be open to this process and meet in the middle. I think you guys can solve this. I do too. It's complex given the relationship with the divorce and the dad and all this stuff, that's tough.

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improved health, they offer a money-back guarantee, no questions asked. Try today and get 15% off at fieldofgreens.com slash Ramsey promo code Ramsey. fieldofgreens.com slash ramsey promo code ramsey field of greens dot com slash ramsey welcome back to the ramsey show alongside jade warshawn ken colman thrilled to have you with us triple eight eight two five five two two five triple eight eight two five five two two five is the phone number our ramsey show question of the day is brought to you by WhyRefi. WhyRefi refinances defaulted private student loans

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from Olivia in Mississippi. She says, last week I was approached by a friend who recently became a multi-level marketing representative. She asked me to join her team and said that many money experts recommended their company as a side hustle to get out of debt. Not this money expert. She said that she had been skeptical when she first started,

but the checks were clearing and they weren't doing anything illegal. They emphasize that the business is not about recruiting people, but doing so leads to earning more money. Is this going to cost me more money than I would be making? Or does that depend on me and how wisely I use this business? She's asking us, like, we're the gurus of this multi-level marketing business.

I would just steer clear of it all together. If I were you in your shoes. I mean, can I just, okay, let me confess something. I have fallen victim to this. Back in the day, I just- Oh, you did? Yeah, I just graduated, let me confess something. I have fallen victim to this. Back in the day, I just- Oh, you did? Yeah, I just graduated, let me tell you the quick story. I just graduated college, I was working in the mall,

and a guy came in to my store in a nice suit, and I thought I was helping him, selling him a suit, and he was like, you're a sharp young lady. He kept calling me a sharp young lady. And then he said, I'm looking for people just like you to work sharp young lady. He kept calling me a sharp young lady. And then he said, you know, I'm looking for people just like you to work in my business, you know. And I was like, you know, I'm in college.

I'm like, okay, I can make some money. He starts telling me you can make six figures a year. And I'm like, really? Like I was falling for it hook line and sinker. Ended up going to lunch with him, with my Sam, who was my fiance at the time. And we still didn't understand it was multi-level marketing at the time. And he was like, yeah, you know, the time, and we still didn't understand it was multi-level marketing at the time.

And he was like, yeah, you know, all you have to do. And then, here's the thing, when he showed up at lunch, he showed up in a really nice Mercedes. And I was like, this guy's making me. He's got all the trappings. Whatever he's doing. Then he starts talking about energy drinks. And I'm like, energy drinks?

And I realized that's what I'd be selling, is energy drinks. Oh, that's the product Well, it was the one product he decided to highlight then he says man. Let me tell you about my boss He is killing it He takes us over to his boss's house that he described his boss is like living in a mansion Boss is living in like a normal nice house I bought the energy drinks.

I can't even remember what they're called. I couldn't sell one, it was energy drinks, paper towels. He was, his shtick was, I mean, everybody needs paper towels. Everybody needs energy. I've heard that before. Toilet paper was the one that I heard. Toilet paper, yeah.

And I'm like, I didn't sell one, that guy. How much money did you have to front? I think it was like 150 or something like that It wasn't it wasn't a whole lot. Yeah Yeah, I mean listen, I'm with you I just think this whole thing just sounds like a house of cards and you just shouldn't invest your time into this Yeah, I wouldn't I wouldn't I mean the truth is I yeah, I guess there are people who are making money doing it Oh, first of all, there are people who crush it. Yeah, no mistake

Yeah, I mean, I'm not saying there's not. But just the way the tone of the question, everything else, this doesn't sound like it's the right thing for you. You gotta be really focused. And by the way, let's be very clear, all of those models are based on recruiting people. That's right, they are. So I don't like the dishonesty of saying,

it's not about that. Yeah. Pass, hard pass. I, by the way, I like to buy my toilet paper from a store. I do too. Not from somebody dropping. Hard pass. Yeah. By the way, I like to buy my toilet paper from the store. I do too. Not from somebody dropping it off in a bag. You know what I mean?

Yeah. That was always the thing for me. My parents got into that for a while. I was like, we got all this toilet paper at our house and gum and all the things. Energy drinks. You know what I'm talking about? Yes. I do.

What are we doing here? Oh gosh. Oh, that's good. All right. Let's get back to the phones. Marie is joining us in South Bend, Indiana. Marie, how can we help? Hello. Hi. So I'm wondering how my husband and I should prepare for planning to pay for college for

two children under two without overfunding a 529 plan and if we should potentially also Look at other investment options to help set them up outside of the 529 plan. Yeah. Okay, so you're on baby step five We're on like four five six, yes, okay great So you're you're currently putting away the 15% for your retirement and then on top of that, how much are you able to kind of put into these 529s every month? Right now, probably just like a couple hundred dollars.

The big thing is that my husband actually works at a university who will pay half of whatever their tuition is to go anywhere else. That's awesome. That's great. Okay. Which makes most state schools and even some like smaller private universities, like very cheap or completely free. Yeah. How old are your kids? That's what we're trying to figure out. How old are they? The oldest? Yeah, the oldest is two. So that's the big thing of like, things can change. He has no intentions of leaving, but if he does, then we do lose that benefit.

That's true. I mean, yeah, this is a long, long way in the future. A lot can change in many, many ways, but it is a cool thing to have right now. If I were you, the amount that you're funding, what is it, did you say $100 per kid every month? Yeah. I don't think that's gonna get you to the point that you're just busting at the seams with cash,

because there could still be books, there could be other things to spend that money on, and there are two. So as you get closer, you can decide to pull back. You can decide to ramp up. You can decide. Do you see what I'm saying? Like you don't, this is not something that you have to lock in and you can't change at

any point. You have a lot of freedom here. Right. And we were hoping to start contributing more, but we're just trying to figure out how much do we put into a 529 knowing what room and board would be on the hook for. Have you projected it? Have you projected what that $100 per kid will be when it's time for them to go to school?

I have not. I need to. Okay. I would do that. I would do that. I would look at the 529 that you're interested in. I would look at the average rate of return for that and see, okay, if I put $100 in here, after 16 years, what's it gonna be?

And then you can decide, okay, let's work backwards. How much do we think room and board will be? And kind of work backwards from there. And that's what I, if I were in your shoes, that's where I would start. Perfect. And if we get to the point where we are potentially going to over fund their other investment opportunities that you would look at doing to help set them up for when

they graduate and things like that. So what I would do at that point, once I funded a 529, working through the baby steps, if I had extra money after that, I would put it towards paying off my house. And then once I paid off my house, then I would start looking at other things that I could do. I know my husband and I, one of our big goals is to have a fund for our kids to help them buy their first house, like that sort of thing. But that comes after mama and papa pay off their house. Yeah. Right. Yeah, and ours will be paid off here in a few years.

So that's what I'm trying to think. Yeah, after that, then I just probably start with a brokerage account, something that you can dip into. It's not part of your retirement, and you can gift them a certain amount each year, under the gift tax. You and your husband are both entitled, what is it, 14? I can't remember off the top of my head.

I can't remember the exact amount. You'll have to check it, and it might be different by then, but that's what I would do, and that way you can kind of see, okay, here's the amount that I can gift them every year, or here's the amount that I can gift them as a lump sum, and again, you guys can kind of project out and see,

okay, what do we think that we wanna be able to give them? How long would it take us to save it at the rate that we're able to save? Perfect. Yeah, makes sense. All right. Thanks for the call, Marie. Good thought. Yeah, love it. Love when parents are thinking about that.

And by the way, I think the advice is great to kind of go, okay, looking at tuition now, there's really no way to know what tuition is going to look like, just the way that the higher ed industry is kind of evolving right now. That's right. I mean, so it's kind of like, you got to do your best with those projections to kind of evolving right now. I mean, it's so it's kind of like you got to do your best with those projections to kind of go, OK, based on where we are right now, adjust for inflation. And then you kind of back into your number.

And his was based on a work benefit that who knows in 16 years right where they'll be, you know. All right, let's go to San Antonio. Oh, actually, no, we're not. Look at that. The little ding. That was it. That's right. We are running out of time in this segment so we will take a quick commercial break don't move the phone lines are lighten up triple-8 825 5225

is the number alongside jay warshaw I'm Ken Coleman you're listening to the Ramsey show people tell me about their experiences with big banks all the time. Bad service, fees that nickel and dime them to death, and predatory lending that tries to catch them in never-ending cycles of debt. So if you're ready for a bank that puts people over profits, check out FairWinds Credit Union. I recommend FairWinds because they share our Ramsey values of helping people get out of debt and live generously. If you go to

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winning in your money, winning in your profession, and winning with your relationships alongside jade warsaw and ken colman the phone number jump in is triple eight eight two five five two two five triple eight eight two five five two two five we're started with the Nicole who's joining us in Toronto Nicole how can we help hi I'm not my boyfriend for some time now and basically for the last year we've been kind of planning to buy a house together. So I've been going to the staffs and saving money and recently he's been kind of hinting at the fact that he's going to propose soon.

So I kind of sat down with him to see over the last year how much he saved towards this house. So we kind of know where we're falling. And I discovered after a year that he basically hasn't saved any money. And during that period of the year, I have been taking on most of the financial burdens because I make significantly more money than he does. I'm kind of shocked by the fact that he hasn't saved any money and I don't really know how to go forward. So I wanted your advice.

Yeah, good question. Um, on the one hand, I get why you're concerned because in you guys's relationship, it sounds like there was kind of an agreed on point that you wanted to reach and you were going to try to reach it together. And it seems like he hasn't, you know, held up his side of the deal. But from my perspective, I would say he doesn't have to come. He doesn't have to contribute to this at all because it's really not a great idea for you guys to buy a house together if you're not married and it's really

not a great idea for you guys to be combining your money in any sort of way if you're not married. It's really great for you guys to say, okay, say you do live together, I'm paying my portion, you pay your portion, but we're not doing this thing together until there's some legality protection surrounding it in marriage. I agree with that, but Nicole, how did you feel? I've got a point to make after I ask her this question. How did you feel when you found out? That's actually the plan. Sorry, I don't mean to interrupt you.

No, go ahead. But the plan is not to buy the house until we get married. That's why he's telling me that the engagement is coming soon. So like that's we're getting the ducks in the roe for okay we're engaged now that means after we do the wedding we're going to be buying the house but the house is going to be the biggest fee right? I see I see I see. Yeah but so okay so how did you feel? What what emotions and thoughts did you have when you found out that he hadn't been saving any money? I was absolutely devastated because he's living at home with his, we don't live together now,

he's living at home with his family. And I've been printing the money on everything, all of our dates, I've been putting away tons of money and I make three times the amount of money he does. How long have you been dating? Just over a year. I think this is a very clear, I'm going to call it yellow light. Oh, I would have said red flag. Well, you always surprise me.

I feel I think it's a yellow light. I think in the sense of this, what I mean by yellow light is... Proceed with caution? No. It's we sit down, she doesn't dump him. Red light to me is dumping, leaves him, I'm out. Yellow light is sit down and go, we need to do some premarital, I mean if we're talking this, we need to get in alignment on this because this is what... I was devastated and you may have already shared that with him Nicole but even if you have there needs to be a true alignment conversation and is he going to show you in the days and weeks

and months ahead that he understands your values and is in alignment with your values and he begins to save some money. I would not even say yes to his proposal. I wouldn't move forward on anything until that. That's what I mean by yellow light. I agree with that. I think Ken and I are saying the same thing. We just used different colors because red for me means like let's stop and see if anything dangerous, else dangerous is happening. Yeah. And so my question for him would be like okay you've not been saving. can you tell me why?

Why? And then can you tell me like, well, what have you been using your money for instead because you're still living at home? I would have real questions and I would want real answers because that's indicative of what it will be like in your marriage when you speak about money. I know the answer that I did ask that question.

And the majority of his money has been spent on food and video games. Again, massive massive like like construction sign going watch out watch out cliff ahead you know I Nicole are you feeling that too? Yeah that's what I'm calling because it's okay. So if I could play older brother or I might be old enough to be your dad for all I know, I would just tell you that this is a serious, serious conversation. He needs to make some changes in his life if he wants to be in your life. That would be my bumper

sticker. What do you see about him that's really... I want to go in another direction. What do you see about him that is really, I want to go in another direction, what do you see about him that is really great? That you go this guy, this guy's got motivation, this guy's got that thing, this guy, like tell me those things. I'm just curious. Why I love him. He has been my rock. I've opened up a ton of new businesses in the last year. And every single one I've done, he's had my back through every single one. He's so genuine.

He is so sweet. And he is so kindhearted. I've never met a man like him in my life. Okay. I like that. Listen, I'm gonna say something really harsh. And I realize this. You can get all of those things from a pet. Support somebody to be there to talk about.

I want you to be able to say deeper things. Does that make sense? Oh, it makes sense. I love this. I love you're bringing the heat. What you said, like that's a golden retriever. And we love that. That's why we love our animals.

They're always there for us unconditionally. You know, they're there to support us. They've got that, that, um. By the way, he's doing by playing video games and buying fast food. He is essentially the same as a golden retriever there as well, just costing you money. Costing you money.

And I want to hear you say, you know, he, this guy, you know, he, if you were to ask me or my husband that same question, it would be more about what they bring out of us and what I see when I go, oh man, nobody works harder than Sam Warshaw. That's inspiring to me. The way he will get up and do whatever it takes to take care of his family, the way that he'll take care of his kids, the way he's sacrificed for us year after, those are the things that I want to hear and I'm not hearing that. That's why I kind of flipped it to see, okay, how is, what do you guys mean to each other and what roles are you playing?

And is it beyond just, well, you know, they're, they're there when I need them, you know, and what does that even mean? He's a very sweet guy. A nice guy. All the things. He's also a pretty decent gamer, sounds like, you know, but we've got to, you see where I'm going, Nicole? Just a level more. I got gotta chuckle out of you.

I mean, listen, you can love someone and decide to also say they're not the person that they need to be right now for me to decide to marry them. Yes. I think this is a very real conversation. Back in my day, we use DTR to find the relationship Yeah, you don't know what that means. I'm sure DTR. I'm sure I dated myself again on that but I think that's what's got to happen

Yeah, I think so too because give her the alright, so so give her the you're the strong female I think she's a strong female Give her 30 seconds on how she starts that conversation with our guy. Oh Boy, how she starts the conversation.. Or sets it up. I've been thinking. Okay give me more. I've been thinking you know I love you because you've always been there for me you've been my rock but I really needed you to be there for me I really needed you to show up when it was came time to talk about our goals as a couple and when it came to our goals as a couple you let me down you didn't show up with your side of the money. You said

you were going to do this. You said you were going to do that. And I haven't seen that. And this is the first time you've let me down. And unfortunately it's in an area that really matters to me because it's not just about you or me. It's about us. Wow. All right. Oh, it's good. It's good. That alright? I think it's gonna get his attention. Well done. Whew. Poor guy. But he's gonna have to stand up at some point. He is. We'll be right back. This is the Ramsey Show. You shouldn't own a gun. You're not willing to shoot. In moments of self-defense, a Berna launcher lets you protect yourself in a non-lethal way. That's exactly why Berna launchers were created.

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above average and you'll save even more. So what are you doing still listening to me? Go download the EveryDollar app for free and start saving more money right now. Welcome back to the Ramsey Show alongside Jade Warshaw. I'm Ken Coleman. Glad to have you with us. 888-825-5225 is the phone number. Hey folks, as the Ramsey work guy here helping helping you win at work so you can make more money, really excited to tell you, I've been dreaming up a concept for a long time, Jade, you know

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where Mo joins us. What's up, Mo? Hey, how you guys doing today? Good, how are you? I'm well. So I've just been doing research with my financials and then I came across George Campbell on YouTube and then that's why I saw the Randy show yeah I love George oh yeah yes sir he's very amusing on YouTube so if you guys

ever see him please give him a thank you for how he believed me I'm gonna tell him on the next break because he loves hearing it how can we help my my question is I so with the baby steps I feel like I'm in limbo between baby step two and baby step three I I have six thousand dollars right now in my HYSA. So I feel step one is definitely complete. So my financial situation, my wife and I, we closed down a home in June of 2023 out in California. Our mortgage is, sorry,

expense-wise we're stocking away $5,200 a month into another HYSA to cover the mortgage, property taxes, and insurance. Okay, so you moved, let me just make sure I understand. You moved from California, you hadn't sold the house, so right now you're still paying for the house? No, I'm moving out to California. You're moving out to California?

Okay. Okay. I think I understand. You're moving out to California. Okay. Okay. I think I understand. So that's the mortgage there. And then I have non-traditional student loans. My parents had a 529 plan for me and my sibling. And they want half of the money back of what they totally spent from my college and university.

And then... Okay, hold on. Let me clarify. Let me clarify. Make sure I understand that. Are you telling me your parents created a 529, you use the money for education and they're like, hey, pay us back some of what you used from the 529? Correct.

That's wild. Okay. How much do they want? They only want 50% back of what my costs were. Which is what? Which is $75,000 now. That's wild! I've never heard of a parent investing in a $529 and then saying, hey kiddo, pay me

half of it back. Did you know that on the front side? Or is this new information? No, this was when I was a teenager in high school. So you knew Yes Okay. Okay. That's okay. Whatever you guys decided. That's the deal. All right, that's different What else so you owe your parents? $75,000 you've got six thousand the HYSA

Why did you say earlier that since you had six thousand,000 in the HYSA, you had moved from Baby Step 2 to Baby Step 3? No, no, no. I moved from Baby Step 1. And now I feel like I'm in limbo between Baby Step 2 and Baby Step 3. Okay, got it. Well, technically, well, let me clear that up. You are in Baby Step 2 because Baby Step 2 is we pay off all of our consumer debt, anything

except our home, if we have a mortgage at that point. step two, because baby step two is we pay off all of our consumer debt, anything except our home if we have a mortgage at that point. So you are in baby step two. And part of that is taking your savings down to a thousand and putting the rest at the debt. So in this case, yeah, you'd be dropping that H Y S A down to a thousand and throwing the rest at the debt. Is there any other debt aside from the student loans?

Yeah, for the, so we, when my wife and I closed on our home, we don't have PMI. So the other 10% came from a loan from her parents. Okay. And how much was that loan? That, uh, now I believe is, I think it's $50,000. Ooh, sir. Okay. Man, let me tell you something. I'm going to be flat out. I'm going to be straight up with you. Owing money to like debt and creditors sucks, but it kind of feels worse when you owe it to family members because they have a-

Oh, it's a different emotion. It's a different emotion. I want you to get out of debt so quickly. Okay, so you're moving to California, you've got the house, what are you gonna be making? My gross salary last year was $137,000 and I'm predicting it'll go up. It's not a predictable set. It's predictable in that the salary will increase, but it's not a predictable number per year.

What about your wife? She's predictable at around, I think her gross last year was $80,000. Okay, so you guys are going to be a little bit over $200,000, like maybe $210,000? That sounds about correct with our gross income from last year. Okay, and so I just want to make sure because your mortgage is $5,200 a month? What's a month? What's your what's your more the more the mortgage is $4,252 a month. And then we also stock away extra money property taxes are now increasing. It was it's about $8,400 a year now. And then California does its 2% increase from Prop 13.

Yeah. And then we also stock away extra money for the insurance. I have a question. And the insurance last year was... I have a question in all of this because I'm trying to track with you on the math as much as I can, but I don't know these direct numbers. What percentage of your take home is your mortgage going to be? Because California is expensive tax wise and the number you gave me, the 4,000, that's

not including taxes and insurance. So what percentage is it? Have you done that math? Yeah. I think it's about 50 to 60%. My guy. I know it's supposed to be 25 percent. Yeah, and you're not even a little bit over.

We gotta go back to the drawing board. And I want that for you. Like, I don't want you to be in this situation because you're about to be stressed to the teeth. Yeah, I was gonna ask, do you feel stress, Mo, when you start thinking through this? I have, but now I've accepted the terms of it and I feel relaxed because because of the nature of

my job I feel content that my wife is she is 20 minutes away from her parents and the nature of my job I'm gone for two weeks at a time so emotionally I feel okay because I know she has somebody to rely on while I'm gone. But you don't have any negative emotion about the lack of margin because of how much you're paying in mortgage. I used to, I've come to terms with it and accepted it. I mean, I'm just like percentage wise,

I just wanna lay this out, because I think you understand it conceptually like on a very like not detailed level, but like actual numbers putting it in your budget because I'm looking at it like this. I'm like, okay, 15% in a little while, 15%, well, not for you, it's going to be a while, but at some point, 15% is going to go to investing, 10% is gonna go to giving you are you're at 60% on your

mortgage that leaves you 15% to live on that's not much and at this point that that would be for paying off debt which is gonna take forever at that rate so I strongly urge you to consider nothing's done that can't be undone, right? Like you don't have to stay in this situation. It might be, and I think that it is you not keeping this house. It's too much house for you. You got to get out of this house. That's what I would do.

And then I'd work on paying off the debt that you owe to your family. Yeah, I agree. Thanks for the call, Mo. Please reconsider. Don't move. We'll be right back. This is the Ramsey Show. Call Mo, please reconsider. Don't move, we'll be right back.

This is The Ramsey Show. You know how when you go against what society thinks is quote normal, like avoiding debt, it feels weird at first? Well, I'm here to tell you that is okay. I want you to be weird. If that means you're being intentional, including how you budget.

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That's chministries.org slash budget. Hey guys, George Campbell here. Do you ever feel like insurance companies only care about your money and not what you actually need? Well, there's a better way. When you go to Ramsey's Insurance Resource Hub, you'll start feeling confident that you're getting the right coverage that's truly best for you.

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888-825-5225. Ray is joining us now in Dallas. Ray, how can we help today? Good afternoon. Thank you so much for taking my call. Sure. I have a bit of a unique situation, a little different than others. I'm in my late seventies, I'm quasi-retired, and I've amassed in this state

a little north of $30 million. Way to go, Ray. Come on now. We have no debt, we have no mortgages, we have no credit card debt, everything is paid and we have approximately 17 million in cash and equities and the balance in property. Holy smokes. My question is that we've set up a very, I think, qualified estate plan with competent estate lawyers. And the beneficiaries of my estate are approximately a third, a third, a third, my daughter and, um, um, my grandchildren and my wife.

Um, um, my grandchildren and my wife. Um, um, the monies that are spinning off of our investments are more than my grandkids could legitimately or reasonably spend when they become of age. I want to right now, the estate plan calls for up to $250,000 per annum for my, plan calls for up to two hundred and fifty thousand dollars per annum for my for my grandchildren by the way my grandchildren are six and nine okay so they're going to build a lot of wealth over the next several years when they're 21 they get a modest amount of money for five years. And then at 25, they begin to kick in. My question,

the simple one is $250,000 a year, too much or too little given the fact that the, um, you know, the growth of the estate will be much larger than that. Um, I, that is a good question. I don't know that I can tell you if it's too much or too little. I think that... Yeah, I would return that with a question. Do you think it's too much or do you think it's too little or do you think it's just right and why?

Yeah, that's good. Or throw it back at you. Well, at this stage, you know, in our economy and our country, I think it's just right. But I'm concerned that they will be, that the growth of the investment portfolio, it'll be selfish not to let them grab more of it. And the whole reason for having an escape is to take care of the little ones in the future when you don't know what's going to happen. That's right. However, you decided that

250,000 at this point in time does feel right. And it's per year, correct? Yes. Starting at 21? No, at 21 I think it was a little bit too much. So we're going to do five in a month between 21 and 25 and then 250 and then a matter of 25. Yeah, I think it depends on, you know, I'm trying to channel Dave right now. I think gifts are really great. And I think how people use gifts depends on who they are as people, because when one person's hand 250,000 a year is like, hey, this was my grandfather's legacy. I'm going to do great things with it. It's not going to stop me from reaching my personal

potential. It's not something that I'm going to use as a crutch in life. Whereas another personality, it could become, you know, really a stumbling block for them. So I wonder more about the type of language that's built in as far as who, what type of person does this grandchild have to be in order to get this money and is their language built in that says if it's harming them, what takes place? Those are the things that I'm thinking about and I know it's not like you can reach out

from the beyond and control everything, but those are the things that I'm thinking about. The other part of this, and again, this is your estate. I am not trying to overstep. I see what you're saying. You're like, there's a lot of money that's gonna be generated here. I don't wanna not let them have it, but I also wonder,

okay, well, there's other things that you can give to that's not just kids and grandkids because it's in many ways, like you've got so much money, you can only give them so much without really giving them a ton of money. Right, how long would the 250 be paid out? Is it in perpetuity? Yeah, so I mean, we don't have a stop on it and then there one would assume that they

were by the way just to comment on your last statement we have clauses in our state plan that they have to be good people of good character you know drug and disease free and all of those. And we have a very competent trustee and you know with a wonderful moral compass and you know we're comfortable about that. But I'll be gone. So let me ask you this then Ray, so they get the 250 each year. By the way, these are the grandkids we're talking about? Once they get to 25. Okay, so at what point would they get the rest of their inheritance? Is there like a kick in at like a retirement age where they get it all? Because you were saying

they're going to be building tremendous wealth, and it's like the 250s a nice dividend, for lack of a better way of describing. Is that right? That is essentially correct. So when would they get the big chunk? There is no clauses in the estate plan in which they get to clean out the drawer. So I would assume that that legacy would continue on with their wills and estates to where they could leave it to the great-grandchildren, whom I will never know. Okay, so it's $250 each year, and never, it's not like they get it all at one lump sum. That's all they get and that's very generous by the way. And then it transfers to their children's children. Yeah, I hope so. Right. But we

could well afford, just with the increases in the portfolio of the investment side of it, to give them more. I'm concerned to do that for all the reasons that you already know. You know what I'm thinking, Ray? I'll just get out of your way, Jay, but I was just thinking I really trust your gut. I think you are a man of wisdom and you have proven it with how you've lived your life and as to where you stand today. So I'm not going to second-guess your plan. However, if I personalize it, and if I was doing this for my grandkids, which I don't have, but if I'm sitting there thinking this, I'm wondering if

even the most mature of 25-year-olds, it's not that they can't handle it, but how would it change their perspective if they knew they were going to be making a quarter million dollars every year, whether they do anything at all? And I almost would want to maybe put it to them in different ways. So for instance, they get a really big lump sum to buy a house, but it can only be used to buy a house cash. So you can put that in the trust right so that's one thing I'd think about you know I'd be thinking about it can only go to an

investment it's gonna be put in an investment thing at which point you can only pull out at retirement you know like that could be another way of doing it right but I'm not second-guessing your plan Jade all right yeah I agree with Ken the other question I had for you, Ray, was you said, okay, obviously this 250 is paying out to the kids, grandkids, but that's by no means going to drain basically your estate nest egg. And then you said, I hope it would go, but they never get the lump sum. So what happens to it based on the estate? What happens to it? Do you know what I'm saying? What's the transition point? Well, the transition point is,

is that following our conversation, you know, with you guys, you know, we'll certainly go back to council and we'll amend these things to make sure that we, you know, make that money's available either in the gift side of it or increase in the 250 or include the unnamed biological grandchildren in the gift side of it or increase in the 250 or include the unnamed biological grandchildren in the state. Our major concern was giving them too much too soon. Yeah, I agree.

And our major concern was requiring them to be good citizens and no criminal record and all those things that you can think of. So that's kind of what we're leaning on. But with insurance, with property taxes, we want them to have cars that work and a good vacation. Of course. Ivy League school, if they choose to do that, there's plenty of money there to do that. Well done.

You're a good man, Brake, I wish we had more time. I want to know how he, how he came up with this 30 million. Maybe another call. I mean, Ray's my hero. I would love to be Ray one day to be able to bless my kids and my grandkids that way. That's really awesome. What a blessing. What a legacy. Well done. This is the Ramsey Show. It's that time again, folks a legacy, well done. This is the Ramsey Show. It's that time again folks, tax season is here. I know some of you would rather bury your head in the sand until April 15th than face your taxes.

But here's a better idea. If your tax situation is complicated, get in touch with a Ramsey Trusted Tax Pro today. That way they can take the stress off your shoulders once those tax forms come in and teach you how to keep your tax bill as low as possible. But don't wait, Ramsey Trusted Pros can book up fast. Go to RamseySolutions.com slash Tax Pro to find one who serves your area with excellence. That's RamseySolutions.com slash Tax Pro. Welcome back to the Ramsey Show alongside Jay Borshaw. I'm Ken Coleman. So

glad you are with us. 888-825-5225 is the phone number. Let's go to Devonte in San Antonio. Devonte, how can we help? Hey, how are y'all? Good to talk to y'all. Good. How are you? Good, good. So I'll get right into it. Me and my wife, we started a Christian based after-school program last year and long story short, you know, we felt led to do it, but it did not end well. We took some risk. I mean, they started with personal finances and then credit cards. And then we did a HELOC loan, 50 grand. Okay.

Fast forward to right now, got all the credit card debt paid off. We went down two cars, but the Lord blesses, we're back to both cars being paid off. But I got this 50,000 HELOC loan. I want to know what y'all would do if they all were me. I got a two-year- old, a baby on the way. I'm trying to be like Ray.

I'm glad. Come on, come on. Yeah, me too. No, it says to leave an inheritance to your children's children, spiritually and financially, right? That's right, that's right. I'm ready to, I'm ready to,

I'm not, I'm about to be Dave Ramsey Bonafar from now on. I'm not doing that anymore. Good, good. But what do I do now? Okay, so not doing that anymore. Good, good. But we're watching now. Okay, so for, are you guys homeowners, you're homeowners, what's your house worth? Like what do you owe on it and what's it worth? It's at, I'm gonna say it was 120.

About 120 left on the loan. It's about 250 to 260. Okay. Yeah, the reason I asked is because we kind of say if the HELOC is more than half of what you owe on the house, then you kind of throw it to baby step six and it's part of paying off the house. But if it's less than it's part of baby step two. So for you guys, I would treat this HELOC as though you're in baby step two and paid off in that way. And I think it's possible. I'm in real estate and you know, it's had some good years last year was tough, but still did pretty well. Um, but I'm torn between, you know, emergency fund and paying off the heel. Like, like how'd I attack that?

Cause I don't have our emergency fund where I want it. Okay. And you've got the baby on the way. Um, yeah, I, I hear you on that. You're technically in stork mode, I would say, in that case, which is you just piling up money to save for this baby being born. And the hope is, you know, you stack up a bunch of money, the baby is born, everything's all good. You know, maybe you pay the insurance deductible at most, and then the rest of it

can go on to the debt. and it's kind of like push play on the baby steps at that point. That's what I would do in your situation as far as the idea of saying, I'm gonna kind of skip baby step two, and I'm gonna do baby step three first. I would not do that. Because if you do that,

you're honestly putting yourself back in the position that got you into this mess, which is when we don't have savings and when we don't have cash, we use debt to do the things that become emergencies or even the things that we say we want to do. And so having that emergency fund there is so important so that later on you're not dipping into things like the 401k when an emergency comes or a HELOC when the emergency comes. Got you. Got you. pay when an emergency comes or a HELOC when the emergency comes. Got you. Got you. So, Lane, and a little bit pay, you know, have a considerable amount in emergency

fund, but attack the attack the HELOC. No. So we'll talk. Let me let me put it to you two ways. You're almost there. So the baby steps are baby step ones, a thousand dollars saved. After you get a thousand dollars saved, you do baby step two, which is you pay off all of your consumer debt. In your case, that's including the HELOC.

And then baby step three is you save up three to six months of expenses. And then you go on baby step four, five and six on down the road. We don't need to cover those just now. In your case though, since there is a baby on the way, we kind of call that storm mode, which is whatever baby step that you're on,

in your case, baby step two, we stop, pause, and we stack up as much money as we can, knowing that there's a baby coming, there could be added expenses, and we wanna be ready for that. So once the baby comes and you go, okay, everything's good, like I said, maybe you paid the deductible, but you've still got, I don't know, 10 grand sitting there,

that 10 grand doesn't stay there. Now you push play on the baby steps and it goes back to paying off the debt. Does that make it a little clearer? Yes, that makes perfect sense. Listen, that's what Ray would do. That's what Dan would do. So true. I love that. Hey, Devonte, man, listen, I love your spirit. I love that you've got a clear goal ahead of you. And right now, you're working as hard as you can work. You are stacking jobs.

You're just not able to be turned down if you're out trying to sell a house or sign up somebody who's looking for a house. You just have got to turn this into big time intensity. And that's the best thing you can do for when you've got this sense of, oh, I got to provide and I get that and I can hear it all over you and no judging yourself, just moving forward, just turn that angst into effort. And I think if you do that, you will be surprised at how quickly opportunities come to you to

make more money so that you can move forward. So I mean, that is, that's the play. Owen is up next in Asheville. Owen how can we, excuse me, Nashville. Owen how can we help? Hey guys I was hoping to get your take on you know how how young you know young couples can kind of navigate car ownership some things like that you you know, honestly, I'm actually currently working on my wife's blown up car to repair it, to either keep it or sell it. But um, man, we've been shopping around for a car and the, the used market, the new market, and I'm just over here like, wow, do people really buy these things?

Like that's too much. And I'm thinking like used RAV4 is $30,000 for a used car. I'm like, no, I'm just not doing it. Well, what do you have to spend? Well, kind of whatever I want, but then I'm hitting our savings and things like that. And we have a very large savings for a home right now. So that's kind of what I'm hoping to get through

and hopefully get some clarity from other people. What do you want to get? What kind of a car, what do you want out of it? So currently my wife has a Prius, which is one of the larger small cars and she is pregnant and so we're expecting a child. So a small SUV to mid-size SUV? Yeah, something like that. You guys debt-free?

Completely, yes. Okay. Low debt. What about 15 grand? Completely, yes. Okay. What about 15 grand? How's that number hit you? No problem. We were going to put that down and try to maybe finance a little extra. No, no, no.

I'm saying 15 to 20. If you can do 15, you can do 20 and not feel indigestion, right? Well, we were looking at the 25s, but the problem is for the kind of vehicle that we can get for that price range, you know, now I have my wife in a car with 200,000 miles on it. Not true. And our new child. Owen, listen, I just-

But wait a minute, even to that degree, my car has 200,000 miles on it, almost. Well, but we're in the wrong narrative. Oh, and I just bought my son two years ago, a Ford Explorer that had 98,000 miles on it. We got it for 13 grand. It's an older model, but it's in phenomenal shape. And it's got, like I said, just right now,

he's only got 101,000 miles on it. So this idea that you can't get something that's decent mileage in the 15 to 20 range is not true. Yeah. Well, and that brings me to the, I guess the frustrating part is when we look at vehicles like that, we always look at each other and say, well, why don't we just keep your Prius then? Cause it's about to be, you know, have a rebuilt engine in it. Does it fit everybody?

Well, the baby doesn't care and the baby fits in there. If everybody fits, I thought the reason was nobody, we couldn't fit as a family in the Prius. No, well, she wants something a little bit bigger because the Prius is tight. Here's what I think. I think you need to do more shopping. If I were in your shoes, I would set my budget first

because I want that to be the driving factor. Here's what I'm gonna spend. I don want to spend any more than this number right here. Right. I'd set that first. And then our cap is 26. Okay. So to no more than $26,000. And then I just worked backwards.

I say, okay, what are we looking for? We want four doors. We want a midsize. We want it to be the color black, whatever it is. And then run that back because the options are there. They might be higher mileage. And then as you begin to narrow that funnel, you it is, and then run that back because the options are there. They might be higher mileage. And then as you begin to narrow that funnel, you might decide, listen, I thought I cared more

about the make and model, but really I care more about the mileage. And I just, for whatever reason, I'm not saying it's right, but you might go, I just don't feel good about a car with 150,000 miles. Fine, that's your prerogative, but it's gonna shift the year and the make and model of car that you get. So I think that you just have to have a set of priorities

listed in order of most important to least important, and then we're working through that model to actually get where you wanna go. And by the way, you get where Owen is by budgeting, by having an idea of what it is that you have, and you keep it. The best way to make the most of your money, by the way, is creating and sticking to that budget.

And we've got the best tool. It's EveryDollar. Makes it simple to plan spending, track expenses and save for what matters most to you. It's an easy to use app. So go get it. You can get it at the App Store or Google Play or click in the link of our show notes.

Get EveryDollar right now for free. This is The Ramsey Show. The right questions are the key to unlock personal and professional potential. That means if you're not where you want to be, you are not asking the right questions. I'm Ken Coleman and this is what my new show, Front Row Seat, is all about. Over my career, I've had the distinct privilege to interview successful people from all walks of life and to coach over 10,000 professionals who wanted more. What sets successful people apart

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