Build Your Foundation Before You Build Wealth

0:00Brought to you by the EveryDollar app. Start budgeting for free today. Normal is broken. Common sense is weird, so we're here to help you transform your life, your money from the Ramsey Network in the Fairwinds Credit Union Studio. This is the Ramsey Show. I'm Jade Warsh on Next-A-Me. George Campbell taking your calls. Triple A8255225 gets you on. Erica is on the line. She's up next in Cedar Rapids, Iowa. Hi, Erica, how can George and I help out today? Hi, Jade and George. I am calling because my in-laws said that they set money aside for my boyfriend and his brother's wedding. However, they said that they're not going to pay for a destination wedding, so we're kind of caught in the middle deciding, do we go destination or do we do what they want to stay in town but maybe get some help with it? Do you need the money? No, but it would be nice.

1:01I mean, what would the financially smart thing to do be? I know, George got his wedding paid for. I would love that. I wish I could give that to you. Destination weddings are going to be more expensive, I imagine. Is that why they don't want to do it or are there other reasons? No, actually, I think the destination wedding is going to be less expensive, but it's going to be always priced out so far. That depends on how you're doing it. Are you fitting the bill for anyone flying out or is it just like the wedding is here, if you can make it great, if you can't, see you later. Great question. So if we pay for it, everyone else is going to put the bill. It's going to be about 1,500 maximum per person to come out. However, if his parents said, hey, we've got this money aside, do what you want with it, we might be able to help the family members and the friends who maybe can't afford to pay for it all themselves. So what if you pitched an idea where you say, hey, guys, we also have some money saved, but we really want to do a destination wedding. What if our portion of the money goes, what if your portion of the money goes towards paying

2:05for the venue and the food and those things, but our portion goes towards flying out like key family members to make sure that they can go or subsidizing it to a certain extent? Yes, we did try to pitch that already. We got some pushback. So the issue is his dad has nine siblings and his mom has six, so we can't pay for everyone to come. So I think they want an in-count wedding so that way everyone can come, but we actually want a destination wedding so we can get to talk to everyone and see everyone and make sure that it's not just, you know, the day's over and oh my gosh, we didn't see anyone. Can you just do it locally and limit it and you guys just do a little getaway kind of honeymoon situation? We could. Would that be a compromise? Because then you get a free wedding plus the Salt Expenses Pay vacation. I would think that would be a compromise. The issue is if we do a local wedding, then the people who don't get invited might feel slided. Who's not getting invited? Yeah, you're saying because now it's local.

3:06More people can come, but we're still limiting the invite list. I mean, the invite list is still nine siblings and all their kids and six siblings and all their kids and they're not not even my family. Right. So what is his parents willing to cover financially? Is it a dollar amount? They wouldn't give me a dollar amount. They said that if they give us a dollar amount, our Mexico trip might turn into an Italy trip. So it's probably significant. See that's strange. Oh, wow. I'd want them. I don't know why they're being kind of like not telling you the details. I think if I were you, I would talk to your fiance and say, can you please press your parents to get some actual facts so we can plan? That's not because we're trying to tell them what to do or because we're ungrateful. We just need to understand clearly our options so we can make a plan. Can you please ask them for the dollar amount if we do it local? That's all we need and then we can make a decision. And then I wanted to ask you, Erica, how much do you guys have saved? Yeah, that's a good question. So I only have about seven thousand saved, but I could probably do another seven before

4:11the wedding. Okay. So if you don't say he has about 85 to 90 thousand saved, but that was actually supposed to be allotted for a house. Yeah, that's a lot of money. We could spend money on a wedding, but if it could be free, that would be a fantastic too. So I think it sounds like the biggest value is not that it's a destination. It sounds like the biggest value is we get to choose who comes and we get to choose what we spend on it because we'd rather have more money going to other things like a house or the honeymoon. Is that fair? Yeah, I do. I do still really want the destination. I think if we do the destination, it'll limit the guest list without us having to limit the guest list. But that's the reason you're doing it then is to sort of force the issue and go, well, the guest list is not everyone can come. So yeah, so to George's point, guest list is number, if we force rank these priorities, guest list is number one, destination is number two, not overspending is number three

5:14is what I'm hearing. Yeah. Okay. So I think that what you and your fiancee need to do is do what you would like to do and that's, it's your choice. If you want to do a destination wedding, do it and invite who you want. And the other, the adults are going to decide if they can make it or if they can't. The best thing that you can do is give them a save the date pretty far in advance and let them know here's when it is and here's what it's around what it's going to cost. And do what you want to do. It's your day. It's up to you. It's not your job. It's not your job to make sure everyone can attend. Let me say that. It's your job to create the wedding that you want. Yeah. I know I really do want the destination wedding. The only other fear that I have is it kind of kicks the in-laws off when we said we want an destination wedding. That's all right. So do we need them to worry about having them in the middle? I mean, you'll have to live with that. I don't know how long they'll hang it over your head for.

6:16But you're in it for the long haul. So they're going to have to learn to like you. Yeah. And they will. They will. There's always some drama. I'm thinking back in my own mind about my own wedding. There's always some kind of drama. And over time, it goes away. And it just solidifies all that does, Erica, honestly, is solidify what takes place when you get married, which is that bond going towards you and your husband and you're kind of moving away from your mom and dad and your family and kind of doing things the way they want you to do them. And you're moving towards you to being a unit and living your life the way you want to live your life. And that's, it's almost like the first foray into that lifestyle. Yeah. And you guys are in my shoe. What would you do? I would personally try to come up with a compromise where they feel honored. And that might be you guys do the destination wedding with a small group. But then at home, when you guys are back, there's a big celebration and you kind of make a little your own wedding out of that. And that way all the people get to come, there's still a celebration. And who cares when the actual, you know, nuptials happened.

7:19That's the question. But then we both pay for it. Like we would pay for the destination. They would pay for that. Then you guys can talk about it. That might be you guys pay your own way to Mexico to have your destination wedding that could cost you 15 grand. And then they might cover 40 grand for an in person wedding back home. And I would say use your money that you have and have the wedding that you would like to have give everybody a fair amount of notice, price some things out and let that be that on that. I think you're wanting the cake and you want to eat it too. In this case, it's the wedding cake. But I want to have my wedding my way, but also I want someone else to fund it. You can't do that. You can't do that. If someone else's budget, they're going to have some level of say, I wish they said carte launchers a check for 40 grand do what you want, Erica. That would have been the cool thing, right? Yeah, I think that's what Dave did. And he said, I'll have to check in with Dave on his play. But here's what I did. Our wedding that we won. Yeah. 50 people total, including bride, groom, bridal party. So we had to throw a second party just to have everyone we wanted to have.

8:21And see, I had it. And see, I had a destination wedding and we invited 75 people and I think 70 came and I never did anything else back. That was that. That was that on that. If your business is making seven figures or more, you should be proud of that. But that growth probably brought a mess with it. Systems that don't talk to each other. It's impossible to track down your numbers because they're scattered everywhere. That's a visibility problem and NetSuite has solved that problem for more than 44,000 businesses

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10:30Hi, Julie. What's up in your world? Hi, so I in here did a home and it has solar panels and it has a 25 year debt attached to the solar panels. I've been on social media on Facebook and such and I keep getting advertisements for canceling your solar debt. Is that possible to do? How much of the home, how much are you paying every month in these solar panels, just in the solar panel bill? $300. $300 a month. Oh my gosh. Are you telling me when you contact the business, there's nothing there or are they still in business? What's going on with the business? The people that installed the solar panels are out of business. The automatic payments are coming out going to a whole other business.

11:33Okay, so that's what I was going to do. Have you separated the lender who actually holds the loan aside from the installer? Okay. And what are they saying? Well, I haven't spoken to them, but I'm getting these advertisements saying that if you had this installer, you can cancel your loan with this and they're using the same company that I'm paying. So that's why I don't want to click on it. You know, and then get on a whole bunch of other lists. Yeah, my fear is they charge you a hefty fee and then it doesn't end up getting canceled and you're still on the hook. And you're just out more money. Right. Right. And I've gone through a financial piece university and I'm 100 percent debt free. Thank you. And so I don't, you know, I'm like, wait a minute. Now I have a house. Yeah, how did that work in the contract? I'm sure that came up when you bought the home, what was going to happen with the solar debt because it's in someone else's name.

12:35It's inherited. I inherited it from my father. Oh, from your father. So the debt is technically in his name still, but you legally know it. Well, wouldn't he? Yes. Okay. Because he gave me the house in as well and the house has the solar. What's the total left on the loan? 40 something thousand. Ouch. That's a lot. Yeah. What's the interest rate on this? Three percent might have gone up by now. Yeah, I'm just wondering if this was part of the contract. Yes. I don't know that it's just going to go away. I don't know how the lender would just cancel the debt, magically, just because it was inherited. All right. Have you talked to an attorney about this? No. Should that be my next step? I might just be worth a consultation to see what your options are. Okay. Because if you can get out of this, unscathed. That's awesome, but I don't want you to go down a rabbit hole of clicking advertisements

13:36and people promising you things that aren't true. Right, right. And I have learned not to do that because I learned in my financial piece of university. So, okay, well, you answered my question and I appreciate that. So, Mike, and I appreciate Ramsey Solutions. This is awesome. Absolutely. I've been looking at all that fine print you signed to see what your options are when it comes to getting out of this thing. If you owe it in full, if there's any remedy here, I would at least do that much homework before deciding. All right, I'm just gonna tack this thing like any other debt. I feel like she doesn't have a lot of options just because she legally signed for that when she got out. This is part of it. Yeah, it's kind of part of it. That's tough. Try to avoid solar at all costs. That's the takeaway. Anything where someone shows up at my door, I'm usually like, this is probably not a good deal for me. Uh-huh, uh-huh, I feel that. That's usually how it goes with solar. Then I'm promising you, hey, that electric bill's high. Wouldn't you love to pay 300 bucks a month just something else instead? I would not. I know thank you.

14:37Wolf. Wolf. Let's go to Caleb in Cincinnati, Ohio. Hey, Caleb, how can Jordan help? Hi, how are you guys doing all right? What's up in your world? I am in the process of, uh, closing on a new home. And I am going back on, back and forth on whether I should get a FHA or a conventional one. Do you qualify for the conventional loan? Yes. So what's the benefits for you going FHA? Just less money down? That would be one thing and, uh, the purchase of the new home is contingent on the sale of my current home. And how does the FHA help you in that situation, the contingency? It doesn't. Uh, there is a deadline on it. It's basically the FHA I can have, I would have a liquid cash right now to close that I need. Um, conventional, I will not have that liquid cash accessible until my house is sold.

15:40That kind of sounds like, uh, a protection for you in my opinion, because if your house doesn't close and you needed that money to put down on the new house, you're going to have two mortgages that you're paying. Can you handle that? Correct. Yes, yes, I can. Without a, without a renter, just, I'm just carried to mortgages. Yes. Okay, then that really shapes why do the FHA loan? If, if you've got the money, then I'd be thinking, okay, let me put more down so that there's equity built in at close versus going the FHA route and putting less down. What I'm saying right now, I probably won't have the 10% to put down if I give the conventional until the house sells. Once the house sells, I mean, you'll have to be fine. Yes. Why are you afraid of, because having a contingency is a fair thing, why are you afraid of waiting? Is it a build and you've got to get it? Like what's causing you to have to make that call right away? And you can't wait.

16:43I mean, I can wait. I mean, now, it's something new for me. It's a big move. It's out of my city and I don't know, just attachment to the house most likely. Have you seen it in person? Yes. This isn't like sight unseen. Well, another problem with FHA. I'm sure you've heard of this as MIP. The mortgage insurance premium, it's about 1.75% up front of the loan and most people roll it into the loan because they can't afford it. And so that just becomes a bigger payment with less down. Correct. Because it's what I'm trying to have. Is it required? Yes, I can afford that. Right, but you're going to be paying that long term. Over 30 years. And it's not a crew to over $40,000 more that I'm going to pay for the same exact home. I think you're in a rush and I think the rush is, and I understand there's a time crunch if you're moving, but can you rent for a while? Because I think that that time crunch is causing you Caleb to look at options that honestly aren't ideal for you

17:44and that are going to cause you to pay more out of pocket and fees long term and have a worse loan long term. When we could go, okay, let's just put the current house on the market. Let's let it sell. Let's go move to the new location. Let's rent for a year, which is what we would suggest anyway. And then certainly in that amount of time, the current house is going to sell. You'll take the equity and then you'll be familiar with the new area and you'll buy a new house in the new area. Okay. Tell us the timeline so we can kind of help you a little bit more. My closing date is the 23rd of October. Third November, I'm sorry, November. So I have a 23rd of November. And how long has the house been on the market? The house has been on the market for roughly three months. Not my house, the house that I'm buying, the house that I am, my home has been listed as of Friday last week and just updated today with the photos from the photographer

18:44that came then. Okay, so your house, your current house just went on the market and you're in the Cincinnati area. We have a tool on the real estate hub where you can actually type in your city. So if you were to put Cincinnati, Ohio and the real estate hub, which we're doing right now, average median days on market for you is 40 days on market. So if your house Caleb is in good shape, you've had a realtor, one of our realtor's look at it and they're saying, hey, yeah, you're good to go. I mean, I think that's a fair assumption to say, hey, this could take 40 to 50 days to sell. Okay. But the key here, I think the key for you is gathering all the information so that you can make the best choice instead of pushing yourself into a corner and saying, my only choice is, yeah, this is the biggest financial decision of your life. And so you just want to do it slowly and not out of a desperate situation but instead walk with confidence, with patience, with options, that's how you're going to make a good long term decision.

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21:53to find the type of insurance that you're looking for and to connect with a ramsy trusted agent. Do that today. Let's go to Jennifer who's in Los Angeles, California. Hi, Jennifer. How can George and I help out today? Oh my god, I can't believe I'm talking to you guys. How are you? We're doing good. Happy to talk to you too. Good. OK. Well, let's see. I deserve to be better. I think 100%. We're three at 63. And so I plan on working probably another 10 to 11 years. I'm in sales. OK. And I have 15,000 in an emergency fund. My 401k sadly with a company match is at about 83,000. I forgot to tell the screener. I have another 50,000 in another 401k account that I had that I just kept there, let's say. So I have 83 and the 50. And I'm just wondering at my age, how can I maximize this?

22:59Should I roll over my existing 401k with my current company into a Roth? If that's something that I should do or so, really, those are my questions. Does your current employer offer a Roth option for 401k? I think they do. It looks like they do on the website. I mean, I can tell you the name of the company. I mean, if they offer that, I would 100% go for that. And then if you have this old 401k, is the old 401k with a different company? Yeah. It's a different company. And it's a financial advisor basically a company that's been with my family. So it's with them. But it's not a 401k. I think it's not all that. Did he roll it over to an IRA? Right. It's a trash lob. OK. So you got an IRA with 50k, 83k. And your employer 401k, you want to retire in 10 years. That's the goal, 11 years. Making up for a lost time.

23:59We're willing to work till 74, is that right? It's crazy. I could probably work till 80, but you know. OK. You sound great. It sounds like you're in great health. What do you want to work only because you must? Yeah. Well, I feel like I need I must because I never stayed in all my life. Yeah. Are you single? So no, I'm married. But but we I really don't want to talk about my husband because we do everything separately. I'm just really concerned about this, this account. OK. So in retirement, you're only going to have access to your own money. He said, don't touch my pot. You guys split every bill. If my husband passes away, he is 11 years older than me. Then I would have something I would have our house. What does he have? Can you tell us what he has in retirement just so we know what what passes to you and if it passes to you? I'm state that again, I'm sorry. Can you tell us what he has in his assets? Because if he does pass before you,

25:01we can have an idea of what would pass to you. Yes, yes. I believe he has about 100,000 just that he does draw from. Monthly, he has a pension also that that's separate. Do you know how much he gets for the pension? I think it's about 2000, I want to say plus, just the security. And do you know if it's structured in a way, sometimes with school system, a pension can be structured in a way that you get more monthly. But when you die, it dies with you. Or it can be structured in the way that you get less monthly. But when you die, it can pass to a spouse. Do you know how his is structured? No, we yes. I do. No, it just goes with him monthly. And then when he passes, that's it. That's that. So just the 100,000 that he's drawing off in the pension? Yes. No, from a separate account to help end the date with the pension. $100,000 plus the $2,000 a month, and what's the third thing?

26:05Social security. OK. And I think it's about 1,500, I believe. Is his social security more than yours will be? Mine will be close to 4,000. OK, so you'll keep yours. I think it up to 70, something, yes. OK, so we at least have that in the horizon, plus whatever you have saved. So what is your current income for the year you gross income? It's about 130. It could give or take with a bonus commission. Awesome. And do you have any debt? No. No, no home mortgage. No, my husband pays for that. He does that. OK, but if something happened to him, would you be on the hook for the mortgage? Yes, because the house would go to me. Is it close to being paid off? I think it's about 400. OK, so no. What I'm trying to factor in is you need a whole lot less for a retirement if we're not needing a mortgage payment factored in there.

27:06So that's why I'm trying to figure out all the variables instead of just saying, yeah, you should be good. But based on your current income, we recommend investing 15% until the house is paid off, which would be $19,500 for you. And that's without a match. So every month, that would be $16.25 going out. So I'm going to add that. I have our investment calculator up here. I'm going to show you, and you can watch this back on YouTube or Spotify. You have 133 grants saved. We're adding 16, 25 a month over the next 11 years. And I'm going to go with a 10% average rate of return. So when I hit Calculate, it's showing me $785,000. How does that sound? 10 years or so. That sounds amazing. That's great. That's 11 years. If you're living just off of the interest that that's generating, I mean, 70 grand a year, that's not bad. Plus, you've got your 4,000 social security. And what I would be talking to your spouse about, I understand. I may not agree with it, but I understand

28:07that you want to keep the money separate. That's your business. However, the conversation that I would be having with him is we're both going to be retiring. And there's things that affect both of us that we both need to have a clear idea of and a clear plan for, and that's the house. Because that's going to affect each of you if you pass first, if he passes first. And so I would want to know, are you guys going to create a plan together to get this mortgage paid off faster? Does he have a plan to do that? Is his plan, do you want to downsize? Start talking at least about that, because that does affect both of you. And for you, it affects you greatly. If that house comes to you and you're used to living in it, and now you've got a mortgage, well, now if you can't afford it, you've got to move all of these things. And so you both deserve to have a really clear plan that makes you feel secure and retirement. Right. Right. OK. And George, right? Yes. So on the 1625, is that 15% of my income that you calculated?

29:13That's where you thought that number? Exactly. Because 1,130,000, 15% of that is 1,500. Divide it monthly, you get 1625. And that's without any match. And I've got the calculator up on the screen now. We finally figure that out. And so that's if your income doesn't grow. So if it grows, if you get a match, this number will be even bigger. And to give you some perspective, $785,000, if you, let's say you had a withdrawal rate of about 6% to 8%, you're talking $45,000 to $60,000 a year is what you could withdraw from that. So about 4,000 a month. So now if you tack that on with Social Security, OK, that's about $8,000 a month. Now we can figure out, is that enough to sustain our life and lifestyle, the mortgage, health care, all of that at that age. Right. And if I said, oh, I want to retire in five years, of course, that number will be way less. Yeah, at that point, you have a very high likelihood of running out of money. And again, I don't know your lifestyle. I see you're in the Los Angeles area. I know you have the mortgage still.

30:14That's probably not going to get paid off in the next five years based on the current trajectory. And so that's where this conversation with your husband, even if you guys have separate finances, and I wish I could convince you guys to build this thing together. Because it feels crazy. You're building two different rocket ships and you're both trying to land on the moon. Let's just pull our efforts together. Yeah. If you're the beneficiary, you're a part of this financial plan, whether he likes it or not. So I want to know, am I the beneficiary on all these accounts? Can we make sure our eyes are dotted, tease are crossed? Because one of us is going to croak one day. Not to mention in a perfect world, there'd be life insurance on both of you. So that if one of you passes away, there's a lump sum to carry, at least cover costs for paying off the mortgage and have a funeral cost. Absolutely. So working together is the best bet. Let me tell you what I get asked all the time.

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32:28That's zander.com. So if you're new to the Ramsey Show, you'll hear us talk about the baby steps quite a bit. And that's because they are the framework that we use to answer every money question. You can learn more about that at the link below the seven baby steps, the key to a rich and satisfying life. All right, let's go to Bryce who is in Winnipeg, Canada. What's going on, Bryce? How can we help today? Hello, hello. You can hear me clearly. For sure. Awesome. Awesome. OK. So my wife and I recently welcomed our baby boy into the world about three months ago, and so my wife has become a stay-at-home mother in that time. And so we're trying to navigate the transition to being a sole income. Last year, she had pulled in 60,000 and pulled in about 55.

33:33And so with her now going to be a come-of-state home mom, our income is getting cut in half. Yeah. For the next couple of months, she will be, what's it called, pulling in maternity leave, but that'll end like kind of like April of the next year. And so I have a bit of a window. I just want to catch it early and try to get the ball rolling through, situate myself using the next couple of months to get a study of foundation beneath us as possible. My income itself tends to be highly variable. And so I kind of want to use the slow season ahead of me to hopefully get out like kind of what I can do to potentially fortify ourselves in the best way going forward. Bryce, did you guys plan for her to stay at home ahead of time and you knew this was coming? Or is this kind of like, we're figuring it out now as we go? It was like when we first talked about having kids, she did note that she wanted to have a multiple. And I said, if I can make this possible, I would love to go up a step in the little being that sole provider that is not

34:38that'd be an absolute blessing if I'm able to fill those shoes. For sure. I'm just kind of terrified that I won't be able to and we kind of put ourselves into a precarious ish. Maybe so. Financial situation. Has she already put in her notice at work? Yeah, she's been away from work the last three months. Like she, she they, she's not coming back. Yeah, yeah. Okay, that's what I'm trying to figure out if there's still an option for her to go back to work for a season until you guys can figure this out. Cause right now you're bringing home like three grand a month. Great. Right now it's busy season. So I'm actually closer to bringing home four grand a month. Okay. And that is good for for what I'm doing. And then obviously with her mat, Lee's anus closer to about $6,500 a month. And we are squirreling way every cent of her mat, Lee right now. Good. So you're figuring out how to live on your income alone. Yeah, pretty much is what we're trying to kind of figure out how to do. Have you put it in? I'm just have you put in a budget and seen what the difference is like, seen, okay, if I make four K a month and she brings in nothing,

35:40what is the difference? Are you in the red or are you in the green? There's just no margin. What is what are you finding? Right now it's as far as I can tell, it should on paper be in the budget. Should be, which would be $200 in the green, which isn't great, but at least we're in the green. Okay. What's your rent or more? So we actually have three mortgages, which is why this gets kind of long. So our first mortgage payment for our primary income house is $950 a month. Okay. So we're good on that one. We're clear the other two mortgages we have are rental properties and they end up being net zero. So what they generate completely covers the cost. One of them is a seasonal cottage. It can only be rented out for half the year. And so that's the reason that it's not zero. It brings in just enough to cover itself. So we're like, all right, cool. It's relatively space. Oh boy. And the other one.

36:40Yeah, that's what you have in savings. Hold on, before you go further, how much do you have in savings? I hope it's a lot. I have $20,000 like basically three month commercial funds. But if I bought a note income from the rentals or from myself, we would be completely clear for minimum three months, probably closer to four. Oh gosh. So why are you keeping net zero properties? Because it's kind of like a dream that we want to have with this cottage going to the future. And I don't know, it kind of just stumbled into it. I know it sounds passive, but. Well, it's not that it's just that I do think that some things have necessary endings. And I think that in this case, there has been a lot of change. You now have a wife who's not bringing in an income. That's a major change. You have a baby. That's another major change. You have three properties and you only have $200 of margin. That's that's really, really, really, really, really tight. And then you have two rentals that are net zero.

37:41And if for whatever reason, you don't, you don't have a renter that month or that renter goes away. And it takes you a while to re-wrap. A big repair. A big repair. You're up a creek without a paddle, my friend. I don't know how to feel. You're probably trying to save that. I might. Well, it's not because I don't want you to have rentals and it's not because I don't want you to have your dream. What I really do want for you, Bryce, and I know George feels the same way as we want you to feel secure. And we want you to feel peace. And whenever you bring a baby into the world, that is invaluable to be able to live your head on the pillow. Your priorities and dreams have changed. Right now, the priority is she needs to stay home at all costs. That is the goal. That's the dream, which means the other dreams need to go away for now. And that might mean you sell these properties, take the equity. You have a bigger emergency fund and long term, we need to get your income up to make this work. What are these rentals worth? What do you owe on them and what are they worth? Okay, so the first rental, the seasonal cottage is worth 200,000.

38:42And we currently owe remaining mortgage on it's 150,000. So we have 50,000 equity in it. Okay. And then the other one is a condo, which is worth 65,000. And we owe 50 for it. And that one was actually unforeseen. I wasn't planning on having that much risk, but a family member of mine was at risk of going homeless. Okay. So my wife and I, we put her hand out, got the property to have that person put into it. Well, that's a problem because you have to evict them now if you sell this thing. I recognize that. What if you sold one and took the 50K and paid this one off, the second one off? I'm, I'm, I'm tempted, like, I'm quite tempted to do that for sure. Like it would, it would bring more stability, which would be definitely nice. It's just, it's hard to like go like kind of like a dream. Well, it's, you're not letting go of it.

39:43I want to, I want to reframe your mind. You're not letting go of it. You're reframing it and you're restructuring it towards more solid. Right now what you've built has a horrible foundation. And we're saying, hey, we really like real estate. We love the fact that you're trying to help family member. We love the fact that you want to stay at home. Mom, we love that. Let's do it with a firm foundation. The best way to go about this, even if you just do this baby steps a little bit at a time. The first thing, let's sell this one rental that's earning you no money. Let's take the 50,000 and let's at least sure up this other thing. I understand you don't want a homeless family member. Buy yourself some time, start having the conversation with the family member and saying, hey, we have a life here that we have to live. We're going to need you to start either paying rent or find another place to live. And then you can have that. That's the thing with regards to this other one is like that. But it's just at cost. It's cost. You're not paying for rent. It's cover. Right now, what I'm trying to remember, those are the charging loss.

40:48I'm sorry. It's a 900 that we're charging them because we're trying to show up getting the debt paid off to get that. So we're going to be dropping the rent down to 650 to be at the net zero cost so that it's not so we don't run into weird. Here's the problem, Rice. You're not in a place to be super generous like this. I hope one day you are. But right now you guys are tight. You just lost half your income and you're trying to make this life work while trying to be generous over here while trying to keep the dream alive with this cottage. And that baby changed things. I think we need to own that that we can't have the cake and eat it too. And that's something's got to give. And if they can afford 900 bucks and rent, let's try to find them somewhere else. They can rent for 900 bucks. Yeah. That way you can sell this property, simplify your life and be able to afford your life with just your income. Yeah, because then what if you sold that property, you got the 65,000 and what if you threw it towards your mortgage? What do you own your mortgage? Our current mortgage, we owe 175 bucks on it. Oh my gosh. I mean, you're chopping that down hugely if you were to do something like that.

41:51So do you see what George and I are trying to do? We're trying to get you to some firm footing here. You're in the mud, my friend, and you're about to slip and fall. I don't think you see it the way we see it, but you've got so much risk on your hands right now. Oh gosh, please think about clearing these properties. And I don't think that you're going to be able to make this work in a pleasing way for either of you with $200 of margin a month. Then you've got to start thinking long term about what that means for both of you. When it comes to your health insurance, one of the biggest mistakes you can make is believing your stuck in a one size fits all plan that costs too much and covers too little. That's why I recommend health trust financial. They're the only Ramsey trusted health insurance partner because their advisors take the time

42:54to understand your situation and help you explore the coverage options that are available to you. You've changed jobs. Welcome to new baby or had some other life event health trust financial shops multiple top rated insurance carriers for you. Then they help you understand your options so you can make a smart decision instead of guessing. I've recommended health trust financial for more than 20 years because they work for you, not the insurance companies, so they offer unbiased advice. Visit healthtrustfinancial.com to connect with an advisor today. That's healthtrustfinancial.com. Welcome back to the Ramsey show here in the Fair Ones Credit Union studio. I'm still Jade and he is still George and Aaron is on the line in Columbus, Ohio. Hey Aaron, how can we help today? Either can you guys hear me out? Absolutely. Very good.

43:55Thank you. My question is around emergency funds. Currently I have about half my emergency fund in a high yield savings account earning 3.8% and then I have money just in regular checking account. I am wondering what do you guys think about taking some of the money that is in my checking account and putting that into the 20 year treasury as a means of holding some liquid cash or getting a better return on it. With the discounts, the 20 year treasury is currently yielding about 5.5%. I'm just wondering if that is a good way to hold some extra money and get a little bit better rate of return on it but also keeping it liquid in on hand. How liquid is that? You can buy and sell treasuries. I use Charles Schwab so you can buy and sell them pretty much instantly.

44:59You would just need to transfer money out of Charles Schwab into my regular checking if I needed it. Why isn't checking if you don't need it? Why not just move that to high yield savings? I could but part of the reason I'm calling. I'm a little bit cautious with my money. I'm a father of four and my wife doesn't work. I keep maybe a little bit more cash on hand than I really need but it's just a little bit of how I am. I have about 21,000 in my high yield savings and about 40,000 in checking. I know I probably have a little bit too much in just regular checking. What's that equal for you? How many months of savings is that 61,000? I actually don't know the exact amount of months in my last but certainly more than six.

46:02I just kind of go ahead. If you wanted to drop that down to six months and not have any extra, you could take what's left and you could invest it. I wouldn't invest it in bonds but you could take it in investment because you don't need it in high yield. You don't need it in an emergency fund. I'm going to sell it. I guess there's worse things that you could do. I don't think you're going to lose a bunch of money. Now the price will fluctuate even the lender's safe. It's the government. You're good there. The price will fluctuate and there's a settlement window and you're going to get less if you take it out before maturity. It's not as liquid as I would like it to be if it's actually an emergency fund. Personally I don't have any T-bills or anything like that. I just have a high yield savings account. I keep my six months in there and then I have my checking account for monthly spending with a little buffer. For you, you might say, hey, I want a couple thousand as a buffer. Everything above that is my monthly spending. Anything beyond that. The first, I'm going to wipe away the high yield savings and just keep it that simple.

47:05Right. Yeah, I think with the bonds, I mean, I'm not looking at using that as a means of saving for retirement or anything, but just trying to get a little bit better return on my money that's on hand and just... I think that's what you have to challenge. I think that's what you have to challenge is what the money is being used for and what it's truly for with an emergency fund. The purpose of the money is to be there when you need it. You don't want any risk attached to it. You don't want it to dwindle. You certainly don't want it to go down and value in any way, shape, or form. For that reason, I would keep it in the high yield savings and then when you have money that you have it and the purpose is for it to grow quickly and the purpose is for it to be invested and multiply. That's the money that I'd want invested well in good growth stock mutual funds. I think just... It's placing it in your mind for what it actually is. I think we can get hung up sometimes when we put the wrong purpose on what money is for

48:05when it's separated in our different accounts. Is that fair? Yeah. A good example, Aaron, is 1% spread. Let's say you could make 4.8 instead of 3.8 by getting the T-bills. On 20 grand sitting in there, you're talking about 200 bucks a year. It's not nothing, but it's not something either. It's just a little over 10 bucks a month. 15 bucks a month is what you're gaining, but you're also losing some liquidity and it's a lot of mental calories to try to sell it off, wait for the settlement window, access it a couple of days later if there was an emergency. For that reason, fair ones is great because the high yield savings is tied to checking. If I really needed the money, I could transfer it to checking and then swipe my debit card. Right away. I'm done. My every dollar budget, what I do is just have my monthly spending money accounted for. I like to be a month ahead. That's kind of a different approach. If you have all of your bills ready to go, locked and loaded on, let's say October 1st, you just have a lot more peace of mind. Then I make sure it doesn't go below a floor. Let's say that's $2,000. If it goes below that, I'm going to refund it with savings.

49:07If it goes above a certain amount, let's restock. That just kind of simplifies it in my brain. I like that. I like that a lot. All right, let's go to Ryan and Nashville, Tennessee. Hey Ryan, how can we help? Hey guys, thank you for taking my call. I had a question about options. I'm more little late to the game as far as it comes to investing. Right now, we are currently in Maxx, her 401k Roth at work. Then she's got a Roth and I've got a Roth. Both of those are going to max out yearly as well. We're talking 401k's. Well, her Roth 401k, she had a regular 401k and we switched that over to the Roth at work. That's what they offer. We're contributing the maximum to that and I think they give her 4%. That one's doing well. She had a roll over from previous jobs and then we converted that to a Roth. Then I traded that one and then I have my personal Roth that I traded. Now she has an option to buy options.

50:09I understand how they work. I just don't understand the risk. You just betten the farm on how the company is going to do or what you're opinion on buying options as an investment versus just maybe starting a new account and trading that. When you say options, you're talking about like an employee stock purchase program. Correct. She can buy the shares at a discount, like 20% off. Correct. Okay. Yeah. What is this a publicly traded company? It is not. Okay. That. That gives me a little bit of pause. Yeah, that would give me some pause because I don't know what it's worth and what it will be worth and you're still putting your hard-earned money there instead of let's say a separate S&P 500 fund. Okay. So now you're making a little money right off the top because you get a discount. So it feels like, well, this is free money. Why wouldn't I take it? But depending on the company, it may not be a good deal and I would sort of look at it as something outside of your 15% into retirement. If you want to put some fund money there, then you can just say, hey, we're going to budget

51:12500 bucks a month and buy up some of these employee stock purchase program. When you guys max out the Roth IRAs and the 401Ks, does that meet your 15% of your gross income or is there still wiggle room there? Between everything, it's probably a little bit more than the 15%. Okay. But we're pretty comfortable with that. But I guess, can she sell the stocks as soon as she buys them or is there a hold on that? No, there's not a hold. Once you want, yeah, you can turn it on and sell them. I can just leave you out. That might be something I'd be interested in. Is just buy it, get the discount, sell it and then invest it on your own. Somewhere that's more diversified, like a mutual fund or an index fund. That I would do. Here's something that keeps a lot of parents up at night.

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53:32That's worldwatch.news slash ramsy. Let's go back to the phone lines where we have Sophia in Houston, Texas. Hi, Sophia, Georgian, I are here to help. Hi, thank you for taking my call. You bet. What's going on? So I just want to know, we'll help with how do I slow down my elderly mother who lives with us from spending her money on charities and political organizations so that she has money to take care of herself as she ages. Oh, man. What is she spending on this like monthly ballpark it? Well, in the last month, she spent about $1,100 on just like, checks of like 41 checks went out $27 approximately a piece.

54:33I mean, averaging. We're talking paper checks. She's ranked checks. Paper check. Hey, I didn't even, we didn't even, I write, I wish that would work, but she, we didn't even know how much money was going out. And then she's like needing to order checks all the time. We're like, wait a minute. Wait a minute. Every time you get checks, that's like 80 checks. What are you talking about? So we're trying to figure out what's going on. And she all there mentally or faculties there. Like she's not just writing checks out of like a weird habit. She is, she is forgetful. She is a little not quite, but she's not so far gone that she doesn't know what she's doing. Sure. Okay. But she is getting more and more forgetful of over time. How much money does she have? She's got like, she sold her house because she couldn't afford the property tax. So she moved in with us with like a $400,000 check from the sale of her house.

55:38She had hardly anything in the bank before that. And then she, so it's been, and it's broken down into, thankfully more recently, we moved a bunch into a CD, but for about $150,000 and she's got like a savings of $43,800 and she has a checking account with like about two grand in it. Is there anything invested? The 400,000, whatever's not in the CD is it just in an H.I.S.A. It's gone. It's just gone. And I've told her like, mommy, you had four minutes out. Oh no, I never had that. Like in what period of time, in what period of time, Sophia, did she blow through the most of the 400,000? She moved in in 2022. So between then and now she went through like $200,000. Oh my goodness. Okay. So yeah, this is a big deal and you're just now discovering it.

56:39Well, we started realizing last year that she had, she had taken in between, it, between how she gets her money and she had taken in like $48,000 in deposits, but she had blown through $90,000 in withdrawals and we're like, we're not. Well, I'm more worried that there's scam fraud things happening here and even elder abuse where she's unaware of what's happening and thinking she's giving somewhere and she's not. Right. Well, what happens is, you know, they sell her name to everyone. They're like, oh, we've got a life one here. And so. I'm not sure I should check. You got it. You got it. Sophia, you got it. Sophia, you got it. Sophia, you got it. I'm fine. But I mean, it's like Dell's children hospital and this missionary and while I'm wondering if you get control of her bank account, where you get financial power of attorney and if she needs to make a giving donation, a purchase, it goes through you. Is that like a door with power of attorney?

57:41Exactly. And while she still has her faculties, I would get that signed over because in the event that she loses that, it's going to be real hard to get it. You're going to go through a judge. So that's what I, okay. So I have been wanting to see a lawyer and they said I had to get like her tested from a doctor in order to even see them because they were afraid that, you know, there would be repercussions and all that stuff. And I'm like, so I don't know. Can you go to the back? Is your name on any of her bank accounts right now? No, it's all in a trust and it's a trust set up in California. So I don't even think it's legit out here in Texas. Oh, boy. Well, I'm wondering if you can get to the bank statements and see where this money's actually going because if she's writing checks, every one of those has a paper trail. Right. We can get into her account because she can't remember anything as far as like how to go in there and do all this stuff. And that's all of that. All of this stuff. All of this stuff. All of this stuff.

58:42And not that you're trying to build a case against her, but all of this is an indicator that it's probably time to do that if she can't remember her passwords. It's not normal to go through $200,000 of savings that quickly and in that way. So all of that does point to the fact that it's time. And I bet if you sat down with an attorney and you did the testing, you would be able to get that power of attorney. And in the meantime, I also take the money that's in the CD and I start to invest that because this dwindled so fast, we need to get a higher rate of return and make sure there's money here to take care of her because if she does end up needing memory care in the future, you want to know that there's some money there to go towards that. Okay. So that's my biggest concern. Like even if we just have to get somebody into the house to help because I mean, I'm not young anymore either. How old are you guys? Oh, she's 84. She's 84. I'm 60. My husband's 63. I have MS. My husband has a bad back and we're like, okay, we'll have to get people in to help.

59:45So we've got to get a hold. You've got to be able to get access to whatever lump sums that she has, the $43,000, the $200,000. Let's get it invested. Let's get it making some money and getting a nice return so that, you know, in a couple of years, that money is there to help take care of her and help take some of the stress off of you guys. Yeah. Yeah. And I would cancel all recurring gifts. So anything that's, is there anything that she signed up for that just taking money out of her account every month? Um, no, I mean, other than, I mean, she pays us rent. So she does, yes, rent. Okay. And she pays for the stupidest thing she pays for as a storage room. And, you know, and she helps with some stuff like her own phone and her, and her insurance, she still drives. Wow. Which I'm not sure how long she's, I know. I might be interested in setting up some new accounts for her only because she's written so many checks and her routing number, her account is just out there in so many different

1:00:47places. And to Georgia's point, if anybody is kind of going in there and pulling money out of her account and you guys aren't aware of it, maybe just starting fresh would be a good, a good thing. We have not, we have not seen anything like that because she doesn't do anything online. It's all paper checks. Okay. So nobody's getting in there. So, well, they have work for that. 100%. They have her name, her address, her account number and her routing number. That's all they need. That's true. That's true. Can you cut the solicitation pipeline out? Can you start unsubscribing opting out of mailing lists, register her for the do not call list to try to limit the opportunities for her to get? Well, is there anything that actually helps unsubscribe people from mailing lists? Like, is there an organization that will do that from mailing? Yeah, the do not call this will help with that a lot. And so that'll stop a lot of the unsolicited marketing that she's getting. It sounds like at this point, it's solicited. She's reaching out to them, trying to donate to these causes, which is wonderful. Well, they, yeah, they sent to her first.

1:01:48They sent to her first and she replies and then they appear. It's a love letter. It's a love letter. Yeah, and they are so much more. Just intercept the mail. Just intercept the mail at this point. Just say, yeah, this is general. It didn't make it. The other part of this is maybe you set up an actual budget for her to give and, hey, mom, you get $100, $200 to give this month. Where do you want to give? Yeah, that's the way she doesn't lose all autonomy and she's clearly a generous person and she doesn't dwindle her money down in the thousands every month. And it probably wouldn't hurt to sign up for a delete me or something like that just to make sure she's not getting access to her personal information is in out there. That's, you know what? Actually, we're going to give that to you. Our friends at Deletme will give her a premium one-year membership so that she doesn't have to pay for it. One less thing coming out of her checking account. Absolutely. And that's our gift to you to help her with this. They'll actually go into the hundreds of these data broker sites, remove her personal info, keep monitoring it, and that'll definitely help a lot with all these solicitations she's getting. It's really sad because they do. They pray on the elderly.

1:02:49They pray on older folks who just aren't looking as closely, right? Slow hanging fruit. Easy target. And you do, whenever you have older folks, you really need to make it your business to kind of get, sometimes you have to push your way in to get into their finances because they don't, they're grown and they don't want to show it to you, but it's for their own good. So it's worth it. Most people spend years changing their money habits, but never think twice about how their bank probably works against their values with nuisance fees and endless debt products.

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1:05:07So George, you have an amazing YouTube channel, the George Camelot YouTube channel. That's what it's called. Brilliant name I know. I mean, but you guys do a lot on there and a lot of your segments have been doing so well lately that we're kind of like crossing it over here to see what you know, everybody likes it. So of course, it's obviously going to like it too. Well, the main thing people are intrigued by is just talking about wealth and the tactical parts about what does it actually take to have money one day, whether that's retirement, you want to be work optional one day. And so we started calculating the value of a dollar based on how old you are. And it was so incredible to see how it changes over time. So get this. If you're 25 years old, that dollar you invest is not worth a dollar. It's worth $51. Okay. Later on in retirement. If you're 30 years old, the same dollar is not worth 51. It's worth 31 now. By the time you're 40 years old, it's down to $11. And by 50, amazingly four bucks. You got it. So think about it. So you put a dollar into that vending machine at 25 at 65.

1:06:08You hit the return button. You got 51 back. But you put a dollar in at 50 and at 65, you hit return to get four bucks back. That's time for it to grow and compound. Exactly. And less time contributing on top of that. So the age when you start investing matters because of compound growth. You want that on your side. And that's when your money makes money. That new pile of money makes money. So think about it. 10% of 100,000 is more than 10% of 10,000. Right. That's what compound growth is doing. And so a single dollar invested at age 25 with a 10% average annual return with zero additional contributions will grow to 51 dollars by the time you're 65. You did nothing else. You just left the dollar sitting in there growing. So let's talk about what it takes to retire. Let's just use an easy round number of a million dollars. Yeah, because people call in at all stages of life and we want them to retire with a million bucks. And before you jump in the comments section, go, George, you can't retire on a million dollars. That's not the discussion. We're just saying, if you have a million dollars 65, what does it take starting from nothing based on your age? So I'm going to use our investing calculator. We'll drop a link in the description. If you guys want to check this out for yourselves, it's a free tool on a website.

1:07:11This is actually the retirement calculator. This is, I have an end date in mind. So age 25 to 65, current retirement savings is zero. I'm going to contribute $159 a month and we're going to go with an average rate of return of 10%. Perfect. Calculate. You'll see just over a million bucks. Love it. What's interesting, I only put in $76,000. The growth was $929,000. Free money. Because I was so young when I started. Compound growth did the heavy lifting. It's like when there's no more footprints in the sand. Compound growth. Stop it. Here you go. Okay, now let's move to age 30. What is it going to take to still have a million bucks at age 65? But now we have 35 years for it to grow instead of 40. Well, let's see. If I invest $264 a month, that gets me to, oh, I didn't crunch the numbers correctly. Let me go 30 to 65. There we go. Boom. So over a million bucks. Perfect. 30 to 65 investing to 64 a month. So that's your number. 264. Now let's say you're 35.

1:08:12You're just getting started. Nothing in retirement. We're going to change the age there and change the contribution. It's going to take $443 a month now consistently to get that million. And you'll see here, the amount I'm putting in keeps growing because compound growth has less time to do the work. Right. It's more about my savings rate. Now let's bump it up to 40. Okay, you're 40. You're going, hey, I started late. Is there still hope for me? There's still hope. There is. But you're going to have to invest $750 every month. $754 would get us there. Let's find out. There it is. Million bucks. Now you're putting in 226 of your own money to get to that million. And then 45. Let's up it. Now this is where it gets crazy. It would take $1317 a month to get to that same million by 65 because you only have 20 years now. Yeah. So less time to contribute and less time for compound growth. Let's go to the big kahuna, Jade. 50 years old. What do you think it's going to take? I'm going to go with what did you do before?

1:09:13It was at 45. You got to put in $1300 a month. I'm going to go with 1600. Buckle up. 24, 13. Oh, I'm in pain. Almost doubled. Painful. $2413 a month from 50 to 65 would get you to a million. Again, you only have a 15 year time horizon. And you'll see the money you put in was $434 grand of that million. Oh my gosh. So that's the power. 35 you put in 159 a month to get to a million by 50. You got to put in 2413 a month. That is the power of compound growth. And it's why we tell people to get started earlier. We've got a chart here if you're watching on YouTube or Spotify. So I always tell people the best time to plant the tree was 20 years ago. The next best time is today. So no matter who you are, this is not to shame you. If you're in your 40s wishing you learn this stuff earlier, this is to tell you that the best time to start investing is today. Do not delay. Wait, even if you're 50 with nothing safe retirement, don't worry. You're not up a creek. You still have time. Yeah. And what the fair thing about that is when you kind of go back and do the math and reverse

1:10:15because we always say invest 15% of your income. And so if you look back even at the highest number, that's 15% of basically $105, $60,000 income. So there really is hope when you look at this because most of the folks that call in, they're kind of making around 80 to 100,000. That's what we see. And so there, there truly is hope. Obviously you do want to get started. And once you pay off the mortgage, you can increase investing to 20, 30, 40% of your income. If you follow the Ramsey plan, you've got no debt, no mortgage payment. You can make some, some big catch up on that show. Love it. So go check it out. You can get the retirement calculator, investment calculator in the show notes and description of this episode. Go check it out and drop a comment. Let us know how old you were when you started investing and where you are today. That'll be a fun little social experiment. I like it. Love it. Let's go to Sarah, who's in Tallahassee, Florida. Hey Sarah, how can we help today? Hi, yes. I'm thinking for taking my call. I am looking to buy a house and I got into a situation where I've been negotiating with

1:11:17a new home builder and tomorrow's the end of their fiscal year. So they're offering me just all these incentives and things. And I just want to make sure that I'm making like a good decision and not just kind of an emotional decision to buy right now. Okay. Tell us more. Well, the house they have agreed to take 15,000 also asking Christ, give me 15,000 towards closing costs and then add on some other stuff like gutters and washer and dryer and then give me an interest rate of 5.56 rate on a conventional loan. Are they the lender too? Yes, they are. Interesting. Okay. So yeah, I'm just nervous because I'm like, it's a lot of like 20% down the lot of money to give and all of those things. I just want to make sure I make it. Yeah, what will the payment be? Let's say you did all of this tomorrow. What would the mortgage payment be comparatively to your after tax monthly income? Is a principal and interest would be 1500? Okay. And I make 130 Q a year.

1:12:19Fantastic. So this would be less than 25% of your take home pay? Yeah, I mean, that's about like tax and insurance and all that stuff. Okay. The property tax is insurance. What would it turn into? That would be 2,200. Okay. And what's your monthly take home again after tax? Is it about like 7,500? Yeah, right around there. That's reasonable. Nothing's on fire here. I assume your income will go up over time. Are you single? I am. Okay. This doesn't sound like a bad deal. If this is the house you're already wanting, is that the case that you would go through with this, even if this was a month later? Yes. Do you have time to save? Because the full amount isn't due until the home is built. Or is this a spec home that's already ready to go? It's a spec home and I have the cash. I just am looking at my savings and I'm like, oh, it's so big right now. I felt that. I felt that. I felt that. Yeah. Well, did you ear market for a house?

1:13:21I'm sorry. Was this money earmarked for a home anyways? Yeah. Okay. I know guilty spending it. I know it hurts because like, what could I do with that $500,000? But there's someone else out there going, man, I wish I could be in that home. So. And you for sure would have emergency fund left over after the fact? I would have, well, so I have, I have 28,000 left in saving, but I do have 8,000 of that earmarked to pay off a credit card. That's at zero percent interest. So I have that money. That's like earning money and like a, I say what's called high yield savings thing that I have? And that credit card's your only debt. I have a card as well at 10,000. Okay. Here's my caveat. If you promise me in America and God that you'll pay off the credit card and the card today, then I would feel really good about this. Go into this thing debt-free with some savings of the bank that might mean you put a little bit less down to have some cushion as you move in. But I don't think this is a bad deal. I mean, if they're willing to throw some incentives, you might be on the bargaining

1:14:24end here and even ask for a little bit more before you sign the papers. Hey guys, it's Rachel Cruz. If you're working the baby steps, every major expense deserves a second look. And healthcare is one of the biggest expenses in most family's budgets. And that is why I recommend that you check out Christian healthcare ministries. CHM isn't insurance. It's a health cost-sharing ministry. That means members help pay one another's medical bills. And they've been serving Christians since 1981. CHM programs start at just $115 a month.

1:15:25And here's why that matters. If you are paying more than you need to for healthcare, that money could be going toward paying off debt, building your emergency fund, or reaching your next financial goal. And your monthly cost isn't based on your medical history or where you live. Y'all a lot of families find CHM gives them more room in the budget. That's why so many members say they're better with CHM. And right now new members can receive a 50% credit towards their first month of membership. Go to CHministries.org slash budget and use promo code Ramsey. That's CHministries.org slash budget and promo code Ramsey. All righty, let's go back to the phone lines. But before we do, I just want to correct a mistake I made when we were talking about retiring at any age with a million dollars. The final number was contributing $2,413 a month.

1:16:30That's actually closer to making $200,000 a year. Let's be fair about that. Okay, from age 50 to 65. Yep. All right. You're welcome. I just like to keep things clean. Above our front. It's who she is. It's who I am. Good hygiene. Let's go to Stephanie who's in Springfield, Illinois. Hey Stephanie, what's going on? Hi, thank you for taking my call. I really, really appreciate this ministry that you guys have. So I have, we're on baby step number two. My husband and I have been doing it for about a year. We paid off quite a bit. We sell about $54,000 in debt. But I'm calling to kind of get an idea of how to justify because we are sending our kids to private school. They are 11, 13 and 15 right now. It's a non-negotiable for us to do this, but it is also our largest monthly expense when we're doing our budget. It is. Oh, gosh, we have it written down. It's about $950 a month.

1:17:31Oh, oh, I thought it was going to be way more. Yeah, me too. I thought you were going to be like, it's $6,000 a month. That's not even daycare for one kid. I'm just saying, you know, well, our mortgage payment is only 800. I do have a $600 car payment right now. So it's our biggest expense. And I think I'm dealing more with the emotions of it. That could be going towards our debt snowball. Sure. But I definitely don't want to skimp on their education because they're thriving at the schools of their attending. So I guess maybe my question isn't so much financial as emotional. The question is, how quickly are you able to tackle this debt? What's your income? We need to know a little bit more before we can say if this is really off the rails or not. Okay. Yeah. So after taxes, we bring in about $9,000 a month. Okay. Are you guys doing any investing right now? I think I've got like $400 coming out of my paycheck a month into a deferred comp. I work for the state.

1:18:31So I'm in the pension program. But my actual investing separately from that is only about $400 a month right now. Would you be willing to pause that as a concession? The 400? Yeah. Like pause all investing while you knock out the debt free up as much money as possible. Because what I'm trying to figure out is if you can come up with an extra $950 a month, would you feel a whole lot better about this private school expense? Yeah. So we are using every dollar app. We're doing our budgeting stuff. And we are able to throw like $1,500 to $2,000 a month at our debt right now. Okay. So we're making progress. We paid off a lot. We paid off medical bills and the small ones, medical bills and credit cards and things. What are minimum payments? I'm just looking at, I'm just doing napkin math here. But I'm like, okay, $9,000 a month, we take out the three biggest expenses. You're down to $6,650 a month.

1:19:32We take out, you know, groceries. There should be more money left over. There should be more money left over it. For you to only have 1,500, I'm just wondering, is there more? Okay. The minimums we've got the one credit card we have left. So it's got like a $200 minimum. My mortgage, like I said, is 800, tuition right around 900. You have a $500 payment. You should have their payment, 600. Yep. And I counted for that. So that's what gets us to the $6,650. And then if I take out your margin around $2,000, that means there's $4,650 going towards variable things in your budget. Minimums, does that feel right? We spend probably about $2,000 a month on groceries. Okay. That's not high, but it is high for what you're trying to do. You know, that's a, you know, it's fair to say an average family of four spending a mediocre

1:20:34amount on food could easily spend 1,300. So 2,000 is high. I would try to get that down to 1,500, 100%. If you can. And if you then stop investing too, you just rate up about 1,000 bucks right there that you didn't have. Okay. So that's the sort of budget audit I would be doing because I think you'll feel a lot better if instead of just sending 950 to private school every month, you're coming up with an extra 1,000 to throw out your debt on top of that. That way you're not losing progress. Put that in quotes. And I would make a goal to say if we throw 24, 200 bucks a month, 2,500 bucks a month, we're done in, let's call this less than two years. That's pretty impressive. Okay. Yeah. So we're trying to get to a $2,500 margin. Exactly. Because 2,500 bucks, you divide that into, you know, 54,000, you say as you're totaled that, that's 21 months. So now we have something to aim at and we have a margin goal to aim at and now that becomes the thing we're all gunning towards regardless of what the private school is costing us.

1:21:35So let's now project. Now that George has given us basically a little less than a two year horizon, that also puts you with the 17, almost 18 year old, getting ready to go from private school to whatever next education. Have you guys started thinking about that and talking about what that would mean? Yes. We obviously are not in a position to say right now, but our son is very bright. So we're aware of, you know, community college opportunities, scholarship opportunities. He actually worked his tail off to get a scholarship for the private school that he's attending for high school right now. Great. So he's very motivated and I am sure that whatever he can do on his end, he'll be able to. And then yeah, obviously if we freed up some money, we'll have, you know, some money that we can pay cash flow to save. But yeah, think about once you're debt free and you have an emergency fund, that same 2,500 bucks can now go towards cash flow and college. Right. And if you choose a affordable school plus scholarships grants, then working part time, I think this

1:22:39is a very doable process. Yep. Just getting ahead of it and thinking out like you have been, I think is so good. A lot of people get in Stephanie's situation and they're so focused on the debt they're not thinking about the next thing that's going to be kind of banging on their door after that. The next monster. Yeah. Down the path. But having that conversation with your kids early so that they know here's the expectation, mom and dad didn't get a chance to say for that. So we're doing scholarships. We're doing community college. You're working and we're cash flowing. That's how this is going to work. Very, very good question. You know what, George? I like to go to these social questions a little bit. These are some of my favorite. The world is your oyster. Yeah. I mentioned it before. We have some really great communities online. Obviously, George is social in my social. We also have a really great Ramsey Baby Steps community on Facebook that's got tons and tons of followers. It's bumping in there. Sometimes I'll jump in. It's just to create some chaos. I like that. You jump in the comments. I do. I've done it before. Sometimes I get tagged in there too and that makes it extra fun. True that. Yeah. Hop in there. If you've never seen it. The Steps community said, if we can easily cash flow college tuition and expenses for our

1:23:42three teenagers, are we doing them an injustice by not allowing them to learn how to pay for it on their own? What a great question. I don't think it's an injustice to cover your kids college. Now, if they have zero work ethic and they're just entitled brats, that is your fault. That is an injustice. You've done them dirty on that. But if they can learn how to pay for other things on their own, that they just are wants. Yeah. That's fair. I'm totally good with covering education for my kids and it's a goal of mine. And as long as you raised them right to go, hey, money doesn't just grow on the trees. That's right. You got to go out there and hustle and work for it. And if you did it right, they've been doing this, you know, with other things in their life, saving up for the video game when they're younger, saving up for maybe they're paying half a car and you're paying the other half once they turn 16. Listen, I agree wholeheartedly. There is part of me. I will say and it depends on the kid because every child, you know, every teenager is not the same. But some teenagers do need a little skin in the game. So they feel like they've got something on it, you know what I mean?

1:24:43I just remember my freshman year, there were a lot of people who didn't make it back to the sophomore year because they flunked out. And it's like you need a little skin, you need a lot of money and some hard work that you want to make sure there's something to show for it. You don't want unlimited like Scrooge McDuck pile of money for them to blow through. Right. But I think covering tuition, room, board, that's fine. But I wouldn't fund their lifestyle on top of that toward they just can do whatever they want. I'm going, hey, you got to work part time if you want some fun money to spend. I saw a social media post and a guy was basically saying, my wife and I saved up and we bought basically bought homes for our kids and covered this and that. And he said it was the worst thing they ever did because they're all brats and they're all like not knowing how to take care of themselves. And so to your point, it's about the home. Yes. It's about the children that you raised, not the generosity that you gave them. So the other side of the spectrum is this, which is I'm going to punish my child. They must learn. They have to cash low $100,000 a year, even though I have the money. Look, come on. Do that to your kids.

1:25:43Yeah, there's a generosity play here. And if you can ensure that your kids enter the world without student loans, you have given them a leg up in society and they will be forever grateful for you if you raise them right. Hey, what's up guys? It's Jade Warshot. Now, I know a little something about saving money while my husband and I were paying off over $460,000 in debt, we went over every expense in our budget to find ways to cut back. Nothing got a free pass, including our phones. And you need to be doing the same thing. And now with Boost Mobile, one of the easiest places for you to save money is your phone bill. Their unlimited plan is just $25 a month forever. With a price that nice, why would you ever go back to your old carrier? And with Boost Mobile, there's no contracts, no hidden fees, and no surprises, which makes this a no-brainer when it comes to saving money.

1:26:45The best part, you can keep your phone and your number when you switch. So it's not like you're making some huge lifestyle change. Listen, you need a phone, but you don't need to be overpaying every month. So whether you're paying off debt or building wealth or you just want to keep more of your money in your pocket, this is a win. Go to boostmobile.com slash ramsie and make the switch today. That's boostmobile.com slash ramsie. $25 forever requires customers to remain active on Boost Mobile and Limited Plan. Welcome back to the Ramsey Show here in the Fairwinds credit union studio. I'm going to take calls about your life and your money. George is next to me. I'm Jade and Matthew's on the line from Oklahoma City, Oklahoma. Hey, Matthew, how can we help today? Hi, how are you all guys? Doing all right. What's the word? So, eventually I just want to know what I need to invest into and what my monthly budget needs to be become a millionaire.

1:27:45Ah, we love this question. We were just talking about this earlier. That's right. So what's your current status where you at financially? So, financially I have $4,000 in debt and it's on my truck. It's almost paid off and I bring home $100,000 a year. Great. Do you have anything in savings right now? I have about 5,000 savings right now. So you're telling me you could pay off the truck today and still have a thousand bucks left over? Perfect. Yes, sir. I'm going to start with the truck payment, which is how much? It's only $4,37 a month. I don't like only in front of any debt payment. So you free up $4,37 and then you can begin saving up a fully funded emergency fund of three to six months. That's baby step three in our plan. How long will that take you as you free up the truck payment today? It probably took me five weeks to save up $10,000.

1:28:48Wow, that's impressive. That is. So you can save $2,000 a week? Yes, sir. Wow. How is that possible? Yeah, it works here. There's 52 weeks. So you're telling me you can save up $100,000 a year but you make $100,000. Are you living at home? So currently I'm on the road right now and I stay in a apartment here in Helena, Montana. Okay. And so your expenses are low but they're not zero. So. Yeah, no, they're not zero. No, that's true. So each month is basically off of hours. So some months I made 10 grants a month to make 13 grand. Got it. Got it. Okay. Okay. I'm 21. Oh my gosh. Man, this is fabulous. You got this stuff early. I mean, think about that debt free at 21 with some savings in the bank. You're so far ahead of the curve. Yeah. And making $100,000 if you're investing 15% once you save up that emergency fund, you're

1:29:50investing 15% that's 15,000 a year. And if we divide that by 12, that's $1,250 a month that you're putting aside. This is off of your gross income. And that's just going to compound over the course of your life. Georgia, you plug in those numbers. I got it. I wish you could see the screen right now, Matthew, but you're about to have your mind blown because if you follow what we're teaching you, let's say by the end of the year you have an emergency fund saved. Is that fair? Yes, sir. So we start 2027 investing 15%, that's 12, 50 a month of your income. We're going to do that for 39 years. Let's say it'll bring it to 60. Is that fair? Yes, sir. Okay. With an average rate of return of 10%, that's because of compound growth. Totally fair. Because you're investing, not saving, you would have $7.1 million. Wow. Wow. I think that would be incredible. Which means you'll be a millionaire well before 60. That's just going to continue to compound until you get to the 7. And that's if your income never goes up. So that's your commitment you're making to yourself is that I'm going to put 12, 50

1:30:50a way and learn to live on whatever's left. Yes, sir. How does that feel? That was awesome. I just wanted to talk to you guys. So y'all can talk and send something to my like talk and send something to me. Yeah, why do you think you need to kick in the pants here? Yeah, have you. What have you? Obviously you had some debt on the truck, but you're just getting started. You haven't had a chance to mess up just yet. And that's another thing that's so funny about this. I won't have a mortgage because my father and I actually gave me my wife a house. Whoa. Congrats. And you're married. We didn't know that. What's she make? Yes. She is currently in college. Okay. So to George's point. And for that staying off the student loans, well, actually she won't have any student loans. Or it has to be paying for college. That's excellent. And then add her income into the mix and you guys are going to be super wealthy, my friend. That's the, that's the goal. Now do you have an employer retirement plan? Yes, sir.

1:31:51What is it? So it's a pension and anuity and they take basically every hour that I work, they take what I make an hour and they put it into a pension and anuity. So basically it's two of them. Is that required? Oh. Where's it optional? I think I really don't know. I just started working here in January. Okay. I just don't love, I mean, pensions and anuities just have crappy returns and you have no control over them. So I'm wondering, maybe you fully fund a Roth IRA on your own because you have earned income. You can do that outside of your employer. And that's $7,500 is the max for the year. So you could fund that thing and still, you know, invest in your own retirement plan. The pension and anuity, is there any, are they matching what you contribute in any way or it's just a place for you to park the cash? I don't know if they're matching at all. I think they just take basically what I make an hour and the hours of the year I work, they put towards it.

1:32:51Okay. Yeah, I'm definitely with George. I like that and I would love for you to just kind of get a little bit more well versed on our investment strategy. So you can go to ramseysolutions.com slash smart investor and just kind of learn about the best way to do that. We suggest investing your money over four different types of mutual funds, growth, growth and income, aggressive growth and international. And if you can start to do that and just start getting that ball rolling, gosh, like I said, with your wife included, once she gets out of college, you guys are going to be rolling, rolling, rolling. You're going to be calling us back one day, say, no, I've got $10 million net worth. I know. What do I do now? That's crazy. You know, I think I actually feel like it's impossible for that to really sink in in a moment. I'm not going to be able to start a forecast 39 years for now. Sure. Sure. But the truth is, I mean, gosh, if the market continues to do what it has done since inception basically, yeah, that's a true scenario, you know, hoping that the United States doesn't implode. Doesn't it all, it doesn't all come down like John Delbuti would say it's all very optimistic

1:33:52when it comes to the US economy. It somehow keeps going. It keeps hitting record highs. It takes on ticking. No matter what's happening in the world. Yeah, that's true. That's true. Right back to our Facebook community questions. Actually, I've got one here. Yeah, they're all from Facebook. So Dean said, is it okay for a single person to get insurance? My 28 year old son wants to get a policy that would cover his mortgage because he wants to provide for us if anything happens to him and to cover his funeral expenses. Is it wrong for him to do this? Wow. I mean, is he living with you? It's just a cover that would cover his mortgage. Now, I think it is wise to have enough life insurance. We say 10 to 12 times your income. And so that would definitely cover the mortgage and then some and funeral expenses. But I wouldn't get it. I guess he's single. So yes, it is wise to do this while you're single because you are young and healthy and the term life insurance you get is going to be cheaper. Yeah, absolutely. In the next couple of years, you might meet someone nice and you don't know what your

1:34:54health is going to do either. And that's really more what it's for because you're thinking about people who depend on your income. That's one of the primary purposes of it. And so I like the idea of him getting it young when he can lock it in at a low rate. But the purpose of it is more so to your point, what his life is going to be in the future. Maybe there'll be that special somebody who's dependent on him. That's right. Not for the parents necessarily. No. And both Jay and I have our life insurance through Zander. And so if you guys want to check that out and get a quote from them, go to zander.com. 10 to 12 times your annual income on a 15 to 20 year term. That's what you're looking for. If you follow our plan, by that point, you're going to be self-insured when the insurance expires. You don't need this whole life or permanent life insurance crap. Get a good level term life policy through Zander. Hey guys, Dave Ramsey here.

1:36:09Every day on this show, we help people work through real money problems and figure out what to do next. Now, you can get that same kind of help anytime with Ask Ramsey. Ask your money question and get answers built on Ramsey principles we use on the show. Whether you're making a decision or just want something explained, Ask Ramsey is here to help. It's fast, simple and free to use. Go to RamseySolutions.com and try Ask Ramsey today. That's RamseySolutions.com. All right, well, let's go to our Ramsey Show question of the day, which is brought to you by YRIFI. If your private student loans are in default or you're not sure what to do next, YRIFI

1:37:10can help you explore refinancing with low fixed rates and a payment plan that's based on what you can actually afford. To go to YRIFI.com slash Ramsey, remember, that's the letter Y-R-E-F-Y.com slash Ramsey. It may not be available in all states. Today's question comes from Todd in Alabama. Our eldest son is 16 years old with a new driver's license. He regularly drives one of our vehicles. My wife does not want to add him as a licensed driver on an insurance because she knows the rates will go up substantially. She states that our insurance agent said it would be fine and if he gets in an accident, they'll just say he was using it that once. Oh. I fear this could have serious financial repercussions as I can't imagine a scenario where the insurance company buys the story and just pays up. Should I go along with this or insist that we add him to our policy? What in the world? Why is this even? Who is your insurance agent? So I guess it should be fine. Just say it was a one-time use. That's pretty bad. That's pretty bad. That's pretty bad. That's pretty bad.

1:38:10I mean, yeah, I would definitely add them. It's a fact of life that insurance for a 16-year-old is expensive and it will go down over time. So budget for it, have them working part-time to help cover all or if not most of it. Yeah. Have some skin in the game because you drive differently when you're the one paying that insurance bill. Yeah. And there's some things you can do to help it out a little bit. You know, the color of the car matters, making sure it's a nice used model pay cash for it. Like, those are some little things that can maybe bring it down. Now's not the time to get a brand new red Civic. You know what I'm saying? Yeah. And the other part is there could be some discounts, good student drivers at discounts, higher deductibles if you got a solid emergency fund. There's a lot of things you can do to lower that premium. And so if you want a second opinion and I would get one because I don't know who this insurance agent is, I would jump on Ramesysolutions.com and you can find a Ramsey trusted insurance agent to help you find the right coverage of the best price and look into all the discounts and premiums and levers there. But I got to say that might be some of the worst, like, second-hand advice that I would

1:39:10use your risk at all on a 16-year-old. My goodness gracious. Just budget for it. My goodness. All right. Let's go to Tony who's in Lexington, Kentucky. Hey, Tony, you're on the line. Good afternoon. How can we help today? Well, I mean, let me give you a little bit of background before I get into my question. In the last two and a half, three months ago or so, we, my life, I've had two accounts that have been hacked and we were to the two of about $70,000. Oh, what kind of accounts were these? Well, the one was an interest-marrying check-in account that we had for a number of years. We moved into a new house about 14, 15 months ago and we were using that account on our to pay on mortgage. Now, when you say hacked, does that... There was fraud and they spent the money in the bank would not return it to you?

1:40:11Oh, no. I've gotten the money back. I'm done. We've gotten the money back. Okay. Good. Okay. Good. We had sent in July's mortgage payment and we've been adding to the principal and that check was for just under $22,000. We found out that somehow that check was... Didn't make it through the mail. I'm not sure where it made it. But the bank used the term that the check was washed and someone cashed took off the mortgage company's name but somebody else's name on there and was able to cash it. Oh, my God. They can't raise it. Well, no, they traced it, it said it was cashed in Dallas, Texas according to the information that the bank gave us. We did get the money back and we opened another account.

1:41:13We couldn't close that one entirely because we had some direct deposits going in there. What's your question, Tony? I want to make sure we have time to get to that. So you've got all the money back. You're not out of pocket. Yes. Okay. I mean, then that new account in late August, that new account, someone got that account number and they printed a check on that new account number. Account number was two months old and it was for $48,000. Did you get that money back? Yes, we got that money back as well. Okay. Both of those instances caused me to think about the security of our money that we got in our raise investments and at one time to figure out at what point in our lives were 75 right now. At what point in our lives should we begin looking at moving some of those funds into a, neither one of those are in high risk investments, but I'm assuming at some point in our lives,

1:42:14we want to look at changing, moving some of those into less risky, whether it's some CDs or whatever. Well, I hear two different things here, Tony. On the one hand I hear, we've dealt with our accounts just not being secure. They keep, you know, we keep getting our identities stolen. We keep having fraud and theft. And then on the other hand, I hear, well, the investments that we have, at some point, do we want to move them into something that's out, use your words less risky? So I think those are two different ideas. The first one, let's talk about the identity theft. I would just sign up for Xander, ID theft insurance, and they're going to help you stay ahead of these things. They're going to alert you when somebody has your information. If somebody does steal your information, they're going to go to bat for you. So I would check into that. You can go to ramseysolutions.com slash insurance. It should be there, right? Yeah, Xander.com. You'll see it right there on the homepage.

1:43:17So you have financial protection up to $2 million through that. So that's one step to take. I would also make sure you got, you know, two factor authentication, all these accounts and good passwords and all that stuff. But this is crazy that it's happened that many times. And then to Jade's point, there's a different thing you're worried about, which is market risk, which is the market volatility. So how much money do you have? In the between the IRAs, it's not a whole lot. We only got a little over $500,000. Our retirement income is fixed with four separate incomes at about $120,000 a year. Fantastic. So you don't even need the 500,000 number term? No, we haven't since we've been retired. We haven't done anything as far as getting anything out of those IRAs or more invested. Well, in that case, I would be investing more aggressively because you're not needing to touch it. And then whoever gets to inherit that one day, what a legacy you got to leave if that money doubles in the next seven years because it was invested well in good, gross, stock

1:44:18mutual funds instead of a bunch of CDs earning three or four percent. So if anything, I would invest more aggressively, not less aggressively since you don't need the money. So you've got two pieces of homework, Tony. We want you to go to zander.com and pick up that ID theft protection. And then we want you to go to ramsy.com slash smart vester and you'll find a smart vester pro who can help you invest this money. Just the way that George is teaching it, it's going to be somebody who has the heart of a teacher. They're going to send you several different pros and you're going to be able to vet and interview them and decide who's the best person for you to work with in order for you guys to do this. I like that plan. Go ahead. I was just wondering, Dave and I talked about this in our investing essentials virtual event because there's an asset allocation theory that he talks about and everyone goes, hey, you're 60. It's time to really get spooked and put half your money in bonds. Well, here's the problem. If you make it to 60, you have a good chance of making it to 70, 80, 90 if you're in decent health. And so that's a problem for 30 years.

1:45:19You're missing out on market returns, half your portfolio. And that's why Dave sticks to 100 percent equities. Absolutely. And so that's my plan of retirement. And we're not saying have no money in the bank. You can have a year of expenses to help protect you in a market downturn. Even two years of expenses, socked away in a high yield savings account. That's liquid to help you there. So that would be my strategy and retirement. That's what I plan on doing. Keep the majority invested. Keep it in the same growth stock mutual funds you had up but keep a nice portion. Whatever makes you feel good. So if the market's down 20 percent, that's the worst time to take money out, of course. So you can go to use your cash. Replenish it once the market is back up. And remember, you're not taking all the money at once. You're just taking what you need to make it through that month through that year. Yeah. So don't get spooked by that. I love that strategy. And for anybody else listening, if you don't have Xander ID theft protection, you need to get it. It costs a couple of dollars a month, guys. It's really inexpensive. But the protection that you get is totally worth it, especially in today's day and age.

1:46:26Hey, it's Dave Ramsey. If you or someone you know owns a small business, listen up. Even if you could build the kind of business you'd be proud to hand down to your kids. Over 30 years, I've been able to build Ramsey Solutions into a business that's going to be a blessing for my kids. I'll show you how to do the same thing at Entry Leadership Master Series November 8th through the 13th. During this five-day conference, you'll get my strategies for building a winning business that outlasts you. Visit RamseySolutions.com. Slash Master Series for tickets or click the link in the show notes.

1:47:43Well George, for the folks who filed an extension here in 2025 for their taxes, just know that that October 15th deadline is coming up pretty quickly. It's right around the corner. In the good news is you do have a couple of options on how you can handle this. Number one, if your taxes are pretty simple, pretty straightforward, you could just use our Ramsey Smart Tax. It makes filing simple, affordable, and there's built-in support if you need it. But if your taxes are a little bit more complex, if you're overwhelmed, then you probably need a tax pro. Somebody to help you make a plan. I mean, gosh, nobody wants to face the IRS without a backup plan. So go ahead and hire a tax pro. But if you're not sure what to choose, you can go ahead and take our tax quiz. You can find that out real quick by doing that. You can find that tax quiz at RamseySolutions.com. Slash Tax Quiz. All right, let's go to Mandy, who's in Milwaukee, Wisconsin. Hey Mandy, how can we help today? Hey, thank you for taking my call. I'm excited to be on the show.

1:48:44Thanks, ma'am. Thanks. So, my question is, I've been sleeping on some debt. It's been on the back burner for about 15 years. We just had our last baby. I'm pretty sure. How many total are there now? This was our third, our third girl. Fun. Wow, three girls. Yep, and she's a month old now. So, yeah, I'm thinking about going back to work soon. I've got about six more weeks of my leave. And I think when I go back, it's going to be really time for me to get started on that debt. Is it just you and your husband? Oh, yes. I'm married. It's me and my husband. But the reason I say it like that is because the debt is technically my student debt. Okay. I know it's both of ours, but I feel responsible for it.

1:49:45But are both of you going to pay it off or is it just your income that's going to attempt to do that? Yeah, and this is the one part that we're Dave ish on is I think I'm going to try to start this off on my own mostly due to just the feelings of guilt and shame around the debt. That's never a good reason to do anything. Is that a guilt and shame? What does your husband feel about this? If you talked him about this and hey, once I'm done with leave, I really want to attack this debt. What would he say? I think he would do it with me, but I think it would be, I'm not sure if it would be something he's going to love to do. If I could do it myself, I would and I just got my new job with a really great salary. Okay. What are you going to be making? Well, okay. When I say really great, I mean for me, it's really great. It's about 90.

1:50:46That's excellent. Okay. And how much debt do you have total? 53,000. And that's all the student loans. It's all student loans. It's consolidated. Can I ask a quick question though before we move forward? So I hear what you're saying, the guilt, he might not like this, but do you guys combine your money? Do you combine it? Like do you live off of combined funds and everybody, everybody's money is everybody's money or how do you guys know? Yeah. Like I said, it's a little davish in this one way. I love that guy. I don't see where Dave is in any of this right now. What part of this is the Ramsey plan? I know. I'm sorry. We have a joint checking that we use for, you know, all of our sharing. Keep put some money in there. You put some money in there and then you keep the rest of your monies for whatever your purposes are. Yep. That's how we do it now. It could say. Okay. Before we go into this, I can't leave this alone. I would, do you want it to stay that way or do you want it to change? That's a good question.

1:51:49I never actually really thought about. Let's put that on your list of things to do tonight is I want you to decide what you want your life and relationship with money to look like with your husband because it does feel separate. You know, George said it and I'll say it to it's really hard to accomplish goals together when you're money is separate and just on another layer. I know you didn't ask for this, but it's very hard for me to just walk on past this. There's clearly some element of trust that's not there because when you get married, you do, you want to be, you want to become one and you want to have such levels of trust and transparency that what's yours is mine and what's mine is yours. You people have three babies together. So you have shared on a molecular level and yet when it comes to the money, there's like this weird separation. Does that strike you as a little bit odd? Yeah. Yeah, and we do and I wonder if it's really because we haven't had a big reason to really put it together. And you know, I guess this could be a good reason for us to do that and get on the same

1:52:52team and it could be a conversation. Well, does he have any? He doesn't have any dad. How do you know? Well, he's had a few credit cards that he told me about that are paid off like store credit cards. And I never really dug into the questions on it because I trust that's true. But that's where I just want to call that out. That's where the layer lies. So when there's when there's transparency built in, it's just baked into the way we do our lives. And I don't have to be detectives. I can just see it. I don't have to ask my husband, do you have debt? Is it a store card? What did you buy? What did you do? I don't have to remind myself to ask questions or dig deeper. It's just right there. And so there's kind of like an easy button that you're inserting in your life that's like, okay, now we can just see, I don't have to be a detective. I don't have to grill him. We just have one account, right? And so it does. It does add a level of ease there. So anyway, just add that to your list of thoughts and things to think about and just know

1:53:53all levels set with you. This is probably if you do decide that you like this idea and you want to start combining, it's not going to be one quick conversation. It's probably going to be an ongoing conversation with him because you've been doing it like this for 15 years or however long you've been married. So just set it up. Okay. Back to the debt. Back to the napkin math here. So you make you're going to be making 90. How much could you realistically throw at the debt every month between the minimum payments and the extra? You know, we do have some expenses with the kids in daycare and rent. We're renters. I thought about it and I thought that the most I could do is, oh gosh, probably no more than 2000 a month. Okay. So that means it would take you if you did it that way and really committed to it, it would take you a little over two years. And that would be hard. And that's just my, and that's me calculating on my income. Now let's pretend he's on board. What does he make? Well, that'd be different. Yeah.

1:54:54Well, he makes about 65,000. Okay. A year. And how much margin? Let's say you guys did a budget together and you said, hey, we're going to attack this debt with a vengeance, which means everything that's not an essential expense is going to go toward the debt. Could you guys put three grand toward the debt, four grand toward the debt? Yeah. Well, I didn't do that math problem, but I think we probably could. Imagine this. You guys have a great income, right? We can all agree. $150,000 is a fantastic income. If you could throw $4,500 this debt, it's done in less than a year. Oh, my gosh. Instead of over two years, it's under one year when you combine your powers together. So that's where I'm trying to say, if you're saying, how do I commit to this? The hard part about commitment is the longer it takes, the less likely you are to finish. But if you just see the live at the end of the tunnel, 12 months from now, and you both are looking towards that, it's going to happen. And it's going to actually make your marriage better. Wow. I love that. Yeah.

1:55:54Thank you for that advice. I'm giving you a marriage life hack here. I've never seen a couple who paid off the debt together, regardless of whose debt it was, who didn't walk out of that stronger as a couple, more bonded, more communicative. Yeah. So that's what I'm saying. If you can get them on board, you don't just solve your debt problem faster. You solve a marriage problem. Yeah. Yeah. I don't know where he stands on this. He might be going, oh, we're not combining. And then you can get to the bottom of it. He does think it's kind of dumb that I am in debt. And I think so too. Yeah, fair enough. But the question is, part of marriage is having that person who's there for you come hell or high water, and that's kind of like part of the vows, like better or worse, sickness and health. And probably somewhere in there, they should be saying, you know, debt or debt freedom. And it's like, and it's true, you know, just to quote Dave Ramsey, he says it, you know, when you get married, he become French and everything becomes we we. And that includes the debt.

1:56:55But I understand where you're coming from when my husband and I got married, he had the majority of our debt. And he felt some type of way that I was having to take on that burden too. But I was happy to take it on because it's part of showing your commitment. It's part of showing your loyalty and your husband is probably anxious to show you his love and loyalty. You've heard from me and the Ramsey personalities for years, but nothing beats actually getting together in person. That's why we created the live like no one else crews. For seven days, we're vacationing with you and 2500 Ramsey people in the Western Caribbean. With live shows, us, new content, us and more.

1:57:55If you're on baby step four or beyond, come spend the week with us next March. Choose your cabinet ramsysolutions.com slash events or click the link in the show notes. Well, our Ramsey show scripture in quote of the day, Romans 152 says, our goal must be to empower others to do what is right and good for them and to bring them to spiritual maturity. Love that. And Reagan said, when you can't make them see the light, make them feel the heat. Okay, that's spicy. Ronny. Golly, make them feel the heat. You don't want this smoke. Let's go to Jay, who's in Houston, Texas. Hey, Jay, how can we help today? You don't call him because I have some financial problems and some legal problems that are

1:58:56dressing me out and making me depressed. Oh, maybe we can help alleviate some of that. Tell us what's going on. Okay, I had to put out take it out a loan on my home to play some legal bills and hire an attorney because of ongoing problems I've had with my neighbors. Okay. So are you suing your neighbors? Am I doing well? Are you in a lawsuit with your neighbors? No, I'm not in any litigation. They filed some false charges against me. And I had to hire an attorney to fight the case, which was dismissed. And I'm waiting for it to be exterged. And I'm not able to find employment until that is exterged because when I was for employment opportunities, when they Google me or the employers do a background check, it's coming up. Gosh, so how much did you borrow to pay the attorneys? I borrowed 25,000 because that was the minimum, but I had to pay the attorney 12,500.

1:59:57So you've still got another 12 or so that sitting around or did that go to something else? No, it's just sitting at 17, that's sitting. 17,000. Okay. And was that a home equity loan or a line of credit? Yes. It was a home equity loan. Okay. Okay. And this is still going on. It's been going off for 10 years with the neighbors. 10 years? 10 years going on constant. Just move at this point. Yeah, why not? Why can't I? I cannot afford to move at all. Cannot. Do you own the property? Yes, I do. Okay. And what's the property worth? Tell us more about that. It's probably worth about close to 300,000. Uh-huh. And what do you own it? About 85 between 80 and 85. And so there's not a scenario where you could sell it, take the equity and put it down on another house in another location. I can't afford it because I don't have a job.

2:00:59So I would need to have employment to do all of that. I understand for the moment you don't have a job, but I'm going to get to that. But I'm saying in a situation where you have a job and you're able to take that equity along with your income, because that's a healthy down payment elsewhere. Yes, but I have a very, very low mortgage and the interest rate is great. But the market that it is now, I can't afford that. It would be too much. And I can't live in a senior fitted-sync facility because that's triple or quadruple, the mortgage payment. What were you making at work? Around $20 an hour. Okay. It's about 40 grand a year. And is there anything you can do in the meantime, any kind of work, gig work, to supplement, to make 15 or 20 bucks an hour? What's the current timeline to get it expunged? Have they told you? Well, they said October 19th, it should go before the judge, because I found my own expungement

2:02:02paperwork because I'm apparently going to find out how to do that stuff. I have to wait for the judge to rule on that, whether they're going to have it expunged, then it has to go through all of the entities that I listed that I want to be notified. So they don't want to peer on background checks and government websites and get the things and groups and like that. So I'm just in a holding pattern right now. And you're living off the extra 15 or 17 from the HELOC or from the home equity line? No, I just put that on my savings. I was able to get unemployment and I have a small security. So is that covering all of your bills right now? Yeah, it does cover. Okay. Do you need to make your mortgage payment and cover your bills without touching that 17K? Yes, I can. Then I might turn around and pay that right back off. If you don't need to touch that money, whatever you didn't spend, you only spent the 12,500. I'd probably take the 17 if that's your only debt. I'd throw it right back on that $25,000 loan. Get ahead, start on paying that off because eventually you're going to want to do that.

2:03:05Okay. Now I'll bring your debt down to 8,000. Is that all of your debt? I have a student loan, but they haven't come after me for that yet. That's about 60,000. 60? 60, 60. 60. Okay. Yeah, I think you're right. I think you are in a holding pattern, at least making what you were making. But in the meantime, October 19th, I mean, if you can get out there and try to do something, come up with a gig or something that you can offer maybe yes, but it sounds like you've got at least your four walls covered. You've got money keeping this going. My biggest thing that I hear Jay is staying in a location that has caused you so much grief for so long. I actually, yeah, I actually, I mean, you called us and I'm here on the outside. I actually do think that you can move. I look at you and I go, okay, $300,000 house, you only owes 85. Gosh, that's almost, you know, $200,000 of equity there for you. Let's take that.

2:04:06Let's go put it down on something else. The interest rate is going to go up. We can't change that. But at one point you were making money and you can make money again. You're making $20 an hour. Can we up the income in some way, right? So I don't think you're up against a corner in the way you think. I think we just need to expand our horizons a little bit and it is going to feed on a major change. I don't have any retirement. I'm sorry, I don't have any retirement savings. I'm sorry. I don't have any retirement savings. I'm sorry. I don't have any retirement savings. You're almost 70. Yeah. Okay. But let's roll back because I was listened to you sound like you're 33. Okay. 70. Okay. That's a good thing. Okay. So the neighbors are, can you tell me a little bit more about this? Are they going anywhere anytime soon or have you guys just been feuding your whole lives? It's feuding. They're very ratcheting. Get a lot of notes. You understand that? I understand, Ratchet and Ghetto, 100%.

2:05:09My friends are on my property lines. I have to hire a subversive surveyor. They're building a stance on my property lines. So back and forth with legal issues for 10 years. None of my friends want to come visit at all because they get harassed and threatened by the neighbors. And that's the least I'll help. And that's the part, Jay, that I think about. I'm like, gosh, is there, is that the way you want to live in your 70s? Or can you go somewhere else? Maybe you downsize a bit. And I know what I'm asking is big, but I'm, this is for you. Maybe you downsize a bit. Maybe you go to a condo or a townhouse, and you spend a little bit less. You put down a big down payment, and you still make sure that that payment is, you know, no more than 25% of your take home. At the very least homework for you, I would love for you to just look at what's out there. Use our calculator. We have a really great resource. It's our Ramsey mortgage calculator, and start plugging in some numbers because I think that you have, once you get work,

2:06:12I think you have more options than maybe you think, and it might be a good thing for you too, to get access to some of that money and have liquidity. Maybe we can invest a chunk of it so that there's some money that's growing for you. But staying, I don't know, George Stan, where she's at feels. Yeah, because there's a long-term problem too of just how are you gonna retire? Regardless of what happens with this case, and I also think it's overblown what's happening with the background check because appending, you know, you didn't actually get arrested. And so, and even if you did, you weren't convicted of anything. Right. And so if there's just appending charges, that shouldn't stop you from getting any job in the world. There's convicted criminals out there who are working and have gainful employment. So I think you need to keep doing your homework on that side, and they can't discriminate based on age. And so there's work you can do and figure out what that is based on your current health, your ability to drive and do some of this gig work in the meantime, because you can replace 20 bucks an hour pretty easily in today's economy. Yeah, I think so. I mean, at 70 years old, it could be tough,

2:07:12but I think the biggest key is your money, your nest egg is in your home, and you've pointed to your home being in a location that's an issue. So maybe it's time to get access to that nest egg, let that money grow for you, and get an a less expensive living situation, maybe a condo, and that could be the answer. One with less troublesome neighbors. Yes, gosh, you know what, neighbors do affect your quality of life. You gotta get next to some good ones, and it's hard to choose them. Yeah, you don't want riff-raff as my parents used to call it. You don't wanna live next to riff-raff. All right, guys, well, thanks for hanging out with us. Remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus. Sheng Shaoarea