You Can't Stumble Your Way Into Financial Freedom

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Go to AskChapter.org/Ramsi Brought to you by the every dollar app. Start budgeting for free today. All is broken, common sense is weird, so we're here to help you transform your life. From the Ramsi Network and the Fair Wins Credit Union Studio, this is the Ramsi Show.

I'm Dave Ramsi, Rachel Cruz, Ramsi Personality. Number one bestselling author, co-host of this Mark Money Happy Hour on the Ramsi Networks. And my daughter is my co-host today. Open phones at AAA 825-5225.

“Vernon is with us in Tampa. Hi, Vernon. How are you?”

Hey, Dave, how are you? Better than I deserve, what's up? Amazing. On 25, I just moved to Tampa, Florida. I'm making $2,000 a month across three jobs.

And I want to build an online coach in business. I had three came savings. And I don't know if I should just be saving for certain, I think everything is a building on business right now. Okay.

Tell me about the coaching. What are you coaching people to do? I'm sitting this hybrid training. Let's just running and looking at the same time. Okay.

And brand differentiates yourself for me, meaning if I'm your customer, which I'm probably not, Rachel might be, but if I'm your customer, why am I talking to you on the online, rather than the 8,000 other people on YouTube? 8% yeah.

Well, I'm 25 years old and I've struggled a lot with being consistent in the gym and started 75 hard journey, which has sparked my passion again for it. I know the struggles of being on and off with the gym and being able to get back into it and not overwhelming yourself with everything, because it is an overwhelming journey of getting into shape.

So you have a story of starting and stopping in failure that other people can empathize with. And you're going to use that to connect to them and help them on their journey. Did I get that right? Yes.

Good. I like the rule. Let me tell you what's beautiful about this. You articulated a brand position fabulously.

It didn't take you a second.

You didn't have to think about it. You spit it out. You spent time thinking about this and you've, and it has paid off. So really well done. It's part of the 2000 you're making every month doing this in person.

“This kind of training or is it just like odd jobs that you're doing just to pay bills?”

No, it's just odd jobs to pay bills. Okay. So you're not making any money on this yet. No, this is starting crash. Okay.

So how will you acquire your customers? Through ideas through Instagram through posting content along you and value.

And hopefully getting my first two to three clients just to get some testimonials out of them to have proof.

Okay. So is there, I mean, in my mind, you working out and creating content for Instagram. If you have a phone is free. I do you don't need to spend money to do that. Until you get customers and when you get customers, they give you money.

Then there may be a couple of things you could do to push some of those reels or enhance some of those reels or something to get people to see them that aren't seeing them yet. Yeah, how much is that online? The online. How much are you charging? I don't have a price yet, honestly.

“It's going to build it now, but it honestly ranges around a thousand to two thousand dollars I believe.”

It's depending on how long you want to coach them for or they want you to coach them. Okay. And why are you not working in a gym as a personal trainer? Honestly, Dave. You're going to have more than one rejection with customers and rest of your life.

So I think it's a good base of operation for you to be around people doing the stuff you're doing all day long. And it also gives you a place to, you know, to shoot some of your Instagram stuff and show some examples rather than just in your garage. And by the way, you need a job because you're not making money and it's going to be a while before this actually monetizes. So I want you to go do this.

I don't think it's investing money into the business as the answer.

“I think getting an income while you grow this side hustle into a business.”

Yeah, and just be cautious because there's a lot of chatter on social media about, you know, by my course on how to build a course and course. It's all of this, you know, a lot of courses and some people make great money doing it. But don't fall for something that feels too good to be true as well because there's a lot of effort and work that goes into it. So move at the speed of cash, earn and don't go into debt for any of this. And if you can before you purchase, you know, someone else helping you in any level of investment in the business.

I would, I would do my due diligence to make sure that what I am buying or purchasing is going to help me and it's helped other people. Because I think there's a formula. There's a smart formula to do. But I really wouldn't do any of that until you're making some a bunch of money. And you're right now what you have is some really good theories. You have a great brand position that you, I told you that. But you made no money yet. You have no proof that this is anything but a theory.

So the next stage and when we're launching a product in at Ramsey, whether it's a coaching product, a text, a digital product or whatever, we want to see some social proof.

And social proof is people tell you they will do all kinds of things.

But when you actually ask them for their money, that's when you find out if you got something or not. Because they're not going to give you their money until you approve and value to them. People trade money for time and value. So all they trade it for. And so when you start actually getting money on your theory, now it's not a theory anymore. It's a business. But you haven't got a business yet. Right now you've got a theory.

And I think you might have one. And I want you to go do it.

“But while you're doing on this to give yourself some patience, you need to be making some money at a full time job.”

And I love having a full time job in the vicinity of what you're going to be doing. Rather than I'm going to go work at Costco and I'm working on my other thing. My personal trainer coaching thing on the side. Now, I want you to be in the training business. Be around trainers. Be around talking to people about this.

Be all up in this industry.

Be learning from people that are doing it wrong. Find you some anti-mentors. You know, find you some mentors. And so yeah, you need to go to work at a gym and you need to keep. There's a bazillion gyms in Tampa, Florida. Somebody will hire you as a personal trainer if you tell them your story.

And you know, you made learn some techniques of teaching while you're working there. That will help you further this theory of yours into an actual business. So that's what I would tell you today. But no, I would not spend any money growing this business to Rachel's point right now. Because you don't have a business.

You have a theory. And I don't want to pay somebody to take my theory to market. You take your theory to market. That's your job. And you can do it.

“I really believe in you because the thing about you was you could actually.”

I could actually articulate with no hesitation what it is you're trying to do. And that is very unusual. I have people come in that work on our team and they go, you know, we got this need out there. And I think we could do this. And they're not nearly as dialed in as you were just thinking.

Yeah, and the testimonials, I think specifically with. You know, I'd say, I mean, physical fitness. I mean, probably any service, but especially with that is one of the promises that you said or one of the motivations is that it's so hard to start and stay with it and say consistent. So if you can find a few clients.

And over the course of six months, be like over six months, they've stayed with me because of this tattoo. Here's your before and after. Yeah, live a level testimonial too.

I think is going to give you credibility. I think that's probably what you need starting out. Yep. Very good. [Music] If you're serious about building a business,

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Hey Nathan, how are you? Hey Dave, very Rachel. Thanks for taking the call. I'm calling today to ask the question about should we train our take our emergency fund down to a level to pay off the mortgage?

We've been following the baby steps and doing that for a long time. Our kids will be in a range of babies effectively, and there'll be the beneficiary of all this wonderful. And so it's truly just a question from our life.

We've done this for so long, so budget and all these things are happening.

And now we've got to take that final step to pay off of our two percent mortgage or something. So what's the balance? What's the balance on the mortgage? 280.

Okay, and where do you have $290,000? We have, we've sold some projects. We started a business a few years ago, and we have some projects that were acquired by a major public company. And so we have some earn-outs that we've already received three out of the four payments.

We have one final payment coming, and so we've been accumulating that.

“And then separately, why are you not already shrinking that on the mortgage?”

Just, it all happened so quickly. So it's very recent. It's only happened. How much do you have savings in? How much do you have in the account today in those accounts?

In total, we have $100 in $90,000, and then we have about 136, $156 maybe in non-retirement to broker's accounts. Okay. So that is, what, $340, right? Yeah, $340, and you need $280.

So why would your emergency fund disappear? Well, it wouldn't. It's just when I talked to my wife and we laid it out. We were discussing, you know, what level of emergency fund? It's going to be three to six months of expenses in what world is 66,000,

not that amount. It, it, a hundred percent is way more than that. But it's more just the, the reality of the decision.

“The reality is not, well, the reality is you're not touching your emergency fund,”

which is how you ask the question. Yeah, but seeing that. But seeing that amount of money in the bank. That's very important, then. That's different than to take my emergency fund down to pay off my house.

That's not an accurate question. That's, that's correct. It's more of the emotions of draining. And a count that has a lot of money in it. And you're thinking, do we really not?

And I'm fine with it. But my wife has, you know, as she's more hesitant, you know, and you're, you know, your mom and your last phrase, her feelings are, you know, she's a good girl. She's a good girl.

Yeah, we're safe to deal. Well, here's a couple things to think about. And, um, yes, I would write a check out of the $346,000 and pay off $280 and have 66 still sitting there by nightfall. No question about the answer to the question.

But then let's talk about, you know, the actual feelings that go with that and the sense of all of those things. Two things come to mind. One is it is a valid thing. And we're, we're seeing it more and more.

We're understanding it more and more. That it's weird the way your brain works. When you pay off a mortgage, it does not feel the same as when you have that same amount in a pile. Like you're diminishing this pile and putting it over on the house,

and it feels like it's gone. Yeah, because you're kind of like losing that. It feels like it's gone. It's not gone. You just moved it into equity.

But so math wise, it's really not gone. You just changed it from a brokerage account to a paid off house. That's all it is. So now we have real estate into the other. So in, you know, the mathematics don't tell you that.

But the feeling is I'm diminishing one thing and I don't feel like I'm getting as much on the other side. That's the thing, one thing too is when you pay off your house on the positive side of the ledger of this discussion, you're going to feel different.

She's going to feel different because you've never been there.

And I've talked to literally tens of thousands of people over the last 40 years to say, it's like I could breathe again. Like somebody was standing on my chest and they got off. And I didn't even know it. You got so used to it. I feel a little bit that way now of I can,

I can see that I'm about to be able to take a deep breath.

I can feel it.

It's, it's, I mean, we've done this through business school.

Yep. So many things. Yep. Exactly. Now that then the other one is the, you know, the, and this is for your wife is I have told tens of millions of people.

Uh, tens of thousands in person, but millions indirectly to pay off their house. And I, I get criticized for almost everything I do from the time I wake up till the time I go to bed. But no one has ever called me ever and said I hate you. I hate the fact that I paid off my house because of you. I've never had that one.

No one has ever mad at me for that. Right.

“They all talk about it as before they do it. It's like, oh, why would I get rid of two percent?”

Dave, you're stupid and you're wrong and you're crazy and all this and it's like, but when they actually do it, no one ever regrets it. And so in the joke is, if you pay off your house and you hate it, Nathan, you can go get it on the mortgage. Right. That's what I've shared.

Yeah. I think I know it would be a six percent, but it, you know. But I would just say, honey, we have $66,000 left in the bank and we don't know anything else on our house. We've got to do this. Everything else that Ramsey has told us to do, we went and did and it worked.

And they're not steering us wrong here. Yeah. And you're probably not going to like this. But I'm like, even if you wanted to slow sapping back, let's throw a hundred grand tonight at it. Throw a hundred grand and let's wake up tomorrow and see how we feel.

You know what I mean? Like, nothing's on fire right now. You guys need to pay it off because you would have no mortgage next month, which is crazy. I know you would disagree. I get your logic.

But the problem is you don't get the feeling of reducing it that you do a paying it off.

No, I know. There's no relief. No, it's not relief.

“But I think it is a another step to show confidence of like, okay, we are okay.”

Okay, I'm okay. Because it's the amount that's being diminished in the bank that is scary looking. Yeah. If you had $66,000 in the bank and a paid for house, would you go borrow money on your house so that you have more money? In the bank?

No. And it's just the same thing in reverse. It's exactly the same thing. Every day you don't pay this off, it's like you're borrowing on your house to put money in savings. It's exactly the effect.

And so it needs to be paid off tonight. But we got to get her on board and I appreciate that. And we empathetic and gentle and persuasive and all those things and do it. Yeah. Well, and run the calculations of how quickly you can build at $66,000 back on top of when you don't have a mortgage payment.

You haven't even gotten all your payments from your business. Oh, yeah. You still got more money coming. Yep. So it's not, you know, we're near the edge.

Yes. And we'll donate. And that's a lot of work on your part to get to this place and your wife. So you're there. And it's interesting, it's a study listening.

So out of the abundance of the heart, the mouth speaks, right? The Bible says that. So the words we use tell us what where our heart is. And, you know, it took a minute for us to figure out that he actually was asking the wrong question. Because his heart feels like he's actually getting into the emergency fund.

And once we got into it, he's not. Maybe she feels that way. And he was recasting what she was saying. I don't know. He may have been asking the question on her behalf.

But it's interesting that the feeling is that they're getting into the emergency fund. And they're nowhere near it. Yep. And yet that's, that's the, it's touching that same place. It's, it's this feeling of security from a pile of money.

Mm-hmm. And it's that a security from debt free. And once you've been a hundred percent debt free, you won't trade that for a pile of money. I mean, the stuff that I own that I could go borrow money on and make a pile of money. I could do it by the end of the day and have a big old pile of money.

I didn't have all the debt to go with it over on the stuff I borrowed on. But I wouldn't trade that piece yet for any pile of money. The piece, the piece.

I can always feel like I'm up in the mountains and it's a cool morning and the sun's coming up.

And, you know, you get that deep breath and it's cold air into your lungs. It's like 46 degrees. I love that.

“That's how it feels to me when you pay off your house.”

Phew. Phew. And nobody hardly has that feeling. When you do have it, you won't trade it. [Music]

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Start every dollar for free in the App Store or Google Play. Thomas is in St. Louis. Hey, Thomas, how are you? Howdy, Mr. Ramsay. How are you? Better than I deserve, what's up?

“I have a couple of questions I'm getting married in about a week.”

We're 100% debt free. I'm on baby step number three. And I'm debating leaving a stable job with good benefits to go risk and entrepreneurial opportunity in another state to do windowsales as a window representative to potentially make a lot more money. What are you doing now?

I'm an HFAC technician. I'm four months into the trade and I'm bringing in 3800 a month. Okay. What did you hear about the window opportunity? Um, my cousin is a manager down there in another state and Idaho.

He's running a window company and he's making it considerably more than I am. And he has reached out. Well, I kind of reached out to him. Hmm. Dave's pondering.

Yeah. Okay.

So, what I want for your first year of marriage for your relationship is stability and predictability.

And this sounds like a wild adventure. And I do want, I do like wild adventures. I don't want to do those on my first year of marriage. Because I want you guys to invest in each other, not in a wild adventure. Where is you are in St. Louis? Where is she?

She's out here. We're living separately right now. She's living in a hotel, working for a hotel. And then we'll get married.

“So if you go to Idaho, she has to get a job too, right?”

Yes. Have you talked about that? We did. We have and she's okay looking at any job, Costco or just something random. Hopefully to get medical insurance, especially if kids come along. Because this job doesn't offer benefits.

Because you threw in benefits with your current job. Right. Current job has awesome benefits. And the sales rep doesn't, but for I. How long is your cousin been doing it? He was on and off with other companies and I think he's been with this company for two years now.

And he doesn't own it. He's working. He's a manager there. He's working for the company. How big of a company is it? It's growing. It's not a huge sales company.

But it seems really stable. He's first year there.

He brought in 198,000 in the year and then doing better and better each year. Now, as a client management and has extended offers to me to come out and work with him. Because it thinks I can do well and sales. But it's just nerve-wracking. Mm-hmm.

Yeah. So are you? Are you trained as an H-fact tech? You know what you're doing. So if this thing goes sideways, you could go to work for an H-fact company there.

I feel pretty well first, but you don't have a set of credentials to walk into another H-fact company and get a job.

“No, I'm not doing well though. I'll be getting my certification in a couple weeks.”

Okay. Then you would. Yeah. Yeah. Well, obviously, you can plate the certification. Okay.

I don't know why. You just have this like hesitation, Tom. Just a little bit of when things feel too good to be true.

So sometimes they are, not always. Sometimes they are, though.

And so I appreciate your patience on making the decision that you wouldn't just hear 198 and just back, let's just jump ship and go. Mm-hmm. So yeah, there. I mean, there's a part of me that I'm like, I mean, yeah, you can control it because you have the question.

You can go back up of the licensing to be able to plug into another trade, which is awesome. Finish up your certification for sure. So the thing that's bothering me, the thing I keep hesitating, I never want to tell people to not go make more money if you can. I think that's a wonderful thing.

I don't think it solves all problems, but it solves some of them. And so if you can go from making 40,000 a year to making 140,000 a year, it does change your life. Mm-hmm. That's the temporary thing, and that's so. But what it doesn't do is it doesn't give you a

15 or a 20 year track to run on.

“Because you're not, you're very likely, you know, you said you're what 20, how old?”

21. 21. It's very unlikely that you will be selling windows at 31. Right. Even if you're making 198,000, it's very unlikely that you'll still be doing that

a decade later. For sure, two decades later. So at 41. For sure.

So the question I'm always asking is where is this taking me?

And it could be, maybe we need to rethink it. I don't know. I'm a big fan of people learning how to sell. Because salespeople are some of the best paid people on the planet, and more people in marketing and sales end up as CEOs than any other trade.

It's the fastest track end of the C-Suite into running a business, running your own business, running someone's business. Because it depends. Because you're developing people's skills and persuasion. The ability to persuade.

“And not the ability to talk apparently, but the ability to persuade.”

But the. That's a great point. That where is it taking you? Not just making more money. I don't want to just go make more money and end up being something I hate.

In a place I hate because my cousin called me. That's a dumb reason to do it for real. It's like because I mean, I like my cousin, but I'm not going to do something because he said do it. I mean, there's like nothing.

He's going to know. No. But I mean, I'm not saying he's a bad guy. I mean, that's just. But this just sounds like somebody dangled a carrot.

And now you're the horse jump and after the carrot. I want to think through where this is taking me. Who do I want to be at 35 years old? And how does this help me get there?

And if the answer is, I'm going to go over there and make $200,000 a year for four years.

And then I'm going to move to X that I've always wanted to do. Or we're going to open a business doing Y that I've always dreamed of. And I'm going to use that $600,000 swing to do that. That's an okay answer. That's an okay answer.

You're going to pick up a load of fuel. And the fuel is going to take you to your dream. And that's okay. If that's what you're doing. But I want this conversation to go beyond.

I'm taking a new job because my cousin called me. Well, and because of the money. There's a lot of people that they get a big bump in salary. And they go work for a company. And they're miserable.

And they're just like, oh my gosh. I like to this other company. I wasn't getting paid as much. But it was a better fit. You know, that happens.

Yeah. You're always, but you just, if if money is the only motivation. I love the idea of that kind of basement full of cash and learn in a skill called sales. And that's going to take me on my journey this way and and define this way. Define where you're going with it.

That's an oak. That's a better way of doing it than I'm just randomly going over there. Make more money in another place. And I just got married. Oh, this sounds like stress.

Mm-hmm. Sounds like tough times on the. The new bride's going to leave her job at the hotel and work at Costco. Oh, wow. Yeah.

I'd have a plan B Thomas and also a timeline that, hey, we're going to give it one full calendar year. And if this isn't picking up to X, Y and Z that we thought, you know, if I were her, I probably would want some level of because it's so new. Mm-hmm. Is there an out?

Forever and ever even if it's not working.

So there's always kind of a.

I like having multiple options. So even with that even if you choose to do this. Here's kind of the parameters around that to go to something else if we need to. But if you're out there and you're 18 or 19 or 21 and you want to learn sales as a skill. I'm going to encourage you to do that before you do a whole lot of other things.

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So we don't have any financial worries in the future. We are less than $50,000 away from paying off our mortgage. Plus we have two car loans and three credit cards. The house and the cars don't trouble me too much. But the cards have a 25% interest rate.

So we're not making much headway on getting them paid down even with extra payments. Should we take out a home equity loan and pay off the cards? Then throw everything at the loan and pay it off as quickly as possible. We have no intention in keeping any credit cards going forward and have agreed to just pay cash from here on out.

No hope I would not do that because the problem is you're just moving your debt from other debt.

And so there's no real progress happening. Yeah, you can play the interest rate game. But the truth is, if you focus all of your energy didn't pay more on the house. Didn't pay extra on the cars. You throw everything at that smallest credit card and you work your way down.

“Honestly, by the end of it, do you didn't say how much specific credit card debt you guys are in?”

But ideally it will be less than a year when all that's paid off. So the interest isn't really what matters at that point. It really is the focus intensity that's going to get you guys far and then possibly sell these cars and set in yourself up. Because yeah, going into retirement with two car loans, three credit cards, not too much in the mortgage. You got 50,000.

I mean, you guys are getting close on that. But you're not ready for a return. It's not a retirement year next year for your husband. Yeah, you guys need to get. Yeah, your husband's not going to get the return next year.

You're not ready. You're broke. You have two stink and car payments and credit cards coming out your ears. It can't figure out what to pay off. You don't get to retire while you're doing that and make less money.

You need to make more money. So he needs to double triple his hours. And you guys need to quit spending like you're in Congress. This is out of control. So the deal is this.

You presented two things in the email that are juxtaposed with each other. We're trying to get out of debt. So we won't have financial worries in the future.

Well, they ought to worry you. That'll worry you so much so you sell them. Because keeping your husband from retiring.

So the problem is you're not worried.

That's why you shouldn't do this. You need to get worried. You need to get fired up and wired up.

“You need to get pissed off that you're this old and still in debt.”

Well, why could you keep buying cars on payments? That's why sell them. Get you a couple of hoopedies and let your husband retire. Oh, now I got personal. See, but you need to get worried.

That's the problem with this email. You're not bothered. No, what bothers there's a 25% interest rate. Not the fact of debt. But she likes like that's the reason she's in debt.

No, she's in debt because it keeps spending. Yeah. And keep buying crap they can't afford with money they don't have. That's called debt. That's where that comes from.

And so when you got, you got to get upset about this stuff. And go city bank has been screwing me. Ford Motor Company has been screwing me. I'm tired of getting screwed.

I'm going to do something about this.

I'm going to take control of my life away from the stupid bankers. And until you get that kind of thing going, you're not going to get out of that. Because you're not going to cut deep enough. Sell enough, work enough to clean up the mess. Because it's all okay.

I'm going to bother me that much. Well, of course, you don't stay right there then. You know, doesn't bother me much. Well, then you're going to keep it.

“That's until it bothers you. You're not going to fix it.”

John's in making. Hey, John, how are you? I'm doing this your day if I bite yourself better than I deserve. What's that? I had a question for you. So I just completed a college internship on 21 years old.

And they have all for me a full-time role in sales and act and act sales. But the caveat is that to move off for a year before I can come back home to kind of get me up. My comfort zone and I understand that. My question is, should I rent while I'm going or should I buy a large size camper. And that way I'm putting money into something on my own besides rent.

You should rent. You should rent, okay. Yeah.

Listen, if you're going to go out and make sales calls and you slept in a bed and apartment.

You're going to look different than if you slept in a camper. That's right. It's not going with it. It's going to go down to value. You're not going to have the money to pay. You know, it's a buy it outright rent.

So you don't have to, you know, yeah, Dave's is your sleep score. That's what Dave's. No, it's a ruffle clothing. What about? Yeah.

No ironing board fits in the camper. Okay. So the, like, fine, John. I would thank you. John, why did you take this job?

What does it pay? I don't know. I don't know why.

“You took an intern, but they're running you out of town and putting you in an uncomfortable”

bad position. Are they paying you to make the up for all this? Why much of you won't be making it? Make it 70 grand. Okay.

And your degrees. What? You got a degree in agriculture. Yeah. And you're going to come back there and sell for them after a year and your home town.

Yes, or that's right. Okay. This may be a naive question. Is that a normal process? It's never heard of it.

But it's not. It's a company process. And they were very upfront with me about this. I mean, I accept this role. And it's just, it's a sign to get me out my comfort zone because I have a lot of

connections that home. And I guess, sir, this is not just me. This is everybody. About deal. They want to see what I can do.

Where you don't know anybody else. Yeah. That's right. Yes. And they don't want you to get your knuckles raw from nothing knocking doors.

I'm, I'm up for that. I like that. But yeah, rent. Just rent an apartment, John. Go get a camera.

Because you're going to get a loan on it. You're going to pay an interest. Going to go down value. It's yeah. I won't.

Bad idea. This is. You don't need a used camper when you come home. That's not, that's not a plan. No.

I appreciate your thinking about it and looking at other options. But just get you an inexpensive apartment and work all the time. And, you know, stay. We live like you're still in college. Stay away from happy hour and work all the time.

Get your couple room mates and keep your expenses down and go make your 70 grand. And this is boot camp. I got this my one year trial by fire. And then I get to come home and have a great life and make good money with the commissions. I make off my connections and my family.

You know, the people have grown up with and all that. So, and you're going to get the advantage of a family network and a so forth and a small town, which is wonderful. Good for you. Sounds interesting.

Okay. No camper. Yes apartment one year. No big deal. Good sleep.

Good sleep. Good sleep. What? We're worried about the sleep score. We're talking about him.

No, I'm not. I'm just, yeah. I, in a sense. Yeah, that's that good. I guess.

I hear I know you're talking about up here. All right. Scott's in Minneapolis.

Yeah, how are you doing Dave and Rachel?

Better than we deserve. How can we help?

“Well, first off, I just want to thank you.”

You guys have been a real inspiration in my family. We've learned a lot. Thank you. Thank you. Because of listening to your guys is a steps in a ways of doing things.

So, long story. For we have a daughter that's in high school. She's interested in your years. She got to accept to do a private school out of Minneapolis. We both contribute a full 20% into our off or four or one case.

Well, with each of my life, my life working my own. We also contribute the max to our off or one case, or off the IRAs. Cool. For run on a time on this hour, what can I help you with? Yep.

So, what we're looking to do is she has a, we did the math on this. And it looks like she's going to have about $17,000 left over after a four year degree. Which is something we can watch out. We've got about $60,000 in our emergency fund right now. We own our vehicle.

What's your question? The question is, should we have her go to the school with that balance?

Or, I know, you guys have always talked about possibly not having a balance when you're done with school.

So, she'll be $17,000 in the whole with tuition, as what you're saying. Yes, that would be the leftover that we've done a math on. Okay. You can't cover that. Yes, we can.

We don't want her to know that. Okay.

“If you want to pay for college, and that's a college everyone's in agreement with.”

And you want to pay for it. Go wherever you want to go. Yeah. But if you feel like it's a stupid idea because it's too expensive for what you're getting. And you want to just say, this is stupid idea.

It's too expensive for what you're getting. It's not going to do $17,000. You all are done in a well enough 17,000 in your problem. But we need to actually speak into, is this a good education decision. It sounds like you don't think it is.

It sounds like between the lines. Let me tell you what I get asked all the time. When should I get term life insurance? How much do I need? Is it affordable?

Those are the right questions to be asking. So let's take a quick review. The fact is term life isn't a baby step.

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Call 800-356-4282 or go to zander.com for a quick and easy quote. That's zander.com. Welcome back to the Ramsey Show in the Fair Wins Credit Union Studio. Rachel Cruz is my co-host today. Sherry is in Los Angeles.

Hi, Sherry. How are you? I'm good. Thank you for taking my call. Sherry, what's up? My husband and I are getting closer to retirement age. We have 735,000 in combined IRA and 401K accounts.

Why don't we have a hunt? Yeah, that's positive for sure. We do have $150,000 in cash that's in the bank that's obviously a waste. And I just started to panic thinking, oh my gosh, we've got to get things rolling here. And that's that excess cash.

And I'm just not sure where to do that of. We're not contributing to our IRA and one other 401K that were separated from service from that employer,

but that we've never rolled that over to IRA.

So we do have-- Sounds like it sounds like you've kind of got some clean up to do. Yes. We'll pull all these things together and point them towards the single strategy. Exactly.

Yeah. I would just jump on Ramsey Solutions.com and hit the smart investor pros in your area. The brokers, the financial advisors that we endorse all have to have the heart of a teacher, or we don't put our name beside them. And we're just going to sit down and not tell you what to do.

And then you will decide if you want to do that or not.

That's the proper way to go at this.

“So it sounds like that some of those things just need to be rolled into good gross stock type mutual funds.”

In general, I just spread my portfolio and Rachel and Winston have spread theirs across four types of mutual funds. Growth, growth and income, aggressive growth and international. We put about a fourth in each. We want to move as much toward Roth as we can move because it's growing tax-free. And we don't have mandatory withdrawals at 73 called RMDs required minimum distributions.

So that's a couple of things you may want to kind of target. But they'll teach you all of that when you sit down with them because they're going to give you advice that's consistent with what you'd hear on the ear. Also, where we wouldn't put our name beside them. Are those other accounts sharing that you mentioned with old employers? Was that included in the 735 number that you gave us?

Or is that more? That's included. Okay, that's a total total. Yeah, and how did you say you were again? How old 50? I'm 53 and I had these 57. Oh, you guys are going to have so much money. Oh gosh, I hope so.

Oh, no, you will. So let me kind of give you a rule of thumb just to prove it to you. It's very interesting. If you take a number and divide it into 72, it tells you how long it takes a lump sum to double. So if you made 10% it takes 7.2 years for it to double. So if you're in a decent growth stock mutual fund portfolio, you're 735's 1.5 in your 60.

It's 3 when you're 67 and it's 6 when you're 74. Oh. If you do nothing else. So I'm not kidding when I say you're going to have a lot of money. You're doing really well.

“But you need to be getting all of this stuff. You can't be sitting in cash.”

I'll be using some of that in real-time. You got to maybe maybe in the pen on what's going on. Well, you may be drawing down on some of it at some point. I don't know. But that's also you probably will be adding to it between now and retirement.

So those numbers aren't going to be that far off for that reason. So anyway, let's get the cash working. Let's make sure that those old junkie leftovers from the other jobs are all pointed in good mutual funds. Everything's dialed in on the Roth as much as it can be within reason. And you know, we've got a good portfolio of long track record high-producing mutual funds that you feel really, really good about.

And then you can really just watch this thing cruise and you're going to do great. Okay. Well, with that being said, I've been our goal is to have our house paid off when we do retire. Good. And I've been seeing extra towards that every month.

Good. Saying that we're going to be okay financially, should I be putting this extra money into the house or should I be using that to invest?

No, you need to get the house paid off because there's two things that causes people to get their first one to five million dollars of net worth.

“One is a juicy retirement program which you have and two is a paid off house.”

We find the average millionaire that we find that becomes a millionaire. So they got a $1.7 million net worth. We find, you know, 800,000 on the house and they got another six or seven, 800,000 in there for a one case. And that's that's the typical first $2 million is somebody built. Yes, but you are investing 15% of your income until then.

Yes. Yeah, and retire right. Yes. But no more. Okay.

Everything else goes on the house and we're going to get this all working. What's your household income? We make 242 combined. Yeah. So you got another--

How much is left on the house? Two, I mean, three, 30. Okay. And I've been paying us 1,000 extra a month that according to the mortgage calculator, that's accurate. If I paid $2,400 extra a month, which would be an extra $1,400, which I could do, we'd have it paid off in seven years.

I would do that. And so that's not too aggressive. No, no, there's not such things to aggressive. Get it paid off. Unless you're not having fun in life because you're aggressive.

But I still want you to go on a cruise.

I mean, you're making a quarter million dollars a year.

So enjoy your life. But put 15% of your income away. And though as much as the house as you can, get the house paid off as soon as possible. And then, with the house paid off, and you've got by then, several million dollars saved, invested, you know, you're in a really, really good spot at like 60 years old here.

Okay. Well, that is really, really, I was starting to panic. No, there's no reason to panic. But I do believe in tuning up things. You know, this is a good piano.

Let's get it tuned up. So it plays a good song. Okay. You're doing a good job. Let's just do a little bit better.

Excellent job. So, and that'll also give you the comfort, the emotional piece. Because you got your hands around the neck of this thing, making it behave. Right now, it feels like it's a little bit drifting. And that's bothering you as much as the actual numbers.

So when you're on top of it and you're telling your money what to do, there's a sense of power.

“When things are drifting away, there's a sense of powerlessness.”

That's right. An anxiety that goes with that. Because, yeah, by 60, I mean, a paid off house. And then if they're investing 15% over the next seven years.

And that would have two million dollars.

And yeah, because of two million. Plus the house. There'd be worth probably three million dollars. Yeah. You know, I don't know what the house is worth.

But, you know, guessing a million. Mm-hmm. So, yeah, that's she's in great shape. You've done a wonderful job, by the way. This is what you aim at.

I took a call earlier in the week from a 64-year-old that had $40,000. I didn't know what it was going to. It's a security guard. It's worth about eating. So, that's the other side.

I mean, so, you know, that's a cautionary tale for the rest of us to get ready. You know, get ready. It's coming. Christmas is in December. Retirement is in your 60s, 70s, whatever.

I mean, it's coming. The other options, death. So, you probably ought to plan.

“You know, I mean, this is what you need to do.”

So, this is the thing.

And it's amazing how fast it comes at you.

All of this. So, um... Yeah, you feel like you have forever when you're in your 30s. Yeah, I was just a daddy yesterday, and now I'm a grandpa. Who knew?

You know, it's just like that. And now I'm a grandpa of a 13-year-old. How does that happen? I've been a 13-year-old. Now I'm thinking about being a crack grandpa.

You know, oh my gosh. Stay alive, Dave. Stay strong. I'm working on it. I'm working on it.

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“Andria is in Raleigh, North Carolina, High Andria, how are you?”

- I'm Kate Walgate, how are you? - Better than I deserve, what's up. - Yeah, so I want some advice on if I should buy a car if I'm already in debt. I am about $69,64 in student debt. I just finished my master's degree. I drive a 1994 F-150 in drive about 30 minutes to work.

So I'm thinking I need a new car. I just started a new job, and I make $65,000 a year. - How long have you been driving the F-150? - For about two years. - Drive it for two more. - Okay. - You're broke. - Do you have anybody say Andrea?

- I do, yes. I have about 19,600 in some change. - Okay. - Nothing's wrong with the truck. It's just old. - It's just old. I have had some issues with it, and that uncertainty of driving 30 minutes every day and not being sure it's something's going to happen to the truck.

- But nothing, I mean, it's not like there's one specific thing that you're like,

- Right. - Okay. - Exactly. I can't keep driving.

- I have happened, but I just keep preparing it. - And through 18,000 at this debt, too. - Yeah. - We teach you to take pay everything down to $1,000. Don't borrow anymore, live on beans and rice, and attack your debt and clear your debt.

You believe in investing in this master's degree, and so far you've got a $65,000 job as a result of it. Hopefully that's going on up from there to make your theory of investing in this education correct. So I want to see you make it a hundred because of this master's,

and I want to get some master's paid off as soon as possible. This is not a pet. It's a student loan, kill it.

“- Right, exactly. And that's how I feel.”

The cars that I'm looking at are all within the $37,000 ring. - $37,000. You have 19. You're going to go into that while you're trying to get out of debt. And so that's why I was like, I don't think that's the right decision for me to make right now. - $37,000 isn't the right decision. $37,000 is 10x, a bad decision.

No, no, no, no. - Yeah, well, that was my question. I feel like I knew the answer to it.

- Yeah, here's the thing. If you will get in the business,

if you'll set your head to say, my number one wealth building tool is my income. And as long as I'm giving that away in car payments and student loans, I'm going to be what's known as a middle-class broke person. But you can make 65, 75, 85, 95,000 as your career expands here,

and become a millionaire if you'll stay out of debt and stay out of debt. Because you're not giving all your money away to other people every month. - Right. And with my 19,000, you guys are saying, you know, pay everything, but $1,000. I do have my company that matches $5,000 in 401(k), but I'm not worried about that.

- No, you do not need to be putting money into a retirement plan. You're broken in debt. - Okay, gotcha.

“- Get the debt cleared up as fast as you can.”

- Yeah, Andrew, when you walk the steps, you come to the baby steps. So it is that $1,000 emergency funds. Baby steps to paying off all of your consumer debt. So that'll be your next goal.

And hopefully you can do that in two years.

And then you want to save up a three to six month emergency fund. And by that point, you're probably going to be simultaneously saving up for a car. - For a car. - In that case. - If you pay cash for.

- Yes, and that emergency fund. And then after that's done, and that emergency fund is in place. And if you're single and you have a great job, you can do a three month emergency fund. It doesn't have to be six months. And then from there, you start investing.

So yeah, you'll be, you will not be investing probably for the next three, three and a half years, but that's okay. Because when you start investing, you're going to tell you to put 15% of your income into retirements. That is that 5% match.

And also a Roth IRA. So you will have plenty to catch up on. So just because you're not getting that 5% match in the next three years, you're going to more than be okay. Because you're going to be funding 15% of your income into retirement.

Because you have that margin. So those are the baby steps. Really, we walk, we walk people through. - Hey, Andrea, if I give you a book that shows you how to do all this, will you promise to read it?

- Yeah. - All right, I'm going to give you the total money makeover. It shows you how to do all the baby steps. - Yeah. - Let's give her every dollar for a year. - And we'll set you up on our budgeting app. - Yeah. - We're just talking about.

- And it helps you a lot of the baby steps too on that. - Yeah, it's going to guide you through the baby steps as well. And reinforce this idea that with no payments, you have money to invest. With no payments, you have money to invest.

See, what we've done is we all make most Americans and make pretty good money. They just give it all to a bank. They give it all to Ford Motor Company, 37,000 dollar car. They give it all to Sally May, you know, 69,000 dollars in student loan debt. And we give all our money away.

And then we wonder why they have tall buildings and we're broke. And they have Samuel Jackson saying, let's see in your wallet. Apparently, my money is in your wallet.

“That's what apparently we can go with there.”

If you're using that stupid city bank card, right? So that, and whoever it is, what's the other guy, Bradley Cooper? Is that the one that lives in the lobby or something? I don't know. Saw that one the other.

The city bank guy that lives in the city bank man lives in the lobby. I think it's Bradley Cooper maybe. - Oh, no, no. Tell me, get Bradley. - I don't know.

It's some actor. - Anyone man? - Yeah, these actors are now bankers. - Jennifer Gardner, I know. - Yeah, Jennifer is for sure.

Which is real disappointing because I was a fan. - Oh, stop. You can still like Jennifer Gardner. - I know, but I can't stand the, you know, this, anyway, these companies are screwing you guys.

It's what it mounts to. - Yes. - And they're paying a pretty person to tell you to do it. - Mm-hmm. - And regardless of who it is.

And so I don't know if Samuel is pretty. - No, it's pretty, but. - Oh, it was no, it was Dan Levy.

City bank commercial, where he's in the lobby of the hotel? Is this what you're talking about? - No, different one. I think.

“No, this guy lives in the lobby of the back.”

- Capital one. - Oh, wrong one, not City bank capital one. Okay, thank you. We'll figure it out in a minute. All right, Will is in Atlanta.

Hey, Will, who is it we're mad at? What's up? (laughing) - Hey there Dave, how are you doing? - Better than I deserve.

How can I help? - Hey, well, thank you. First off, thank you for taking my call. My, even when I was a kid, my dad was watching your Fox Business show,

you know, back in 2009 when all that was going on. And I took financial literacy course. That they had set out for you in high school. - Wow.

- I've always really respected your work.

- Thank you. - Thank you. That's why. Yeah, no fun.

“That's why I wanted to talk to you today.”

I'm 25 years old, and I've been married for two and a half years. And we're doing okay financially. But there's two things I wanted to really get your advice on. And that's, we have a $17,000 car alone left from a car we purchased two years ago. And on the flip side, we want to know how we can maximize our cash and income.

We already have in the bank and bet we do make. - How much do you have on the bank now? - Currently, but between me and my wife savings, we have almost 13,000 in our joint. I have 85,000 in a money market.

- 10,000 a day. - 100,000 a day. - Just pay off your car today. - Well, do you remember the class you took? - I mean, I will say I wasn't that smart and nice bull.

- No, no, no. You can say it was boring and you ignored it. - It's fine. - I didn't really like you Dave, but I thought I would start out being nice on the call. Anyway, now pay off your car right now.

You have $85,000 in a $17,000 car alone. Pay off your car today. You understand? - Okay. - Instantly.

- Instantly.

- And never borrow money on a car again.

- No, and we had a, she had an old car at the time. And in retrospect, I did have a few problems here and there. And I don't really want to hear your excuses. Just pay off your stink and car, man. Pay off your car and never borrow money on a car again.

Ever. Ever. If you want to be rich.

“If you want to be poor, keep a car payment.”

Poor people drop big old cars with big old payments on them and walk around with stress. They don't have financial fees towards the don't go together like airline service. So, I mean, you've got to think different, man. Break the cycle, break the cycle, break the cycle. No car payments.

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[Music] Well, we wish we could get to every call and every question here, but we can't.

It's full of Ramsy answers from three or four years on this show.

We dumped it into the AI, into the data set. We dumped all the books we wrote into the data set. We dumped all the articles, several thousand of them that are on our website, into the data set. So, when you ask Ramsy, you're getting a Ramsy answer. There's no reddit trash, stirred in.

There's no sewage from TikTok, stirred in. It's just Ramsy straight up. If you don't want Ramsy answer, you shouldn't ask Ramsy. If you do, you should ask Ramsy. It's completely free.

You can do it at RamsySolutions.com or click the link in the description of your own podcast or YouTube. Ask Ramsy. Jocelyn is in San Diego. A Jocelyn, how are you? Hey, I'm doing well.

How are you guys? I'm having me on. Sure. How can we help? Well, I am just trying to figure out how to get my husband on board with

one pen out of our debt and just really getting that gazelle intensity. I don't think we've really had that. It just doesn't feel like he's really there. And he's the money maker right now. And I'm doing the best I can.

But I kind of want to control things, you know? Human insurance. So, what's the pace look like? What are you wanting to do? What is he pushing back against?

What's that? I think he says he's on board. But our biggest expense is eating out. I mean, it's a lot. And so it's like, I'm like, could we not eat out?

You know, yeah, yeah, I am down to bring it down. But like, he is not really, it's not really happening.

I just did our first budget last month.

So we did have expenses. We didn't really exactly hit everything. But he's not unwilling. I just feel like it doesn't participate that much. And you've made a mistake that is unusual for ladies to make.

Usually the man makes the mistake you're making. Because you're you're hard driving. And I love you. I think you're awesome.

“But what you did is you started talking about what?”

We're going to do and what we're going to do this. We're going to do that. What we're going to do instead of why. Yeah. And so I want to sit down tonight and turn off the television.

Put the kids to bed. And let's have a dream date. I have a dream. Why?

I would be because the debt scares me to death.

The idea of having no retirement scares me to death. The idea of having a car payment the rest of my life scares me to death. And I have, I want us to dream about what it would feel like to have no payments. And have a big old stack of money to be able to travel and to be able to do the things that you want to do. Honey, what would you do if we had a big stack of money and him dream with you?

And then we've got a why a reason to not go out to eat. That's true. And it changed. What would it be for you, Jocelyn? What's the reason you want to get out of debt?

I mean, we don't have much, honestly, like, on the scale of things. But I want to be able to save up for a house.

“And right now, I honestly don't know, even if I go back to work.”

Like, I'm a nurse, but right now, I'm at home with our one and a half year old son. Like, I can make a decent amount. But from what I'm understanding with numbers, I'm like, we don't have a down payment. And homes here. You could get a tent for probably more than we could afford.

You know, right. That's what you guys have. Honestly, we've got, oh, my gosh, I just space. I just a personal loan with my parents because they bought my, our truck off of us. We were in over our heads with it.

Like, we go with Warren at what then it was worth. So it's only got 8,700. Okay. And that's it. That's your only debt. Yeah.

Yeah. I just got him to play off the credit card. I was like, please, let's say off the credit card. Okay. Okay.

So that's quite off. How much do you guys make a year? How much does he make? Right now, he's bringing home $7,500 a month. Good.

Okay. It's not bad enough. Okay.

“So I think you just sit down and you say, okay.”

Let's talk about what are what it feels like in the future. To have a stack of money and own our own home. And not own my parents. And not own my parents anymore. Yeah.

We don't know your parents. I don't know anyone anything. And we're stacking money for a down payment on a home. We're building a life for this one and a half year old. It's going to change his whole life.

And I want us to have a home. I want us to be able to do this or that. Well, you know, I mean, could you join me in this dream? And then let us sacrifice to hit the dream. It's so nice.

Yeah. I want to dream in high definition.

Let's start talking about.

I remember we were in a rental house and Rachel was eight. Rachel was seven or eight years old. And we were in a rental house that we because we sold our house to get the rest of our dead after the bankruptcy cleaned up. And my wife hated that rental house. And she said, I, we have to get a house.

I, this is life is too short. And I'm going to pray for a white kitchen and a three car garage for our two cars in our boat. And I'm going to pray that we can do that and in the school system over here where the kids are going to school already. And I'm going to pray for that. And, you know, we were on this little weekend trip.

And I got an email from a real estate friend of mine. And it was in the early days that they actually started putting pictures on the internet of a house. That's how long ago it was. And the dad gum thing had a three car garage in a white kitchen. Because we had dreamed in high definition with great detail.

“And we were both agreed that's what we were pointing at.”

And we pulled the money together to do that. And when we came home from that little weekend trip, we didn't even go home. We drove straight to that house to view it with a real estate agent. And then we went home. And we bought that house, by the way.

It's the house that Rachel grew up in. And so that, that's the kind of stuff. But you're together. Well, it makes it feel real to a detail thing. It's not this vague thing of, I just want to have a power money.

Right. No, that's not good. It's a life. What's the life that you want? What is the money is?

Yes. The money is the tool to create the life that you want. What is that? What does that look like for you? Is it the white kitchen?

Is it that, you know, the certain school district? Whatever it is.

“But I think, and John's law only talks about this too.”

Do you really, as detailed as you can create that, it just makes it tangible. That it's not vague and it's not out of reach. But it's like, no, no, this is the type of house that that realistically, because you guys are being real. You weren't like, we need a four million dollar house. We know the money for.

Yes, that's right. So it's like, it's a realistic in there. But to pin point it and to have those details.

And it's, and I would say, too, just to, I always love a timeline.

Like, map it out. And you guys, like, hey, let's have a gold be out of debt in three months. What do we got to do to make that happen? Okay, from there building up that emergency. Yes.

And you actually start painting it and looking ahead and be like, oh, my gosh, In five years, he's going to be starting kindergarten. We may have another baby. What does life look like in five years? How much money do we think realistically we have saved up a type of house?

Yeah, and I'm going to go to nursing land to hit that next goal. Yeah, totally. Yeah, go back to go back to work for her. I'm going to take ER weekends now to hit the goal of buying a house. Yes, or there was a mom in the lobby earlier.

And she was saying, for 22 years, she stayed home. And that was her number one goal. And because they did the babysept sheet, that was her goal. Yeah, that was the dream. That was the high-definity dream.

That's a good dream. Exactly. Yeah, whatever it looks like. But in two jobs.

“You know, if you're super broke, I remember a dream we had.”

We were super super broke. And we had been so scared for so long. Sharon's dream at one point was, I want to have enough money to go the grocery store and fill up the buggy. And just the buggy. And not Southern Southern.

Southern. They fill up the shopping cost. The shopping cost. The shopping cost. The buggy.

Yeah, and not absolutely the price. I want to fill the whole thing with food and not feel like I broke the family. Yep. That doesn't sound like a big goal, but that's a lot of money. You can mortgage your house for that today, but yeah.

But oh, my gosh. It's more the feeling of freedom. Well, it's a full year. I want to get to this place. I can see it.

Yes. It's very clear. It's not a dollar amount. It's what the dollars do. Hey, guys.

It's Rachel Cruz.

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membership. Go to CHMministries.org/budget and use promo code Ramsey. That's CHMministries.org/budget and promo code Ramsey. (music) Holly is in Austin, Texas.

Hey, Holly, how are you? I'm pretty good, how are you? Better than I deserve, what's up? I'm just wondering how you would approach. How can I better encourage my fiance to try to continue to better

or income without him feeling like I'm telling him he's not making enough money?

Where's this feeling coming from, Holly? Do you feel like he's not making enough money? Oh, he's making plenty of money. So about a year ago, we started getting really serious about paying off our debts, following the baby steps, trying to get set up to where we can start saving to build a house,

right now we're living on his career. You're not married. No, we get married. Our marriage date is exactly a year from now. Well, you don't buy a house or pay off each other's debt until you're married.

Um, our debt's combined right now.

That's done for about a year and a half. That's really done. You're going to have a nightmare on your hands. That's really, no, no, no, no. Please do not do that with somebody you're not married to.

“Yeah, if you want to get married this weekend, you can start acting like you're married,”

but you're not married. This is a disaster. What's the combined debt, Holly? Um, yes, so it was two vehicles and then a credit card and then a car hauling trailer. Okay.

And are these both in both of your names? Yes. Oh, please have a celebration one year from now and get married this weekend. You are so vulnerable that your goose is cooked if something happens here. This is so scary. You have no idea the mess you have potentially made.

This is really, really dangerous for you. How much do you make, Holly? Um, I make about 40,000 a year, 45 and then he makes about, this is all take home. And then he makes about 75,000 dollars a year take home.

“And what is it you want him to do better about when he makes twice for you, Mac?”

Not necessarily doing better. Um, he was told about, I would say, 46 months ago that he is making the best he can make and his shop right now. And, you know, he goes in on the weekends. He works late during the week. And, um, I've kind of tried to encourage him to, you know, possibly seek a different shop or higher position. I was job currently and, um, he feels like I'm not being appreciative.

And I was just wondering how you would go about encouraging. Um, kind of like when is the end of the road of trying to increase your income? Yeah. Um, I'm trying to figure out is he is he enjoying his job? He does the angel and he's a body tech body shop technician. He, um, he does enjoy his job.

He's had a couple of problems just with like co-workers and stuff. Nothing. How long are you guys? Um, he is 25 and I am 22. Um, yeah, I probably honestly, Holly, I would, I would focus in more on not only figuring out what to do with your 40,000 and we start paying off some of these debts and start working your journey separate around because you guys are not married. Um, and it's one thing to tell him, you know, that he, you see potential in him and what he's doing.

Um, but he may be very content with where he is right now and he's not making a bad living, you know? Uh, another role. Yeah. So, um, I'm just curious how those conversations go because he's, he's not feeling appreciated apparently.

Um, as far as that goes.

And then other times he's kind of down in the dumps about it.

I do think that when they told him he was making the most he can in his shop, he was not very happy about it. And um, he really wanted to move and then he kind of changed his mind. Yeah. Well, I don't think there's much that you're going to be able to do.

“I think the only thing you can do as a, hey.”

Beyonce. No, as a Beyonce, you can't do anything. As a wife, the only thing you could do would be to, um, you don't have the leverage from the Beyonce position to lift or to do anything. Um, because you're still in the negotiation phase, believe it or not. So, um, you're, you're barking up their own credit, but once you're a wife, then the thing you could do would just be say, honey, I think.

What I see.

I see that you could run your own business and you'd have to learn some skills that you don't know yet about running a business because being a body shop tech is different than running a body shop.

Different set of skills you have to have to learn in the business parts of it, the marketing and the economy. Sometimes being 25 doing what he's doing and really getting good at it is not a bad thing. It's not bad. Like he's, but if we started planning and said, okay, five years from today, we have a goal of you opening something. Let's start saving towards that and you start reading books about business and learning about business.

I think you could be, I think you could make three times what you're making and own your own shop and have guys like you working for you.

“And I think we can get there and I think you can get there and as your wife, I would love to help you do that.”

I honestly think you're doing it from the wrong position and you're not listening to me, so that's okay. You do what you want to do, but I'm telling you from having sat in this seat for almost 40 years that you guys are, you are playing with fire. And if you don't get burned in this, I'll be shocked. And so please do not buy a house or someone you're not married to. You are doing what we call in legal terms a general partnership. And if he dies and there is no will, you will own the house with his mother.

This is the kind of crap you're playing with that you don't even know about. And you think I'm just being mean and telling you to get married, but you are really walking across the lake of fire and asking to fall in it and get your butt burned. You are playing with about four different things there that are going to take off your head if you guys aren't lucky. You might luck your way through this, but you might not, too. And so please, if you're going to own cars together and buy houses together, get married first and do your celebration of year from now.

But you're not listening. So, you're not going to do it. No, I could tell. That's really. I've been doing this a while.

You never know, you never know, Holly. So, I think you can encourage him from that position to go do something with his life.

But, you know, yeah. I don't know, something wrong in the air, something wrong. No, they're just 22 and 25. No, there's something wrong in the air. No, I think they're young and sorry not that sounds demeaning, Holly, but you're young.

And what she doesn't see either is that, you know, engagement, there's zero legal protection for either of you.

“And he, key or you in four months could be like, I think I'm done.”

You know, and you walk out. And that's it. And then for the rest. And now you want a trailer of those cars. For the next three years, as you were trying to get out of debt and date and all of this, you got the X. And I mean, it's just, it is not worth it.

It's not worth the rest. Keep your money separate. And that's for other people listening, right? I mean, hall it there in it. But like, when you are dating, keep it separate. Do not combine finances. And then once you are even an engagement.

But once you are married, yes, combined. It is so funny to me on the show. I don't know why it is like this. There's so many couples like that that are dating, engaged, and everything's combined. And then we talked to married couples and they were fused to combine.

How is this happening? How is this happening? It's so bad. I know. But yeah, there's just, it's the protection side. There's just not, there's not any.

And oh, and the worst is the co-signing. And then we get the call. And I'm like, I co-sign with my ex-girlfriend. And she's not paying anymore. You know what I mean?

And then I can't find her or the car. I mean, it's just like, they're just, there's so much life that can happen. And when you're not legally married, you get to just walk out, you get to just leave. At least with a divorce, you're having to go through a court system.

Yeah, but there's a lot up in the air, Holly.

So I'd lock it down if I were you. I'm getting married. This weekend. [Music] One of the biggest mistakes home buyers make is talking to a realtor,

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Welcome back to the Ramsey Show and the fair wins credit union studio.

Rachel Cruz, Ramsey personality. My daughter is my coach today. Erin is in Charlotte, North Carolina. Hi, Erin. How are you? Hey, guys. How are you?

better than we deserve. What's up? First of all, I just want to tell you, you've changed our lives. We're in babies up too. And I mean, you guys are married. Everything is just on such a trajectory that I never could have thought that a few years ago, we'd be there. So thank you, too, guys. Thank you. Well done. I'm going to cry. No. So, okay. So, clearly we're in babies up too. We have paid about 76,000 down in the last two years or so. We have about thank you. We have about 33,000 to go. Now our question is, I have a mortgage on the house now. Our plan is, once we get everything paid, we get our emergency fund.

We want to take a couple of you. Our plan is to buy a house, a new house, in a different location. We kind of want to move out in the country a little bit. And our plan is to say, we want to say, take about two or three years, save hopefully up to about 150, 200,000 depending on why it's in situations. But so, to use on the down payment on the house and plus the equity in our house now.

“Yeah. How much equity do you think you'll get out of the house at the time you're married?”

You know, unfortunately, I made a lot of stupid text. And as you would say, we refinance the house waste many times. And the last time right before we started the baby's up. So, unfortunately, the mortgage we have now, it's only a few years old. Oh, it'll be two or three years from now you said, right? Yeah. Yeah, true. So, it's going up in a value and Charlotte North Carolina isn't it? I don't know. I guess we could see what it's going to be like then, but right now we owe two forty three on the house.

And the last time we had it praised about three years ago, it was that about three times. So, oh, there were four hundred the day anyway. Yeah, I was about three years in this crop. But my crush by then. It's going up like two percent and that.

Okay. Yeah. Okay. Well, that's good. So, my question is the money that we're saving in the next few years. Should that go into a high yield savings account? Or should we be playing that money on the principle of our mortgage since we're going to sell anyway and use that on the down payment of the house? I put it on the front of your mortgage. All of it? Yep.

Really? Okay. Above your mortgage, you wouldn't save any cash or like, you know, not for the money. Not for the move. Okay. Okay. Yeah, that's kind of what I was thinking.

“And I know some times I say you should have, you know, a certain amount of cash.”

What you're closing, I mean, you may want to have a little bit for the actual mover and the closing cost for something like that. But you're going to get all the money out of this house when you sell it. It's not like you're giving the money away or spending it. It's going to be there. It's just stored where you can't get to it.

And what's your mortgage entrance rate?

Which is more than your age, than your high yield savings is paying.

True. It's almost like a forced savings account, Aaron. Yeah. Yeah. As you're putting it in, you're like, we'll get it out. Yes, inequity. But it's not sitting there for a beach vacation to grab.

You really, it makes you, it forces you into that goal. And if your plans turn left and you end up staying there and paying off the house, then you didn't lose any ground. True. Yeah. I don't know that that's going to happen.

“I think you're probably will live your dream because you've been executing on the other part of it beautifully.”

So I think you're probably going to play through. So I think two years from now, three years from now, you sell this house. It's going to be 4.5500 somewhere in there. And probably based on the numbers you're giving me anyway. And you will have reduced the principal dramatically during that time.

So you're going to walk out with this big fat check to buy this house in the country with.

That's going to be beautiful.

And you will have been making 4.9 on your money. Not bad, really, for that situation. And you won't accidentally go by a bass boat with it. So not that you would because I don't think you would. But he might.

I don't know. You wouldn't. I can tell. Races in New York City, high race, how are you? Listen to the dream, how are you doing? Better than I deserve, what's up?

So I just graduated from law school this past May and to the bar. And I have some law debt or two loan debt that I need to pay off. And I'm planning on paying it off is fast as possible. Good.

“And I was wondering, would it be worth it to refinance the loans I have to get a better interest rate?”

Or does that even matter since I'm just playing on paying it off as soon as I can? What's the balance? 104. Wendy, thank you. I'll fall fast.

We've got to calculate it out to, I think, two and a half to three years. Okay. And what's your current interest rate? So it's separated in between six loans. The highest rate is just a little of a 9% and 9.2% I believe.

And when I did something through so far today, it said they could give me a rate of just under six percent. If I remember correctly, but I'm not sure you're happy with it. It is not 6% already. Do you not have loans that are below six?

No. None. Okay. No, none of my loans are below, I below it's just seven. I don't trust so far any further than I can throw their stadium.

So I want you to get some other people to look at it. Okay. And so they didn't pay for that stadium by giving you the best deal. So they're stadiums sponsored. So, you know, the student loans are the one area that we would consider refinancing.

You get one shot. These are fairly insured, right? Yeah. You get one shot. So shop around and check on it and try to find a company.

What's the company we used to endorse it's gone? They were a good little company. I can't think of their name off top of my head. But we had one on here for a while that was doing that and they were dependable. But here's the thing.

Let's pretend that you can go from six to nine on the internet. You're thinking of why refie? On your why refie? No, yeah. No, why refie?

I don't do it. That's private. Yeah. Probably not. The question at the day.

Yeah. Thanks. For your private student loans, though, if they're in default, check out why refie. But race that's not your not problem. So, the, if you can move, the entire portfolio is not at nine.

What do you think the aggregate of the portfolio is? The average through the whole thing. Eight. Probably eight or a little under eight. Okay.

Let's call it eight and let's say you could refinance it to six. That saves you two on 100,000 paid off over two years. Means at the end of the first year, you would have paid off 50,000 of it. And so your average balance that you're saving 2% on is 50,000 dollars. And so that is $1,000 you're going to save.

So this whole exercise. Okay.

“And you don't have a one, that if you want to do it, it's okay.”

But you don't have a $1,000 problem. You have a hundred and four thousand dollar problem. Correct. Meaning that if you're paying this off in two years to your point earlier, the way you asked the question was correct race, was it doesn't really even matter because I'm paid it off so fast.

And the answer is it matters about a thousand dollars.

Okay. Assuming you can't beat so fast number and you might not be able to. But if you want to do it, it's okay. You get one shot at it. But the important thing is to find the other 103,000 during the two years by living on nothing,

not going out to heat and starting your law career on beans and rice rice and beans and get this misclined up.

That's 98% of the equation.

[ Music ] Hey guys, Dave Ramsey here. Every 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. Cat is in Des Moines, Iowa, high cat, how are you? How are you doing? Well, how are you guys?

Better than I deserve, what's up?

My husband and I are wondering if we should move forward on an opportunity for financial freedom. Yes. [ Laughter ]

“Of course you should. What kind of a question is that?”

Tell me about it. What's the opportunity? So, my mother-in-law would like to sell us her home and about 10 acres of land for what she has left on her mortgage. She wants to help us. She knows we've been through a lot in the last few years and she is ready to move on from that property. She's hired of maintaining it when she doesn't even live there. How does it take you on a mortgage equal financial freedom?

Well, it would be right. But we would be selling our home in a different area of the state. And if we sold it even for what we paid for it four years ago, which it sounds like we would get more for it after talking to a realtor, we would be able to buy the land and property outright.

Okay. So, you currently have a home that you owe how much on? We owe 177,000. And it's worth what? Well, when we bought it--

“I mean, the realtor told you the other day you think you can sell it for what?”

He said that what we bought it for would be easy, but he's anticipating we'd get a little bit more. He didn't give me an exact number. So, what do you think the number is going to be in real life? When you put it on the market, what's it going to sound like? Probably around 230.

It wouldn't be much more because we did. Okay, 230. And so there's only $50,000. Okay, minus expensive. So, probably going to walk away with $40,000. And her mortgage on this land is only $40,000.

She said $30,000, yeah. Okay. And what's the land and house worth? Probably more than our house is. It looked like-- But she's going to give you $200,000 gift.

Yes, yes. Yeah, it was the huge gift for us. Nice gift. And what does your husband do for a living? He is a machinist.

And will he be moving being a machinist there? Yes, so there are opportunities there, but it is a lower-income area, which is kind of where this is just a cat area. The whole area is lower-income.

I'm sorry, what was your question?

“The whole area that you'd be moving to is lower-income?”

Lower-income then where we're at. Yeah, it's not. There are opportunities, but they're harder to come by. Do you like the house care?

Yeah. Would you guys move there if the opportunity-- if this whole deal was happening, would you guys willingly want to move there just for your own family? Yeah, I would say so.

My husband has been on third shift, sorry,

for a while. And I don't know. It's just been really hard for a family we've been through a lot in the last year.

He had emergency surgery in December of last year.

We had another baby, which is wonderful and amazing.

But I broke my ankle, so he's had to take less pay because his job doesn't pay as an L.A. So he's had to take some on-paid time off because I was recovering from a broken ankle while heavily pregnant. And on top of that, with him being on third shift,

it's been really hard on our family. We have five kids and I hope school. And I've just watched my husband change. It feels like he's barely surviving. Okay, so moving to this land, you go with you.

Or-- You still got five kids and you still have a husband that's a machinist. Great. You're thinking you want to work third shift. Does that kind of destroy all that?

Yes, that's the hope.

“And you have to work third shift in order for you guys to live where you are today.”

He has not been able to get a job with similar pay. That is not third shift. What do you want to do? He brings home 1200 a week when he's not working overtime and he usually works overtime so usually it's about 1600 a week.

He's making about $60,000 a year. Yep. And the place that you're moving. Okay, so here's the problem. I'm a little bit afraid that you think you're going to run away from all of these problems

when most of them are moving with you. You still got a broken ankle or head one. He's still going to be a machinist. He's still going to be a machinist. And now you're going to be in an area that's not as economically viable.

And it might even be harder for him to make this kind of money. So I love the beautiful generosity of your mother-in-law and that's all wonderful. So, I mean, there's other options. Option one, stay where you are, option two, take the deal.

“And the only way you would take the deal is if he first has a job.”

You cannot move over there if he didn't have a job first.

Right, right. So you've got to go find a job and then we can say yes to mother-in-law. That's option two. Option three is she sells the property and gives you the money. And you pay off your house and your husband finds a better job in the area where you are.

Okay. It's the same thing. Yeah, I don't think she wants to do that. Oh, I think there's those. It's the same thing.

She's still gave up the money. Why does she care where the money goes? Is it sent the property sentimental to her? Yeah. Um, her.

So what happens when you want to sell it? You're still-- You don't know. Yeah, I don't do that. Okay.

“If you have to buy a property, if you have to take on a property that you can never sell or never do anything with,”

no thank you, I'll pass. Okay. If she--so only--I mean, I--I think it might be better for your husband to get a better job. That's not, you know, in the area where you currently are and everything's already set up. And just pay off your house with the proceeds of the sale of the farm.

Um, but it sounds like there's all kinds of emotional complications there that are going to be emotionally complicated. So you're jumping from one fire into a frying pan. Because now you've got mother-in-law breathing down your neck about everything you did with the house she gave you. Because it--it comes with strings attached. Yeah.

Ropes attached. Hang men's news attached. Oh, I don't say that. No, I mean, really. It's bad.

You cannot get rid of it. You're stuck in it. And when I gave you that house and now you're stuck in the country and your husband can't find a job. He loses that job where he finds it. Yeah.

You got five kids. You think you got problems now? Uh, might not--that might be a trap. You need to be-- It sounds great.

It sounds great. But if they're--I mean, and honestly, Kat, I would assume you guys are going to be leaving friends. And, you know, possibly a community of people of where you guys are. And it's just a lot to think through. Um, where the--the knee jerk is, oh, wow.

We basically get a--we get a--a house like that's paid off.

But then when you start untangle again. You--you've written this narrative in your mind that it changes your life and it really doesn't. It might change it negatively. Uh, and then somehow that this, you know, no more gauge is going to make everything okay. And make all the things that are causing you to cry, go away.

And all the things that are causing you to cry are going with you. Five kids in a husband that's a machinist. I mean, that-- And he's probably exhausted. I mean, I--I--I can hear you.

Very--very.

Very--you're probably just tired.

All of it.

“So I'm just wondering, is there a career difference, you know, a different decision in that?”

Mm-hmm. And that clears all this versus a house. Mm-hmm. And a house that you cannot sell. With that you can't sell.

Yeah. Yeah. Yeah. So I'm going to approach and say, I think we would love to have the proceeds from it. How about that, mom?

And that's not for you to do. That's for her son to do, by the way. And known as your husband. You do not make that phone call. [music]

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[music] Well, one of our favorite things to do is have a debt free stream on the debt free stage. Here in the lobby of Ramsey Solutions, we do this show if you didn't know on the glass and our lobby from one to four every Monday through Friday. And so folks stop in and have a free home made chocolate chip cookie and some free coffee

and hang out and watch the show happen. And occasionally there's a debt free stream happening as well.

“The only thing that we like more than that is when it's one of our own Ramsey team members”

doing a debt free stream. And in this case, one of the most popular guys in the building. Yeah, look up and look at your Rachel. Rizley, one of my favorites. Rizley, thank you.

Oh, my God. Actually, Matt Rizley, but we call him Rizley. And Matt and Matt and Matt and Matt and Matt. And Matt and Matt and Matt and Matt and Matt. We got like 100 of your team members that are not working and watching you do your

debt free stream. Sorry about that. That's our productivity and the building is gone down. It's gone down caused by you. Well done.

Well done. Hey, congratulations you two. We're very proud of you. Well done. How much debt have you to paid off?

It was 188,000. Oh, my God. How long did this take? Five and a half years. Wow.

We don't ask incomes because all your friends and coworkers are standing around. That would be a little strange and weird. Yeah. So, um, and awkward. So, what kind of debt was the 188?

Well, you're looking at weird people. It was our house. Yeah. Oh. Oh, what's your house worth?

It's about 400,000. Boom. Look at Ridgly. Oh, my God. What could you, man?

So proud of you. How's it feel to have a paid for house? Amazing. True, true freedom. Now, he's the senior director folks of media distribution in the Ramsey network.

And so, a lot of you that see things happen with a show somewhere on the street. Somewhere on the internet, it's all his fault. Yeah. So, he works really, really hard going through every single episode and making sure it's distributed with all nerve probabilities and analytics and everything out there.

And does a great job. And so, a lot of you have found this show because of the work of this man. And so, we really do appreciate him. So, house and everything. You've been here what?

Seven years? Yep. Well, over seven years. Working here. And how long have you been on this journey?

Yeah, this journey started about 15 years ago. To condense that 15-year story into something really quick. I was a baby Christian. I was really skeptical of the whole Christianity thing. And I decided, hey, I've got something important in my life.

Let's see if this prayer thing works. So, I remember praying at the time,

“"Hey, do I go to an in-state school and a crew no debt?”

Or do I go out of state with some friends and a crew debt?" And the next day, I went to a men's event. And Dave, you were on the screen.

Willow Creek basically yelling at me to not go into debt.

Yeah.

And so, it was a double whammy.

You know, I realized prayer works. And also, I became a rabid fan from that day forward. And every week, I'm listening to the show. And then you come to work here. Yeah.

It was a dream come true. Totally get dunked in it. Yeah. Well, and then you got to watch the show every day. You're totally dunked in it.

Yeah. I have to analyze how this segment does. You're gonna be looking at yourself. Hey, how long have you guys been married? Eight years.

Eight years, okay. So, you've been working in Madeleine all this time with this guy who went ramsy crazy. Oh, yes. To the point, he comes to work here. Yes.

“And has he been hard to live with during this time?”

No. Not at all. Not at all. My dad raised me with the money mindset. So, you guys were all on the page.

Okay. Did you guys have consumer debt before this? Or was the whole thing? The whole thing was just the house. Yeah.

Let's just the house. Okay. So, you moved here, took the job, and then later bought a house. Mm-hmm. And then took five and a half years to knock it out.

Yeah. Okay. Why do you go dead? Yeah. Why do you go, man?

I'm gonna be talking about when you're paying off the house.

We always say that's kind of like the intentional step.

You want to enjoy life, and all of it, but the extra goes on the house. And some people go crazier, and they just stay intense. Where were you guys on that scale, would you say? We were on the intense side. We were.

We weren't gazell intense. We went out to eat once a month. Um, but, uh. Want some money? Yeah.

We blurred you. Um, but there was a piece that left us, because this is the only debt that we've ever had. Um, and so we were very intentional together. Uh, we would talk about money every week, almost every day. Hey, what's our goal?

What are we going towards? And we really wanted to pay off this house so that we could live and give, like, no, and else. So you're saying when you bought the house, took on the mortgage, the piece left, then you wanted it back. That's right. Okay.

I'm making sure I understood that. So good. Very cool.

“So what were things that you guys you mentioned, the outtee thing?”

But what, what did, what did you say no to? Uh, honestly, a lot of trips and vacations. Uh, both of our parents are in New Jersey.

Um, so we didn't go home often.

Yeah. Was it worth it? I had to say it so for sure. Yeah. Yeah.

It's not that you're free. How's it feel? It feels amazing. We honestly can drop a hat, go take a trip, and that feels freeing. Yeah.

You can do anything you want to do. Yeah. I pay much. I mean, you do anything you want to do. It's pretty incredible.

So, um, man, talk to the person out there who's thinking about this and they're going, I don't know if it's worth it or not. Is it worth it? It's so worth it. And, um, there's nothing flashy about our story.

Um, there was no big paycheck or payoff. I didn't inherit it anything. And so it was a daily choice to do something hard. Uh, and if you're seeing this or listening to this right now, you have a choice before you to do something hard. And take that next incremental step because it gets easier over time.

And so when we had a tough decision, it was relatively easy because we were just on the same page about everything. Um, and so I just encourage you guys to take the next right step when it comes to your, your money journey. And that snowballs into the rest of your life. Yeah.

“Have you run out the numbers of if you just invested the mortgage payment?”

And where? Where? How many millions that's going to be? Oh, yeah. Yeah.

I'm old school. I have a time value of money calculator on my life. Yeah. Yeah. And oh, HP 12 C or something.

Yeah. Yeah. Okay. Good. I like it.

Very cool. Yeah. So you can run that out. You don't even need the Ramsey calculator on the website. And you can figure out that this is millions and millions and millions of dollars.

Can you tell older you guys? Well, we're 33. Oh, I'm 33. 32. Yeah.

So early 30s paid off house. Yeah. And we had all 400,000 dollar in house. Unbelievable. And we're kind of, I'm a loser.

I had a goal of paying it off at 30. But, you know, I missed that goal. But I don't know. I have a paid for house at 33. I think you're going to be okay.

Yeah. Yeah. The extra restaurants were worth it. That's what I want. That's what I want.

That's what I want. That's what I want. I know. That's it. You guys are impressive.

I'm so proud of y'all. Thank you. Very, very well done. And we certainly love the work that you've been doing here. And the team loves working with you.

It's obvious with their mouth standing out here to cheer you on today. That's very cool. Yeah. So pretty, pretty stinkin' cool. What was the driver?

What was the motivation under this for you, too? Yeah. We have a very clear goal of where we want to be long-term. Early on. It's really fun.

I'm seeing the guy next to me. We wanted to support missionaries long-term. I'm looking up the guy who was in China doing missions work. And he came here to work here.

But when he came over, I said, man, it would be great if we can house missionaries when they're in between things.

Or they're getting ready to go out to missions. Or they're coming back. And so someday we'd love to own a big plot of land and put some houses on it so that we can serve the kingdom that way. Well, you don't be able to. That's no brainer with the math the way it is in your situation. Just a matter of when.

Yes. It's not going to be next week, but you'll be there. You're going to be there before you know it. We'll congratulate you, too. Very well done.

Okay. Now you got no payments in the world.

“What's the first thing you're going to do for you to celebrate?”

Make something big. We're going to get Madeleine a New York car. Yes. Good. Good.

But Madeleine needs a better car. I don't even know what you got. But you need a better car. Yeah. Great.

Good job. Alright, Rizley and Madeleine. No, it's actually Matt Rizley and his wife, Matt. Let's make sure we get that right. 188,000 paid off.

House and everything at 33 years old. Count it down. Let's hear a debt free scream. Three, two, one. We're debt free.

Yeah. Woo hoo hoo. And little Lilliana in there. My gosh. You're so beautiful.

Pressure. [MUSIC] It's been 30 years. I've been talking to folks on the air. And I can tell you that most people are broke.

Not because they don't make enough money, but because they don't have a plan.

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Because when you do that, something changes. You stop guessing. You stop worrying. You stop stressing. Our every dollar budgeting app will show you how to find extra cash, pay off debt,

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It's time to take control of your money. It's time to start your every dollar budget for free today. Go download it in the App Store or Google Play. [MUSIC] Our scripture today is Luke 637.

Do not judge and you will not be judged. Do not condemn and you will not be condemned. Forgive and you will be forgiven. Robert Lewis, Stevenson said, don't judge each day by the harvest you reap, but by the seeds you plant.

If you're buying and selling a home, it's super expensive. And you want to make sure you do it right.

And if you make a mistake, it's always with too many zeros.

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The show notes for YouTube and podcast. Marshall's in Baltimore. Hey, Marshall, how are you? Don't know what they have like yourself. Better than I deserve.

What's up? So I've got a quick question. I got to give you a little bit of background. I'm 29. I'm married.

I'm living in a apartment. My wife is out of the job right now.

And basically, to my question,

should I liquidate my brokerage account to pay off my truck? What do you make? I make 71 a year. What did your wife make when she was working? She was at 75,000 here.

Are you able to live on yours? We're doing all right. Will she get a job? Will she go back to work? Do you think soon?

We've been looking. There's a potential opportunity. But we haven't heard too much more about it. Okay. How much you owe on the truck?

I owe just about 26,000. How much is in the brokerage? 28,000. Okay. If you guys are not in the middle of an emergency.

And it sounds like it's kind of medium. I would write a check today and pay off the truck.

And that's basically what you've done.

The downward account. You may want to wait two weeks and get her a job. And that would make it much more comfortable to do that. But it sounds like you guys are going to make it okay until she gets a job.

“So it's not like you're going to need this money, right?”

Right. How much is her car worth? Oh, it's a 2009 Nissan, so maybe 500 or for lucky. Okay. Okay.

I'll just see on. How long have you been married? It'll be a year, knocked over. You should get her your car. Yeah.

There's a margin on it.

I'd have to give you the app to give you the unfair information that it's federal law.

Life gets the good car. Okay. So yeah, but yeah, we're going to have to move her up and car quickly as soon as you guys. That's your only debt, right? That is the only debt.

Yeah. I want to move her up and car with cash after she gets lands a new job because save up some money. And let's get the emergency fund of three to six months expensive. Do you have other savings?

“I have a roll fire ray and the 401k and then a little bit of cash.”

I see you at the count. How much cash in your savings account? Four grand. Okay. All right.

That's a good little buffer too. Yeah. So you'll have six grand that you could get to if you needed it after you pay off this truck. Yeah. Pay off the truck though, too, into the savings.

And we're building an emergency fund of three to six months of expenses. As soon as she lands a job, let's save quickly and move her up and car. So that way you get to keep your truck and don't have to give it to her. But I want her to land a position pretty quick. To bounce back emotionally from a job loss because she's got this huge potential.

I mean, yours household income doubles when she lands that back. And so I don't want to, I don't want to jump into something bad. And I don't want to take something for less. So let's continue to work the network and find that next position as soon as possible. But soon as you're comfortable with it, I would pay that off.

“And if you're comfortable today, living on your income, then I'd pay it off today.”

For sure. Stephen is insane. Lewis, how's Stephen? How are you? You're better than I deserve.

I appreciate it. How are you? Better than I deserve. What's up? Um, so I've been listening to you guys for a few months now.

And I really appreciate all of the really practical, emotional, and real clarity that you have with all of your decision making processes. So I was curious about a car. That is a lot of people on here are curious about. Um, my wife and I kind of live in two very unique, fine, natural realities. Um, I am a trust fund kid.

But I have not used it really apart from education. Um, so a little bit about my wife and I combined income is probably about $75,000 a year. And we just had a new little kid. He is doing great now. But at about two weeks of life, Steve had to have a pretty major heart surgery.

And something, and yeah, no, I appreciate that. I'm not going to be a good one. I'm going to be a good one. I'm going to be a good one. I'm going to be a good one.

I'm going to be a good one. I'm going to be a good one. I'm going to be a good one. I'm going to be a good one. I'm going to be a good one.

I'm going to be a good one. I'm going to be a good one. I would personally be very pro into upgrading her into a newer car. Um, something that is either pre-owned is just certainly newer. Certainly has like the newest safety stuff, all of that sort of good stuff.

Just to make sure that her and the kids are about taking care of. Okay. What does you make? So I make $72,000 a year. What you said that was the household income?

Yeah, yeah. So my wife used to work. We moved very a couple of years ago. Okay. And when we moved, she left her financial job.

Where she was making probably close to a quarter of a million dollars.

Oh, wow. Yeah. Yeah. So we were doing well. We saved up a lot of money then.

Um, a lot of it is still primarily in like retirement funds. So we've heavily funded, uh, welfare and uh, for one case. But you have no cash just on the side. No, no, no.

One of the military blocks for luckily. We are debt free from all that when my grandpa who was. So how much is in the truck?

Uh, so in my truck, it's about 2.8 million.

And what is your draw on that? Um, I don't touch it. I've never touched it. Um, but you have access to it. Um, if I were to ask my parents to get me access to it.

So your parents will trust you and it's at their discretion. Correct. Yeah, correct. And your how old? Um, young 30s.

“And you're thinking about buying a car that's how much?”

Um, probably.

Um, no, if we were to get a new car, probably know more than like the gear 60,000.

Okay. Uh, we tell folks not to buy a car that is more. I don't have vehicles that total add up to more than half their annual income. So no, I would not do that. Okay.

Oh, I get you. I do have a, I'm sorry. Wait, wait, wait.

We tell people not to buy new cars unless they have a net worth of over million dollars.

And I guess you do because I guess your net worth is 2.8 million. Okay. And so pay cash for it. Um, I. Is your fear like lifestyle creep that you're going to start tapping into this and spend the day?

Is that. Yeah. Okay, that's your, that's your hesitation, Steven, too. Are you scared to touch it? Are you just like, oh, my gosh, this is so much.

She's driving a $3,000 car. Why don't we go halfway and buy a $30,000 use car? No, so that's that's one of the other options and considerations.

“Yeah, I think I think that's what I would do.”

And I would do that more as an exercise in restraint than I would as an actual mathematical guideline. Because you've been really restrained about dipping into the. You mean you're showing good discipline in that? Yeah. And um, so you're not trust, right?

Trust fun kid in the sense of like stereotype. I don't think you're going to destroy anything. If you're about to 60, but I just like the restraint of. I'm going to buy used and half my annual income. And I'm going to stay with that and still enough to figure this.

I'm not being emotional about the kid. That puts the sour, the Ramsay show in the books. We'll be back with you before you know it.

“And the meantime remember, there's ultimately only one way to financial piece.”

And that's to walk daily with the Prince of Peace. Christ Jesus.