Transcript of It’s Time To Stop Surviving And Start Winning With Money

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Start budgeting for free today. Normal is broke and common sense is weird. So we're here to help you transform your life. From the Ramsey Network and the Fairwinds Credit Union Studio, this is the Ramsey Show. I'm Ramsey personality, George Campbell, joined by Jade Warshaw. We're here to take your call, 888-825-5225. Joy kicks us off in Nashville, right down the road. What's going on, Joy?

Hi. Yes, I'm out here in Nashville. My name is Joy, and I'm going through a complete reset In my early 30s, I have three children, and I'm trying to figure out how to restart financially after having owned a multimillion dollar company and going through a divorce. I think that that's the hardest thing that I'm working through right now.

Wow. Yeah, that's enough hard things. I think we're good on that. So where does this stand? Is the divorce finalized?

No, it started back in June. I had to leave because abuse and control. So I left for a week and it started to snowball worse. And this is a company that we built together. And then he just started taking over everything and then started saying that I embezzled from him and that's why he has to do it.

So are there lawyers involved now? What's going on?

There are lawyers involved. He has two, and I I have one. We don't even hit mediation until February. Right now, I just got assigned very, very little pay from him until we can... Everything can go out. But like I said, I went from a lot of money down to just nothing. I've had to rebuild my own. I don't even have anything. I had to just work my way into what I have. And I recently just got my first rental. I've always bought homes. So it's just like I'm in the middle of a serious, wow, what do I do? But I'm trying my best because I also homeschool my children.

So the court didn't issue you to have nothing. Has he just essentially locked you out of all of the money? Is that what's taking place? Correct. That's correct. Okay.

And the attorneys have done nothing to reverse any of this?

We haven't gotten a mediation And we have 59 counts of contemptive court on his side. But it's just been a slow process because the goal is really custody with the children at this point. Right now I'm primary, and he gets a couple of days a week. But I think right now I'm being awarded $2,500 a month for just custody issues until we can even figure that out, which is very little to live on.

Sure. What were you used to living on?

$20,000.

A month. Okay. Yes, ma'am. Okay.

And you're still both a part of this company that's still running?

My name is 50 % on it. It's an LLC. It's a manufacturing company. Okay. Yes, that's correct. I'm not working it now. I got locked out. I can't even get on unemployment because he won't get me an unemployment letter.

What do you mean you got locked out?

I don't understand how that's possible, but he is claiming that I embezzled and he is able to take control of the company because I left the home because of the alleged abuse. I took off for a week, and it just, like I said, it's no longer possible.

So no more direct deposit, paychecks, nothing?

Correct, nothing. He started taking it into his account.

Who was saying that, though? Is it just him or are your lawyers agreeing? Who is Who is corroborating this? Is this just his story and he's doing it and you're not allowed in? Or are your lawyer saying, Yes. Correct. This is his story. Okay, so can you go to your lawyer and say, Hey, I'm 50% of this company. I am being locked out? What happens when you do that?

We have the paperwork. We've tried to show it in court, but court keeps saying, We're going to try this in the divorce hearing. We're going to try this in the divorce hearing.

Okay, when is the divorce hearing?

We don't even have one set because of mediation. They want us to get to mediation first.

Which is February? Correct. How are you supposed to float yourself if he's locked you out of your own paycheck and is giving you two grand a month?

I am an entrepreneur by heart, so I started doing piano lessons, doing baked goods.

That's great. Everything is in there. Our point is, that's good that you're doing that, but I want you to push on this really hard because February is a long way from now, and like you said, that's not even the hearing. That's just for mediation to begin, right?

Yeah, your attorney sucks if this is the status quo.

You need somebody else.

I don't know what to say about any of that. I've really been pushing for this, but they keep saying my priority, obviously, is to have the kids.

It is, but it shouldn't be at the... You haven't done anything wrong. No. So it shouldn't be at the detriment of you not earning your income. I mean, obviously, if you're not working anymore, you're no longer earning an income. But figuring out how that works with you being part owner of the company is the part that... Because why can't you lock him out is all I'm saying. If you're 50/50, you have just as much power as he has. So why is he holding? Do you not have keys to the company? I just am trying to understand- Yeah, I understand. How that balance of power happened.

So on paper, I'm 50 % legal owner of it. But you have to go through a court process. Like, anybody can accuse you of anything. Sure. So he was able to lock me out of the building, took all the money out of the account, and he was just able to just block me from any system that I ever created. We get to court. The court says, Well, we can try this in divorce.

Our focus is on the children.

There's really nothing that we can do until you all get to divorce court. And we've gone to the judge multiple times on this, and the judge is saying the exact same thing. You're just going to have to pay her this in the meantime. And I wish I could understand that more, but that's what I keep getting told.

Understood. Okay, so how can we help you today?

Well, I guess my question is, I'm going to have to try to find a path of not being able to work with him. That's just not possible at this moment. And in the future, it's not going to be possible. I don't know how to move forward because I don't even know if I ask for a portion of the company monthly. I know he's not going to be able to pay for it, pay me outright for the 50 %.

Yeah, it'll likely be some structured payout over time. You get profits of the company until you're paid up to 50 % of the value that you guys all decide on with the lawyers and whoever else is involved. It's in the meantime. But for now, we just need a plan to survive right now. So you are in a rental, you have the kids a majority of the time, and you have $2,500 coming in from him plus whatever you can make on the side?

Yes. So it ends up being right around 5,000, which I've been able to do. But still, I'm just struggling. I'm struggling with that.

You have your own bank accounts now? You've separated from him completely on that side?

I've had to do all complete separation. He's not even allowed to contact me.

And how much are you paying for the rental out of the 5,000?

1750, which is really high for me.

And then when you do your budget, is there any margin whatsoever? No. There's no margin. Do you have any debt that you're on the hook for that you feel like, Hey, this is what's eating my lunch right now? Or is it simply the fact that I'm on a shoestring budget and this just really sucks right now? What's the thing that's eating your lunch right now?

I have no debt outside of the business. The court has told him he has to cover everything. But between the mortgage homeschooling my children... My Tahoe is a 21 Tahoe. It's paid for. But I'm driving 30 minutes, four times a week to meet up with him back and forth. That gas is so expensive.

Can you sell the house that you're not living in?

That's the problem. He has the house, too. I left. That's the problem with divorce.

But is your name It is. Okay. So you're going to have to force the sale of the house as part of this divorce. And that's, again, something for your attorney to fight for.

Yes. And the judge has told him he needs to do it. Well, he is delaying the process, and they can delay the process in a $2 million house. Sure. And I'm not even going to be able to look at that until probably year down the road that it will sell.

Right. That's going to be a ways down the line. I'm not convinced that your lawyer is great. I feel like you're at the disadvantage when shouldn't be. This is the guy that was abusive, and this is the guy that you had to flee from. So find you an attorney that understands that you're the one with the upper hand, not him. And that's the best advice I can give you. Luckily, nothing's on fire financially. You're just going to have to keep going until the divorce proceedings.

Cover your four walls. And if you can't pay the mortgage on the house he's living in, tough cookies.

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John is with us up next in Bowling Green. What's going on, John? Hey, guys. How are you? Great. How can we help today?

Okay, so we've been in the baby steps for two years. We started out with $268,000 in debt after that V-R-V we bought several years ago before we started listening to you all. We've been trying to sell it, but over the last three years, I've had nine surgeries and been pretty sick. Wow. This morning, my neighbor passed away. I finally got a clean bill of health. I'm just leaving the doctor. And my wife and I want to travel a little bit. So my question is, is it okay to be the slowest or the next to the slowest gazelle for the next two years while we finish that paying off so we can travel and enjoy life Last three years has been tough.

Yeah, you've been through it, man. Hey, can you speak directly on your phone? We're having a hard time hearing you.

Oh, I'm sorry. Is that better?

Not much, but we'll try our best. Okay, so you've had a lot of life happen. Nine surgeries, three years, big pilot debt, where does the debt stand today? What's the total balance of the consumer debt?

The total balance of the consumer debt is $218,460.

Okay, so you knocked out 50K in two years. Is that right?

A little over 50K, yeah.

Okay, so based on that math, you said there's two years to go. How is the math tracking on that? Or three years to go?

Well, I'm just going by what's on my every dollar app. Now, all of the debt will be three years, but we're hoping that half of the debt right now is the RV, and we're hoping to sell that.

That's based on selling the RV? Yes. Okay, that makes more sense.

It got two years to sell the RV.

And why isn't it selling? Just people aren't in the market for a used RV at that price?

Yeah, it's a middle of the market diesel pusher. It's not high and it's not low-end.

What's it? What do you have it listed for?

Well, they have it listed for $125,000, and it puts private sale at 160. So that's what we owe on, is 120. So we're trying to just get out from under it.

And it's been on the market for a year?

How long? Yeah.

Something's wrong. A year.

Is this like a consignment or someone else is selling it for you, or are you just doing this on your own?

No, we're doing it on our own through online ads, and it's been the RV trader, and all that stuff.

Man. So if you do that, that'll clear No, half your debt is what you're saying.

Yeah, that'll clear 120,000 of that debt.

That makes more sense. Easy. Okay, so you're wanting to know if you could slow down and travel and enjoy life a bit more. And it's because of the health scares, the neighbor passes away, and you're in this like, Yolo, life is short. Is this worth it for three years? Knowing we don't know how much time we have left on this Earth.

Right.

How old are you and your wife?

I'm 62. My wife is 61.

Okay. And how's your wife's health?

She's great health.

I hear what you're saying. I understand the logic of what you're wanting to do. I'm just worried that you're going to continue to kick this can down the road and possibly add more debt to it. It's very hard to start the lifestyle you're wanting to start and then stop it suddenly to clean up this mess. You're wanting to travel the world, have a great time, have that peaceful, easy feeling. But that's going to be tough to do with this debt laying around. I'd rather you take some time and really pay this off so that when you do go travel, you really are enjoying it. There's not this monster in the closet waiting for you when you get home. You said yourself, you have a clean bill of health. I'd really be challenging the fears that are in your mind about what could happen in the future instead of assuming, I'm going to get sick again or something else bad is going to happen or da, da, da, da, da Clean up.

And now you're realizing, Oh, man, I do need to clean this up. So I would take that hint and not spend another day like this. I would go headstrong into it. Okay.

At the end of the day- We don't want to travel the world. We just want to go for two or three day overnights and take our RV.

What's that going to cost?

What's it going to cost? It's about $200 a weekend.

Oh, I mean, it's not a lot of money, truly.

I mean, that's like fun money for a lot of people. So if you wanted to take a $200 weekend trip, that's fine. But I think the idea of, well, we'll do it another weekend, another weekend, and we'll get a little lack of days to go over here. I think it's just a slippery slope. It's hard to be really intense while knowing that's also happening on the side. There's just a level of scorched earth come hell or high water, we're getting out of this debt. And in your 60s, to still be carrying this debt your whole adult life, that's what worries me. Because truthfully, there's more of a chance that something could happen to you, and now your wife is left carrying this pile of debt to deal with while grieving your loss. We also have to think about reality on top of the, Well, we don't know how much time we have, so let's just live and do the baby steps at our leisure.

I like the idea of you doing something to celebrate your clean bill of health. I think that that's great. I'm not mad at that. If you're like, Listen, I've been in and out of the hospital. It's finally over. My wife and I were taking a trip to celebrate. I have no problem with that. As a form of a lifestyle in doing that at the detriment of not paying off your debt. I would not do that as a lifestyle, if that makes sense.

And think about it, 200 bucks is not going to delay your debt-free journey a whole lot. No, it's not. But 200 bucks, every month or more. Now we're talking about a serious delay. I would have you crunch the numbers. And here's what I do, John, to make myself justify things like this. I'm going to go, Okay, where can I find $200 that I haven't found yet? I'm willing to work extra or do a side hustle to come up with that 200 that wasn't going to come from our debt payoff journey. That is a way I would couch it to make sure that this doesn't delay the journey as well.

Okay. Yeah. We don't want to take away any money that we're using to pay the debt. That snowball. We want to find it someplace else. So I hear what you're saying.

And then hopefully we can get this RV listed. I might look into some other options, like consignment or something, to have someone else list it professionally and handle it and handle the test drives and the paperwork. Even if it costs you a little bit, you might be able to get more for it doing it that way. And they might get professional photos instead of taking an iPhone picture and listing it on Facebook. I think there might be other avenues to get this thing sold. So best of luck to you. Ethan's up next in Nashville. What's going on, Ethan? Get right to the question. We're up against the clock.

Hey, how are you doing? Great. Good. So I am 25. I live in Nashville here, yes. And I am just so thrilled to announce that I have completed Baby Step 3. Good.

Way to go.

A big milestone for me. I've never been super great with money, but I like following this system. So I'm to the point now where four, five, and six are my next approach. And if I look at five and six, saving for kids' college, paying off the mortgage early, I feel like these don't directly apply to me because I'm younger and I'm less established. I don't have it. I'm not married, I don't have any kids. I've never bought a house before. So I'm curious, what can I do with my money outside of those things? What are the next steps for me in particular? Obviously, investing some is going to be good.

Yeah, but you need to hit that 15 %. So for you, Baby Step 4 still applies. Obviously, if you have four, five, and six to do, you do them simultaneously. But for you, that's not the case. You'll just do Baby Step 4. You'll invest 15 %. And to good growth stock mutual funds. You can either do that through a job. If your job has maybe a Roth 401k, if not, you could invest it into a Roth IRA and do that every single year. Then if you have money left, yeah, add it to your budget. Some of it might be fund money, some of it might be additional savings because one day you are going to want to buy a house, Ethan. When that day comes, saving up a down payment, 20% if you can get it, whatever is going to keep that home less than 25% of your take home pay.

That's going to be six figures in the Nashville area. Exactly. You got plenty of work to do just in baby steps, what we call 3B, saving the down payment, and four investing. So yeah, I love that.

It's a blessing to have that time.

15 %, and then stack the rest in a high-yield savings account for that house in the next few years if you can make it happen. And then, like Jade said, enjoy some of it, too, man. You're young.

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Hi, guys. Thanks for taking my call.

Sure. Speak directly into your phone. Can you hear me? Yes, that's better.

Okay. So my husband and I bought a house earlier this year. We actually moved in a week after having our first baby. For religious and social reasons, we wanted to be in a specific city, but because it was really expensive, we bought in the outskirts of the city. It wasn't the most place, no location, but we said, for 7-10 years, we'll live here, we'll build equity, we'll save more money, and then we'll go elsewhere. About two months after we moved into the house, we found out that the church across the street, the pastor has actually been trying to open a homeless shelter in the plot of land that the church owns next to the church. There were government officials that were trying to fight it and explain to the pastor that as a residential area, there's a lot of families, a lot of children, and he expressed that he was still going out with it and that this was an interest of his.

Right now, the project is still in his audit. Still having a hard time hearing you, Rebecca.

Can you hear me now?

It's coming in now. Let's try again. Mm-hmm.

Okay. What about now? Can you hear me?

Yeah, that's better. That's better.

Oh, okay. Did I start from the beginning?

No. No, we got you.

Oh, okay.

Now it's currently under in audit. We're in this situation where we don't know what to do. Because we thought we were going to be in this house for 70, 10 years, we put about $40,000 of work into it. When we found out about all of this, we did a little bit of research and we actually put the house on the market, but we had to include that $40,000 of work because we didn't want to lose money on the house. There were no hits on it because we knew that it was overpriced, given the fact that we put money into it. So now we're in the situation where if we sell the house, we really wouldn't be able to afford anything else because everything else is double the price of what we bought. But are we supposed to sell to get out now before the house potentially depreciates if there is a shelter across the street? We wouldn't really want to raise our family right across from there. Do we sell it even at a loss to prevent further loss, or are we supposed to stick it out and see what happens?

When When will whatever city ordinance or whatever is going through, when will you know if this can happen or it's not going to happen? What's the timeline there?

Nobody has been given us a straight answer. We've been having a lot of back and forth. Some people say, Oh, the audit could take a year. Some people say it could take six months. We're in this limbo. We don't really know. No one's really giving us an answer.

I mean, part of me, it's one of those things. It could go either way. I don't think that you're going to be able to get the $40,000 back. I think if you guys choose to move, especially sooner than later, I think that's going to be a pill that you're probably going to have to swallow. I hate that for you because $40,000 is a lot of money. But I do sympathize with you because I am thinking about that. If that happens, do a little due diligence and find out what the timeline could look like, because obviously people have to okay this. And then it's like, what must be true from then on? I would go over to the church, and I would just level with whoever is- I did. And I'd say, Hey- I went to the pastor. Yeah, but in a non-combative way, just say, Hey, we're trying to work with what might happen here. Once this gets approved, how long until people will start coming here, and how long until your doors are going to open? We're just trying to do some family planning here. And do they tell you anything?

So, yeah. So I just said, and they said that I spoke to the pastor directly, and he told me that it will take about 2-3 years for them to build the facility, and then he expect the people to come right in after. The issue is that once we start building and people know about it, then nobody's going to wind up buying the house anyways. I see, I see.

What have your neighbors been saying about this? Is there a community effort?

Right. People are calling the government officials, but as I said, it seems like there were some under-the-table situations going on. Nobody really knows exactly, but people are just saying, We can't really afford to go anywhere else, so we have to wait and see. But I kept calling my husband, If we take the wait and see approach, then we're going to be the people that are stuck not having a place to go? What are we supposed to do?

Listen, there's a couple of ways you can go here. You could, yeah, tomorrow put the house up for $40,000 less and high-tail it out of there, or you could say, I really care about this neighborhood. I really care about what's going on here. I'm going to pull my neighbors together. We're all going to go down to the church together and say, We love what you're trying to do. We just wish you could do it not here. Start opening up the lines of conversation. Has anybody tried that? Talking to these people?

Yeah, that's been tried. Community liaisons have tried. The pastor is very insistent on the fact that he owns this plot of land, and he wants this to go there. If he has whatever deal he has, then this is his plan. I guess, I don't know. We're still lost here.

Well, there's no crystal ball to say, Hey, if this thing is well run, the home prices may rebound. We just don't know. I don't think we can say across the board, If there's a homeless shelter in any residential area, the market tanks there forever. I want you to get some facts around this. I would have real estate agent actually pull comps in areas where there's a homeless shelter near residential homes, and then track it to see what happened with the home prices there. Did they stabilize? Did they rebound? Depending on the shelter in the area. That'll actually help you get some facts, because right now, it's just all emotion and rage. I think that'll help just go, Okay, there's not a worst-case scenario. The market's going to continue to increase. If we stick around for five years, we'll probably get our $40,000 back and be able to sell for what we paid for it or a little more. Versus, no matter what, if we stay, it's going to be terrible.

Okay. And if we decide to go, how much of a mistake is it to go back to renting?

I don't think it's a mistake.

I think that- We'll call that a stupid tax that was out of your control We had to pay. It costs us, because you're going to pay realtor fees on the back end of this in closing costs just to get out of this. It's going to be a lot. On top of the lost, missed ROI of this, all the renovation. So, yeah, it might cost you guys a pretty penny and might slow down your next home buying purchase. But if it's going to cause you to lose your peace for the next 40 years, then I don't think it's worth it. I think you should get out now.

And even though we want to be able to necessarily save as fast as the houses would appreciate in this specific community.

I think that's what you guys have to decide. I mean, there's not a right or wrong answer here. The answer is, what is it? Because you called in and said, I don't want to live across from a homeless shelter. So if you don't, then you need to decide, Okay, what are we willing to risk on the timeline here? Do we want to hold on to this a little bit longer, say another year? Do we think that's too risky? Is the word starting to get out on the street that this is happening and we're getting... You're going to have a better understanding of what's taking place in your community than George and I are. But just understand there's not a wrong or right answer here. You get to decide where you're going to live, and you get to decide how big of a problem this is going to be for you. I'm just sitting here thinking about it, and I'm like, Is there any that this could be a really nice facility and all the things that you're concerned about really be contained? I'm having a hard time seeing how that could be contained.

That's where the research is going to help you. There's lots of homeless shelters in Boston. That's where I'm from. I would go, What is the real estate market like around those shelters? Now we can see, okay, it stabilizes. Yeah, it goes down for a little bit. Nobody loves it during construction. But then once things are up and running, and if it's run smoothly, things bounce back. That would give me some peace to go, all right, We're going to stick around for five years and see how this shakes out.

Then what about the safety piece of just not wanting to live there? I guess that's our own view.

That's my point. You're exactly saying my point, Rebecca, is if that's messing with your piece and you're saying, I don't want to live here, you can move and just understand that you're going to take a financial hit. And to your point, it could take you longer to buy again. That is going to set your timeline back. It's not saying that you're making a bad choice or a dumb choice or anything like that. It's just, I am making a calculated It's a choice, and I understand that when I do this, this is the hit that I'm going to take financially. This is the hit to my timeline it's going to take. It sucked that this happened, but here we are dealing with it.

Right.

What would you guys do if you were in my shoes? I think I'd move. Really? I'm not saying I'd move today, but I'd be watching, and if I see that this is seeming like it's going to happen, I'd probably try to get out of there. That's just me. If you were able to get out- I have two young kids.

No matter what, whoever is going to move there is probably going to find out this project is going to be happening in the foreseeable future. So they either go, Yon, okay, we'll deal with that. Not a big deal, or they get spooked by it. So someone's going to want to buy a house in the Boston area regardless of what it's near. That's just how it is in a very populated Metro like Boston. Can you tell us what area this is?

I don't want to get too specific. You said it's pretty far out, though.

Like, is it in city limits?

Yeah. Okay. Yeah. I mean, if you're right across the street, if it's the next house over, or is it around the block. All that matters. If it was right across from my front door, I'd probably be out of there.

If I'm on the front porch staring at it, that's different. So again, I would do all the research before making any decision if I was in your shoes, and then I would have a conversation with my wife. We would be aligned, and then we would do it regardless of the financial implications. We'd go, All right, this is what it's costing us to make this move. That's a tough battle.

Sorry that happened. That's a tough battle.

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Welcome to the Hey, guys. Thanks for having me.

Absolutely. What's your question?

Hey, my question. I'm just getting started with baby step number two. So looking forward to all the pain and stuff that Dave talks about.

I guess my question is around staying motivated as you're going through this baby step, especially with my situation.

Just there's external circumstances and stuff like that that are pretty demotivating.

What?

My wife had intrusive brain surgery back in the end of 2021 that left her disabled.

I'm sorry.

It took away all of our hopes and dreams of our future life together and stuff like that. So it's like part of us is wondering why even go through the baby steps and stuff if there's nothing to live for at the other end.

Oh, my gosh. I'm sorry. That is very tough. So let me ask... Let me just reverse the question back to you. Why are you doing this? Why is this How is that important to you?

I have been a person that's always been on top of my payments. And just because of the depression, shame, whatever you want to call it, over the past couple of years, we accrued the 45 grand of debt I'm on a debt now, and the past two months now, I haven't been able to pay my cards, and it's embarrassing, and I just don't want to deal with that anymore. So I got the second job, and it's starting this week, and we're just going to grind through it.

Nice. What's your household income?

So my day job, I make 59 a year with a 10 % bonus at the end of the year. And then I picked up a restaurant gig in the evenings, and from talking with my different training people, they make 150 a night on weeknights, and then right around 250 to 300 on the weekends. So I'm probably, if I can pick enough shifts, I'm low estimate of 1,500 a month for the next couple while it's restaurant season here in Arizona.

No question, your picture of life has changed, and you're probably still struggling to see what that's going to be and what that looks like. I'm not mad at you finding something to focus on, especially something productive, like paying off $45,000 of debt. I can only speak for me, George, but sometimes having something like that to focus on when everything feels out of control, this is one thing that you can control. Sometimes that's just what you need to power through a season like this. On the other side of it, there'll be some peace because this debt will be gone, and it clears the deck for you to say, Okay, what is our life going to look like now? What does it mean for me working? What does it mean for her care? All of these different things. I think this is worthwhile for you to do for the same reasons that other people do it, right? There's still going to be peace on the other side financially for you. Now, as far as the motivation, are you concerned that the working the extra hours the restaurant is what's going to wear you down? Is that what you're talking about?

Yeah, the exhaustion from that, and then also just the extra time away from my wife because she's home alone.

Yeah. And I mean, you're going to have to balance that because there are some extreme circumstances here for you that you're going to have to say, I might have to pull back in certain seasons. I think that you can navigate that and judge that for yourself. What's the timeline? When you put these numbers into every dollar, what is it telling you? How long is it going to take with this money?

About 20 months.

Okay, 20 months. I have found, as a person who walked a debt payoff journey of seven and a half years, I found that there's moments where you're pressing on the gas, pedal to the metal, and then a life moment happens and it causes you to take your foot off ever so slightly. Then you recalibrate and then you pedal to the metal again. That's a lot of times what it looks like. That's just the reality of it's not to say that you've done anything wrong. I'm sure that that'll pop up in your circumstance, too. Start out with the intent of, I'm gazelle intense, come hell or high water. Then if something happens with your wife or something happens when you need to pull back, that's okay. Then you hit it again strong as soon as you can.

Awesome. Yeah, that's great. What were some of your dreams and goals that are now off the table that have left you guys feeling just cynical toward the future?

Children, just a normal life. We were both artists pursuing our different stuff out in LA for a Then we had to move back to be near family for help. She was a very, very gifted musician, and now she can't play or sing at all much. It's just hard to see and hard to not be able to do the things you love. Yeah.

Man, that's so tough. Are you guys still wanting to become parents in the future through other means?

Possibly, but with just neurological fatigue that she experiences on a day-to-day basis, I'd have to make enough money to either work from home and be there to help out or hire a stay-at-home nurse or something, nanny.

How fresh is this?

The surgery was about four years ago, end of 2021. Okay. And like I said, we've just been going through a lot of depression and just grieving the loss of our life, if you will. Absolutely. And we've been doing therapy and that type of stuff and trying to get through it. But I think it's fresh right now because her mom just got into... Her mom just had brainstem surgery for the same disease. She's in ICU right now, so it's just why it's fresh.

I'm so sorry.

Was this a Chiari malformation or something like that?

Yeah, CCM, cavernoma, a lesion.

I'm so sorry, man. Well, you're taking the right steps. I'm proud of you. It's hard to just to wake up and go to work and face the day. I want to just to wake up and go to work and face the day. Yeah. John Deloney's book Building a Non-Anxious Life. It's got six daily choices, and one of them is choose reality. You guys have grieved what was, and now it's like this is the reality of what is. It'll also help you start to dream and create a new picture that you both are aligned on. But I'm with you in the fact that it's hard, and I'm also with... I'm against you in the fact that I think this gives you a much deeper why of why to do the baby steps. You have more reason than almost anyone to do it because you can create financial peace in your home to where you have flexibility to be there for your wife instead of be stressed out about the debt, working 90 hours a week, forever. I'd rather you suffer for 20 months in sacrifice than 20 years of just mediocrity, carrying this debt, carrying the shame.

There's still a lot of life to be had, even if it's not the picture that you guys had. I want to encourage you with that and get you a copy of that book. But man, it's not easy. There's no sugarcoat in this. Working those nights, knowing your wife is at home, it's going to be a grind. But you can do anything for 20 months. You guys have already been through the hardest of Yeah, that's awesome.

Thank you guys for that. It's a great new perspective. A great way to look at it.

Yeah. Thanks for the call, Henry. Appreciate you. Hang on the line. We'll get you a copy of John's book. All right, man. I just got to take a moment to breathe after that one, Jade.

Yeah, that's tough. I mean, your life can change in the twinkling of an eye, just in a split second, man.

It's tough. It's one of those reasons. People who don't follow the baby steps because they feel like life is going well, they're not at a rock bottom where they're like, I need to clean a mess up. Yeah. You can't show them that. You can't show them the future where life's going to happen to you. So would you want to have financial peace in the midst of that or have financial chaos all while trying to deal with the things life throws at you?

Right. It's not about being fatal realistic or having this glass half empty point of view. But the truth is, life does happen. I mean, it could be as simple as, Oh, my gosh, I tripped down the stair and I broke my leg and now I'm out of work. Emergencies happen, life happens, diagnosis happen, When marriage shifts happen in the form of divorce. I mean, we hear all the time and you just never know. No one sets out for the day and says, I know today is going to be the day that the doctor calls with bad news. But you do want to prepare your life in such a way to where if the worst does happen, you've set yourself up for success in the best possible ways that you could have success. Because what he's facing feels, I'm sure, very dark. But to have this one thing that's like, Okay, but I did this, and because of this, now I can go home. I can have a little bit more peace than I would have had elsewhere.

For our world, that's not owing other people money, not having to deal with that payment while you're also trying to figure out finances for the future. If there's a job loss or a health scare, having an emergency fund to cover you so you're not having to swipe that credit card or take out that person alone or do the heelock. Investing for the future so that you do have that nest egg built up so that in case you can't work one day, you have money to cover your expenses. That's why we do the baby steps, not because life's going great, because we don't know what life will at us. That puts this hour of The Ramsey Show in the books.

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Welcome back to The Ramsey Show in the Fairwinds Credit Union Studio. I'm George Campbell, joined by my co-host, Jade Warshaw. Open phones at 888-825-5222. Com. Oliver is in Davenport, Iowa, up next. What's going on, Oliver?

Thank you for having me. Sure. I'm about to get into about a million dollars worth of debt, and I'm not sure if I'm doing the right thing.

Have you done it yet? Have you signed any paperwork? Can we talk you off the ledge? Again, sir?

Well, let's see if that's the way to go about it.

Okay, so what is the million dollars for?

So, until about a year ago, I lived by the Ramsey rules, religiously, both me and my wife, haven't had a single dollar in loans. And about a year ago, I started a business, and we killed that big year. I have more than tripled my income, and we're doing fantastically. However, I now come to an opportunity, which requires an additional about $450,000 investment into the business. And I just found out that my wife's pregnant, so we are also building a house.

Okay. You got to have room for that. A six-pound baby needs an extra 2,000 square feet. They take up so much room. That's the law in America.

Yes. Tell me, let's start with the house. What are you spending on this house? And have you already made an offer? Is it a done deal or is it too late?

We've already started it. We've already signed the paperwork and we started building it. It should be finished in February.

What'd you spend?

And at that point, we will be taking out a loan to purchase it.

Okay. And what's the total spend on the house?

It is $560,000.

Okay. And did you do it following the Ramsey principles with the payment and everything like that, down payment and what the mortgage is going to be?

We have put 25 % down payment, and we're not spending more than 20... I don't remember how many exactly % of our income on it.

Okay, 25 %. No more than 25 % of your take home pay every month, including HOA's taxes and insurance. Okay, good. That's a green check from me. I'm not mad about that. So let's talk about this $450,000, quote, opportunity.

You should go watch on YouTube later, Oliver. I threw my hands up in the air because just during the break, I told Jade. I said, Jade, every time I hear the word opportunity, it's somewhat about do something real stupid. And so you hit my trigger button.

And that That's where I'm at. So I started this. I've been doing this my entire life, pretty much. I'm a CNC machinist with all sorts of fancy degrees, but I opened an aerospace and medical device company. So all we do is make components for other people. And we've only opened our doors in February, and now we're up to making 13 to $15,000 a month. And that's not very consistently, even though I I still have a full-time job on top of that, just for security purposes, because it is a new business.

When you say per month, is that like top-line revenue or is that net profit?

That's net profit.

Okay, good job. Amazing. What are you making with your full-time job?

I make 175. My wife makes 85.

Awesome. So you already had a great income before this business? Yes. And how did this opportunity present itself for you to go half a million in debt for a business?

Well, I have I have multiple customers that I work with right now, and we currently have only one machine that we work on, and we cannot supply the demand. And buying an additional piece of equipment will allow me to probably triple my income, if that. Probably even more because right now I'm paying a lot for rent. So if I can put more machines into my shop, I can make more money, right?

So the machine costs 450 grand?

That's including all the installation fees, tooling, et cetera. So that's all things considered.

Okay.

I'm always going to suggest that you move at the speed of cash on things like this. But my question is, is any part of this incremental or is it like, I must do it all at once, 450,000, bam, on the table?

It's all or nothing.

Okay. What happens if you don't do it in the next two years?

Well, if I don't do it in the next four months, I lose the business that I have lined up for that. Well, not really lined up, but the opportunity that's lined up for it because I do have specific orders that are coming down the pipeline that I can put on it. If I hold up for another year, those orders are not going to be there. Not to say that I probably won't find them once, but- Can you go on a different growth track?

Can you go in another direction that'll continue you building this $15,000 profit a month, plus your other income with you and your wife? What is that around $260,000? Is there a way that you can capitalize another area of your business, continue to grow that, until you can afford to make some of these upgrades?

Not really. I'm toped out at the moment. We're already running two shifts and running through the night just to try and keep up.

So what was your original business plan? Of scaling the business.

The plan was to get start.

Got you.

And then, well, I had a couple of orders lined up just to get started. But really, it was start going down the pipeline and start doing it, and it's going to work out, and it really did.

Did you have the thought in mind? Because I'm trying to understand, when you first started this business, did you have in your mind, I'm starting this business, I'm not going to take out debt for it, I'm just going to grow it, even if it's slow and steady. Or did you have in mind, I'm going to start this business and I'm going to be one of those people who takes on investors and takes loans. Who were you when you started this project?

I was planning to, if needed, I was planning to take loans and grow exponentially. That's where I needed to go. It's just right now, I never expected to be in this position a year from starting the business. I thought it's going to be a much more slower and gradual growth rather than all and everything all at once. And all of the tariffs that are now happening are definitely helping out for that because We're having a lot of people who used to order from other countries, and now they're coming back to the US.

So here's my take. I think the opportunity will still be there. You might lose some in the meantime, but I don't want you to get too starry-eyed and go, Well, if we had seven machines, we could 20X. At some point, there's not enough money in the world to make the stress worth it, especially with the baby on the way. And so I want you to think about just the reality of your situation. You're about to move, you got a baby on the way. Do we also want another half million in debt? Now We need... Now there's real pressure on this business to succeed. Now you have to be there working overnight. And what if she decides to stay home once the baby's here? Well, what does that do? That might put some strain on this financial situation we've created because we owe a lot of money now.

Fair point.

So that's the part I can't show you on paper. That's just the reality of life. But I would say, can we make a plan to save up and pay cash for this thing in less than two years? I think that's the reality. That's what I do. If you guys are bringing home, I don't know, 25 grand a month and you can live off seven, let's throw 18 into a high yield savings account, and two years from now, we have 450 grand in cash. Now that thing's cash flowing beautifully instead of having a $4,000 a month payment on it.

Yeah, there's nothing on fire here unless you make it on fire. And that's the beauty of what you've done so far.

You're a brilliant guy. And so all I'm saying is the opportunities will be there. People want good, honest quality work done from smart people. And I think that opportunity will still be there two years from now. And I hope you call back and you have a multi, multimillion dollar machining business that is paid for in cash. And I think that future is very much possible for you guys. It's going to happen sooner than you know it, but I wouldn't try to leapfrog it with debt right now.

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Hi. Thanks for having me. I Me and my wife have been living paycheck to paycheck for quite a few years now. At one point, we managed to get out, but that was when I had worked a job that paid me more, and then I unfortunately lost that job. And then now I'm a custodian at a school that pays me once a month. We just had our second kid, and she's not working right now, but that was fine. To really make this money stretch. I don't know how I'm trying to make our money stretch, but also not with paycheck to paycheck.

How much debt do you guys have?

Well, I'm thousands for health care.

So you got medical bills?

Yeah, medical.

And then I know that she's She's in debt with medical, too. You got car loans, credit cards?

No, we do not. Actually, I had a credit card when I had moved up here, and I think I paid it off because they haven't bothered me since. I wasn't terribly in debt with the credit card, thank God.

Okay. I'm hearing some uncertainty in your language, which lets me know that you haven't really gotten your head around your finances. You know that there is some debt, but maybe you don't know how much it is, and hopefully it's gone, that situation. What I'd like is for you and your wife to sit down tonight and pull out everything that you think there might be surrounding this.

You can pull your credit reports to help. You can go to annualcreditreport. Com and pull all three from the three credit bureaus for free. That'll give you a real clear picture of what's out there.

Then you can actually write down these numbers. Before you get off the line, we'll make sure to give you every for free for a while so that you can get your head around this. Because I think part of the problem when you're living paycheck to paycheck is you don't know what the problem is. There's debt, I don't know how much. I'm just making the payment. You're just barely getting by. You don't have a budget. When you don't have a plan, it's really hard to be in control of your money. If we give you every dollar, that's going to be the plan going forward. But you guys have to do it. You got to plug the numbers in. You put your income at the top, which, by the way, what are you making as a custodian? What do you bring home every month?

Well, I get paid $17 an hour, $2,300 a month. I get paid once a month. I think that rounded up to $31,000, $32,000 a year.

Okay. Is there money coming in from anywhere else, or is this the only money to you guys's name every single month? Is there anything else?

If she goes back to work, she'd be pulling in money, too. I think she makes the around $1,000 every two weeks, I think.

What about your living situation? What are you paying for rent?

We pay about $1,000 for rent.

So that's half your income, just about right there.

Which- Yes, sir. To pay $1,000 in any other circumstance isn't bad, but when you're only making $2,300, it's impossible, right? So the key here, this is an income problem. And I think that you realize that. When will your wife start working again?

Well, like I said, she had her baby about a month ago. So I would assume maybe in a couple of weeks. I told her when she was ready to go back in. So I don't want to throw her back in the work if she's not ready.

I get that, which means that you're going to have to have four jobs.

Okay.

And I hate telling you that because it's your baby, too, right? And you're like, I want to be home with a newborn. I want to see this baby grow every day, a little bit each day. But you don't have that luxury right now. You've got to have the custodian job and three others while you're online and knocking on doors to find another main job that pays more. You've got your work cut out for you, Philip.

What were you doing before?

Well, before I was working at a gas station, and that paid, I think, $13 or $14 an hour.

Well, you said you were making more money, and then you lost that job. I'm sorry.

I was making more money two years ago when I was working at an ethanol plant. I was making about $22 an hour, and I was getting paid bi-weekly.

How old are you? That was pretty good.

I'm 25.

Okay. You're still a young guy. What I think we need to do is find ourselves a career instead of just a job, something you can really sink your teeth into, grow in, and that'll get you making 50, 60, 70, 80. I think You're a guy who's got a lot of skill and a lot of work ethic and a lot of integrity, and that's 90% of the problem in today's world. That's who people are looking to hire. What skills would you say you have that you could apply to another area? Are you good with your hands? Are you pretty handy?

Yeah, I don't mind getting my hands dirty and doing grunt work. That's what I've been doing most of my life. I worked in construction before I moved to South Dakota, so I did that for a long while there.

Sorry, you broke up on us. What I'm going to do, Philip, is send you a copy of Ken Coleman's book, Find the Work You're Wired to Do. I think this new baby is giving you new motivation to find yourself a career that's going to help you get out of debt and stay out of debt. Because right now, truthfully, we can tell you the plan of debt snowball, but when you don't have nothing but $100 left at the end of the month, it's going to be hard to do the baby steps. We do need to increase that income ASAP. If your wife can get back to work and make 35, 40 grand, and you can start making $45, $50, well, now we have a plan to get out of this a whole lot faster.

Okay. Yeah, I like that plan for you. I think sometimes people think they've got to have a college degree, they've got to have this college education, and that's not always the case. So I think that Ken Coleman's book is really going to help you get on the right path.

Yeah. Hang on the line. We'll get you every dollar and Ken's book, Find the Work You're Wired to Do. John is in Houston up next. John, how can we help today?

Yes, sir. So my wife and I We're expecting to get a baby on the way, and we're looking at moving here in the next year. Now, her family is giving us a section of land, and we're looking at putting a double wide on it, and we're going to be there for... That's going to be our forever. My real main question on this is, I have the opportunity to go through with the VA home loan like current home loan, but I don't know if I want to, or if it'd be a good idea to pair the land and the VA home loan, because that's what it's going to require, or keep the land separate and do what they call a chattel loan.

That's just like a high interest personal property loan. So let me- Pretty much, yes, it is. You triggered me again. I don't know how long you've been listening this hour, but you say the word opportunity, and I get my fister up ready to fight Because what you're about to set yourself up to is get a depreciating asset at a very high interest rate. Right. It's a bad plan all around. The VA loans, they can be an okay deal in some cases, is if your disability rating is high enough. But man, it's riddled with fees. The closing takes forever. There's really strict requirements. It gets people into houses with nothing down, which is not a good thing because all that means is you have 100% loan and you have no equity.

Correct. So we would still take our current equity, split that in half, pay off the truck, and actually still do a down payment on the house.

How much debt do you guys have?

We only have the house, which we owe 110, and the truck, which is 38, and then about a thousand on a credit card.

And why would you go from the house, which is appreciating to a mobile home? Yeah, what's- Well, it is a current mobile home with land, but the land has appreciated.

And my agent, I talked with her the other day. She told me what we could list and what everything's selling at, and I would have equity in it.

Yeah, but what's the rush? I don't think there's I don't think there's a rush around this, and I don't like what you're rushing towards. I agree with George on this. Plus, you still have debt. Yeah.

What's your household income?

Mine is anywhere per year from 76 to probably about My wife's is about 32 right now. She's in school. We're paying for cashwise, and she'll be making about 50 to 60. Okay.

And then DA- You guys have a strong income, Andy. I would just go slow and get out of the house, I would not move to another mobile home that's going to depreciate. I don't think the land is going to appreciate fast enough to make this a good idea. If you've listened to me for more than five minutes, you know that being normal with your money is not a good thing because normal is broke. I want you to be weird. That's why I love what we're doing with Fairwinds Credit Union. Our friends at Fairwinds just launched a brand new Ramsey debit card, and it says, Debt When is normal, be weird. Right on the front.

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All righty. Today's question comes from Toby in New York. He says, If I have two full-time jobs and the second income is currently going towards investing in my retirement... Let me read that again. If I have two full-time jobs and the second income is currently going towards investing in my retirement fund, do I still need to have an emergency fund since this second job effectively insulates me from the loss of my primary job? I would like to invest as much as I can now while I'm young and worry about the emergency fund later. I'm debt-free other than my mortgage. Oh, Tobi. What? Sweet, Tobi. Okay, so I hear what you're saying. I understand your logic, but there's several holes in your logic. Number one, an emergency fund for those who are new to this, we I suggest the order of events with your finances are first you just set a quick $1,000 aside, then you pay off all of your debt. That's baby step two, all of your debt except your mortgage, and then baby step three. You save up three to six months of an emergency fund. After that, start investing. That's what Tobi is talking about.

Tobi, the problem is emergency funds are there for more things than job loss. That's one of the emergencies that could come up. Or another emergency you could have is You get in a car accident, you can't work for a while or all sorts of other things. That money is there for a plethora of reasons. That's hole number one in your reasoning. The other idea is, well, if something does pop up and you don't have an emergency fund, you're going to need money from somewhere. If you don't have an emergency fund, you're going to do one of two things. You're either going to unplug your investments, which if you do that, that's to the tune of taxes and fees and all of this, or you're going to turn around and take out debt. You're not setting yourself up to win. The reason that we teach the baby steps in the order that we teach them is because it's a system. Systems build on one thing after another in order for the system to function properly. I'm not just talking to Tobi right now. I'm talking to anybody who thinks that they can hack the baby steps and switch them around to suit their order.

When you switch the baby steps around, they don't work anymore because you have to have the foundation in order to start building the wealth the correct way. No, Tobi, I would not do that. I would do your emergency fund first. Since you have two jobs, you can do this so fast.

I'm just still confused at the two jobs. I'm like, this is one of those situations. He calls in and goes, Hey, I lost both jobs because I found out I was two-time ago.

Right. How can you work two full-time jobs effectively? That's a question for another day.

Are you sleeping? I don't know. Are you circular breathing around the clock? I don't know. Sounds like- You're not God, so you can't just push all of your emergencies to when you're retired. That's not how it works. So this idea You're going to get the emergency fund later. The emergencies are going to come before you're ready for it at this point.

Always.

They always do. I would pause investing and just stack up cash for three months, keep it in a high yield savings. You'll do it so fast. Don't invest that money, keep it liquid, and you'll sleep better at night. If you're sleeping at all, Tobi, we don't know.

No, he's not sleeping.

He's- He's left us with more questions and answers.

He's an Android.

He's a- Goodness. Is this when he has two laptops and he's on Zoom calls on both, and he has a little stick figure of Tobi over here to fake it? I don't know.

He has a AI Tobi.

That's sketchy. All right. Stephanie is up next in Louisville, Kentucky. What's going on, Stephanie?

Hi, Zaden George. Thank you so much for taking my call. My question is, we just finished Baby Assa, number three, me and my husband. I went into my 401k contribution to bump that up to 15 % while we were planning out our budget, and we immediately got bummed out because it wiped out all of our extra cash that we were planning on, maybe increasing our spending or having a little extra money to throw at the house or save up for a new mom van because I'm currently driving a 2005 Honda Odyssey with only one working sliding door. So that's where we're at right now. We're bummed, and I don't know where else to go because I don't think we really live outside our means.

What are your total expenses? Versus your take-home pay?

Our take-home pay is about... Well, pre-tax is 3,800. After taxes, it's like 3,200. Okay. So then we've got like- How much is your mortgage? I guess the 401(k) It's about... That's the one thing that I think we might be able to have legal room on. Our mortgage is 1,500, but it's a 30-year. And, yeah, it's about 20 %, I think, of our pre-tax.

Well, that's where your- That's where your problem is.

Wait, you said your... Is your monthly take home pay 3,200 or is that bi-weekly?

Oh, that's bi-weekly.

Oh, okay. I was about to say, well, there you have it.

You gave us a heart attack over here. We were like, That's all of the problem right there. Okay. So 6,400. 6,400. I'm so sorry. Okay, so 6,400. Is that after the retirement contributions are taken out?

The 7,700 is our before-tax monthly income.

Okay. Yeah, I'm just trying to figure out how much margin is really there after the 15 % and health care premiums, all that comes out. And you're saying, Hey, we got nothing left at that point.

Yeah. Are you guys... Do you do % tithed, or do you do a higher percentage of giving? What's your giving look like?

Our giving is about 5 %. 401(k) is at 15. Taxes, I guess, are another 15. The mortgage is 20. Grosseries is 10. Eating out is about five.

Do you have daycare? Anybody in daycare?

No. Health insurance is about eight. No, we don't have any daycare. We have diapers and all the normal things, oil changes and home maintenance.

Do you have a bunch of sinking funds?

No. I guess we have a Christmas budget. We had to bump up recently, that's 200 per month, but that's just so we can be prepared for Christmas.

The reason I ask is sometimes a bunch of sinking funds can drain off margin if you have them set a year round and you're just doing a little bit, but you're doing a bunch of them. I want to take a look at your budget because obviously, yeah, a mortgage should be no more than 25%, 15% for investing, 10% giving. That's half gone right there. I'm wondering how much all those other little odds and ends that are eating into this and how necessary they are at the current amounts. That's what you're going to have to go through with a fine-tooth comb. There are some things, time of life, that can really play into it. If you have kids in daycare or kids in private school, things like that can really eat into that margin after 15%, but I don't hear that here. I think it's just a bunch of death by a thousand cuts.

Because if you guys are bringing home about 6,400 and the mortgage is 1,500, well, there should be $5,000 disappearing somewhere. Yes, it gets eaten up by different things, but I think it might not be one big thing, but like Jade said, that fine-tooth comb, nickel and diming each thing, and maybe you can squeeze out 50 bucks here, 100 bucks there, to where it adds up to a thousand bucks we've freed up by doing a very detailed budget. Well, now that's 12 grand a year towards this minivan goal.

What What do you spend on food every month?

Grossries is about 200 a week, so 800 a month. And then eating out is about 100 a week, so it's like 1,200 total.

That's not bad. Anything else we should know about? I mean, you could squeeze some of that. You're a family of four, though, right?

Five, yes.

Oh, yes. Grosseries, food is good.

Yeah, like you said, I don't think anything's out of control here. I also reshop your insurance and see if you can save. That's one of those weird areas where you're like, Oh, we've had whatever for 20 years, and we just never looked into it. I would jump on ramsey solutions. Com and start reshopping your insurance because that's somewhere you could shave off hundreds just overnight, just by realizing we've been overpaying. And on top of that, there might be a season where you guys need to increase your income to save up for this van or increase the income. If your lifestyle is just way up here, we need our income to match it. One of us or both of us need to work a little more, get that promotion, start scaling up in our career. I think both of those are going to help you long term, and both should happen. But right now, the thing you can do tonight is start going through that budget, going through every transaction, every bank statement, going, Where can we do better? And I think that will help you find some margin right now. But you're doing all the right things.

The money is going to the right places. But I agree there should be a little bit more to save up for that car upgrade, to put money away for college, to pay off the house early. So I hope you guys will get there in due time. Thank you so much for the call. For way too long, I struggled with sleep and woke up groggy after tossing and turning all night. But now I look forward to bedtime, and I wake up bright-eyed and bushy-tailed, thanks to Casper, a company that's been perfecting better sleep for over a decade using durable, high-quality materials that actually last. My whole family now sleeps on Casper mattresses. Yes, even the dogs have their own Casper dog bed to no one's surprise. It's not just one man's opinion. Casper customers keep their mattresses for years, and four out of five customers recommend them to friends. With free delivery and 100-night trial, Casper is no gimmicks. A mattress you can trust, backed by quality that lasts. So go to casper. Com/ramsey and use promo code Ramsey to receive 25% off all mattresses and 10% off everything else with code Ramsey. That's casper. Com/ramsey.

Exclusions apply. All right, here are the top questions people have about online wills. Number one, how do I know if I need a trust or if my estate is too complicated for an online will? Well, if your estate is worth less than a million bucks getting a will online, good option right now. What do I need to start my will online? Answer these questions. Who do you want to get your stuff? Who do you want to take care of your minor kids? Who do you want to make decisions if you're incapacitated? Is it legally valid? Yes, but it's got to be state-specific to match your state laws. And finally, why would I do an online will versus traditional made with a lawyer? Well, online, it's going to be less expensive, more convenient, and take less time. So to take our quiz, go to ramsey solutions. Com/willsquiz to find out if an online will is right for you. Kevin is in Philly up next. What's going on, Kevin?

Hey, guys. I'm just wondering a little bit of a moral financial question. Do I, morally, my dad's girlfriend money from his estate?

Okay. There is so much context needed here.

My dad's girlfriend. Tell us more.

Well, number one, did you borrow money from your dad's girlfriend?

I did not.

So why would you owe him money?

Well, they've been together for quite some time, a little bit over 20 years now, and he passed away about two months ago. And they were living together at the time. And now her Her daughter is now pressuring family members on my side to somehow come together and financially split the money from his estate once we get it and give it back.

Why are you getting it?

Did it all go to you?

No. So it goes to me, my brother, and my half-sister. He did pass away unexpectedly without a will, and they were never married.

Okay. So I was going to ask, was there a will that said it went to you, or the courts just decided this?

No, there was no will, and the money will be split between me, my brother, and my sister.

And how long was he with the girlfriend?

Just north of 20 years. 22, 23 years, something like that.

And they lived together? Were their lives combined as though they were married?

Basically, yeah.

And the daughter, is that your dad's daughter or that's the girlfriend's daughter from another relationship? Correct. Yes. That's messy. Boy, oh, boy.

What does she want? What was his wishes? Did he have a will? Your name was on everything legally.

No, there was no will. No will.

So it was just a next of kin thing. The government just goes, All right, give it to the kids.

Correct. What are they requesting? What's the girlfriend requesting and what's her attitude? What's her demeanor been?

Well, it's more her daughter is requesting. It's not necessarily her.

She's trying to fight on behalf of her mom to go, Mom, you're owed something. You were with this guy 20 years. This is crazy.

Correct. How old is the daughter?

Just over 30, 31.

Tell me about her, if you know anything. Is she doing okay financially, or does this have the ability of a lever that she's pulling to try to get something?

No, she's not financially set. She lives with her boyfriend. They actually have a baby on their way. They are just living their lives. And I can understand where they're coming from with trying to get money back into her. And they're only really pressuring my youngest sister, my hand sister. They're only pressuring her. They won't come and talk to me.

What are they asking for, specifically?

They're basically asking for her to either split and/or give up her portion of the- Give up?

What is the rationale for her giving up her share?

Because her mom put all this time and money into the house, basically.

Okay. Got it. Is the house split amongst the three of you now?

We have to sell the house, so whatever we have on top of that, basically, once all the debt gets paid, once the house gets paid off, once the debt gets paid.

So the girlfriend has to move out? The girlfriend has to move out so you can sell the house, is that right? Or she wasn't living there?

Among other things, yeah. So I was Actually, so I was renting a house that my grandmother owned. And since we found out we had to sell the house, they all needed a place to live. So I packed up me and my family and went and rented a different house so that way they can move into that house.

Oh, my gosh.

That's paid for. That's- This is so much. My grandma has owned their house for 55 years, so she's owned that house. And that way, they can all have a place to live, and that way they're not struggling to jump around and find a place to live. It's my grandmother, her, and- So that was good. I have a full brother and a stepfather. Yeah. So it was just a decision me and my Me and my wife made some movies.

Can I recap that and make sure I understood it? So you were living in your grandmother's paid-for house with your family, and you said, I'll leave that house so my dad's girlfriend and daughter can move in there, free and clear, right?

Well, it was basically all the people that lived at my dad's house. So it was my grandmother, who had just moved in in February. Who else? His girlfriend. I have a stepbrother, which is her son. Oh, my God. Which? And then my full brother.

So they all have a place to live. So the girlfriend and the daughter are not displaced, is what I'm saying. They're taken care of because my thought, the one thing I did wonder about is like, okay, she's been living with this man for 20 years. It does feel like the rug's being pulled out from under her. If she has to move out of the house, she doesn't have a place to go, and she doesn't have any money, right? So it does make me feel better that she's got a place to live indefinitely. She's not on the streets. She's not on the streets.

And this is in Pennsylvania, all of this?

Correct. Correct. And if there's a silver lining to this, it's that they move into a house that is paid for. There's no rent, there's no mortgage, there's no... There's basically living expenses all they have to pay.

Who pays the taxes?

My grandmother will be paying the taxes. But rent from the other three people that are living in the house will pay for their taxes.

Great. Okay, great. And does girlfriend have to pay rent?

I don't know their financial, the way they're handling that house right now.

Okay. And did she have to... I'm just trying to understand. When she was living with your dad, did she pay or did he pay for everything, or you don't know?

So he basically paid for everything. She did work. She really only worked so that way they can have insurance because he didn't have insurance for his company. So he basically held everything financial down. She only worked enough to pay for insurance.

I don't think that you guys are on the hook to do anything here. This is what happens when you don't have a will. This is what happens when you don't estate plan.

When you don't get married and have a house. And when you don't get married. So there's a lot of things that went wrong here, and it's very complicated. But morally, legally, ethically, I don't think you owe anything. And here's the problem. If you guys do give them a dollar, they're going to come at you for the next dollar and the next $100. Because there's nothing in written. So it's going to open a door, and I just would keep that door closed, personally.

Yeah, that's what I was on the phone with my youngest sister today, I was going over and explaining that to her. But I just wanted to get a little bit of a second opinion.

It's going to be- Well, there was never a commitment. And that's what I'm going to base my answer on, anyway, is if you want a commitment to getting money out of a will, then you have to start with a commitment through marriage. I'm going to keep that same through line of a commitment was never made, and therefore a commitment does not have to be fulfilled. That's, some people might be like, Well, dang, Jade. The woman who was living there for 20 years. And I get that. I hate that. For me, being okay with it is the fact that you all didn't displace her. You made sure she has a place to live. She's okay on that end. And my other part is she had a role to play in this, too. It wasn't just that your dad left her without anything. She also could have said, Hey, I'm here. I've been with you. Do you have a will? Is everything taken care of? So both parties have something.

For 20 years to not even think about this is pretty wild behavior. And so she put herself in a very risky position and now is reaping the consequences of that. But from what I've seen under Pennsylvania law, she has no right to any of this just as a girlfriend. She's an unrelated person in this, and it's going to go to legal air. I would consult a lawyer if you want to cover your bases. But morally, just based on feelings, you're going to feel guilty because this is not a good situation, but you did nothing to cause this. I don't think it's your problem to solve either. I'm so sorry you're going through this. I mean, goodness. If I'm you, I'm like, lesson learned. I don't want to put my family in the situation. Let me simplify and not intertwine family finances and non-family and are we or aren't we? Just keep things very, very clear. You spend hours researching before making a major purchase like a home or car, but it's also a good idea to put in the work searching for the right insurance coverage.

To protect your biggest assets, I recommend using Ramsey Trusted Pros. Whether you're looking for car, home, or any other type of insurance, Ramsey Trusted providers have been coached and vetted to serve you like we would. Find what you need at ramseysolutions. Com/insurance.

Welcome back to The Ramsey Show in the Fairwinds Credit Union Studio. I'm George Campbell, joined by best-selling author Jade Warshaw, and we're taking your calls at 888-825. 5225. Marcus is in Columbus, Ohio. Marcus, welcome to the show.

Thank you.

What's going on today?

I have a bit of a question around whole life insurance, something I know there's a lot of opinions out there about. I'm considering a whole life policy in addition to a term life policy. I have a bit of a unique case and the reason why I'm considering it, and I'm curious to get your thoughts and opinions on it.

Okay. What's brought you to this point where you think you need it?

So just a little background on myself. I'm 39, and I just started consulting a whole thing a year ago. I'm married. My wife isn't working, but she's helping out a little bit, but her priority is managing our two kids, three and five. So we're considering two policies, the term life being 40, and then between now and 60, having that term life insurance there available in case anything happens, and then looking at a whole life in terms of being able to access a certain amount of dollars. Now, a certain dollars between now and '60 to where I can't touch a lot of the investments.

What do you need access to the money for? I'm confused.

So the thought is that I have $10,000 I'm considering putting in to a policy. If I was to need a certain amount of money between now and '60 or towards cars or whatever expenses may come across, I want to be able to have access to my own money and also be able to still have it grow separate from where it's going to be.

You can do that in a savings account.

Yeah, or you could invest in a- Or an investment account.

Yeah. So why not just have your own emergency fund or sinking fund or even side investment account if you're trying to build wealth for the future? Why do it inside of a super expensive whole life policy where you make someone rich while you stay broke.

Yeah, with a bad rate of return.

So the return is what I was curious about, is the return.

So the return being low, and of course, the savings having barely anything. So not looking for an investment on these dollars, but something that I can actually...

So the idea with the whole life is that you could borrow against the dollars that you put in. And so with that thought, I was wondering if I was to put in, say, $10,000 into this and be able to continue contributing to it and have the benefit of borrowing back to myself.

Why do you need to borrow back to yourself?

But do you know that? That sounds insane. Why not just take money out of your savings and replenish it? That's the same thing without interest that you're paying.

Yeah, or use the $10,000 that you started with for whatever it was that you needed.

So if the $10,000 was used to pay off, say, a car or something like that, or to pay off whatever expenses, then it goes away.

Not if you invest it. What if you invested it? Invest it. Let's just pretend. Forget the baby steps, what baby step you're on right now. Let's say you have $10,000 and you say, I want this to continue on for me. Yeah, I probably won't put it in a high yield because the rate of return is not enough to make it grow at the rate that I'd like. So you say, Okay, what if I just drop it in an index fund? That's got an average annualized rate of return between 10 and 12% if I invested in good growth stock mutual funds, or if I do just a regular index fund, I'll get that, right? So I drop it in there and I say, Okay, I'm going to let that grow. Yeah, I wouldn't suggest putting it there unless you're going to keep it there five years or more, but we're talking investments, right? So that's across the board. Why wouldn't I just drop it there instead of dropping it into a product that's inside of life insurance that has a poor rate of return? Why would I choose something with a lower rate of return if that's the point?

Yeah, so the poor rate of return is what I'm thinking about here.

I have investments.

I have Roths and other accounts that I'm investing in, and I get that poor rate of return piece. So my thought here is I could keep it, yeah, of course, in a savings and access it when I need it and try to replenish it. I'm probably not going to be able to replenish it as fast to $10,000. So that's why I was considering, is there a place to access money as I need it, but still keep it there as accessible?

Yeah, you want to borrow it As debt.

Right. As my own debt.

And I'm saying, why? Why are we having to do that? Why are we having to make things complex? Especially if you're not saying, Jade, here's what I need the money for. You You don't even have an idea of what you're going to use the money for. So why are we making it complex in that way?

So the idea is that I'll always... So right now, I am consulting. So I'm building a business, and And so there's not that constant, consistent income.

Are you doing that full-time, or do you have a full-time job? I'm doing it full-time. And how much are you making?

A hundred thousand.

Oh, nice.

As a base, and growing from there.

And And that's where- What business is it? What consulting?

Energy Consulting.

Very cool. Where did this whole life idea even come into your brain? Because this feels like something somebody sold you on, like a friend called you up.

Yeah. So no, I've considered it before, but I wanted to get more thoughts on it outside of just writing it off.

So I want to get more thoughts on understanding, because it's not that I want to invest in it as an investment. So I get that it's not going to be an investment It's a good case. But being able to access my own money and then pay myself and then build it as my own bank.

So I've done zero interest credit cards.

I've moved money as I needed it responsibly.

I've kept my credit score above 700. So I've operated responsibly with my money. But I'm saying, is there a vehicle I can use that allows me to access it as I need it, as I grow my business?

Yeah, we've told you, Marcus. Here's the thing. You're playing a different game. You're in the financial maze rat race of going, I have a good credit score. I can borrow money. I do the zero % cards. I've just never met somebody who is wealthy and successful who plays all this game. And wealthy people just have their own bank in the way of savings. So just build up an emergency fund. And if you need money outside of that, you can build up a sinking fund with your amazing income. And so I don't think you need to play a scenario out where you need to borrow from yourself and pay yourself back with interest for some benefit. I don't think that's ever going to make sense unless this whole life the insurance person sold you on this as far as some tax benefits or otherwise.

Yeah. So you said, what's the other one that you said? A savings? Because I thought about this as well, just have a savings and build it up that way. But you said another sinking fund.

Was that the one? So high yield savings account is great for liquid money you might need in the next couple of years, right? So that's going to be your emergency fund, you're saving up for a car, whatever it may be. Anything that's beyond four, five year timeline or horizon, you could invest. Now, you could invest in retirement. And if If you want to access it earlier, you can invest outside of retirement just using an index fund in a brokerage account. But you don't need to do that through an insurance policy. It's the most expensive and stupid way to do it. The only people who advocate for it are the people who sell it.

You're limited on what you can invest in.

That's what I was trying to get at, who talked you into this? Because this is not something that's common sense. Common sense would say, Have a savings account if you need money. Yeah.

I wouldn't necessarily have been talked into it. This is me exploring it I've looked at... I wanted to hear it out. And so this is the opinion that I'm looking for, is what are the supports? Because the three that I've heard from your show is you're losing money in the first three years. I get that. And then a lower death benefit for a dollar and then the low return on investing. Those, I get that.

Do you have life insurance right now at all?

Yeah, he has term. I don't. No, I thought you did.

You said you were looking at term. That's the one that I'm looking at. I'm setting up that in the process of setting up that. Insurance is made for one thing, to protect your income. That is the reason for life insurance. We don't use it as an investment. I would get term life today. I would stop fooling with it because if something happens to you tomorrow, your family's in a real lurch, man. Get it today. Check out Xander.

Hey, what's up, guys? It's Jade. You know that moment when you check your bank account and think, Wait a minute, how is my paycheck gone all Ready? Yeah, not cool. You work way too hard to feel broke like that. And the truth is, you deserve better than just not feeling broke. You need more margin, more breathing room, and that's what our EveryDollar Budget app helps you find. Most people free up an average of $3,015 in just the first 15 minutes in the app. Just imagine how much you could find to pay off debt, stack savings, and just breathe easier with that money stress gone. Things might seem tight. I get it, but I promise you, you've got way more margin than you think. And with every dollar, you'll find it. Download it for free today in the App Store or Google Play today.

All right, Jay, let's talk about real estate.

Do it. Buying or selling a home is a big deal. With all the clickbait headlines and conflicting data out there, it's hard to know what's really happening in the housing market. So let's make the trends easy to understand. Median home prices dipped a bit last month to about 426 grand, a typical season shift as we heading to the fall. Biers have more options and negotiating power. Sellers may face more competition, and maybe in your area, the houses could be sitting a little longer. Mortgage rates dip slightly to five and a half % in September, giving some buyers breathing room. But since rates are unpredictable, the best to buy is when you're financially ready, not when you hope rates drop. That's called timing the market, and it's risky. To learn more about housing market trends and get free tools to help you buy or sell with confidence, go to ramseysolutions. Com/market, or click the link in the show notes if you're listening on podcast or YouTube. Joe is in Minneapolis. Joe, welcome to The Ramsey Show.

Hi, how's it going?

Great. How are you?

Great. Better than I deserve.

I love it. That's what we like to hear.

What's that? So I was wondering. I'm in baby stuff, too. And I wonder if I can go on a trip, like a trip for Christmas to see family living... No, I got family in Hawaii, and I don't know if I'd call it vacation. I mean, it is, but it's also just a busy family. My mom was out there, and my nephews and nieces. That's my main question.

It's just you?

Yeah. Yeah, I'm a single guy.

What's it cost to go?

I'm thinking, I've seen tickets. I've gotten tickets for 500 around trip, but around that time, it'd probably be maybe I have an 800. So I'm thinking cap the trip at a grand. And I've been Ubering on the side. During the day, I work as a quality engineer. I make 90, but I got 20 20, some thousand in debt, but I've been moving around the side to get out of debt faster.

What are you making from that?

It took six to eight months. Well, I've been trying to figure that out. I'm thinking I'm getting like 300 in my pocket a week is a good target, but I'm trying to hit 500 a week if I can to get my maybe so two and three done by next May. But I'll definitely get out of debt by next May, though.

I mean, did I hear you say you're earning 90,000 from your day job? Yeah. And the debt is 20,000?

Like 23, yeah.

23? I feel like you could go faster than that, but maybe... And it's just you? When you get your check every single month, how much is it?

I guess my benefit stuff is like 25.

25 what? Per check.

So it's five grand a month?

Are you investing?

No. I think it's close to a couple of hundred goes to You get to do benefit stuff or insurance or whatever. But I think it's across the year, it's like 2,600 per check throughout the whole year.

Okay, great. And then you did the $300 per week, how much do you pay for rent?

I feel like a lot. I pay 1,500, 1,600 for rent utilities.

Okay. Are you on a budget?

Yeah. I've been trying to kill things in my spending so that I can be not Ramsey-ish, but really doing this. I feel like I probably got a failing grade the last couple of months, but this month I feel like I'm more on on track, serious about not just doing it. That's what I was going to ask.

When did you start? What I'm trying to understand is how serious you are about this. Did you just get serious this month and you're like, All right, I'm doing it. Or have you been lollygagging for six months and now you're finally like, Okay, I'm doing it. Because here's where I'm struggling, and George, you can chime in. On the one hand, I'm like, You're here all by yourself. I'm not going to tell you to spend Christmas alone. I feel bad about that. I would be okay with you saving up the money and doing this in cash, knowing that you're going to be debt-free in May. But I am interested in your demeanor on this debt and what your patterns have been. If a pattern of yours has been, I'm going to get serious about my debt. And then something that looks good to you comes up and you stop and you take your foot off the gas. If that's a pattern for you, I don't want to say yes to that.

Yeah. It's like there's a lot of tempting things. My friend is just always They just come out of the woodwork. I'm like, I don't know all these friends that want to go out to see all the time.

Do you have friends locally that you can spend Christmas with that you would love to spend Christmas with?

I have a lot of church friends, but a lot of them are older than me, which I think is pretty cool because they're pretty wise folks. I don't know if I would hang to spend Christmas with them or nothing, but I got a lot of church friends and community, though.

Do you know anybody who's done this Ramsey plan that you're close to?

No, I haven't. I haven't found anybody.

And how old are you, Joe?

I know maybe one guy at church, but I'm 30.

You're 30? Okay. Yeah. Man, I'm on the fence here. I'm not super convinced that this is a one and done. I think this is one of many things that are going to trip you up on this debt-free journey. And you make a lot of money. I just feel like I would be okay with you one Christmas. We're not saying never have fun again. But if you didn't go, I've done this here where I was an orphan one Christmas, and some friends here said, Hey, just come over for a Christmas dinner. And I go hang with them, and that way I'm not alone. And I also didn't blow a thousand bucks to go on a vacation.

Listen, we sound like the biggest scrooges. I'm going to tell you what else is starting to play into my thoughts here. I'm not saying that this is a great idea. If you were 23, I'd be like, Oh, man, this guy has got to go home for Christmas. But I'm like, You're 30. You're in your own life.

You don't need to go home.

I'm looking at Kelly in the booth. Have you missed your Christmas yet? Are you a I go home for Christmas every single year, no matter what?

No, I mean, I really want it. Honestly, a big part is I want to go see my nephews and nieces, and there's multiple of them that are five and younger, and they're just so much fun.

When was the last time you saw them? They're like, Uncle Bob.

And they're I've seen them. I think I've seen them, I think, recently. I can't crack my memory's terrible. This year? But I think it's been this year.

Okay. Okay. Well, here's my thing. I wonder if we do a delayed trip once you're debt No, it may. Then we go in the springtime. And that lights a fire under you to get out of debt faster versus slowing down your progress.

Yeah, I was thinking about that.

So that's my heart behind it. It's not so Joe has a sad Christmas. It's so Joe gets debt free faster and then does this thing completely debt free with no guilt, no shame, no debt to come back to. And you're a free man come summertime. Then you could spend three weeks there. Yeah. Have a great time.

Yeah, I've done that a few times. It's pretty nice.

Yeah, because the longer you stay in Hawaii, the more money you spend. I'm guessing it's like 150 bucks a day just to live in Hawaii. You just leave the house and spend that.

I would even, or let me add this one to the mix. It's October, so you have two months in a week. I would give yourself a challenge since you're driving Uber, too. I'd say I have to have X amount of dollars of debt paid off if I'm going to take this trip.

I have to have- I like to compromise.

I have to have, let's see, your rent is 1,600. I try to replace my rent in side hustles. That's what I try to do. And I would say, Okay, that's the goal. Do you see what I'm saying? Then you're getting the best of both worlds. You're getting to be there with your family for Christmas, but you're also really going hard, and you're giving yourself a clear goal so that you're not like, I get to go. I can pull my foot off gas. I would do that. I would challenge yourself to have, I don't know, the majority of this paid off. I would go crazy. I'd be like, I'm going to pay off $12,000 or $15,000 of this debt really, really fast. My goal is to put $5,000 on it in November, $5,000 in December, and then another 2000.

Do it. I like this plan, Joe. I like the compromise. I think we just wanted to feel some fire from Joe.

Just get crazy with it.

It's not hot enough. It's just lukewarm right now and looking for the next trip. But I'm rooting for you, man. Let us know if you end up going. We want to know where are they now. When you're tired of feeling stuck with money, there's just one solution.

To get different results, you have to do something different. No one accidentally wins with money.

You have to have a game plan, and that begins with our get started assessment.

Go to ramsey solutions. Com/start, answer some questions, and We'll show you what steps to take next. Don't stay stuck. Take control of your money starting today. Go with ramsey solutions.

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Welcome back to The Ramsey Show.

On the debt-free stage, we have the pleasure of speaking with Jeff and Danielle. How are you guys? We're great. We're doing great. Thanks for making the trip to be here. Where are you from? Tucson, Arizona. Thanks for having us. Lovely. Okay, how much debt did you pay off? $329,000. Wow. That'll do. And how long did that take? About 12 years. It took 12 years. Wow, quite the journey. And what was the range of income over 12 years? We started at 155, and last year was 327. Wow, nice jump. What do you guys do for work?

I'm a pilot. I work for a big company out in Memphis with a bunch of Purple tails.

Oh, yeah. I've seen those. I'm sorry.

I'm an office manager for a concierge physician's office. Okay. Awesome. I'm getting a sense here about this 329.

I like it. Okay, tell us, what debt was the $329? 33,000 was our truck, which we still have, and the rest was our house.

I knew it.

It's almost 300 grand on that mortgage. If you guys just plow through the truck and then go, You know what? We're pretty good at this debt payoff thing, what if we just kept going? What was this journey like? We had a lot of life between 12 years.

We financed with their scholarships and their hard work, three kids through college, debt-free.

Oh, my goodness. All useful degrees. Yeah, awesome. You raised some great kids along the way. That's no easy feat. Yeah, we just kept rolling, walking through the baby steps. What got you connected to the Ramsey plan?

Well, about five years before we actually started the plan, I brought the idea to Jeff, and at that time, I was a stay-at-home mom, and our income just perhaps didn't support it in his eyes.

So I think his suggestion was we should just stop buying stuff.

That's a good suggestion. Five years later, he came to me with the idea.

Then it was right. Then it was the right time. So this was early 2000s?

Probably, yeah. Maybe 2008 or so the first time I brought it up. Yeah. You've heard of Dinks, right?

Dual income. That's right. We were oinks, one income, numerous kids.

Oh, my goodness. You were feeling the stress. You heard about Dave, and then five years into this thing, you go, I think we know what we need to do. Yeah. Our big problem is we've been in our house a long time, so it was appreciating, so we kept refinancing it. The American way. We bought a rental property and vehicles, and we did put in a really nice pool in a yard.

Our house isn't the gathering place for our family.

That's awesome.

Yeah. Wow. And so what was the journey like when you got started? Was it a hard shift? We moved through two and three relatively quickly, and then we were on track to pay it off by my 60th birthday, which is about a year and a half. And then, fortunately, my parents just passed away in May and June, so we inherited enough to go ahead and finish it up. Just kick it over the edge. Wow. How much of this was the inheritance that helped you finish? Just 64,000 or so. That's it.

Like I said, we were on track to do it in about a year and a half from now.

Well, sorry for your loss, but what a legacy to leave. Thank you. 93 years It's like they were looking down going, We got you. We're proud of you.

How does it feel? Kind of unreal still.

It's only been a couple of months. We're still trying to get used to not having a house payment.

All that money sitting in the checking account. I'm sure.

What do we do with that? That's a good problem to have. I'm sure the kids are like, I think we have some ideas. We got some trips we'd love for you to take us on.

Are you going to do anything to celebrate?

Yeah.

I don't know if you've heard this, but it gets hot in Tucson.

It does. Man.

When it starts getting hot in '27, we're going to get a newer camper, and we're going to go north to Idaho, cross to Maine, and then down the East Coast and back home.

Hit all the states that I've never been in.

I'll also be going to work. I'll jump seat to work from wherever she's at.

Sure. She'll hang out and volunteer at the Humane Society or go see the kids or whatever.

I have a sinking fund going to go to dog training school.

Oh, wow. That's so fun. That's one of my passions. That's so fun. When I can hang up the full-time job, that's my plan. The Encore career. Can you train my French Bulldogs? I You could be number one on the list. If you can train them, you're like Caesar Milana in my book. You guys are an inspiration. Were the kids watching this whole time? Because you got grown kids seeing this journey. Was that weird to bring them into it?

Well, they were in high school when we started.

Dave Ramsey might be a swear word and invoke an eye roll around our house from time to time.

Did they take to it? Are they like, Hey, we want to live debt free now? Or are they like, Gross? No, they're all on board. Well, they're here now, so it'd be awkward if they were. They cash for their used cars and everything. Yeah. Wow. And how old are the kids?

Our oldest is 26. He's married in the Air Force, so he couldn't be here. Then our next son is Andrew. He's 25, and our daughter is 21.

Wow. Way to go. And they're looking at their parents like, That's pretty cool that my parents did this. We hope so. While many Americans out there hang on to their mortgages until their dying breath and then leave their kids with a mess to deal with. Oh, my goodness.

Was anyone around you doing any plan like this, or were you on an island?

When we were each, supported each other, but we hosted FPU.

That's when we went through it at our house with some family and neighbors and church.

Then I hosted it. I used to work for the Department of Home and Security, so I was flying for them, and I did the government addition at work.

Holy smooth. That's awesome.

Yeah, it was good. Okay, so what's the house worth?

About 600,000.

And what do you guys have in the retirement nestings combined? Go ahead. 1.

7.

Okay, way to go. Okay, so Well beyond Baby Steps Millionaires. You guys were there a long time ago, but now this just adds to it with no payment. So what's the Baby Steps 7 look like for you guys? What are you looking forward to doing across spending, saving, giving? All above. Yes.

I'm going to build an airplane in my garage.

I've got the wing kit or it comes in kits. How big is your garage? It's a good size garage. Okay. How do you fit a plane there? Eventually, you'll have to go to the airport. You'll be in a hangar somewhere. That's exciting. So she's going to be You're going to be building airplanes.

We hope to be real generous with our grandkids in terms of their education when that time comes.

Oh, that's fantastic. I love that. You guys are who I want to be when I grow up. Very inspired by your story. What would you tell people the key to becoming debt-free is?

Eye on the prize. It can be a long journey. As you see, it took us 12 years. I think most of your families pay off their mortgage in about seven, but we started the path just in time to help kids get through school and life It happens. I would say give yourself a little bit of grace, too, because there are going to be bumps in the road.

Just rely on your partner.

And stick with the plan. That's fantastic. Well, I'm honored you guys decided to join us today. We've got some parting gifts for you. At two every dollar premium subscription, so you can use those. You can give them to maybe one of the kids who's on the journey. It's up to you what you do with that. Okay. As our wife saying, Thank you for being out here. All right. I'm excited for this one. You guys ready? I think we're ready. All right. It's Jeff and Danielle, $329,000 paid off the truck, and then they kept plowing through the mortgage in 12 years, making $155,000 all the way up to $327,000. Count it down. Let's hear a debt-free scream. Three, two, one. We're debt-free. That warms my heart. Never gets old.

Yeah, that's awesome. That's so awesome.

I love this This is a couple who went, Hey, this isn't going to happen tomorrow. But if we're just focused on this goal, it's going to happen within a decade. We're going to be around in a decade. So do we want to be debt-free? Or do we want to keep refinancing as the offers keep coming in? We can get a bigger line of credit on the house. It's crazy how much will come at you during the steps on the financial journey of people trying to come at your money and come at your equity and move you backwards. And you've got to stay alert and proactive just to stay forward.

That's right. Eventually, that's exactly what they did. I I mean, consider the fact that the average American mortgage is a 30-year mortgage, and then we say, Hey, be different. Get a 15-year. And then they still turn around and pay that off in 12. I think that's great. I think if you can pay off a mortgage in 12 years, that is a win in life. That is a win in my book. And all it takes is you doing a little bit, just a little bit extra, right? This is not you being intense, intense. This is just intentionality. I have a little bit of extra money. I'm going to throw it on here. Maybe it's an extra half payment, maybe it's an extra full payment, maybe Maybe it's once a quarter, maybe it's every month. You get to decide what that looks like. And before you know it, you're standing where they are.

If you're in their shoes, you're in that four, five, six territory. I encourage you guys, jump on ramsey solutions. Com, use our mortgage payoff calculator. We'll put it in the show notes. And you'll be shocked at how just an extra payment a year makes a difference, how much interest it saves you, how much closer it gets you to freedom. And then what I found is it gets addictive and you go, What if we did two payments? What if we did a thousand extra a month? What could that do? And then it just becomes we learn to live what's left and we learn to be content. And that level of focus gets you debt free really fast. Babysteppers do it on average in about seven years, and the average millionaire on our Millionaire study, 10 years. So let that be your goal post to go, Can I do this within seven to 10 years? Can we be completely debt-free? And again, if you give yourself some grace, maybe it takes 11 or 12, you're still so far ahead of the game. Still a win. You can do this, guys, and they're living proof.

Our scripture of the Day, Hebrews 10: 34. Let's keep a firm grip on the promises that keep us going. He always keeps his word. Norman Vincent Peel said, Promises are like crying babies in a theater. They should be carried out at once. A. Wow. Listen. I love that. As a guy with a newborn in the house, let me tell you, that really speaks to me right now.

I love that quote.

I can't really carry them out because I'm with him. I do the Airpods trick, though. I got noise cancelation on to keep my cortisol levels low. When they're just, I'm just like...

You know what I do when I go on flights? If I see that there's a mom with a baby, I'll sit next to them because I- You're an angel. Well, because it's You're a safe place. I'm used to it. You're a safe place. It doesn't bother me. Yeah.

God bless. Jay is just a better person than all of us. I'm like, How many rows can I get away from the baby?

No, I'll try to be nice because it's not fun when you're the one with the screaming baby and you're sitting Next to somebody who's so annoyed and they're so mad and you're like, I'm doing the best I can here.

I'll take that over a toddler, though, because they'll be kicking that seat. I'm not trying to fight a toddler today, but you better put that baby in check. Don't be kicking my seat. All right, let's go to James in Harrisburg, Pennsylvania. What's going on, James?

Not much. How are you doing?

Better than we deserve, my friend. How can we help?

I'm calling on behalf of my parents. My parents recently asked me to attend their financial advisor meeting with them. And I'm not sure. I've been listening to Dave Ramsey for a while, and it doesn't seem like it's what Dave would recommend or what you guys would recommend. So they're roughly right at half a million dollars or 475,000. And a third of that is in a annuity fund that will, once they start to retire, they'll start paying out X number of dollars, like 10 grand or something a year. Yeah.

What annuity is it? Do you know?

I don't know if I can say the name.

What do you mean? Is it like a fixed annuity variable, index? There's all kinds of types.

Yeah, I have no idea. I assume it's growing value of some sort. Like the cash value is much like, 156 of it is cash value. They pulled it out and there's like 220 some actual value in it.

Okay. Well, in general, we are not a fan of annuities. They may have a time and place. I can tell you Dave Ramsey has zero annuities. They make sense for very few people. And the issue, one of the biggest issues I have with them is they're expensive. They make the advisors a whole lot of money. And so that's my only fear. I'm not saying they're a bad person. They may have a reason to do this, but I have a lot... My red flags go up. My spidey senses start tingling when I hear that someone's getting pushed into annuities. Did your parents want this for a reason? Are they scared market risks? Because that's usually who this is for.

I don't know that they're necessarily scared of market risks. It's more they want to be able to sustain through their retirement. My mom's 62. She's not planning on retiring today. She's going to work a few more years and retire, but they want to move the whole thing into this, and it just doesn't seem... It's like, You have enough money, in my eyes, to sustain off interest because they live a super within their means lifestyle.

Yeah. Are they in Baby Step 7 with a paid-for house, no debt?

Correct. Okay. James, how's your financial situation?

My wife and I are in Baby Step 2, where we basically have a truck to pay off yet, and that's it.

So I love that you're going with them on this and that they invited you to go to this meeting. I would The hard part about this is you're not where they're at yet, and to offer advice in that area could be tough unless they're asking you, James, what do you think we should do? Are they?

Yes, they definitely asked me for advice. They asked me to come along because I've been rambling, rambling to them about you guys for the past two years and how I'm excited to get debt-free, or my wife and I are excited to be debt-free. And they were like, Well, they really weren't involved in their investment. I feel like they received some money from my grandma when she passed, and they just took the financial advisor's word for it and said, Just here's the money type thing.

So if you suggested and said, Hey, I came with you guys. Here's what I heard. I'd love for you guys to get set up with a smart vestor from Ramsey. To get a second opinion. This is the people I've been getting advice from that I've been telling you about. Do you think that they would do that?

Yeah, and I already recommended that to them. I said, I want to sit down with someone else. And what'd they say? I don't trust your advisor, but I want to get someone else's opinion type thing.

What'd they say to that?

And my mom's all for it. So my Right. But your dad's not in the best health, so he's not fully involved with leaving to go meet with people, stuff like that.

If she's open to it, you set her up with the smart vestor, maybe Maybe you sit in on that conversation, too, if your dad's not able to sit in. I think that's where you take it from there. The great news is that they're open, which I think is wonderful. Maybe a little too open with the other advisor.

Yeah. I think they need to... We always say, Don't invest in anything you don't understand. Until they fully understand it, and I would not just trust the advisor's explanation because they're clearly going to do a good job selling them on it. But I'll tell you this, fixed annuities, if that's what they're in, barely keep up with inflation. If it's variable annuities, it's one of the most expensive and complicated financial products out there. Then indexed annuities is another form, and it's similar to index universal life insurance where it's tied to an index, and so the returns are tied to that, and there's caps on gains and protection against losses and all that. But the key here is with that one, a subpar returns and super high fees. That's always my concern when you're trying to mix this insurance product with investment. Not to say there isn't a time or place for it. If they really want the guaranteed returns or the estate planning benefits, and they're in baby step seven, and they have amassed a serious amount of wealth, maybe it's an option if they're super spuked by the market. I don't think that's the case here.

And so your spidey sense is all right. I would get a second opinion and try to advise them against this. Do you know what they're invested in right now in this portfolio?

I do not. No, I literally sat down with their advisor like two weeks ago. This is the first time they actually left me into their finances or brought me into the loop and asked for my opinion on things.

Well, that means they also had a little bit of That's a red flag. That's right. And so if you want to see them in a retire of dignity, I would stay away from this annuity based on what you've told me. And you can jump on ramseysolutions. Com and get connected with a smart investor pro that can give you that second opinion. But you're a good son, man.

We're at the very least, just leaving it as it is.

If it ain't broken, don't fix it.

If it's not already in the annuity.

Good mutual funds and all that and good equities, and I wouldn't mess with it. Diane is in Chicago up next. What's going on, Diane?

Hi. Hey, thank you so much for taking my call. I love you guys. Oh, thank you. I started listening to the Ramsey show about six months ago. My son actually got me hooked up with you guys. You guys ask a lot of times about people's networth, and I understand the concept of assets minus liabilities, but I'm a retired police officer, and I receive a defined benefit pension. And so I didn't know if that should be considered as an asset, and if so, how to quantify it.

You know, there are some fancy, complex calculations you can do to find the present and future value of your pension. So that might be one way to do it. The other way is just to figure out what is the actual cash value today. Is there a lump sum? If you took a lump sum, what would it be?

No, there isn't that option.

Okay. You can go online and use a pension calculator and find out what the value actually is, and you can add that to your networth. Networth is one indicator of how well you're doing financially. It doesn't present the whole picture. You can add in what you've put into the pension as a way to calculate it into your networth and use that. But there's no simple way to say, Well, my pension is 4,000 a month, and so it's going to be X added to my networth. It doesn't really add to the balance sheet in a perfect way, but you can use calculations to get you an idea. The key is, are you going to be able to retire with dignity based on the income streams you have from your investments plus pension?

Yes, I'm currently working now. I have an encore career now, and that has a 401k that I've been putting 15 % into. And between my pension and my investments, I think I'm going to be fine.

Yeah. What's your networth without the pension?

640.

Awesome. And you still got a ways to go in the workforce? About five years. Awesome.

You're doing great, Diane.

Yeah, I'd keep climbing. If you can get that networth and nest egg to a million bucks plus a pension, I think we're in good shape, Diane. You can get connected with a SmartVestor Pro to help you calculate that as well. That puts this hour of the Rambly Show in the books. Until next time, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.