Transcript of Wealth Is A Strategy, Not An Accident

Brought to you by the EveryDollar app. 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 Dave Ramsey. Jade Washaw, number one bestselling author, Ramsey personality, is my co-host today.

Chris is in Phoenix. Hey, Chris.

How are you?

Hey, I'm doing good.

And you?

Better than I deserve. What's up?

Hey, so I'm in a deep situation. So this is kind of a serious thing with me and my family right now. So I have a mother, single mother. I have 3 other siblings. We are from Wisconsin. And my mom, she does pretty good financially. She's a doctor, but she wanted all of us to go to college. With us going to college, she took out multiple Parent PLUS loans in order for us to go to school. She moved us out to Arizona. So she kind of took care of us, like paid for my rent for 2 years while I was in school, graduated. Now I'm in a good financial position. My mom is in Arizona and she wants to purchase an $800,000 home. They won't let her purchase the home because of her debt-to-income ratio from the Parent PLUS loans that she took out for us, me and my siblings. I'm kind of the more financially responsible one. So she asked me if I could— you know, be a cosigner on her $800,000 mortgage. Keep in mind, I'm only 22 years old. Um, you know, I have my own place, I have my own car. I don't really have much debt outside of, you know, the Parent PLUS loans that I'm helping my mom with.

But she's kind of guilt-tripping me and saying, hey, out of everything I did for you, this is the least that you can do for me. So it's kind of a fight with the family, an $800,000 mortgage that I'm scared to cosign because one, I don't know if I'm ever going to be able to get off of it. And two, I don't— my mom is, she's, she's pretty smart. Like she's not like—

No, she knows she's not.

Well, there's, there's something, there's something really important here that can easily be missed, which is just because something turned out okay doesn't mean there wasn't a mistake attached to it. Right? Like you guys, you ended up in college and you guys are okay, but there was still a mistake that she made in co-signing all those loans. Otherwise she would be able to buy her house, no problem. And there would be no debt-to-income ratio issue.

So.

So you've got to go to her and say, here's the thing, Mom, uh, I thank you for everything you've done for me, but there's still— cosigning is not a good thing. And the same way that you're having problems because you cosigned, if I cosign for you, I'm signing up for the same set of problems. I'd rather do this, and I'd rather you find a way to do this in a way that there's no mistake attached to it.

Agreed.

Got it.

Yeah, but she's not going to accept that because she's already gone into travel agent guilt trip modes.

But oh my God, yeah, it's been so bad.

Yeah, so let me ask you, well, How much Parent PLUS loans did she take out in total? Do you have any idea?

For me, all 4 of my siblings, probably around $200,000.

Okay. And you said she's a doctor?

She's a doctor, yes.

What does she make?

She probably makes around that— I would say around $160,000.

Okay. All right. So I'm going to gift her a Total Money Makeover book from me and a year's a subscription to the EveryDollar app and suggest that she decide, starting today, that she become financially responsible for the first time in her life, because what she did was very irresponsible. It was stupid.

Okay?

Mm-hmm.

What she did was stupid. It was of good heart.

Mm-hmm.

And she was intending good things, and she was putting herself on the line for her children, which sounds like a good warrior princess single mom. I appreciate all of that. But then to turn around and ask a 22-year-old to help you buy a million-dollar house, you ought to be ashamed of yourself, lady.

Right.

That's ridiculous.

Okay.

And as a, as a, as a dad of children that are grown, they're not children anymore, adults, Generation 2, that are responsible, I would never do that to people that I love. And it's just wrong. Okay, so no, you don't get to buy a house because instead you chose, Dr. Lady, to go into debt to send your kids to school. I don't agree with your decision. I agree with your motives. Your motive was sweet and kind and noble, but your decision was stupid, and now you have to work your way out of stupid so you can buy a house. So for the next 2 years, you get to live on $60,000 and put $100,000 on $200,000 worth of student loans for 2 years, and they go away. Boom! And then you have a life instead of screwing up your own kid's life that you set out to help originally. Now you want to— now you want to screw it up. So that's my message to her. You can play this for her. Quit guilt-tripping your kids. Suck it up, buttercup, and clean up your mess instead of dumping it on your 22-year-old.

Yeah, that's right.

Now, I love you, Mom. I'm happy for what you did. But that's my message to you from an old grandpa to a soon-to-be hopefully old grandma. And you start— you clean up this mess, and then you don't Saddle your own children with this. And so here's what's gonna happen though, Chris, okay? She's not gonna do any of that, probably, and she's probably not going to accept your no.

She's probably gonna— you're gonna feel blamed.

She's going— she's gonna blame you. She's gonna be mean. She's gonna be nasty. And you're— she's gonna get her feelings hurt, because boundaryless people, when you put up a boundary, always resist the boundary. 100% of the time.

Well, and she's saddling her responsibility in the deal on you.

Yeah, you didn't sign up for this. She did. You didn't ask her to. She did. So you're set free, my brother. Do not do this, whatever you do. But also, do not expect it to come without consequences of her whining and rolling around on the floor, foaming at the mouth, or whatever it is she's gonna do, okay?

Right.

And my siblings are also— it's like a whole family thing.

Well, I'll tell your siblings to bite it. You know, they don't get a vote anymore. You're like a free 22-year-old man that gets to do what he wants to do with his life. You are not required to do this. And your siblings, by the way, are irresponsible too. Hello? Which also nullifies their vote.

But— and here's the other part of this— you're young, and the more that you establish your boundaries in this way, and the more that you draw a line in the sand and say, I'm not going to participate in behaviors that I know are stupid choices financially, over time, the less you'll be pulled into that orbit of stupidity.

Here's what you're saying. Here's the message you're delivering while you're doing this, and you didn't even mean to. The unintended consequence is your sibling's wife now knows she can't call you for money, right? Because Chris has got one big answer. It's that, it's that magic ancient word. It sets you free. No. No one says the word anymore. It's ancient. It's a sound that has disappeared from our culture. You're not allowed to say it anymore. But I've taught people all the time, "Be defiant, not compliant. The answer is no." You press your tongue towards the roof of your mouth, you release, make a kissing motion. "No." That's how it looks, that's how it sounds. It's an interesting word. We don't hear it much anymore. You're not allowed to say it to people because you get labeled all these things if you say, "No, that's foolish." No, that's wrong. No, that violates my ethics and my values. No, I'm not going to do that. No, that's not helpful. No, at the end of this story, we'll all be pissed if we do this. So no. Because that's what's going to happen. You're going to get married and have a kid, and you're not going to be able to buy a house because you're cosigned to your mother, who's still going to be chained to Parent PLUS loans and an $800,000 mortgage and can't get you off because she can't refinance it.

and then probably the house is gonna get run down and can't even get sold because she can't keep it up. Because this is a pattern, dude. This is what's, you know, there's nothing good going to come of this. Please endure the pain of everyone not liking your answer because 10 years from now they'll be happy you answered this way.

The kids call it standing on business.

Oh, there you go.

Yes, stand on business.

All right, there we go. What's the one that Deloney says he says, "Accept regret more than—" Oh boy, I'm not going to get it. Because I can't make it come to my head either, but it's perfect for this. But anyway, we'll remember it later. Guilt over resentment. Guilt over resentment. You'll be resentful later. Choose guilt now versus resentful later.

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Lucy's in Charlotte. Hi, Lucy, how are you?

Hi, good, thanks for taking my call. Hi, Jade. Hi, Dave. How can we help? Um, yeah, so I was hoping that you can help settle a debate between my husband and I. And by debate, I mean more me making fun of him for this, but I'll let you know what it is.

Oh good, we get to make fun of him.

He's scared. So, um, we got married in January. We've combined our finances, so we have a joint account. How old are you guys? I'm 34 and he's 35.

Okay, all right.

And we are very blessed to be financially stable. I pay my phone bill from our joint checking account. It's prepaid, it's great. Um, he and his 3 siblings, they are still on his parents' phone bill that his parents pay.

Oh, that's sweet.

He says if it's not broke, don't fix it, and I just think this is crazy.

It's broke. You're a 35-year-old man. You should have been off your cell phone, your parents' cell phone plan, 10 years ago. Yeah, yes, you should make fun of him at length. Okay, this is exactly what I thought. Does his mommy fold his underwear too? I mean, no, surprisingly not.

This is the only thing that I, I just think it's crazy and he thinks it's normal. So no, it's not normal.

It's not normal. It's, it's, it's, it's more normal than it should be, but normal kind of sucks in our culture. We've gotten people all confused about, you know, we You got 35-year-olds living in their mother's basement still playing, you know, Call of Duty because they've never actually figured out what duty is. And so, yes, crazy.

So he probably— he hasn't paid the bill in 15 or 20 years. He's never paid the bill. So he probably wasn't even thinking about it. Let's be fair there. He probably wasn't even thinking about it. Then you brought it up. That was his opportunity to go, you know what? I forgot about this. You're right.

I should be like a grown man and stuff now. I should pay my own bills and stuff now. Yes, because that's what adults do and stuff now. Wow. Yeah, and it wasn't— that's fun. Yes, we should all make fun of him on behalf of all the 35-year-old mama's boys out there. We should make fun of him mercilessly. Mercilessly. Yeah, you win, Lucy, you win. Touchdown. That's funny. Uh, it, it is very funny, and it's cute, and, you know, we'll have some fun with it, but it does bring up something that— I mean, we did a show yesterday on real estate, and the number of single ladies buying a home is now 3 times the percentage of single men buying a home for the first time in history.

Which is interesting because women tend to earn less dollars in general.

Yes, not always, but they also tend to want to make a "home," so to speak, a nest. And but what we're seeing is, is that we've got— the numbers vary depending on who you read and who you believe, but somewhere between 40% and almost 50% of the single males under 30 are living at home still.

Well, this goes back to a lot of the content that you were talking about earlier in the year, because there's data that's attributed to that, right?

Yeah, well, it's the— you know, there's a couple of things we're seeing that are causing that. Those guys are not— they don't feel like they are winning in the marketplace for various reasons, and so they are further trapping themselves by being the generation that has sold their soul to DraftKings. The sports betting is through the roof, and it's killing them. They're losing like hand over fist. They've made, you know, DraftKings and whoever else just unbelievably billions of dollars in a very short period of time, and that's where the crypto bros live. 'Cause they're swinging for the fence. They don't think they can hit a single and get on base, so everything they do is a desperate move. It's a bet on a football game or a bet on crypto, and that's the only thing that's gonna get me out, 'cause I can't do slow and steady. It doesn't work for me. I'm too scared. I'm too stuck. I'm too whatever. And I blame mom and dad, because, you know, in my 20s, there were times as a I got married at 22, but in my 20s, in college, and as a young married person, there were times I was terrified, but it was really good for me.

A lot of wonderful things happen out of a healthy desperation. Uh-huh, uh-huh. Because I knew if I didn't do it, it wasn't gonna get done.

Well, that's what I was gonna ask. Do you think it's a low expectation of, "Hey, we don't even expect you to do this," or do you think the expectation is scaring them, and it's like, "Hey, I don't think I can meet this.

I'm not even gonna try"? Well, it goes all the way back to early childhood. Teach your children to do hard things. Yeah, teach your children to do hard things. And then at some age, early 20s at the latest, like when you come home from college, you can't come home. Be a man, my son. Oh yeah, get a place to live. Moms and dads are not doing a 28-year-old favors when they're spending their evenings on binging Netflix They're betting on sports and with DraftKings, they're buying crypto and they're excellent at video games. You have done them no favors. You're a child abuser because you've said, who wants to date that guy?

And that, that's the problem. Yeah, that's the problem too.

What father wants his daughter dating that guy? Well, Daddy, he's a dreamer. Oh God, they're going to live in the basement.

"I want to see that you can go out and make a life before you add me to your life." You know what I'm saying? Like, I want to see that. I want to see it happen. I want to see that you can get a place.

The dictionary is the only place that success comes before work. Everywhere else, work comes before success. And so, you know, moms and dads, an eagle that is not kicked out of the nest pretty quickly becomes a turkey. And so we need to kick the little eaglets out and let them have some terror. Oh, it's hard out there. It is not hard out there compared to when you did it, moms and dads. It's the easiest and best time in the history of the world right now. The stock market's freaking booming. Jobs are everywhere. Now, not $150,000 a year jobs for people who got a degree in left-handed puppetry to follow their passion. No, people who actually are working at things that the society needs. It's out there. And if it's not, give them a lawnmower. Run down to Home Depot, buy a leaf blower. Rich people are afraid of leaves. You've got a job instantly. Instantly, "Brrr," it's the sound of success. Facts. You know, get it, baby, get it. So the wussification of America is beyond belief. We have killed a generation of young men by not teaching them how to throw their shoulders back, lean into the harness, and pull something.

Now does that sound like a dad joke? I don't care. I'm observing the socioeconomic data. I'm also talking to the young women who wish there were some more men out there that they could date instead of a mama's boy living in their mother's basement basement. And it's just ridiculous, you guys. It's out of control. And I gotta tell you, I got a whole bunch of good ones. It's not all— it's not the entire generation. We've got 750 in their 20s working at Ramsey right now, and they're incredible. Their eyes are shining, they're passionate, they're talented, and they can balance a checkbook, and they can pay their own light bill and buy their own milk. And you know, this is a— I mean, Lucy's call is fun, and we can have fun and joke around with her about winning her argument. And yes, he needs to get off cell phone bill. But it kind of points to this whole other rant. Yeah, it does. This whole other issue that we're running into. It's affecting the housing market. Okay, so twice as many women, single 30-year-olds, are buying homes as men, 30-year-olds. First time in history. Why?

I don't know, other than they're maturing emotionally, relationally faster. I don't know.

And they don't want to wait on someone else to—

if they're waiting around, they ain't waiting on a, you know, the— what is it, the knight? Yeah, in shining armor. Thank you. Because his armor is pretty tarnished because he's been playing video games all day.

He needs some WD-40.

He needs to get him a little stainless steel, rub that armor, shine that. Golly, you guys, come on. The great news is for you young men that will decide you want to shoulder up, you're going to be so rare that you're going to have your pick of the litter, baby. You, I mean, you got a guy that works and pays his own bills and is walking around and is kind and gentle and has integrity. You can have anything you want out there, man.

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Scott is in Chicago. Hey, Scott, how are you?

Good, sir. How are you doing today?

Better than I deserve. What's up?

So as a travel tech, it's really hard to stay on a budget as far as food and staying with decent nutrition. What do you recommend?

Um, I'm sorry, the nutrition is the problem or just the impulsiveness? Um, both.

So it's really— I'm out of the— I'm— I don't— I'm not at home like except for 2 days out of the month, 3 days out of the month. Okay. So when it comes to like homemade meals, stuff that has like good, and it's actually good for you and it doesn't cost an arm and a leg, that's where I'm really struggling when it comes, I'm on Baby Step number 2. I'm under 10 grand left in debt. I'm getting there. Last month I was able to put like $3,000, close to $3,500.

There's kind of 2 questions built in if I'm understanding. Number 1 is how do I not go over my allocated amount that I have to spend? And number 2 is how do I literally physically create create food that's acceptable for a human being to eat while you're on the road, which that's really hard. But Jade can help us with that.

Yeah. What is your budget? How much do you— can you spend a week?

Uh, $240 is what my per diem is.

That's a lot. You have a per diem? That's wonderful. Yeah. Yeah.

Well, that's wonderful. And you also— because that, you know, that's plenty, I think, for one human being. And then the other—

$1,000 a month.

Yeah. If you can't do that, we got— we've got other problems.

$240 200 for— 240, sorry. For the month or the week? For the week.

For the week. 240 times 3 times 4 is $1,000. Yeah, it's a lot of money. Um, yeah.

Okay, so tell me, what are you trying to take most of that and put it towards the debt though?

So, okay, so you've cut it down.

There's the problem. Okay, so how can we eat for $240 a week or less healthy on the road, Jade?

Yeah, I think you need to find healthy meals that are already prepared. If your hotel room doesn't have the little kitchenette where you can do some things on your own, then you when you're going to the grocery store and you're going to the deli area and you're picking up salads and you're picking up grilled chicken and you're picking up grilled tofu and you're picking up things that were made fresh that day, they're not filled with all, you know, you're not gonna—

Do people pick up tofu on purpose?

I've done it before. Oh, that's pretty scary. But my point is you're not gonna pick up, you're not going through McDonald's, you're not going to Sonic, you're not going through the drive-thru. You can do something just as quickly. You're just popping in the grocery store, picking up something that's pre-made, What would keep you from doing that and what has kept you from doing that is the question, because I think you know that, right?

That what I said is not a minimum of— Yeah, I work a minimum of 10 hours a day, often goes to the 14-hour, uh, day. That's kind of where going to the grocery store is kind of like, uh, are you saying it's closed by the time you get there?

Is that the problem? That it's something—

not always, but also it's like by the time I get done my last job, the closest grocery store is like 30 minutes out. Okay. Okay.

That would be Walmart. What I hear is there's pre-planning that needs to happen. So what's happening is the, the time is happening to you. You haven't thought about it at all and it's time to leave work and you're like, oh crap, it's 8 o'clock. What's open? And now you're having to solve the problem on the fly. What I would suggest is solving the problem ahead of time and saying, here's what my rhythm has to be. I have to go to the grocery store on X day and I grab 5 meals and I keep them in the refrigerator in the hotel, or I keep them in my cooler that's refrigerated in my car. And you just solve it ahead of time. This is just a pre-planning thing. I don't think it's a money thing. I don't even think that it's a, you don't know what choices are available to you. I truly think it's just a getting ahead of it and planning ahead. Because how long do you spend in each city or in each location?

Uh, normally a week to 2 weeks. Perfect. And then they kind of give me different regions in that area.

So, so you want to take, take your flight in, you fly in on Sunday usually? Oh, I drive.

I have a work truck because I have tools. I'm a fiber technician. Oh cool, like I do even better different stuff.

Even better. Okay, so you're scheduled to get there 2 hours earlier than you used to, correct? On the first day. And you go to the grocery store and you load— you go to the grocery store and you load your cooler for the week with things you're going to make when you get back to the hotel room. Got it. That's the only thing you can do. That's all you can do. Because otherwise, because, you know, if you— and you could take, take your lunch with you during the day. Get up in the morning, make you a lunch, take it with you. We've all done that, just about. And, you know, how old are you?

I'm turning 30 this year, and I'm going to be debt-free by 30.

Good for you. Well done. I'm proud of you. You're killing it, man. It's a great question, by the way. Yes, Scott.

When my, when my husband and I, we used to do musical tours around the United States. And sometimes a tour could be 14 or 21 days. And so that's what you do. And you could be in a different city each day. And so that's what we had to do. But our hotel was kind of in a central point. And so we would, we'd go to Whole Foods or we'd go to Publix, load up on the things we want. Just like Dave said, some things would be quick and prepared that we can just pull out of the refrigerator and heat up. And other things, because we had a kitchenette, we could go in and say, okay, well, I am gonna go ahead "Grill this piece of tofu," or "I am gonna go ahead and, you know, slice up this salad myself." And it truly is just getting ahead of it, and that's all there is to it.

Yeah, so pre-planning in detail helps you do two things. One is it keeps the thing from happening to you. You're happening to it. You're being proactive in terms of the nutrition and the food selection. And you don't ever see the inside of a restaurant with what we're laying out.

No, and you're gonna spend less money, 'cause now you're not doing this.

You're gonna spend a lot less money, and you're gonna get the stuff from from a nutrition and health standpoint that you're actually looking for there. And you'll learn about that. It may be that you like— I think probably one of the best things on the planet is a ripe tomato, personally, because I'm from the South. A tomato sandwich? And I'm just saying. So if it was me, and if it was my wife too, we would probably figure out where the closest farmers market was to where I'm getting ready to go to work for 2 weeks, and I'd probably hit that puppy on Sunday afternoon and load the load the veggies up, the fresh veggies like that. Dave, what do you make?

My mouth is watering. I was gonna say, what's—

I don't make anything.

No, what's your go-to meal? If Sharon said, "Dave, it's on you tonight," what are you making?

We would starve. Reservations. I would make reservations.

Not even a steak on the grill?

Okay, I can throw a filet on the grill. I can throw a hamburger on the grill. I'm really good at a— yeah, that's it. I believe that. I'm lame. But I'm really good at washing dishes. That's good. You gotta do one or the other. I'm helpful with that. But I'm not completely a couch slug. I don't mean that.

But yeah. But you bring up a good point because there are a lot of jobs that— over-the-road truckers, like, you have to be careful.

You can't sacrifice— You'll end up very unhealthy if you live on fast food. I mean, what was the Super Size Me? You remember the McDonald's? Yes, I do remember that documentary. I cannot eat a Big Mac because of that guy. That guy passed away. He did. Yes, he did. You're right. Oh, that's awful. I shouldn't laugh. It's the irony of it. Oh man.

I mean, we all saw it, but it's true.

There's a level of health. That was about 25 years ago or something. Poor McDonald's, it killed their sales.

Even, let me take it around this way. Even in Baby Step 2, when you are sacrificing everything, which you should, you should be sacrificing, cutting everything down as much as it can. However, I'll be the first to tell you, you, uh, number one, beans and rice. Rice and beans is not literal. If you like rice and beans, you should eat it. But you— Dave, people think it's literal.

Example— I know, they send me cookbooks.

They think it's only beans and rice.

I get at least two rice and beans cookbooks.

I know, but let me just say for the people—

thank you, people, we thank you—

but it just means, guys, cut it back if you can. A grilled cheese sandwich is fine. You can have grilled cheese. You can have a peanut butter sandwich. You can have, God forbid, a tuna fish sandwich. But the point is, you're cutting back. It's not an excuse to eat fast food, to eat the cheapest thing, to eat the crappiest thing. Your health matters too, and you can eat healthy food very inexpensively.

If you follow Jade's Instagram, you put up a bunch of good stuff.

I do sometimes. I do, from time to time.

And you're quite the cook, as opposite of me. I do, I do. And you like it. I love it.

You enjoy it. I do. And for the people who don't enjoy it, it's a struggle, because they're the ones that wanna, you know, stuff.

Well, what I want to do is do something efficient, and really good food is not efficient, right? I mean, I'm, I'm not talking about nutritional food. I'm talking about like gourmet food.

Gourmet.

It's ridiculous amount of time. Oh yeah, to create that one bite. Uh-huh. Yeah.

Yep, that's why they can charge for it.

That, and they do. Yep, it's my favorite sport.

Now there you go. Got to find a spouse who's good at it, or good at making money.

One of the two. One of the two.

Ahh!

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Logan is in Denver. Hey Logan, how are you?

Better than I deserve. How are you guys?

Just the same, sir. How can we help?

So my direct question is, when it's time for me to eventually make a cash purchase on my first pure rental property, if I should look at townhomes and condos or single-family homes, does it even matter? Um, I can give you more depth of my scenario if you need.

Um, doesn't matter. Uh, I would do— if you're going to a townhome, I do a single family. I wouldn't do a duplex. Um, and so I do a single family would be my first purchase, whether it's a townhome, a condo, or a standalone. Um, and, um, if you're going to do something that involves an HOA fee or a condo fee, be careful around that because that's obviously going to affect your resale later. And it's also gonna affect your cash flow. Even though you paid cash, if you got a huge HOA fee, then it's gonna eat your cash flow. So be looking at that because some of these condos, if they've not been managed well in the past, they had to catch up on their maintenance and they're hammering the current occupants with high fees to catch up. Deferred maintenance problems. And so you just look at the budget on the condo. You can get a copy of the budget. You can find out about the HOAs and see if you get sticker shock on that or the condo fee or whatever they're calling it in your area. I would always stay in the bottom half of the market for sure.

Yeah, Logan, what do you plan to spend? What were you thinking of spending?

So I'll try to give you a 30-second long story short. I just bought my first ever home and I'll have it paid off because I'm renting out both bedrooms. Townhomes, and I'm 24 years old. So my goal is to sell this place, and then with that, buy two things. One is a cash purchase on my townhome condo in the amount of about $230,000. And then with my leftover money, I'll buy my own primary residence house. Good for you.

Wow, that's fun. That's cool. That's a good plan. And all with cash.

Well, that's my goal. So I bought my place. I got quite lucky. I've been a longtime listener, so you guys have helped me out with it. And fortunately, I rent out both rooms and I don't have to have bomb tenants because whether they're there or not, I have my mortgage under control. Well done. So I'm trying to plan in advance. This question isn't an urgent one. Yeah, understand, understand. Really what I'm trying to do is just not have my first ever rental property give me a bunch of headaches. And I don't know if the type of property matters.

It doesn't, as long as it's a good quality neighborhood. And the lower the price of the property, the more headaches you're gonna have, because that's it, because that's the type of tenant you're gonna have. Okay, and so I, before I went broke in real estate, I owned a bunch of super low-end stuff, trashy stuff. Yeah, and but the, the return on investment was ridiculously good, but the hassle factor was ridiculously high because we're constantly dealing with some kind of criminal element, you And so it was a real problem. And not 100% of them are, obviously. There's some good people there, don't misunderstand. But it's a lot different when you're renting something for the cheapest possible rent in the market or double that or triple that. So—

Oh, totally.

In terms of who you're having to deal with. And even that goes even so far as to say if you left residential someday and owned a piece of commercial property, Now you've a lot less hassle because you're dealing with a person with a business acumen that's your tenant. Not a— it's not a residential situation. The drama level goes way down. And so anyway, all of that to say, now that— so Winston and Rachel, they bought their first property. Winston loves real estate. He always has, even before he knew me. And he manages all of our real estate now. And his very first property he bought was a small I think it was a 2-bedroom condo, and I think they held that about 5 years, and they made bank on that thing. I think it doubled in 5 years. It was a great purchase, you know. So I don't mind condos at all, but you buy them like— you buy them like you're gonna sell them. And so if you— if it's an ugly house and you get a good deal on it, when you get ready to sell it, it's still gonna be an ugly house, and you're gonna give somebody a deal.

Deal because it's ugly. So, you know, that kind of thing. So just keep that kind of thing in mind. Everything that's a deal is not a deal. But, but if you can buy a good property that you're going to be proud when you're selling it, you can throw your shoulders back and be confident and kind and good on your price and all that kind of thing, then there you go. That's the good thing. Jake is with us, and it's a good question, by the way. Jake's in Atlanta. Hi, Jake.

How are How are you? Doing well, sir.

How are you? Better than I deserve.

What's up? Good. So I am— my wife and I, when we got married at 27, we made financial goals. We really got serious about age 30. And we've been on Baby Step 7 for about 4 years now. Way to go. Yeah. Yeah. So my question is, and it's sort of a two-part question, is how do you stay motivated once you've hit Baby Step 7, being that there's not necessarily goals you're working towards?

Well, there's no desperation anymore, correct?

But you still need to have goals.

You still have a goal, it's just a different goal. Yeah, yeah.

Like, I think our main goal now is like retiring at 55. That's it.

Okay. Have you got— have you got children?

Uh, yes sir, we've got an 8-year-old.

Okay, so, um, the framework that is biblical that I've taught— and I'll send you a copy of the book The Legacy Journey, it's in there— is what we call now then, us The first stage of money is now. I have to eat now. I have to pay the lights now. I have to deal with Friday now. Right? And when you get that under control, you get your— start getting your debts paid off, you start having some savings, you start living on a budget, now you're not living what we call hand-to-mouth. And when you're in the now, your head is down, your eyes are on the ground, you're grinding. Now, then. Then is when you get everything kind of under control, you notice this, you start looking up and further into the future to then. Where there is no vision, the people perish. And that's what took you all the way to Baby Step 7. You started saying, I'm gonna start putting money into my retirement, my kids' college, I'm gonna get my house paid off. That's all into the future. You're paying into the future, you're thinking into the future, your goal setting is in the future.

Future. Then when you got to Baby Step 7, it moves from now, then to us. And us is, I want to change my family tree. A godly man leaves an inheritance to his children's children. I want to change my family tree. And so I want to make so much money and I want to teach the children so well in their character, in their emotional intelligence, their spiritual walk, and their financial acumen that they can't mess up. What we're going to leave them, and it's not gonna mess them up because they're solid. And that's the us step. And then the last step, once you know you've changed your family tree, which I knew I did 20 years ago, I'd already passed that one, the last one is them. And, um, godliness with contentment is great gain. And any— every time you read about someone who helps the poor a poor, helps a widow or helps an orphan in Scripture, you're making God smile. And so them is the community. And whether it's the community right off your fingertips or the community around the world where there's a hungry kid, where there's someone being abused in sex trafficking, and you start to go for that.

So I got a buddy of mine that the other day dropped $12 million into a sex trafficking interdiction ministry, and they're gonna stop— you know, there's a certain number of people that are not gonna be able to do that anymore by the time he gets through with them. I mean, it's a big deal. And so he's not thinking about his family anymore. He's not thinking about his family tree anymore. He's now setting goals for girls that have been kidnapped and are stored in a warehouse in X location, including your neighborhood.. And so whatever it is, whatever your thing is, right? And that's his. Yeah. Okay. And you know, he's got a lot of money. His kids are— his kids can't mess it up. He doesn't have to worry about eating Friday. And you know, and he's got his 401 just fine, believe me. And he just dropped $12 million just like that. And instantaneously this thing is born. And you drop that kind of coin on it, it'll happen, you know. And so what's the thing you need to move a needle on? What's the thing that's your heartbeat out there that when it— when you see it, it makes you cry?

A social thing. And that's a good reason to work. The reason I work now is just generosity. I mean, I don't— our investments would provide us with whatever lifestyle we want at this stage, but now I keep working because I love doing this and because I get to hang out with guys that drop $12 million into something. As your business grows, everything becomes more complex. There was a time when Ramsey Solutions had too many disconnected systems and not enough visibility across the business. We wasted too much time chasing information instead of making decisions. That's why we got NetSuite. NetSuite brings your financials, inventory, CRM, and more together in one place. More than 44,000 businesses run on NetSuite, including Ramsey, and now they're taking the next step step with NetSuite Next, making it easier to put AI to work across your entire business. NetSuite Next helps you make the most of your time, automating routine work like forecasting demand and following up on overdue accounts. With NetSuite Next, AI is built into everything you do, so you can ask it questions just like when you're talking to a member of your team. And right now Now you can try NetSuite Next for free.

If your revenue is at least 7 figures, go to netsuite.ai/ramsey. That's netsuite.ai/ramsey. Welcome back to the Ramsey Show in the Fairwinds Credit Union studio. Abby is with us Abby is in Cedar Rapids. Hey Abby, what's up in your world?

Hi. Hi. I just wanted to call in today to get some advice. Okay. What's going on? Like, so I'm married, um, and I don't want like my financial stress to hurt my marriage and I want to become more financially stable again and feel like I have a future because I lost my job about a year ago.

Okay. And how long have you been married?

Um, since 2013.

Okay. And how old are you guys?

Um, I am in my 40s.

And he is how old? Yes. Yep.

Yeah. In his 40s too. Oh, okay.

All right, cool. And what'd you make at your last job?

I was only making like around $50,000. 86.

Okay. And what does your husband make?

Um, like, I think it's like around $180,000. $180,000? Okay. Maybe $160,000 a year, maybe potentially. Like, it's around that.

So why do you have financial stress if he makes $180,000?

Like, because, um, when we first set up our marriage, like, we didn't set it up like where everything was like totally together.

Um, does that— I mean, so for the last year you haven't had a job. I assume out of the $180,000 he's feeding everyone in the house and paying the bills, correct? Yeah.

Like we've had a couple of changes, like, cause we moved to a different house. So that helped a lot. Um, but there's just a lot of things that I noticed that when I had a job were easier. And then like now So it's, it's a lot different.

When you say that your money is not together, does that mean you're on the hook for a certain portion of the mortgage and you're on the hook for a certain portion of, you know, the bills? How does it work? And explain how it works in your house.

Like right now I can't pay anything because everything's gone from all of my money. Like everything I had saved up is like, it's gone. There's nothing left.

You've gone through all of it.

Yeah.

And so then what happens when you don't have your share of the money? What happens?

Okay, um, like, I just don't— I just don't buy stuff. I don't— I just choose not to, like, buy the things I used to.

Got it. And you have zero access to his money?

Um, pretty much, yeah. I mean, I could talk more with him about having more access, but I don't. Like those, those conversations don't go well because like my power, I feel like it's less from not having an income right now.

But explain it clearly. Do you get an allowance and it's just not enough? Tell— give us more detail. What does it look like? Do you have a checking account card and you have access to the checking account or you don't even have that? Tell us in detail.

Yeah, I have a checking account. I mean, like, I guess I could say it has maybe $5,000 in there and I'm just scared to use it because I don't know I don't know what's gonna like happen if I use that up and then really like have absolutely—

Well, I mean, you have used everything up except that $5,000 and he's been paying the bills. That's what's gonna happen. You make it sound like he's not paying the bills or he's threatening you or something. What's going on for real?

No, like it's just that our income was not set up together.

And so I understand, but your household still has $180,000 coming into it and you're not hungry. So what is the stress?

Um, like buying things that I used to buy. Like, I, I guess it's like I just want to feel like more secure in the future. Like, I really feel like I, I don't know what is there, the financial solution besides that.

Have you gone to him and said, hey, here's the deal, uh, I feel like we're living two different financial lives, and because I no longer have a job, I, I feel like I don't even have a vote anymore. I feel like I don't have a life anymore. I would love for us to get to the point where our money is completely shared. There is no more yours or mine, it's just ours. How would you feel about that? Have you said anything like that to him? And if so, what did he say in return?

Um, I don't think I've been maybe that specific. Those are words that would be really useful, I think.

Okay, good. Now, when I say that to you, do you have any concern over how he would react to that? Or do you have a concern that he might, um, that, that might be volatile? Do you have a concern? Do you have any concerns?

I mean, we've talked about it a lot before, but those would be maybe better words to use to try to stick up for myself maybe a little bit more. Um, but I feel really— I just felt really, I guess, maybe insecure because of no income, and I just feel like—

okay, have you had, uh, while you've been ill or while you've been off, or have you been ill?

Um, a little bit, I have. I have not felt the best. Like, it's affected me, like, yeah, with my health a little bit.

Yeah, in what way?

Like my mental health, for sure. Like, seeing friends and then seeing, like, family and feeling like, like, unstable.

I don't know anything about anything. I'm just listening to your voice and it sounds sad.

Yeah, because like, I feel like without having like my job, I felt like I lost a lot of like freedom in a lot of ways.

I understand, but that's, that's because you haven't done anything about it because you're sad. So I think you need to do two things. One is I think you probably need to sit down with a good therapist and there's a possibility you're dealing with something like depression or something like that. I don't know. But you just sound very— it's dragging and sad and slow and low energy versus someone who's bright and sparkly and sits down with her husband and goes, "Hey, Bubba, we are now sharing the money. You remember that part, for richer for poorer? This is the poorer part. And we on the same page starting now. Ready, set, go." And I don't hear that coming out of your voice right now.

I don't. And I, I don't want to project onto this, but I have an inkling some of that is coming from a result of this marriage. Yeah, whatever this guy is to you, it doesn't sound like it's in a healthy place either.

I agree, I agree. So I think you need to see a good therapist and possibly a good marriage counselor as well, and then that will solve all of this. This is not a math problem, it is not a finance problem, this is a relationship problem. You have a freaking $180,000 In your household, the word panic should not even be in your vocabulary. It's ridiculous. Okay, so, so the way he treats you is ridiculous. The way you treat the situation is ridiculous. The thing you've gone through and the way you all set this up is falling apart. And so yeah, you need to sit down with him and say, uh, this plan is not working. I can't exist this way. I'm gonna go see a therapist. I feel like crap. Yep. And and we're gonna start sharing our finances, ready, set, go. And if you don't think we are, then I'm gonna have— we're gonna see a marriage counselor. If that doesn't work, we're gonna have to see a divorce attorney because this is not working. Yeah, I'm not gonna live where I feel like a worm crawling around and you with a whip in your hand because you make the money and I don't.

That's bullcrap. So, and by the way, my wife Sharon Ramsey has not had an earned income income for 42 years, and yet she has a lot of money. We have shared everything— passwords, her name's on every account. As a matter of fact, her name's on more of the accounts than mine because I don't own anything anymore. So it's, it's gone the other way. But, you know, you don't have to earn an income to have an equal vote, equal standing in the marriage.

That's absurd.

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Easy.

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Okay, today's question comes from Savannah in Colorado. She says, I'm having trouble getting my husband on board with buying our first home versus buying a rental property. We have 25% saved up for a down payment, but my husband wants to buy a rental first and use the income to pay itself off. While we're saving for a home of our own. The problem is we have a 10-month-old and a 3-year-old, and we need more room now. Would it be smarter to buy for ourselves first and then buy a rental? I'm not opposed to buying rentals in the future, but I feel like the family should come first. Uh, Savannah, what you said there at the very end is exactly it. This is really a values conversation more so than, um, a right or wrong thing So for instance, we had the guy that called in earlier. He was a single guy. He said, I'm going to buy this house the proper way. I'm going to rent out 2 bedrooms and I'm going to use that money to pay off the house quickly. And then I'm going to turn around and take that house and buy a rental property.

To him, I say, great, great idea. He's in a different stage of life. And so he can value doing a rental first. For you guys, you've got 2 little ones at home and that's not on your set of values list right now. It's not a high priority to have a rental property. Property, number one is let's have a stable place for our own family since we have a family. And so in that case, I actually think that you're— I tend to agree with you. The hard part for you is going to be sitting down with your husband and saying, here's what I value today. Here's what my values are probably for the next 5 to 6 years. And it's not having a rental property.

So one of the top real estate experts in the nation was with us yesterday. Yesterday, and he gave us the statistic that a married couple that owns a home has 40 times the net worth of a renting couple. There it is. There you go. That's simple. So your husband's what's known as wrong. That's what that's called. It's not a matter of choices. It's not a matter of values. He's just wrong. So establishing your personal residence and getting it paid off as a part of building wealth is a primary tool. And it has unintended consequences, unforeseen things that when you're simply looking at the math— because your husband's spending way too much time on the internet looking at stupid butt stuff where they're telling him to buy real estate. And his TikToks. Attack hours are way up there, okay? And so, um, he's getting all the nothing-down crap fed to him and all this stuff and how you get rich in rental real estate and all this garbage. And, you know, real estate is a good investment. I own several hundred million dollars of it. I love real estate. That's not the point. The point is, when you own a home that the landlord cannot call and say, I'm doubling your rent this month.

When you own a home that the landlord cannot call and say, "We're going to put the home up for sale, you're going to have to move." When you own a home, the stability that is represented psychologically and spiritually in the family results in a calmer situation. There are medical implications for the family. The children aren't as ill because there's a stable, calm, protected, safe environment. The anxiety level of the entire family is going down. And guess what? Dad and mom are better at their jobs because they're not having to look over their shoulder for an incoming arrow or spear or bullet. That the landlord's getting ready to throw at them. And so these are unintended consequences that— and unforeseen, that you don't realize. That's why— that's some of the reasons, not to mention the home goes up in value, and not to mention you've stabilized the largest expense and locked it in in your budget, which is housing. It's not gonna go up every year, and if it's a rent, it goes up every year. Meanwhile, he's trying to outpace that by raising the rent somewhere else on a rental he bought because he watched too much TikTok.

TikTok. And get off the internet, dude. You're being fed trash. Your wife is wiser than anything you have read. Who can find a virtuous wife? For her worth is far above rubies. The heart of her husband safely trusts her, and he will have no lack of gain. Hmm. Savannah, your husband married way Well, he should listen to you. That's where— that's the end of that. Samantha's in Rochester, New York. Hey Samantha, how are you?

Better than I deserve. Hi Jade, hi Dave, thank you for taking my call.

Sure, how can we help? I just have a question.

My husband has an annuity and, and there is about $2,000 between like the cash out value and the, um, guaranteed, um, value. So how much is this thing? Um, about $640,000.

And it's paying what?

Um, it's guaranteed 6%. We haven't annuitized it yet. Okay. Um, But it's, the cash-out value is $620,000, and the annuitized amount is $622,000. Okay, I don't really care about the annuitized.

So you can get, if you cash it out, you're past the surrender period, obviously. Yeah, yeah. So you could just cash it out and walk out with $620,000.

Yeah, but then we'd have to pay tax on it. Correct?

Yeah, yeah, you may, you may have some gain on it. That's possible. Yeah. However, you understand that the market since January through today, when you call here in August, is up 18%?

Well, I mean, that's why it's only $2,000 difference, because the market has done so well.

Wait a minute, I thought you said it was making 6%?

No, it's guaranteed 6%. It makes what it makes.

Oh, it's a variable annuity. Equity. Okay, so what is it making? I asked you that.

Oh, oh, it's making a lot of money. I don't know exactly.

Okay, well, maybe. All right, you need to find out what it's making, and then the question is, can we invest it better? And the answer is probably yes.

But how do we do that? Because if we take it out and invest it, then we're going to pay all that tax. It's going to—

I'm not sure there is all that tax. I mean, you may— how long have you had this?

Oh, he's had it for probably almost 20 years.

Okay, do we have any idea what the basis in the thing is?

Um, I don't know what that means, I'm sorry. That's what—

that's how much he's put into it in total, the initial amount, the monthly amount, whatever it is. How much of the $600 is money he put in? The difference is called the gain. And that's all that's taxable. So I think I need to get you with somebody that can help you unpack these numbers. I can almost promise you it's gonna be worth taking the tax hit and reinvesting it in a better thing. I can almost promise you. Because you're getting all kinds of fees on this that you don't need to be paying. And so, net of fees, net of everything, you know, what are you ending up with? With, and then compare that with what you could be putting it in, and how long with the difference does it take to recoup my tax problem.

Are there ever situations where you could do like a direct transfer rollover from an annuity to an IRA?

Only if it was in an IRA. Mm-hmm. Through their— okay. Which this one's probably not. I don't think. She never mentioned that, and I'd be shocked if it is actually. So, go to RamseySolutions.com and click on SmartVestor Pro. Find a SmartVestor Pro in your area. Sit down with them. Say, I've got a $600,000 continuity. Let's pull the numbers out. Let's untwist this barrel of fishhooks and figure out what we should do with it.

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Gina is in San Diego. Hi Gina, how are you?

Hi, I'm doing well. Thanks for taking my call. Sure. So my husband and I have almost $1 million in total debt. That's 2 mortgages and about $75,000 in student loans. Um, we do have a rental property in Baltimore. It has great cash flow and we have a lot of equity in it, and that income helps offset our really high primary mortgage in California. But my worry is that it is a 126-year-old row home, so one major repair could wipe out all of our profit and put us in the red.

What is that home worth?

It's about $275,000.

It's worth $275,000, and what do you owe on it? About $130,000. Okay, spoiler alert, it's not cash flowing that great. Okay, yeah, it's cash flowing some, but not enough to offset the other. So you have a $700,000 mortgage in San Diego. Is that right? That's right. Okay, so if you sold the house that you owe $130,000 in Baltimore that is worth $275,000, you'd make $145,000 minus the expenses. Does that sound right? Yep. Okay, let's call it for fun $120,000 bucks. Okay, let's pretend you do not own a home in Baltimore and you have $120,000 stacked on your kitchen table in cash. Mm-hmm. Would the two of you go buy a house across the United States in Baltimore as a rental property with that cash?

No, thank you.

No, it's asinine. Of course you would not. The only reason you kept that is because you used to live in it and you moved to California. California. Yep. This was not a strategy. It was an accident. It was by default.

Yeah.

Sell it. Okay. Thank you. For the same reasons you wouldn't buy it again, right, is the same reasons we're going to sell it. Does that make—

is that logical? Yeah, it is. And we do. Yeah, yeah. I think I just needed some clarity because because of the extra monthly income.

But yeah, but if you take $120,000 and invest it, you'll have extra monthly income and the roof won't go out, right, 4,000 miles away.

That's literally my fear. Your fears are accurate.

They're accurate because that's what happens when you own rental property. And that's why, that's why I know you're not cash flowing a lot net. I mean, your monthly rent minus your monthly mortgage payment is a good cash flow, but then you have to deduct from that repairs, vacancies, tenants that don't pay and have to be evicted, times it sits empty while you're waiting to re-rent it, redoing the carpet and the paint or the hardwoods and the paint when the renter moves out.

Traveling to come check on it.

Yeah, all of those things come out. So net, net, net, you don't have a lot of real cash flow here. True. That's how real estate really works. And so all of my real estate's paid for. and yet I'm amazed at how much, how little of the actual rent still gets to the bottom line. And I have no payment, you know, and so when I look up and I see you got a payment that's half of your value, then I, you know, I'm guessing, you know, you're probably renting this thing for $3,500, give or take, and you probably got a $1,500 payment, so there's $2,000 spread, that's $24,000 a year on a $300,000 property. You can cough $24,000. And it's just gone, just like that, right? I mean, it's just that way. So, what we just did, Jade, we talk about here on the show a lot, which is called a sunk cost analysis, which is reverse engineer it.

Yes, and then you can look and see if you would do the decision again. Just from a— it's like a different view, a different point of view.

You can do it with your boat. You can do it with a car. The only thing you can't do it with is your spouse. I mean, would I do this again? But you can't give back a kid, so you can't do it with kids either. But I want to do this again, not with that one, maybe with that one. But the stuff you purchase, the stuff you own, the stock— I'm waiting on this stock. You know, the famous one is, you know, I paid $50 a share for this stock, it's selling for $10 a share, I'm waiting on it to come back up before I sell it. It ain't coming back up, but "Hey, buddy, you got a long wait. And while you're sitting around waiting, you're gonna turn your $10 into $5." That's true. And so, and then I just ask and say, "Okay, that stock is worth $400,000 right now. Would you go buy this stock at $10 because you think it's gonna come up?" "No." "Then why are you holding on to it?" Same exact thing. Same exact thing. So, I do that for myself occasionally too. I reverse engineer it. If I didn't own this property, knowing what I know now, would I buy this property?

Would I buy this thing? Would I do this thing? And the answer is no. Would I go on that trip again? No. That one wasn't worth the— the juice wasn't worth the squeeze, all that. So all those kinds of things. Matt is with us in Seattle. Hi, Matt. How are you? I'm good. How are you folks? Better than we deserve.

What's up? Hi, I'm new to the Ramsey system here, and I'm just not sure kind of where I fit or where to go next. We don't have any debt, and we— except our mortgage, excuse me— but we are currently putting the 15% into retirement and have for some time. Wow, that's awesome. Thank you. We've always been cash savers. Um, just, you know, again, we're going to do some of this.

So you should have done a podcast. You could have made a lot of money.

I don't know. I don't think I got the heart for that, but thank you. Um, what we're not sure of is just a couple things, if you don't mind. Number one is we're putting the 15% away, but we still have some leftover cash each month. We've just been saving it in cash. I'm not sure if that's the smart thing to do. Is your home paid —no, it is not.

Okay. All right.

How much cash savings do you have that's like non-invested money, just cash?

Well, not including the emergency fund, I have $100,000, and then we've got $40,000 in the emergency fund. Okay. Very good.

Matt, you have done incredible. You've done incredible.

Oh, thank you. Thank you. I'm not sure what to do with the $100,000 or the extra cash each month, but my last part is, we also got a baby on the way. Yay! So I'm not sure what to do when she gets here and if I should change what I'm doing with my extra cash, etc.

I hope that makes sense. I mean, you're doing a lot right. You have no debt. We would definitely say pay off your debt. The next thing would be to stack up an emergency fund, which you've done. It sounds like that's probably somewhere between 3 to 6 months of your expenses, which is right on track. You're investing the 15%. Beyond that, yeah, you can do 15% along with that. You can start a college fund for these kids. A 529 would be And then you can start putting extra on the mortgage. What do you owe on the mortgage? We owe about $430,000.

And your household income's what?

$220,000. Okay, so what we teach, to bring you up, you ask what we, you know, you're not familiar with it, so we teach to do exactly what you've done and the methodology, we call it the Baby Steps. But Baby Step 1, save $1,000 while you're getting started. Number 2 is pay off all your debts except your house, work on the smallest to largest. You've done that. 3 is build an emergency fund. Those 3 things are done with intensity. Then you do Baby Steps 4, 5, and 6 simultaneously with intentionality. And that's 4 is 15% of your income into retirement, 5 is kids' college, 6 is go ahead and get the mortgage paid off. When the mortgage is paid off, then you are what we call Baby Step 7, which is debt-free completely. And now it's time to just invest and give out with outrageous generosity. You've done a really good job. I'll send you the Total Money Makeover, which outlines all of this for you. For you. Health insurance is confusing on purpose. You call one company, get transferred 3 times, sit on hold for 45 minutes, and end up more confused than when you started.

That's why I recommend Health Trust Financial. They're health insurance advisors who actually get to know your situation and help you find the right coverage for your life and your budget. Health care needs change as your life changes. Maybe it's a job change, the birth of a child, a new diagnosis, or you're just trying to have more margin at the end of the month. No matter your situation, Health Trust Financial shops multiple top-rated insurance carriers and helps you understand what you're actually buying. I've trusted Health Trust Financial for over 20 years because they help Ramsey fans make smart healthcare decisions. Go to healthtrustfinancial.com today and talk to a real person without pressure or confusion. That's healthtrustfinancial.com. Bob is in Los Angeles. Hey Bob, how are you?

I'm doing very well. How about y'all? Better than we deserve. What's up? Um, I am I'm of retirement age, collecting full Social Security benefit of about $3,000 a month. I get $1,000 a month in a pension from a union and debt-free, house is paid off, no medical debt, no credit card debt, no car payments. Way to go, Paul. The only thing— well, thank you. Um, I was doing the debt snowball before I ever heard of Dave Ramsey. Amen. Um, you had common sense before it was cool. Uh, yeah. Smallest to largest. And then you get a win, you get a hit of dopamine and then you go for the next one, taking what you paid on the last one and adding it to what you did on the next one. It works. Absolutely. Very cool. Anyway, only expenses are groceries, utilities, and property taxes.

And what's, how much is in your retirement accounts?

That's where I'm getting to next. My 401 is sitting with a grand. I put in— $1,000? Excuse me. No, excuse me. $100,000. Oh, okay.

$100,000. Okay. I feel 100 times better.

100 grand. All right. Um, I've had coffee and the adrenaline kicked in.

It's okay. And it's nervous being on the show. I understand.

And then, um, my salary, uh, it's split up into a per diem because I'm an over-the-road trucker in the entertainment business that is not taxed. That goes into my checking each week at $500. I have 50% of the remainder, which is considered taxable and income going to my 401 at $500 a week, and about $500 a week after all the taxes and things goes into my checking account. So at the moment, I'm currently putting $8,000 per month into interest checking and savings accounts. And I'm wondering, is this a good time since I'm at and beyond 7 to just put the maximum legal amount into my 401. How old are you? You know, go 67. I hit Social Security at 66 in 10 months. Yeah. I'm getting, you know, so, and then my wife is getting $1,800 a month. I didn't even add that in. And then I've got some other oddball investments, like $5,000 in a REIT called Arrive that was started by Bezos. As soon as I hit— So if you— How long do you intend Um, the goal is another year or two, um, sell the house and do a direct swap and buy for cash on the Oregon coast and retire there and, uh, go salmon fishing and, uh, repair and restore musical instruments.

I love it. So great plan.

Just to get clear, right now you're investing $2,000 a month. Month, how much more of the $8,000 that you bring home do you want to invest?

Um, essentially another $2,000. So bring it up to $4,000 a month. Yeah.

If we work 24 more months, another $2K is another $50 grand, give or take.

Before, uh, yeah, before things compound, etc. Yeah.

Yeah, and, but I mean, they're not gonna compound a ton in 24 months. So, but you know, if you put, if you add an extra $2,000 to what you're doing now in your deposits into your 401, you're gonna add over the next 2 years, you're gonna add approximately an extra $50,000, which is great. And you're putting how much in retirement today again, one more time?

Um, $500 a week, $2,000 a month.

Okay, so we're doubling it. We're talking about doubling it. Yes. Okay, so instead of $50,000 in the next 24 months, we're going to put in approximately $100,000 in the next 24 months. And you've got $100,000 in there, and that'll have you $200,000 in there, and you're not going to touch it, and it'll continue to grow. Yes, I would do that. Absolutely, I would do that.

And then add to this, I've got $25,000 in a high-interest savings account or a checking account, which I just need to be home to transfer some of that into other accounts. Accounts. I've got another $18,000 in what's similar to your credit union's fund. My credit union calls it Common Sense. Started with $5,000. Automatically $500 a month comes out of my checking and goes into that fund.

No, you need to stop all that. What's the purpose of that? We need to be systematizing. You need your operating budget to operate your household, and then you need to be loading up your 401. Above your emergency fund. And anything in that 401 that you can put into Roth, if they have a Roth option, I would put it all in Roth. It's that simple. So yeah, that's what we're gonna do. Joe's in Albany, New York. Hey Joe, what's up?

Hey, it's an honor to speak with you both.

You too, how can we help?

So me and my wife just got married in May and we combined our finances and we realize that we're kind of— we disagree about one part. Well, actually, I disagree, I should say. She believes in tithing 10% of her income, where I'm more of a person who likes to just give when I feel compelled to give.

What is the basis for your decision on this? A feeling, or are you trying to be following a faith? Are you Muslim? Are you Christian?

Are you Jewish? Jewish? So we're both Christian.

Okay. I believe— I don't care what you believe. Evangelical Christian? Oh yes. Okay, so you go to an evangelical church?

Um, I believe it's an evangelical.

Okay, all right. So, um, are you Catholic? Uh, no, not Catholic. Then you're Protestant, and so you're probably evangelical in Albany, New York. Okay, that makes sense. Yeah. Now, and so then your guideline would be not what Dave Ramsey says or Jade says, but what the Bible says. Or not what your feeling is. Right, not what you feel.

That's what I was gonna say, not what you feel.

Not what my opinion is. Your opinion doesn't matter at that point because you said, "I have submitted myself to Christ. He is the Lord of my life, and his instruction manual is the Scriptures then." Okay. And so let's use that as the baseline. Line. Then if you want to— I mean, if you want to have the argument, but if you want to say the basis for us making the decision is, I don't— it's whatever I want to do, it's my feeling, then you can use that basis. That's okay. But if you're going to say, I'm going to— the basis is my Christian faith, then you would use the handbook. Is that logical?

Yeah, that's logical. I never thought about that.

Yeah, so I don't really— I'm being a smart aleck, but I don't care what Dave Ramsey says. I don't care what your wife says. I don't care what you what you say or what your feeling is at that point, because at that point I'm saying this is what God says to do, and then I get to decide, do I want to do it or not? And it's not a sin, by the way, if you don't do it. It's just this is his guideline, and the Scriptures are very clear in the Old and the New Testament that the tithe, the word tithe in the Hebrew literally means tenth, and evangelical tradition for the last 1,500 years is that the local church represents the Old Testament storehouse, and the Old Testament storehouse took care of the Levites, which were the priests and the pastors, and it took care of the widows and orphans, the poor and the struggling in your community. And your church should be doing both of those things, and you tithe to your local church. That's evangelical tradition, and that's the teaching that most evangelical churches would go off of, and that I adhere to, and that I personally do, and Jade and Sam do.

The church that they used to minister in, Jade was part of the worship team. That's what they teach. That's what David teaches, the pastor there. He's a friend of mine. And so, and it's what we've taught in Financial Peace University all these years. Now again, we never tell people, Joe, that it's a sin, okay? Or that God hates you or something like that. That's not what we're talking about. It's just an instruction manual. And God teaches us that when we give a tenth of our income as a standard part of the rhythm of our life, we're resetting who's in charge of our life. Okay, it's a reminder. It's a weekly or biweekly, whatever your paycheck is, reminder that God is in charge and that this is his stuff that I'm taking care of. Now I'm looking— I'm talking up to a Christian through a Christian lens here. If you're out there listening and you're not, that's okay. Then you don't have to do all that. That's not— it's a completely different thing. And if you're Muslim, you would have a different guideline from the Quran. That's right. And you would go— you should go by that because that's what you believe.

And so, but again, in the Christian world, sometimes the tithe is used as a whipping post or it's used as a guilt trip when it's in a toxic environment. And we don't want to do any of that. Well, yeah.

And I like to think that it's not about the money at all. It's about the posture of your heart. God really doesn't need anything that we have.

Yeah, that's laughable.

You know what I'm saying? It's about your heart, which is one of the reasons that I don't put tithe on direct deposit. It's something that you ritualize. Visualize and do every month so that you're aware of the money that you're giving so that you're letting it do the work in your heart.

It's one of the reasons I miss passing the plate. Most giving in Christianity is now done online. Yeah. And I miss passing the plate because it's— there's a sense you're bowing. Yeah. When you're doing it.

And your kids see you do it.

Hey, hey, man.

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Welcome back to the Ramsey Show in the Fairwinds Credit Union studio. Jade Washaw is my co-host today, Ramsey personality, best bestselling author. Ann is with us in Sacramento. Hi, Ann.

How are you? I'm doing well, thank you. Good. What's up? Yeah, so my husband and I, we're in our 40s. We just got married last May, and we are having some challenges with deciding how we should handle our blended family estate planning. Essentially, he wants his 7 children children from his previous marriage, plus my one child from my previous marriage, to split everything that we have now and build together 8 ways equally. And to me, it seems a little bit like that somewhat disinherits my one child because he has to share with the 7 others. And so we're just looking for some advice as to what your thoughts are on blended family estate planning.

Well, my first thought is that what you've discovered is what we most often see. It's hard. It's very hard. It's complicated, because there's not a smooth, one-size-fits-all answer. It always helps me with these things, and it helped me even— I mean, we're not a blended family, but it helped me when I was explaining our estate to our children, to first start off with, there's no ethical or moral rights that any of them have. Mm-hmm. It's your money and your husband's money that you both brought in, and the money that you build from this point forward. And if you leave them zero "that's not traditional, but it's perfectly moral, perfectly ethical." Okay? And it helps me to just kind of take it all away from them to start with in my mind. And then when I start giving it back, it feels different. I can see that. Right. And so, instead of like, "This is mine. It's mine. It's my rights. And you know, I had a good inheritance, and then my mother got married, and it got got split 7 ways. And it's like, no, it wasn't yours, you little twerp. It was mine.

How old are they? How old are the kids, yours and his?

So mine is the youngest, he's 10, and they go all— the other 7 go up to 24 years in age. Okay.

In my mind, first and foremost, then I would establish what happens while they're minors, right? Okay. It's because I want to make sure my minor children are cared for if we both die in a car wreck today. Okay. That's paramount, and that could be a lump sum into a trust that's formed upon death of both of you. Mm-hmm. Okay, statistically, you're not going to actually execute that. One or both of you will live till those children are grown. Okay, so statistically you're not gonna have that, but probability— but anyway, that I had— so if I set that up, I set that up differently than I would set it up for adult Gen 2. Okay, Generation 2 adults. Now when we get the Generation 2 adults is when the question you ask, and starts to come into play, is what's fair? And you make a valid point that, you know, let's say for instance you brought in even more more the other day when y'all got married than he did. I don't know, I haven't asked that yet. I will in a minute. But then you're— so, really, your kid's getting the short end of that stick.

You know, your point is valid then. I think it is, but there's— here's where my mind is, and I've never been in your situation, so I cannot claim to know for certainty what the answer is. So, let me say that. But what my mind goes to, how old are the kids? Because if the kids are home-aged, the age where they're in the house, and the understanding is I want these children to look at me like I'm, I'm their mom, like mom and dad, and we want that family unit to feel like a family unit. There's part of me where I go, okay, well, I no longer have one kid, now I have eight.

Yeah. And so if that's where my husband's at with it, he feels like we are one family unit, um, that we should treat all the children equally. So their mom's not in the picture and my ex-husband's not in the picture, so we're the only parents to children.

Oh yeah, okay, then you signed up for it. That's what you signed up for when you got married, then. That makes sense, okay. So Jade makes a valid point, then, and your husband does too. So it's an interesting discussion, though, because there's not an absolute slap your hand on the table, this is dumb or this is smart kind of thing. It's just kind of feeling it through. To me, I'm going to draw a line between when they're minors and when they're not. Okay, when they're minors, absolutely your husband wins. Hands, 'cause the babies at home need to be taken care of, and one of them doesn't need to get $300 sneakers and the other one has holes in their shoes.

They need to feel like they're equal with mom.

I mean, this is not Cinderella, okay, with the stepsisters and all that. It's not that thing. But once they're out of the house, which is really what we're probably dealing with, they're all grown, then let me ask this: how much net worth did he bring to this equation? How much net worth did you bring to the equation?

Equation? Great question. So he brought in about $400,000, $300,000 of that is equity in his property, which we are living in and paying down half a million dollar note together on. And then he had about $100,000 in his 401k. Um, and I have, uh, what's now a rental property that I brought into the marriage that has about $200,000 in equity. It's worth about half a million. The tenants are covering 100% of my mortgage, property tax, et cetera. And then I had about $200,000 in 401 and my HSA. And then when my husband retires in 10 years, he has a very juicy California pension for 30 years of service with one of our local—

So your net worths were fairly similar. Uh-huh.

Yeah, we were pretty equal.

I mean, it wasn't like one of you had $4 million and the other one had $100,000, you know?

No, yeah, and he does make $100,000 more than me. Of course, there's one, you know, we have 6 kids in the house right now that are there. Hello. So the grocery bills a lot more than just me and the one.

Try hiring Mary Poppins for this. He won't be making any more then when we offset that. But yeah, um, wow. And so neither one of your spouses are involved? Ex-spouses? No, correct.

Yeah, so it's just the two of us and the kids.

Us against the world.

Okay, so fast forward. If, if our contributions given that your income is being offset by your childcare, by you being the child primary caregiver and his income is there, if your contributions are fairly equal coming in and your contributions are not that far apart, really when we get into this, somebody's not making $1 million a year and somebody making nothing. So we got a fairly equal contribution. I think you guys got married with young enough children that I'm gonna prob— I'm just trying to think what I would do. Again, we started the conversation with it's an interesting conversation. I'm probably gonna go a little bit more on his direction because the kids are young and the contributions are fairly equal. Sure. As they become adults, and really as they're children too, that's just a— I'm just feeling this out though. I might wake up in the morning with a different answer. So I'm I'm not gonna hold you, you know, don't slap your hand on the table and say, "Dave Ramsey said," 'cause I'm—

Well, if they were adult children, which two of them are, but if they were all adult, this would be a totally different conversation, I think. But they're in the house.

It would be, but there's not enough net worth that it's not that much money. Even what it grows to, it's gonna grow equally. So, I mean, if it's 30 years from now, do I want the one child child to get half and the other 6 get half? No, I'm not. I don't. Not 30 years from now. 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 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. Are you sick and tired of being sick and tired? Working so hard, run, run, run, having nothing to show for it? Well, that's normal. Normal's broke. Normal is 78% of Americans live paycheck to paycheck. There's too much month left at the end of the money. It's not a good plan. You need to tell your money what to do instead of wondering where it went. Give every dollar an assignment.

That's how we named the world's best budgeting and financial app called EveryDollar. It helps you find extra money every month, builds you a personalized plan to get out of debt, build wealth. In just 15 minutes, you're gonna find thousands in hidden margin, and you're gonna feel like you got a raise. Do not live normal. Normal. Normal sucks. You want to be above normal. Look around you. Look at what normal looks like. No thank you. No, you want to live like no one else so that later you can live and give like no one else. Start EveryDollar for free in the App Store or Google Play. Nicholas is in Columbus. Hi Nicholas, how are you? I'm right yourself, better than I deserve. What's up?

Hey guys, um, so I kind of wanted your two cents on this. I'm facing a career change and I guess put it easily, is it worth moving from tax public accounting into industry financial accounting at the cost of, you know, no longer working from home, giving up a lot of PTO, and giving up good parental leave benefits for the purpose of moving in the career direction I want to go in? Because it's just kind of tough to make that transition from tax to financial, and I have that opportunity, but it just comes with all those downsides. Sides, and it makes me feel some type of way, I guess.

All the things you said just simply mean that you have to work more. That's true. Everything you, you put it in a whole bunch of different buckets, but it all means you just work more, basically, I guess.

Yeah.

Do you want to work more to get ahead?

I guess that's— yeah, yeah.

And doing the work that you say you want to do, work you'd prefer to do.

Mm-hmm. Yeah, no, definitely. That, that is, that's why I was trying to get here to begin with is 'cause I've just been doing tax a while and I don't wanna be doing it 10 years from now. And okay.

So then you're gonna have to work more.

Yeah. There's always a trade-off. Yeah. There's, there's almost always a trade involved with making steps forward. Mm-hmm.

Let me give you another, let me give you another equation. Okay. Just for the fun of it. Let's say that you decided, um, my dream is to open my own business. Business. I'm not saying it should be, I'm not saying it is, just giving you an example. Okay, you're gonna work more, you're gonna work harder than you've ever worked in your life. When you're self-employed, your boss is a slave-driving jerk, you know what I'm saying? Yeah. When I started this, it was 16 hours a day for 2 years. My wife was a single mother. We didn't talk about PTO, we talked about PTA that I missed missed, but we didn't talk about PTO. All right? We were getting crap done to get this thing off the ground. And so there's a price to be paid, just like Jade said, to go do whatever it is you want to do, and it's called work. And you're not a horrible person if you don't want to do that, but you're making a values-based decision that says, I'm going to be putting in more hours. Because by the time you outline all those different buckets that you just put in front of me, you're not working 40 hours a week.

Yeah. And so, you know, and you're about to start working 40 or 50, real work, not just at an office with other grown-ups and stuff, you know. Yeah, that's gonna change, and it's gonna change your career, by the way. So I would encourage you to go do it, but most of the good things that have happened in my life came from hard work and doing hard things. Doing things and pushing through to hit a goal. Yeah, and level up.

You may end up on the other side of this with more freedom than you had to start with, because my guess is if you're doing the work you really want to do, now your potential for income probably goes— I promise you— through the roof. Listen, you're better at the work.

There's tons of data out there that the work-at-home people are screwed when it comes to promotions, because nobody knows there. You're at home. And so the data's out. I mean, your chances of getting promoted are like 10% of those that are in the office. Just that one thing alone. Yeah. You know, and you know, if you take a job based on, you know, if I have someone come into Ramsey and they're interviewing with us and they, and the first thing out of their mouth, now they need the information I'm not talking about that. But the first thing out of their mouth is, "How much time off do I get?" I'm like, "You're coming here for the wrong reason. You're looking for a J-O-B, and I'm looking for a crusader, baby. I'm going to give you a water pistol, and you're going to charge the gates of hell. That's what we're doing." We're taking on freaking Visa, MasterCard, and Samuel L. Jackson. We are not screwing around. Around here. So you better not come in here figuring out how little you can work in this place. Now, we don't work 80 hours a week, and we don't work you till your fingers are bony fingers and all that crap.

We go home at 5:00. You walk through this place, looks like a ghost town at 5:45, and it should. These people have little children, go home. I'm not saying that, but while you're here, keep your butt off of Facebook and work. Get your stuff done, man. And so, and that's who I am. If you don't wanna work here, that's okay, but that's how this place operates. We work. We go home tired, you know. But those are the people that excel. And so, what it costs you if you don't do this is you're not gonna get to do the thing you think you love. You're gonna continue to do something that you hate. And your prosperity factor's probably gonna be cut somewhere around 75% of what it of what you should have been. You're gonna be 25% of what you should have been. So, I want you to go be all you can be, man. Superman. Okay? I mean, come on, Clark Kent. Let's go, baby. Get the phone booth. Let's go. I agree.

Everything we're gonna tell you on this show is probably gonna require you to make a trade-off. Every little thing.

Well, 'cause everything does. We're just the people that admit it. Yeah, and you get— See, get rich quick doesn't tell you that there's a trade-off. Yeah. Get Rich Ramsey? There's a trade-off. You're gonna be on beans and rice, man. You're gonna cut up your stupid credit cards. Your friends are gonna think you joined a cult. I mean, because we're actually living on less than we make, when nobody does in America. Yeah. Yes. And you know, we're gonna teach you stuff that's hard, but it gets you to a place that you want to go faster than anything else will get you there.

Well, and it's your perspective. You can either look at it and say, "Man, I'm trading the free time that I used to have for working more," or you can look at it and say, "Man, I'm trading a dead-end job where I was really going nowhere to doing the life and the career that I really want to have." There we go. That's up to you how you think.

Work like no one else so later you can work like no one "Yo, when I work, dude? When I want to." Why? Because I used to work all the time.

Because you did it on the front end, yes.

That's it. I paid a price to get there. I mean, nobody wins the Super Bowl on accident. It's an intentional act. A lot of detail, a lot of practice, a lot of work. So that's not preaching at you, it's inspiring. Yeah, that is inspiring. The question you ask is a great question. Especially in today's world. And so, yeah, yes, I would tell you to go do that for all of those reasons, but you are going to give up the things that you have correctly identified the price to be paid. And I think the price is worth it. And you're not a bad dad, and you're not a bad husband. I have 8 grandkids. That means there's 73 sporting events this week weekend. I will not attend all of them. I promise you. I have no desire to attend all of them. I'll pick out a couple of them, but I'm not a bad grandfather because I miss them. I miss some of the kids' stuff growing up. I didn't miss all of them, but I missed some of them growing up. And so, welcome to being grown-ups. You know? Be like that. "I don't want to miss the children's sports." By God, I I don't want to go to 83 games this weekend.

I promise you I don't. I do want to miss some of them. So I mean, this is the stuff we, you know, we don't say out loud in America anymore because it's uncool or whatever, but welcome to the Ramsey Show. We do, and we think it's worth it because the value— whether my grandchildren are loved by Papa Dave is not measured in whether I attend their games. They have a different way of measuring my I love. It's I actually pay attention to them when they're in front of me instead of my stupid phone. You know, there's that, that kind of stuff. I mean, you know, this is the— there's ways to do this stuff. It's life. So Nicholas, I'm proud of you. It's a good question, and I think you're going to go be somebody. I'm proud of you.

Listen up. If someone you love owns a business, business, you've seen how much work it can be. The late nights, the weekends that disappear. You can't put in the hours for them, but you can point them to something that can actually move the needle. The free EntreLeadership newsletter gives business owners practical strategies to grow their business and their leadership in just 6 minutes a week. They'll get expert advice and real-life tools they can put to work right away. Go to RamseySolutions.com/businessowner or share the link in the show notes. Rod is in Durango, Colorado. Hey Rod, what's up?

Hey guys, thanks in advance for your advice. Here's my question. I've got a 401 that's got about $700,000. My wife's family has a very strong history of Alzheimer's. Her brother got put into a care center for about $10,000 a month. Month when he was 68, she's 67. My question is this: we're redoing our wills, and I'm wondering, because I've talked to two attorneys, they didn't come up with good advice. Can I set up a trust somehow in or outside of that will that if I die before her, my 401 goes in or is in that trust, pays out approximately $2,000 to $3,000 a month to her so she gets some from it. But at age— and there's 3 trustees, but at age, let's say, 82, 85, if she doesn't show any signs of Alzheimer's, then every bit of the fund balance goes to her. And the reason I ask this, her brother, 2 years before he went into care center, started giving away money. He thought he was a billionaire and gave away about $150,000. And so now he's somewhat strapped. So does this make sense?

Hmm, I was about to say no, never do that, until you give me that last thing, and I don't know how to prevent the last thing. That's why I'm hesitating.

So attorneys don't either. Go to court, you'd have judgments and everything else.

Yeah, I mean, you'd have to take away someone's— you have to appoint a I know how to stop someone that's lost their faculties from giving away all their own money. You have to take them to court and have them declared incompetent, and a guardian ad litem is appointed. I know how to do that. And it's not that hard. You just have to have a doc go in there and go, "Hey, this guy, he's not thinking. He's got early onset, and he's not capable. He's not medically capable." It's very hard.

To pay, we had to pay 2 police to come and get him just to take him to a doctor. He would never go to court. Yeah. And he also could talk his way out of it.

Mm-hmm. Uh, what does she think about this when you, when you spoke to her about it?

I think she's up for it, but then she said we ought to do it for each other. And I said, yeah, sure. That's fine with me. Let me rattle this off. Her 401's, 9 $800,000. We have a house paid for, it's $1.5 million. We have cash of $100,000. We have assets that are sellable for $250,000.

We have a brother— You're in great shape. You got plenty of money. Great. I mean, you're multi-millionaires. Way to go, by the way. Congratulations. Thank you. Okay. I did not know this, and I just looked it up, and so I've not had time to dig into it, but Harvard Health says that 75% of the people that get Alzheimer's have zero family history. Family history. Only 25% of the people that get Alzheimer's have family history, which was interesting. I thought it was a lot more than that till I looked it up.

Yeah, they're wrong. Her dad died of it, his twin brother died of it, all in care centers. Uncle died of it, grandmother died of it.

Well, I don't know that this one family offsets the body of evidence though on a big study. Yeah, that's true. And this family may have some kind of a gene issue or something, I don't know. So I'm not as worried about— I don't like your structure because it's too controlling. I don't want to leave that much control on my wife on the off chance she might lose her faculties, so I don't like that part of it, but I don't know how to solve for if she does lose her faculties other than good family relationships with her children and so forth. You all have children? No.

Okay. Been married 39 years. Okay. All right.

So there's nobody to step in other than a brother or sister, like with her brother, and it was— by then it was a pain in the butt because he had gone completely off his rocker and would have fought the police, you said. So yeah, okay. Um, yeah, I don't know how to watch over her in the event she gets something.

You know, I never heard you stomp. Yeah, I—

well, I don't, because I don't like control. I'm fighting against some of my internal principles. One of my principles is I don't like controlling stuff from the grave. I want to set the table, and then the humans do the human thing. But this is a— this is a human that's out of control, and I want to protect them from themselves. Themselves.

But we also don't know that that's going to happen.

Right. And so, do you do something like the president where you have to go in and be declared competent every year to get your money released from the trust for that year or something like that? God, that's so gross. That feels like no way to live. Well, and not having access to your money but $2,000 a month or something until you're 80 is no way either.

That's no way to live.

You've got $4 million the two of you have built together. Together. And because she might not be able— she might have this thing happen, you know, her life is severely limited if you die today.

If— okay, um, I don't like that. Not that I'm in the interest of, of, of wasting money, but let's pretend what happened with her brother had the ability to happen with her, where she's got access to, let's say, $900,000 and she starts giving away like she's a billionaire. Is there a way— it's— you don't have heirs, so nobody else's well-being specifically is on the line for the loss, if that makes sense. Is there a way that you can separate it but do it in a much more generous portion to where it's like maybe half of the ass— like half of what it is, not just a certain allowance?

I think a different structure of the trust. I think you might have been on to your way of doing it. I, I don't, I don't have the answer. I'm gonna wake up in the middle of the night thinking about this one, um, because it's just, it's a riddle. I like Good riddle. I'm probably going to lean toward if either one of you die, your stuff is left in trust to the other one. And now what are the terms of the trust? I didn't like your terms because they're too—

What about the monthly amount?

There were too controlling. Well, no, I would rather her— I would want the trust— I would leave the trustee with clear instructions about medical competency, that if the trustee suspects that there's medical incompetence of some kind, then they seek distributions until a medical report is brought in. And so if she had to come to the trustee to, to send some catfish false lover that's actually a Russian bot that's got her on the hook, which happens all the time, right? If that was the case and she wanted to send them a half a million dollars, she'd have to go to the trustee to get that released, and and that would raise a red flag, and he or she would say, "Not until we get a medical." So it's almost like she has access to the full amount, but if she goes beyond a certain amount, that creates a suspicion. So yeah, the trustee needs to have some moral ties to this more than just the— yeah, she's got full access to the trust unless a weird pattern develops, in which case the trustee has the ability to stop that until he gets a medical, right?

Every month she's pulling out $100,000.

What's that? Yeah, if I see a pattern or something weird, okay, the woman's never bought a car over $50,000 and she wants to buy a $250,000 Lambo, okay, I want to see a medical, okay? And if the medical's cool, she gets the Lambo. It's her freaking money, okay? But, you know, something like that, if something breaks pattern and isn't— isn't— to keep them from going down the way of her brother, I would do that rather than saying, if you make it to 80, then you can get your money.

No, I don't I mean, I don't want to say this in the wrong way, but she— I don't— with family around her, is she just going to jump to that?

She doesn't have a ton of family around her. That's the point. There's no kid— like, my kids would completely interfere with their mother. They would get all up in her business. It wouldn't happen. Okay? They'd be going, "Mom, that is bogus crap. Get off the internet.

You're not doing that." You're seeing signs before it's gotten to—

right? And they would relationally interfere. But they don't— you don't have of that family structure around you guys in this situation, and neither did her brother for that matter. Y'all weren't close enough to him to catch it early and intervene, right? That's correct.

It's so interesting, Rod.

It's a good question. It is. I appreciate you wrestling with it. It's an act of love to wrestle with it. Yeah, if you both left it 100% into trust, and you had full access to the money through the trust, unless a power of attorney a pattern evolved that was an unhealthy pattern, in which case the trustee has the ability to throw a flag on the field and say, "Time out, I need a medical." Dave Ramsey here. For more than 30 years, I've been talking to folks on the air, and I can tell you that most people are broke not because they don't make enough money, but because they don't have a plan. You need to give every dollar you earn a job, because when you do that, something changes. You stop guessing, you stop worrying, you stop stressing. Our EveryDollar budgeting app will show you you how to find extra cash, pay off debt, and finally start winning with money. But most people won't do it. They'll keep living paycheck to paycheck, keep hoping things will change without making a change. It's time to say enough is enough. It's time to take control of your money.

It's time to start your EveryDollar budget for free today. Go download it in the App Store or Google Play. Our scripture of the day is Proverbs 22:3. The prudent see danger. Oh, this is one of my favorite. The prudent see see danger and take refuge. One version says the wise see danger and take refuge. The simple keep going and pay the penalty. Another version says are punished. When I see danger— don't you know when you know, when you know, when you're knower? Yep. When your bell is ringing, it's like, I knew, I knew that girl wasn't right, I knew that guy "Had a feeling." "I knew there was something wrong with that mustache. I just knew, you know, Mr. Mustache. I just somehow, I knew that guy." You know what I'm talking about? It's just like, "And I went forward anyway." "Come on." "And I was simple. I was a fool, and I was punished for it." "Yep." "The wise see danger and take refuge. The simple, the fool, keeps going and pays the penalty." And hadn't we all been both? I know, that's right. But it just tells you to trust Trust your instinct.

Trust your gut. And one pastor said— Pastor Prince said, don't call it your gut. It's the Holy Spirit. Don't call the Holy Spirit your gut, but trust your instinct. Trust your— trust what God's Spirit is inside of you to say, uh-uh, don't do that. Don't do that. Don't walk over there. Stay away from that. That one's trouble. Stay away from that one. You know, you just know. You do. And you go forward anyway and you're punished for it. It's just one of my favorites. Barrel said, "It's amazing how fast later comes when you buy now." That's funny. Nina is in Tampa, Florida. Hi, Nina. How are you?

Hi, I'm doing well, thank you. Thanks for taking my call. I'm 65 years old. I have no debts. My house is paid off. My car is paid off. I have $650,000 in the bank. I'm planning on buying like a rental property, one or two. I don't know if that's good planning, and that's my whole retirement. Is this good planning?

Only if you like landlording and you're doing this because it's something you want to do, not because it's something someone told you you should do.

Yeah, that was my question.

I'm doing it for the income.

I know, but do you know anything about real estate? Have you always wanted to own real estate? Are you— I mean, the $650,000 can be invested in a mutual fund and make you about the same kind of money, net, net, net.

Yeah, but would it grow as much as real estate?

Not quite, but it won't have anywhere near the hassle. Mm-hmm. Let me tell you something that comes with income-producing real estate. Real estate. Tenants. Renters. Right. That's the necessary evil to make this formula work. Not all tenants or renters are evil. I don't mean that. You people stay off the comments. But these are people dealing with people. But they screw up. And then your little plan is screwed up when they screw up. So I'm not telling you not to do this. I'm telling you to go in eyes wide open and go, this is going to be a pain in the butt, but it's going to be worth it because I love real estate. Now, I've been a landlord for 40 years, so I'm unemotional about it, and I'll just toss your butt out when you don't pay. I mean, I don't think anything about it, you know? And I don't have a bunch of qualms. I don't sit and wring my hands and worry about the ethics. No payee, no stayee. It's pretty simple, you know? And so, but if you're going to go through all of that, the drama, in your mind and stuff, and you're going to have to be tough or all of these numbers don't work for you.

If you want to do that, I'm in for it. Go do it. But don't just go do it because it's a better investment in air quotes.

And what if you started with just one instead of two? Because I think I heard you say you were going to do one.

I'm going to do— yeah, okay. That's what I'm going to do. I'm thinking of getting like one for now and invest the rest of the money. Good. And if I like it, I'll get another half. I like that. My question also is Uh, what if the house is in a, like, nice desirable area? Is it in a what? A nice desirable area.

That helps because your tenants are going to be nicer and desirable.

It's going to be a different quality. Yes, yes, different quality.

I mean, not always, but you have a higher probability of a higher quality interaction with someone that makes $200,000 a year than somebody that doesn't. That's not because money makes people's character, don't misunderstand But just overall, you know, it's a lot easier, you know, if you bought, if you bought slum property and you're dealing with criminals as your tenants, that's the other end of the spectrum, right?

I agree, right? Yeah, right.

And not all slum property are criminals as tenants. You people, good God, I can just hear you people out there, some of you. But anyway, um, but yeah, I mean, in a good situation, I'm not in a good, like, I think you're okay, but I really want you to talk to someone that owns rental property and let them tell you the underbidding belly of the business? My daughter does. And she told you it's not all Skittles and rainbows, right?

Yeah, yeah. She said for your age you don't need the hassle. Oh wow! Okay, we'll ask her what hassle means. On the other hand— my son on the other hand, he says I'll be there for you if anything happens.

No, no, this is good. It'll rip your soul out if you don't go in with your body armor on, okay? So go hang out with your daughter and watch her deal with tenants a time or two.

Dave, are you talking about real estate on Investing Essentials? I am.

We're covering it in detail. And a lot of it is that right there.

Yeah, we can get Nina some tickets.

Yes, absolutely. We're going to do an— thank you. You take care of it. Yeah, Nina, we're going to hook you up.

Dave and George are going to be talking about investing, but real estate specifically. And so I think that'd be good for you to log check it out, and then by the end of it, I think you'll have a clear picture on whether it's right for you, if whether real estate's right for you or just going ahead and investing all your money in the stock market.

Yeah, I'm a big fan of real estate. I am not a big fan of all the stuff out there telling people to buy real estate and they have no idea what they're getting into.

That's true. It makes it sound easy, like they're making it sound easy.

Yeah, you know what collecting the money on my mutual fund sounds like? Ding! An email coming into my inbox. You've got mail. That's easy. That's it, you know. Yeah, never had a rent check do that. Okay, not yet. That's true. Not yet. There's no auto plan in real estate. So it's a, you know, that's, that's why I always get just, I just get hysterical when they say, oh, real estate's a passive investment. There's nothing passive about it, moron. It's active as it can be. It's the most active thing you could possibly Probably do. So it's hands-on, baby, all hands-on. Gary's in Charleston, South Carolina. Hey Gary, what's up? How you doing, Mr.

Ramsey and Miss Jade? I'm a huge fan. Thank you for taking my call.

I'm a little short on time. Go straight to your question.

All right. My wife and I just moved for my first big boy job and our car started having problems again. A little bit of history on the car. My wife purchased it in 2020 for $11,000. Now it's probably worth around $6,000 or $7,000. $30,000. I was quoted the other day for $3,500 by a mechanic to fix your car. So I'm wondering if we should spend the money— no, fix the car— or if we should look into selling the car.

You should sell the car and buy another one with that money. Do you have any money? Do you have debt?

Uh, I have $220,000 worth of debt and no money, student debt, and we have, uh, $71,000 Okay, well, we're gonna work our plan.

So we're gonna buy her a $5,000 or $6,000 car after we sell this car for $3,000 or $4,000 as it sits. And we're gonna put a little bit of money with it and get her a little bit better hoopty that's gonna last a little bit longer. And then you guys are gonna tear into your student loans and use the rest of the $70,000 to do that. That's what I would do in your shoes. Yeah, absolutely.

If you've got that kind of cash sitting around, that's money that could be used to pay off of debt.

Sounds like they're just getting started. So yeah, we teach people not to be sitting on $70,000 while they got $200,000 owed to Sallie Mae.

Yeah, I feel generous, so let's give them, uh, the Total Money Makeover and EveryDollar so they can understand what we teach, they can understand the Baby Steps and that system, and they can have a budget, which is going to be the foundation of them working the Baby Steps and paying off this debt ultimately.

Y'all are going to be waiting for Jade to be on the air because she gives everybody some something. And you get a car, and you get a car, and you get a book, and you get a seminar ticket.

Thank you, Jade. You're welcome. It's easier to spend other people's money. I've heard the rumor.

I've heard the rumor. Hey, you're going to make it out of this, but you're going to be really focused. And this is not an excuse to go buy her a $20,000 car. You guys are broke. You have $200,000 freaking dollars in student loan debt. You need to be in a wild panic. That puts this hour of the Ramsey Show in the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.