Transcript of You’re Either Building Wealth or Losing It

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Normal is broke and common sense is weird. So we're here to help you transform your life. From the Ramsey Network in the Fairwinds Credit Union Studio, this is The Ramsey Show. And I'm Rachel Cruz, hosting this hour with my good friend and best-selling author, Jay Borshaw. And we're here to answer your questions. So give us a call at 888-825-5225. At first, we have Drew in Fortworth, Texas. Hey, Drew. Welcome to the show.

Hey, guys. Thank you so much for taking my call.

Yes, absolutely. How can we help?

Quick background before I state my question. Fifteen years ago, my parents went broke and transferred their house to me for a symbolic dollar to keep it from the bank. The transfer was It's legal. The contract gives them a lifelong right of residence but doesn't require rent. They only pay property taxes and upkeep, meaning no positive cash flow on my end. They also verbally agreed to pay off the remainder of the mortgage. Because of that, they have always acted as if the house was still theirs, allowing people to live in parts of the house and remodel sections without my knowledge, and I'm okay with that. Now, after their court case ended last year, they're expecting me to pay for the house. And my question is, am I required to pay them if I want to keep the house?

So they would be moving out in this deal. They would be moving out and the house would go to you.

No. So the life-wrong residency, right of residency, keeps them in there, and I'm okay with that.

Right. But you said that they... It sounded like you were saying they want you to pay for the house, which means they would move, correct? No, they will- Or they So you're going to live there while you pay for it.

Exactly.

Well, jeez. How much is the house worth, Drew?

More than 500, okay.

Okay. How old are you?

I'm 36.

Thirty-six. Do you have a family?

Yes.

Okay. And so everyone's living in the house together?

No, we're actually living in a different country. That house is not in Texas, in Portworth.

Oh, I'm sorry. Okay. Okay. So your family is in a different country? Wait, explain it again. I'm confused. Yes.

So I and my family, my wife and our kids, we are living... We are here in Texas. And my parents, they live in that house in a different country.

Got it. So what is... Go ahead.

Now, as the court case ended last year, that raised the question, how do we proceed? And they verbalized It's the expectations that I pay if I keep the house. My question is, yes, I would like to keep the house, and the transfer was legal, but I don't think, to be honest, to be required to pay.

Well, I think if you're going to keep the house, you should be living in it or deciding who lives in it.

Using it in some way, yeah.

Yeah. As opposed to you keeping it just for ownership purposes and them living in it. Now, if you were to keep it, would you require them? Let's say you did keep it, you took over the mortgage, would they pay you rent or they would pay zero?

I don't know.

And why would you pay for a house, Drew, that you're not living in at all? I mean, you have no financial gain at all from this. And it's in a different country. What country is it in?

It's in Germany.

Okay.

So the point is, I would like to keep the house to generate workflow, a positive cash flow after they moved out, probably. And I'm okay with them living in the house after they pass away. The point is, at that point, I would generate positive cash flow at that point, and I do not intend to live in that house. I think it's an asset for me to generate past positive cash flow.

I hear what you're saying, but here's what it sounds like. It sounds like the number one thing you're concerned about is having a place for your parents to live and providing that. Otherwise, if that wasn't number one on your list, you would sell that house and buy a house here in the States. To do the same thing. That's 500,000. That's in Fortworth. Not in Germany. I don't think that Having a rental property is your number one goal. I think somewhere along the lines, you feel the need to house your parents. I think that's the real conversation here, right?

Yes. I think you nailed that. Yes. I'm concerned about them as far as I want them, or I agreed to the lifelong right of residence in the contract, and I honor that. But I do not see any reason why I should pay them now, as the house is technically and legally mine, that I should pay them back for the house now.

Is the house paid off? Yes. Okay.

And how much do they want you to pay back?

We did not talk about that yet.

Okay. It just sounds like, Drew, there's a lot of details that you guys haven't talked about. If I were in your shoes today, this is very messy. And if I were in your shoes, I'd say, Guys, you guys included me in this, but I don't want to be included anymore.

Yeah, I was going to say, can you, from a legal standpoint, because I'm a little bit unfamiliar, I guess that's German law, the lifelong residence.

Yeah, right of residence.

I'm not 100% sure on that, Drew. My question is, is there any way legally you can get it out of your name, give it back to them, and then they leave it to you when they pass as their estate? Is there a way just for you to be completely out of the situation just while they're alive and let them have their house and they've paid for it? They paid it off, right? Not you.

Yes, they did.

And there is a way. Yes. So is there any way? Just let them live in their house. But you don't need to pay them. I don't think you need to pay them because you're not living in it. And you're not selling it. And it's not your asset. Yeah. If I were you, I would see, even legally, if there's a way to get your name out of this whole... Off it. Yes. Because for some reason, if they fall behind on property tax or whatever it looks like for them, if there's any catch-off for you, Drew, then you're here in Texas. To your parents, they paid for the house, all that. So no, I don't think you need to pay them back. But if it's in your name, I could see how they're thinking, Okay, They don't have any control, and they don't have anything to their name at that point. And if they get in a bind, they have no assets, but yet they paid for a house, so it is theirs, right?

Yes, they paid for the house, but legally, they transferred it to me for a dollar.

Yeah, they did. So either you transfer it back for a dollar. Can you do that?

No, for 120,000 taxes.

That's the limit? That's the minimum them that you can do?

No. If I would transfer it back to them, according to the law, German law, at this point, they would pay 120,000 in property in selling- In taxes.

Selling taxes. Got it. So the only way then... Oh, boy.

Yeah, this is a mess. Yeah, it is a mess. And I almost would find some legal way to write this up. I don't know how you would do that. But I don't... Yes, they paid for the house. You didn't pay for the house, yet you were given a $500,000 gift, and then they're paying.

Well, let's remember, it wasn't a gift. It was to shield them from negative behavior, it sounds like.

My position would be, I think I've paid far more already than the house was worth, because a few months after I signed the contract, I discovered that I had lost eligibility for government financial aid for a college degree.

Okay.

You got to get with a lawyer to get out of this.

Yeah. At that point, then you're tangled in a mess. But I would not want my name on a deed or a situation that I have no control over or I'm not around. That would be my number one for you, Drew.

Statistics show that half of Americans don't have enough life insurance, or they don't have any at all. I don't understand this, John. Why don't people want to take care of their family? They think they're going to die or something?

Well, I used to be one of those guys. I didn't even think about it.

One of my buddies said, Hey, the only reason to not have life insurance is if you hate your wife and kids.

I immediately went and got term life insurance.

That's a gut punch.

You're telling me for decades, Dave, I've sat across who've lost a spouse, they've lost somebody important to them, and they don't know what to do next.

Me too. It's terrifying. You're going to have a crisis here. You got two options while you're sitting and talking to a young widow. She's concerned about how she's going to invest all this money properly and not mess this up, or she's concerned how she's going to eat tomorrow. That's exactly right. These are the two options. Take care of your dadgum family, man.

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Up next, we have Josh in Seattle, Washington. Hi, Josh. Welcome to the show. Hi, Rachel. How are you? Hi, we're doing great. How can we help?

Yes. I had a question about converting a home equity line of credit over to a 12 or 15-year mortgage because we're not making any progress. We're just paying interest only right now, and will for the foreseeable future.

Okay. Because of the payment, and that's what you guys can afford or what?

We pay a ridiculous amount for private school education for four kids, and that's locked down our monthly, I guess, ability to make any progress.

How much is the Heelock and how much is the tuition for the four kids?

Sure. So the interest-only payment or how much do we owe on the Heelock?

Why don't you tell me both? What's the total amount and how much do you pay every month?

Sure. So we owe 65,208 dollars. And then our interest only payment each month is right around 450. It fluctuates because it's a variable rate. And then our monthly payment for private school is 3,704 dollars.

And what's your income between you and your wife?

Sure. So it just changed. My wife just went back to work this year. So she'd been out of work, raising the kids, not out of work. She's how insensitive. No, she was at home with the kids and just went back to work a month ago. So that just added about $1,000 a month. So our total take home is right around 11,500, right around there.

And what's your mortgage payment?

We don't have one.

Oh, your house is paid off. Why did you take the HLAAC out on? To do what?

To do a home... We lost our minds. We paid off the house, we were completely debt-free, and we were working baby steps four, five, and six. And then I had some really good ideas, and it turns out they were terrible ideas. And we borrowed $105,000 for a home remodel and then spent the rest in cash.

Okay, but still, you're making $11,500. School is $3,000 a month total, right?

37.

Okay, still. So you're at 7,000 a month. You have no mortgage. Where's the problem here? To pay $450 a month or more. You could pay $1,000 a month to pay off this heat lock.

Yeah, it would just take forever.

There's the problem. Okay, now, Rachel, now we got to the bottom of it. It has nothing to do with the payment. It has to do with the fact that you're like, I'm tired of paying this. Can't I just roll it into my mortgage or create a mortgage out of it?

Which would be a difference, though, for You, Josh. What's the- Interest. It's all the same. Is it just the interest that you're worried about?

Yeah, it's that we're not making any progress. It's interest only. It's interest only. So we're not making a dent in the 65,000.

So how much extra could you pay Say you did convert it to a mortgage, how much extra would you find to pay it? Because if you kept it at $450, I'm not going to be... How much?

Five hundred a month.

Where's all your money going, Josh? I'm confused.

I mean, can you log in to my EveryDollars app?

Yeah, I know. I want to.

You log in. Why don't you log in and tell us?

You're living like you're on Baby Steps 4, 5, and 6, but you're not. You guys are back to Baby Step 2, which means beans and rice, rice and beans, and you're doing nothing, nothing but paying down the 65,000. This could be a student loan. This could be a car. You could throw any type of debt on this. That's what this is. And you guys are back to that starting point.

And it doesn't need to be a mortgage.

Yeah. I mean, just like, Live on nothing. You don't have a house payment. I'm laughing because it's- It's ridiculous. Shop at Aldi. Don't go out to eat. Don't go on vacation. Cut subscriptions. Do nothing until this is paid off. Yes.

And you've got the income to do it.

I mean, you got to at least find 2,000 out of this.

I mean, not really. When we look at the numbers and where we're allocating funds, contributing to the Roth- No, stop it, Josh.

You have to go back to- No, stop it. You're on Baby Step, too, Josh. You're not on Baby Steps 4, 5, and 6. Stop the kids' college, stop retirement, all of it, and get this $65,000. It's paid off.

You got to- Oh, okay.

Because, Josh, you're wanting to convert it to a mortgage and then put it in baby step six and then just slowly get rid of it?

Just slow and steady. Yeah, that's what he wants to do.

Yeah. If we paid what we're paying right now for it, in addition to- Here's why I don't like that for you.

Here's why I don't like that for you, because you already... I don't like you putting it into a mortgage because now this is risk on your home, right? And I don't like this because you're already It sounds like you're averse to paying off debt. So this is a can that you're going to kick down the road for a really long time. I think you're trying to put yourself in a position where you can kick the can down the road.

Yeah, because you guys make how much a year?

Right now, about 145 before- Okay.

Yeah, because our rule of thumb, Josh, is if a heelock is over half of your annual income, then we say you can roll it into your primary mortgage. But it's not. It's Less than half of it. So it's got to be on baby step two.

And I'm 46 in stopping retirement right now.

You're 46, and sorry, took out $100,000 that you borrowed on your home.

That should make you more intense. The The fact that you said, Oh, my gosh, I'm 46. I took out this heat lock. I have to pause retirement. That should make you go, Holy crap, I got to get my butt in line, and I got to go. And instead, you're like, Oh, man, I don't want to do it.

Hey, Josh, get this paid off in two years. Get it paid off in two years.

Yes.

Yeah. I mean, you called. I think you were enjoying the ride of Baby Steps 4, 5, and 6. Then you went back in debt, which takes you back to Baby Step 2.

Oh, Rachel, I wanted to. I wanted to call because of that, because I was afraid Dave was going to answer, and then I was going to get destroyed. I'm nicer than him, though. I'm so glad you're right.

I'm at least saying it with a smile.

Yeah. No, it's awful. No, I'm not saying...

I know. We're not trying to make you feel bad.

I'm not trying to make you feel bad, Josh. I know. I'm trying to shake you back into reality of where you are financially. Yeah. And so that's where you guys are. And so you got to go back in that mindset. And you all paid off your house. You guys can do this. You'll do it so fast. You guys can do this. And I know that it's not fun, but I'm like, when you have that all paid off, you're not even going to have to worry about this. And I think you can do it in two, two and a half years. Yeah. And if your wife works extra, if she makes double what she's making now instead of $1,000 a month? There you go. People do that on a side hustle, right? I'm like, Have her go back more full-time.

I've been doing real estate for 10 years. And so right now, with working full-time with the government, I do about six to eight transactions a year in real estate. So So if that comes through, and if that continues, we could, if we went back to step two. We can't count on it. Okay, so maybe step two, final answer.

I would. Final answer. And again, I go back to the math of it. Then the math doesn't have emotions, so it doesn't have my like, Josh, what did you do? It is half of your annual income is the heat lock, and that's just the rule of thumb around Ramsey. If it's half of it, you put it in baby step two. If it's more than that, if it was at still $100,000- That It would be a little different. Then it would be a little different. And we could talk about that. But I think it's the pain of the consequences of going backwards. Of course. He's feeling that. And that's what happens. And people listening right now, that happens to people because of a job loss. They go through their emergency fund, they can't replace an income, they go back into debt. Sometimes it happens because of life happening to you. Josh, I love you. But sometimes it's us choosing to make this decision.

The kitchen, the new kitchen. Yes.

And so that's why you got... And the Heloq and I bet... Because he said, I think they started at 100. 120 or something. They've knocked some of it down, which makes me think they got it a few years ago during the COVID. 2021, 2022, when Heloqs just became so popular because everyone's at home being like, Okay, let's get a pool in a new kitchen.

And everybody's mortgage doubles their value.

That's right. You get all this equity, and you're like, Okay, I can use this. But that's the problem. And then also hear the pain, you guys, of the variable rate. The Helox, it's all- That's scary. Yes, it is up and down, and it rides that wave and all the formulas of even how they get it. So just cash flow these things, you guys. And it takes longer. It's not as fun. It may not be as beautiful, but at least you can afford it, that you're living within your means. So, Josh, we are cheering you guys on. Call us back in two and a half years. I hope it's sooner. And do another debt-free scream.

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Well, thank you for all of you that join us, whether it's on YouTube, podcast, Spotify, radio, all of it. We appreciate it. And one of the best things that you can do for us is help spread the word. So make sure to like, subscribe, share our episodes with your friends and your family, because we want everyone to be able to start to learn how to get control of their money and how to do this area of their life well. So that's always helpful for us, but we're always so thankful to you guys. All right. I'm Next, we have Sarah, who is in Kentucky. Hi, Sarah. Welcome to the show.

Hi. Thanks so much for having me on.

You're so welcome. How can we help today?

Okay, so my best friend claims to essentially live by the Ramsey method, but nothing they do is like Ramsey approved, I guess you could say.

Oh, no. What do they do, Sarah?

Well, okay. So Since I've been friends with her, which was starting at the beginning of the year, they have owned four or five different vehicles. They're constantly buying and trading, and they claim they make money off of these vehicles. And I'm thinking, buying a $90,000 vehicle to make four grand doesn't make sense.

Well, are they paying cash for it? No. Okay.

What do you care?

Because it drives me crazy. Because I know what they're doing. They just went out and bought a $120,000 Escalade, and I literally was like, You all could have paid off half of your mortgage for what you just spent on this car. She says, Well, I get too many tax deductions from having a house. I don't want to pay off mortgage.

So she doesn't follow the Ramsey plan, but you do?

Yes, I've started listening to you all in the last few months. I've just got my $1,000 saved up, and I'm walking towards I've got like $3,000 of debt, so I'm working on that. But yeah, I listen to you guys every single day. I clean houses for a living, and I'm a single mom, so I have nothing but time on my hands to listen.

Sarah, you're amazing. Okay, so how can we help you? I'm going to help you right now. What can we do for you today?

I struggle being their friend because of the lifestyle that they live. There you go.

Sarah, I'm going to tell you what I tell my son all the time. Okay, so I can tell my son, Prince, go upstairs and brush your teeth. And the minute I say that, he's like, well, Zeezy didn't brush her teeth. And he's always looking over at what she's... Because I've given him a responsibility, and he wants to make sure that the other person has to do their responsibility as well. And I told her the other day, I said, You want to know what you need to do, Prince? Just mind your business.

Take care of yourself.

Take care of yourself and mind your own business. She'll get dealt with. Don't worry about that. I'm looking and I see what she's doing over here. You don't have to worry about that. Just mind your own business and go brush your teeth. And I would tell you the same thing, Sarah, mind your own business and pay off your debt. And if she's your friend and she's like, Well, I'm doing the baby steps, too. All you have to do is say, No, You're not. Or just smile. And just smile.

That sweet, Kentucky Southern passive-aggressive, just smile and nod. Bless your heart. That's all you need to do. You just look at her and smile.

It stresses me so bad.

Okay, but But it's not your bills. You know what I mean? I know. Now, Sarah, I will say there is, and I don't want this to sound isolating this comment, but just the idea of when you shift your mind and you change your mind, you do start to want to gravitate towards people that are like-minded. That's true. And so there may be a point, and I'm not saying you can't be friends with people in debt. If we lived by that, we would have probably no- I'd have no friends.

Yeah.

So it's not even that. It's not an isolating comment, but I think it's good self-awareness to say, wow, I have changed the way I'm viewing this part of my life. And people that are not congruent with it, I can feel this tension point. And man, it sucks that I feel like I'm growing in this area, and other people aren't. And you're going to probably feel that tension. And over time, does that naturally maybe start to separate you guys? I don't know. Maybe, Sarah. I have no idea.

We go to church together and everything. I feel like there's no getting away from her.

I'll just be honest. Well, do you want to get away from them for other reasons, too? It sounds like maybe you do.

Is she just not a fun person? Because, yeah, if that's the case. Well, no.

I mean, we have a good time together, but she does not work or anything. She has a little boutique she's been running on the side, and she claims to make 10 or 15 grand a month off of this business.

What's wrong with that?

What do you mean, what's wrong with it?

Can I tell you? I'm your What are you right now? I'm going to be your- Listen, you all aren't going to offend me.

I promise. I want you all to be open.

I think there's certain things that I'm tracking with you where I'm like, Yeah, that could be a little bit annoying, or, Yeah, she's wrong. But there are certain things, Sarah, that you're saying that actually sound a little bit like you're hating on them a little bit.

She's not considerate of my life, if that makes sense. She has nothing to do. She doesn't have a job or anything.

But you said she runs a boutique. She runs a boutique. Her life is different from yours. And, Sarah, she might- No, but she doesn't.

Sarah. She only does events.

That's okay. Sarah, she could be putting in less hours than you More money. And making triple money than you. More money. And you cannot hate on her for that. And, Sarah, her and her husband can buy whatever cars they want. They can. And I get it that you don't like it, but that doesn't affect you, and you're letting it get too much in your life. And as much as you think that she's not being a good friend right now, you're also not being that great of a friend because you're hating on her a little bit. And this is just me being a good friend to you.

I don't want it to seem like I'm hiding on them. I know. The lifestyle they live, and she's like, Well, we live a normal life. And I'm just like, No, you don't, though. We've only been friends for nine months. So this is all really new for me.

Here's what I think. I think you're a really hard worker, and I think you know how to grind, and I think you know how to... You know what I'm saying? You're willing to put in lots of work. You understand struggle. You're ready to get in the ring all the time. I can sense that about you. And I think it's irking you that somebody is acting like they're working as hard as you when you're like, No, you're not. And I get that.

She does. She does. And my friend Amanda from church, she's like, It's all about perspective with the work. And I get that. I do get that. I know.

Well, and Sarah, so I think And I've had to do this for myself throughout the years, too, because when you're comparing your life to someone else, I wanted to blame the other person. And I even in my head, I bet they're on this trip to Europe on credit cards, and I bet they can't even afford it. Here I am, and I have to wait another six months. So we go on. You make up a story about someone. And I had to finally tell myself, Rachael, you don't know. You don't know how hard they work. You don't know how much money they actually make. You don't know. You don't know. And I shouldn't know. It's none of my business. Actually, the problem is not them. It was me. It's me. In the comparison world, we want to blame social media. We want to blame the neighbor. We want to blame everyone else. But to be honest, it ends up being more of our issue. And so where can you get to a point, Sarah, that number one, you are confident in who you are and the choices you're making around money and your lifestyle, that when other people come up and that their lifestyle looks so different than you and/or You have thoughts about it.

If you could get to the point where you just think, honestly, Good for you all. Great job. Okay. And I get to move on because the amount of energy and effort that she's in your brain right now, the rent-free space that she has in your brain, Sarah, it's not worth it. Now, the friendship element, if Dr. John Zaloni was sitting here, we could have a relational conversation of, Hey, she may not be somebody that you guys share similar values. She not kept a lot of friends throughout.

She's not been able to ever keep friends for a long time.

Then that's great to know. Then I would put that in your data in your head of, Okay, she may be a hard person to love and be in relationship with, and that's okay. But we can be kind We can be curious and not judgmental. And you all go to church, Sara. Let's bring some of this peace and patience and kindness and goodness. Let's let the fruit of our faith live out and love people well, even though some people are hard to love. And as my dad says, some children of God are stupid children. There are some. But I think we can say it all, but have a level of grace for her and yourself. And it's okay to have boundaries, Sarah. If you need to put up relational boundaries with her, that's okay, too.

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Oh, my gosh. Wild. We are in that fall season where these months are going to fly. I would encourage you guys not just to set goals goals in 2026, but learn how to reach them. And that's one reason we created the 2026 Ramsey Goal Planner. It is here and always packed, as it has been in years past, with great money content, great spiritual content, relational content. So myself, Jade, and Dr. John Deloney are all in, and we've put our thoughts and everything around this planner because it is so important, especially those of you that love planners, you're going to love it because it has so much information. It has so many ways of calendars, weekly, monthly, all you need in a great planner. It is here, and it is selling quickly. We don't have a ton left. And once these are done, we do not reorder them. So we sell it every year. So do not wait. Get yours for 49. 97@ramsysolutions. Com/store. Or if you are watching on YouTube or listening on podcast, we will put a link below. But again, go get your 2026 Ramsey Emsy goal planner before they sell out. All right, let's go to Morgan in Chicago.

Hi, Morgan. Welcome to the show.

Hi. Thanks for having me.

Absolutely. How can we help?

All right. So my husband was late off a couple of months ago, and I was recently promoted. Previously, we were both making about $150,000 for a total of $300,000 for the household. And with my promotion, I'm going to be now making $182,000. Congrats. It's worth noting, I work remotely and I have great work-life balance. But as my husband starts to look for his next role and we look to start a family, my question is twofold. One, can I quit my job to become a stay-at-home mom? We're going. And two, if I can, how much would my husband need to make in order to sustain our family?

Okay, so are you... Do you guys have kids right now? We don't. No, but you're wanting to maybe start a family soon?

That is the hope.

Okay, great.

That's so fun. I'm glad you're looking ahead. Do you guys own a house right now, or where are you in the baby steps?

We do. We're in Chicago right now. We have a mortgage. We just refinanced. We're down to about $3,000 with our HOA a month. We might need to look to moving to his family from Pittsburgh, and we might be thinking about moving there just as we look to grow the family. Whenever people call in, so I'll tell you in reverse how this usually happens.

Usually what ends up happening is one spouse wants to stay home, and the biggest issue and the biggest barrier to that is their mortgage, right? Because once they lose that other income, the mortgage, which was 25% of their take home, becomes 50% of their take home, right? Yeah. That's really one of the biggest pitfalls that if you can avoid that, you're setting yourself up for success. So your income going up to 182 and his remaining at 150, the question is, can you guys live off 150 or whatever it is that you foresee his income to be in the next year or two whenever the family starts.

Right. I think right now the issue is he was in consulting, and that market has taken quite a hit, and he's looking to move into a different industry, so he might have to take... He's a CPA and a certified treasury professional, so we're hoping that those certifications will help him parlay into what he's looking to move into. But the likelihood is that he's probably going to be taking pay cut moving down into the 90, $100,000 range. And so it would change our lifestyle, how we tie, everything about our budget.

That's a big... I mean, that's a $200,000 jump Great. Do you guys have any debt?

We don't, thankfully. Okay, that's good.

And why do you guys feel like he's automatically going to make less? Is there anything from what he's done in the past? You know what I mean? Is there an industry that he can enter into that he loves and make more?

That would be an answered prayer for sure. I'm definitely in the camp that I think he's got... He was eight years at a Big Four consulting firm, which people kill for that experience. I think when you're in consulting, sometimes, though, you're a Jack of all trades, a master of none. And so it's hard for him to find an industry role where he has the exact background that they're looking for And the market's just bad right now in general for hiring.

Well, the good thing is you're not in a rush. If anything, by next month, maybe you have nine months, right? If it happens quickly, if you guys decide to start now, but Maybe you guys are like, Well, hey, we'll wait, or maybe it takes a little longer. We don't know. So the good thing is you guys have time. We just see on this show a lot, and I'm going to sound like Dave because I feel like he went on this rant last time I was on the show with him, that it's like a self-fulfilling prophecy of people that change jobs, automatically think they're going to make less. And I'm not this person like, Oh, just think it, and it's going to happen. It's not that, but be aggressive. Have some level of gumption and confidence of like, Oh, no, he does have experience. You just said people would kill for that experience. And I understand that it's a little bit more of a broad thing, and he wants to go more specific. I get all that. But as you guys are looking, don't just assume, Oh, he's going to make less. So have him... I don't know.

I would have a little bit more pep in a step and belief in himself, too, so that it's on an automatic pay grade, number one. And then, yeah, number two, Morgan, I think you guys will have to make some calls when the reality really hits. I really appreciate you guys planning and thinking ahead, but when the reality actually sets in when you become pregnant and all of that, that you're going to really get to crunch numbers and see, Okay, are we going to be able to afford to stay in Chicago? Are we going to make the move now? It's going to answer, I think, a lot of questions depending on what job he takes. And I think my hope is within that nine-month period, he's going to find something great.

Yeah, I agree. The best thing you could do is to test it before it's actually real. And it's going to be hard with a month mortgage, but get a sense and say, Okay, for the next two months, we're going to live off of the net amount of $100,000, and let's see what that feels like. And you have the luxury of testing that to see and just get a sense of it. And if you're like, Oh, my gosh, this is not what I thought it was going to be, then you can start talking about what does that mean, right? So, yeah, test it. Put it into real life.

Yeah, that's wise. Thank you, guys. I appreciate that.

Yeah, absolutely, Morgan. Good luck to you guys. All right, up next, we have Trenton in Los Angeles. Hi, Trenton. Welcome to the show.

Hey, thanks for having me. How are you both doing?

We're doing great. How can we help today?

Hey, so It revolves around 401(k) plans. I have three of them from power companies that I've worked with. Would you guys suggest to bring them into one, combine them into one or keep them as is? And if so, what's the smoothest way to do that? And is there any investment firm or a company that you would recommend putting them in?

Well, I would roll them all probably into just one IRA. It's probably the easiest way from a tax position. And do you have a financial planner that you're working with in general? No. No? Okay. So if you go to ramseysolutions. Com, look up Smart Investor Pro. We have smart investors all over the country that do it the Ramsey way, if you will. And so they'll be able to help you not only just make that move, but Hopefully, to look at your entire financial picture, too, and just get an idea. Because when it comes to these things, always the tax implications and everything. But usually, the smartest way is to roll all prior 401(k)s into an IRA.

Okay. Good question. Perfect.

Thank you so much. Absolutely. That's one thing, Jade. I feel like I have learned and become more and more a pro of is getting a financial planner in your corner. When you're on Baby steps 4, 5, and 6, and you are starting this process of building wealth and investing in retirement, all of it. Having someone who does this day in and day out be able to look and to help with an insurance, if you're still listening, actually investing those things in good gross stock mutual funds and good index funds, whatever that looks like, diversifying and being wise about it. If you have one little investment and you want to do it on your own in Vanguard or something, that's fine. Sure, no problem. But there's something about someone looking over everything, especially once you're debt-free and you're looking to pay off the mortgage and you're far down the baby steps. It is.

It's so helpful. I feel like as you get older, especially when you're thinking about maybe I can retire, what do I need to have in place if I think I'm going to retire early? All that stuff. It's so It's helpful. Yes. The estate planning and all of it. So, yeah, Tritten, great question. I hope that helps. And, yeah, we'll see you guys next hour.

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Welcome back to The Ramsey Show in the Fairwinds Credit Union Studio. I'm Richel Cruz, and we are going to the phones. First up, we have Donna in San Antonio. Hi, Donna. Welcome to the show.

Hi. Thanks for taking my question. I appreciate it.

Yes, absolutely.

Okay, so my husband has a student loan that is currently in deferment. It's been in deferment over 10 years. Prior to that, it was in default. It ballooned from 65,000 to 340,000. What? Donna. Yeah, pretty scary. I know. There was some fraud involved. We tried to take care of it with some attorneys. We were not able to get anywhere. We're stuck with it. We got married four years ago. His situation is he's 66, close to retirement. He doesn't really have any assets, no savings. I'm 57, probably going to work for another five years. I've got about 1. 4 million in investment assets It's private loans, which are own free and clear. We both have a joint account with Charles Schwab, which has about 200,000 in it, but it's fully funded by me. And then we have two other properties in both of our names. A couple of questions. How can I navigate negotiating this balance down for him? I'm willing to pay up to $100,000 for it. And how do I protect myself?

Are they private loans or federal loans?

They're federal loans. Gosh. They were. Well, I believe they're federal loans. See, I've had trouble with this. They were federal loans, and then they were consolidated. From what I understand, I've been to so many different places, and I keep hitting a brick wall. It's like, nobody can really give me the right answers. I've been told I can't negotiate.

If they're federal, you can't negotiate. If they're private, you can. But if the whole lump of them, if that whole lump is federal, you owe what you owe.

So what's his best route? Does he just keep deferring it? No. He will never be able to pay these off. He'll never be able to pay it.

Tell me about the properties, because I'm going to I'll tell you what Rachel and I are going to do, and then we'll explain it. We're going to approach this as any married couple would, who has dedicated their lives to each other and has decided that they're one, meaning that they're one in life, in money, and all of those things. Then we can go back and trace it back if we need to. But let's talk about these properties, because what I think is somewhere in the assets between the two of you is the money to pay this off. I'm just- Yeah, there's definitely money.

I built this. I mean, we've only been married four years. All of those assets are mine. I mean, I've done what I needed to do, and I've built this before.

How many marriages have you guys had in the past, Donna?

He's been married once before, and so have I.

Okay, so it's both second marriages. Okay. Did you do a prenup at all?

No. We have our wills, but we didn't do a prenup, no.

Okay. Can I ask a little bit about that? Sure. I'm hearing you talk, and it sounds like you very much want to protect the wealth that you built, but you didn't sign a prenup, which makes me wonder about that. How did you view that?

I didn't realize how... I don't know. What can I say? We're soulmates.

Okay, listen, that's good to know.

We're soulmates, and he's a wonderful man, and I'm not concerned about really protecting my assets from him. I'm more concerned about protecting my assets against somebody coming in and swooping in, a lender coming in and taking it.

Got it. Okay, so in that case, I loved hearing you say that because it sounded at first like when you said, Oh, I'm only willing to put 100,000 towards this, it sounded like you were trying to keep your assets from him, right? You didn't want to spend too much on his debt. That's the way it sounded at first. But now it sounds like that's not the issue. And if that's the case, can you tell us about these properties? Because the money might be there to get free and clear of this.

It's all real estate, basically. And again, they're all owned free and clear.

Right. How much are you into the properties?

How much am I into the properties? Probably five or six hundred thousand. So tell Probably around five or 600.

Tell us Property One. What's Property One worth?

I've got a condo, which is probably worth around 200,000. I've got another house, which is around 250. I've got another condo, which is probably also around 200,000.

Are they all owned free and clear?

Yes.

Okay. Yes, they are. Good for you. You've done great, Donna. You've done great, Donna. Did you know about his debt going into the marriage?

I didn't. What happened is his wife, his previous wife, handled all the finances. She was a stay at home. She did some funky stuff with their finances. And he thought his student loans were paid off. He didn't realize until suddenly he didn't get a tax refund one year that he was in default. He didn't even know. Got it. So it really was like a big shock. And then know he just... Sometimes men just ignore things. I think it was too emotionally overwhelming for him, and he pretty much just put it to the side. So I knew there was something. I didn't realize.

How many years did he put it to the side?

Probably about 13 years total. Okay.

Holy smokes. So there's enough that the shock has worn off, and then we can address reality that he chose not to, though.

Right.

Well, now It's got to bother you, right? Does that bother you?

Sure, of course it does. Okay. Of course it does. Yeah, sure. But right now, I'm committed to the relationship. I'm committed to my husband, and I want to figure out what's the best way to- That's great.

And you guys are in your, what? '50?

Did you say- '37 and '67. Okay.

Yeah, he's 66. I'm 57.

Okay. And why does he have no... And what's he been doing? Like with retirement and all that?

He pretty much gave everything to her in the divorce. They didn't have- They didn't have- one of those situations.

It was like no contest, just give her what she wants?

Give her what she wants, yeah.

Is he working?

He works for me. Actually, I have a business. Okay. He does work for me.

Okay. How much is he making?

We just have him making something like around 50,000. So we've been keeping it low. We do W W2.

Is real estate your business? Is that your business? Yeah. Okay. I hear two things going on here. I think you're committed to this guy. Great. I think that you need to reach over and probably sell one of these condos and then go into the joint funds and pay this thing off. That's probably the choice that I would make. I think you guys... I'm worried that, and I'm going to say this ever so delicately. There's a balance of power here that feels off. I think that if you don't address certain things, it's going to cause issues down the line. I think you need to sit with the counts. Do you see what I'm saying? I understand that completely. You need to sit with somebody and work through this because it almost feels like you're just taking care of this guy. It shouldn't feel like that. You feel like you're in a marriage where equal people are really contributing. Whatever it is, they're going to contribute, but you should feel good about it.

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Up next, we have Hannah in Missouri.

Hi, Hannah. Welcome to the show. Hello.

Welcome to the show. Hey. Thank you. Thanks for having me on.

Yes, absolutely. How can we help today?

So I am recently divorced with two small children.

I'm sorry.

I was married to a guy that's been married three times before. I was stupid. I was young. Clearly, clearly paying for it now. She has wrapped us into an insane amount of debt, and I can barely keep my head above water. And I knew divorcing him, that he would leave me with everything and not help with the children. That's exactly what he did. Sorry. It's taking me a while to try to figure out what to do now. I have a nurse. I have worked. I have a pretty good job now, and I'm going to lose everything because he's not paying for everything or helping me. So sorry. And he's doing it on purpose. I have $40,000 in business this loans from his failed business because he talked me into the world, and he did this to multiple women before. I have $40,000 in student loans. I have a $60,000 car I'm left with from him because he had this lavish lifestyle And I just couldn't say no because we gave him what he wanted until he was happy. He had stopped paying for everything. I landed a pretty high paying nursing job, and it's pretty good.

I'm Right now I'm working two full-time jobs to try to get this stuff paid off while paying for child care by myself. I live in a small one bedroom with two small children just trying to get everything taken care of. And I don't qualify for Chapter 13, Bankrupt 07. I qualified for 13, but at the highest payment plan, which is what I'm doing. So I have probably $200,000 in debt, and I don't know if I need to just quit my job and give everything back or what I did.

No. So this $100,000, the $40,000 loan, the $40,000 student loans, $60,000 car, that was after it was split amongst you?

It was. He was court-ordered to pay views, and he has not. And he's done it for everybody else.

And they're still in your name? Yeah. Okay. So the car, who has possession of the car?

I have the car was awarded to me.

Okay. And you said You have to pay 60,000 on it. If you sold it today, what would you get for it?

33,000.

Okay. And then the student loans, are those his student loans or they're yours?

Those are mine. Okay. Those are mine. It's about 40,000. So it's nothing super.

Okay. And the business loan, if you were to force a refinance on that to get him off of it, is he supposed to be paying that loan, but he's not? Not, or was that awarded to you, the $40,000 business loan?

He was. But I can go pay $10,000 to file content and then get money out of a guy that he quit his job and he's on military disability.

Well, no, I don't know. I'm not saying you do that, but I'm saying if the court said that he's supposed to pay the $40,000 loan, but he's not paying it and your name is on it, you should be able to force him to refinance to get your name off of it, so that you can be free and clear. And what happens when you bring that before the judge? What happens?

I have to pay another $10,000 to go forward with it. He just will not do it. He won't do anything.

Yeah, no, but the court can force it, though, is what Jade's saying.

I guess I haven't done that. This is so new. I've been in a panic.

Hannah, when did all this happen?

March of this year.

Okay, so it's fresh. Very new. Yeah.

Yeah. And I can't modify anything for at least a year, so he just dumped everything on me in June, including the children.

Okay. Yeah. Well, whatever the divorce decree says of what debts are his and what debts are yours. And this $40,000, they said is his, correct? Even though your name's on it, but through your divorce, that's his, right? So Yeah, I would contact your... Do you have a lawyer still?

I do, but she just wants money. She's not helpful at all.

Okay, well, maybe let's find someone helpful. She wants $5,000 to take it, to go forward with this, and I could just pay 5,000 to something and pay it off.

So I'm really struggling with that.

Well, if she's not a good attorney, find a new one, and that's okay for you to do. Yeah. And Yeah. What Rachel said is absolutely the case. You've got to go with what the courts have said, and if he's not upholding his side, you've got to force that into action. So it sounds like the only ones that truly are your burden is the $100,000, right? The student loan in the car. Is that if we're really talking about who owns what? Yes? Yeah. Okay. So let's focus on that for now, because today, in this moment, you can't change the situation of the business loan. That It will come, but for now, and my guess is that your credit is decimated anyway. Am I wrong? Oh, it's just right. Okay. So then it doesn't... Right now, literally, it doesn't matter, right? The damage is done. And find a little bit of freedom in that, honestly, that it can't get worse. It can't get worse. Yeah, exactly. So I love that you're making a lot of money. You're doing so well on that side. You're able to pay for daycare. So let's reorganize your budget and make it to where we're accounting for four walls first, which is you're making your rent, you're making sure there's transportation, you're making sure there's utilities, you're making sure that you're eating.

That's number one. And then right after that, number five is daycare because the kids have to go to daycare so you can work. Then after that, if there's still money, now we can start going down priority after priority and making sure that everything is accounted for. And if there's money, now we can start the debt snowball. Yes. So are these the only two debts you have in the whole I have a credit card with 7,000 on it, and I owe 4,000 left to the IRS for back taxes, and I'm making $1,000 payments on those each month.

Okay.

Good. Okay, so let's focus on the IRS first. How about that? Like, make it real small.

How much are you bringing home a month, Hannah?

About 11,000.

11,000. Okay. That's great. Yeah, you do have a great job. You know, one of the biggest burdens is this car, the $60,000 car. I know. And It's teetering right there. It's unmanageable. Because how much is the payment a month?

Thirteen hundred. Okay.

So honestly- Yes, it's totally horrific. I know your credit's horrific because the easiest way to do it, would to go get a $38,000 loan, pay off the car, and then take $6,000 and go get a crappy car just to get you back and forth to work and to daycare, right? I mean, that would be the ideal. With the credit being shot, that's going to be really difficult. So I'm wondering if there's a credit union or someone in your town that you can sit down and explain the situation, bring records.

My sister is willing to cosign or put a car in her name under $30,000 if I just give this Jeep back, this Wagoneer. Can I do that, or is it going to be a problem if I just hand the keys to the bank and walk away? My sister will get a car for me, and I'll make those payments. So I I don't know if that was an option or if I'm going to pay for that in the future.

No, because you're still going to be... If you surrender this car, they're going to take it and they're going to auction it. And whatever the difference is on the $60,000 loan, you're still going to have to pay.

Where did you get the $33,000 number? Because Wagoneers are nice.

Yeah, but their value's horrible.

Oh, is it? Their value's horrible. Is that Kelly Blue Book?

My attorney during bankruptcy, Kelly Blue Book, yeah. Okay.

Shit. Oh, man, I didn't know that. When I see them, I'm always like...

I know. They look nice, but they drop like a rock. They're terrible.

They have no value. When you turn them in, you are absolutely hosed with them. They're $100,000, and you'll get $20,000 for them.

So one of my biggest goals for you would be twofold. The first one, and I think that this car is huge because it's $1,300 a month. I would exhaust everything because anything is better than you having... You owing 38 is better than you owing 60, basically at just about any term.

A hundred %.

Yes. So scour and find what you can find.

Do what you can, yes. To see if you can get any loan to be able to pay off the difference and then get you a crappy car with it. But hey, Hannah, hold on the line. Christian is going to pick up, and we're going to get you with one of our certified financial counselors to walk with you because as a single mom juggling all of this, to have someone sit down and actually run the numbers longer than just eight minutes of what Jade and I can do. We want to give that to you as a gift, Hannah. And you're doing incredible. You're an incredible mom. You're an incredible fighter. Yes. And we're here for you, Hannah. Hey, guys. It's open enrollment time for health insurance. If you have ever felt overwhelmed trying to figure out your health care costs, you are not alone. For a lot of families, health care is one of the biggest line items in the budget, and it gets more confusing every year. But don't have to settle. Christian Health Care Ministries is a biblical and budget friendly alternative to health insurance, and I am proud to recommend them. With CHM, you are joining a community of believers who actually help share each other's medical bills.

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Good. How are you?

We are doing great. How can we help? Good.

My husband and I are on... We finished all the baby steps. My husband is 67, I'm 61. He is going to go into a partial retirement next summer. Our net worth, including our home, is about 3. 5 million.

Oh, wow. Good for you guys.

But the 2. 5 of that is not the home. And I guess a million of that is in brokerage, and then the 1. 5 is in RAs. So the question is, we have a son and daughter-in-law that live about five hours away from us in a very booming market, and they're just having a growing family. And it's just so important to us to be close to family. And we're running up there all the time, staying in hotels and being guests, and all that. And we are really wondering if it would be wise to buy a small house, maybe three. We're looking at there are some starter home neighborhoods. We could get a brand new house for 350,000, like 1,600 square feet. Just something that we could stay in when we go up there. The thing is, we are going to be probably relocating in about three years to that city. Oh. But we have three years to be going back and forth and all that. We want to be up there more because the babies are babies right now. Sure. So it's been suggested that we would rent maybe something for a couple of years and then make a big move in three years.

But it's such a booming market that when we're not up there, it would just be sitting in there, we'd be paying rent on it. But if we buy, we would be building equity. Yeah. How far away? What is your- How far away are they? It's about five hours away.

Okay. And then what's the three-year mark? Is that his retirement when he's done fully?

Yes. So he got to step down retirement. He'll be We need to be in our town right now.

Well, and you guys can cash flow a $3. 50 home right now, right?

We could, yeah.

So I would probably just do that, Susan. I would not rent. No. I would either just have a little hotel fund and know you'll be staying in a lot of hotels for the next three years, and that's okay, or I would just go ahead and buy.

Go ahead and buy it.

Yeah. Because it would be trading one asset for the other, right? It would be trading some of our net worth right now for- It But you're going to sell your home in Arkansas to move full-time in three years.

How much is your house in Arkansas worth? About a million. Okay, great. So that's great. Then I would just put that in investments.

The thing about our house is it's about five years old. It's brand, you know. But if we wait too long, it's not going to be as new as it is right now.

It's just three years, Susan. You're fine.

I wouldn't worry about that. I'm not concerned about any part of this. No.

You're not concerned about any of that. I guess it's just I love where we are, if family, with the baby steps and all that.

Yeah, I hear what you're saying. Yeah.

Well, you're not taking any step backwards, if that's the way it feels.

You're just shifting assets from retirement to a home. And then when you guys sell your million dollar home in Arkansas in three years, oh my gosh.

That's going to be a nice chunk of change.

Yeah, you'll just reinvest back in and keep on moving.

Yeah, and just move up there and sell the smaller house and just get the forever house, I guess.

Oh. Oh. So you would sell the $350,000 house by your- I didn't realize that. Family and get a bigger- Right.

Okay, then I would not do much. I'm sorry. I thought the home you're going to buy now is just the home you guys are retiring in.

Yeah, me too.

No, no.

Why not? Then I would No, you do not. No, you do not need to be in real estate for three years. No. So I would just either stay with family, stay in a hotel. It's just three years. It's just three years. You can do this. And then when you guys sell in Arkansas, I would move a million from Arkansas, a million dollars to where you are, and just break even.

Okay. So don't do it. What if we would keep it as a, I don't know, rental property or whatever? How long is... What's the least amount of time to stay in real estate?

I mean, I'd say five. Five years, probably.

Okay.

This is a different question. So if you bought the $350,000 house today, you lived in it, and then the plan was when you're ready to live there full-time, that becomes a rental. And then would you turn around and buy the next house in cash, or would you be thinking that there's some mortgage on that?

We would take the million that we'd sell in our current home and put that in another home. Okay. And it be- We never say in this other location is very expensive. Right. But I'm saying- We would down track a little bit.

Okay. But you wouldn't take a mortgage at all?

No.

So then that's just a question for you guys, Susan, if you enjoy real estate. Do you all want to be landlords in retirement? I come from a real estate family. I love it. I think that that's so fun, diversifying and all of that. But also, Susan, you're going to get calls, and Something is going to be wrong. John and Sue, who's written from you, their thing is broken, and you guys are going to have to coordinate. I mean, it's a little bit of a job. One thing about investments that's great is you put it in, you leave it, and there's no hassle, and you get the returns and you live a great life. Real estate is a fun investment, but for you guys, it's going to be less about building equity in the home itself, unless you guys want to sell it in 15 years. But it may just be more of a generation Rational property, even. I don't know. You want to look long term at it, but just know that the rental game, I think it's fine. But usually where you make your money is not the rent month to month, it's the equity built in the home, is usually what you get.

And usually, you try to get a deal, which buying a brand new home wouldn't be that.

You're not going to get that.

But you can afford it, so you're fine. So it would just be a question for you and your husband, do you all want to be landlords in retirement? So it would just be- You would definitely not do it if we were not going to rent it later.

If we buy it for three years, we would not do that.

Well, I think this plan would cause you to decide to make a different choice on the house that you might purchase short term. Does that make sense? Because you're going to want to think about it as the rental later, not as the house that you're enjoying now, if that makes sense.

Yeah. But if you're not wanting to rent it out and be landlords, you're like, No, that sounds like a headache. I would not buy until you're there full-time. Because it turnaround of buying a brand new home at $3. 50 in three years, we hope it goes up. I don't know, but there's always that risk that you're maybe buying at the high end, and then in three years, everything softens a little bit, and you end up losing money on it, which we don't want, if that is the case, because it is such a short turnaround. So I would either buy the $3. 50 home, knowing I want to keep it and rent it out as a long-term rental home as a part of your overall estate, and then cash flow the main house, or just be patient and wait three years, and then just buy the million-dollar home, and then the $3. 50 stays in the IRA, and you guys just continue on. Got you.

Okay. Well, that's a great option Wonderful.

Thanks, Susan. That's a good question. What a great problem to have. You know? How sweet. Just thinking through the family.

How do I want to spend my 3. 5 million?

Yes, I know. I mean, well done, Susan. Good job. Well done. But that is It can be a misnomer. And I think real estate can feel like a glamorous, oh my gosh, sophisticated. We're in real estate, and we have investments, real estate investing. It is a part, and I think it can be a great It's hard. I think if you're interested in it and it's what you love, we're not against it by any means. But it's not passive. Not passive income. That's right. Usually with it, how you're making your money is the equity of the home, of the actual property, when you sell it, you make a lot. That's the key. It's not always the monthly rentals. That's not the thing that's going to do everything for you. It's really the equity that you're building in. But it's a great question, Susan.

Hey, guys, I'm I'm so excited to tell you that our new 2026 Ramsey Goal Planner is available right now. This isn't just your average planner. It's your personal guide to setting clear goals and building habits that stick. So get ready for all new monthly content from your favorite Ramsey personalities, tactical goal setting trackers, and upgrades that make this our most durable planner yet. Last year, we sold out, so don't miss out. Order your 2026 Ramsey Goal Planner for 49. 97 today at ramseysolutions. Com/store. Our EveryDollars team is offering free live budgeting workshops this month. And in Budget 101, you're going to learn how to make a budget in every dollar, get tips from our experts, and even be able to ask your questions in a live Q&A. And you're just going to get the step-by-step walkthrough of every dollar's features so you know how you can use this app the best. There's so many elements of it, and for you to have the knowledge and to actually practice it and be in it is everything. So make sure to check it out. Sign up for Budgeting 101 for free at ramseysolutions. Com/workshop. All right, up next, we have Josh in Illinois.

Hi, Josh. Welcome to the show.

Hi. Thank you both for your time.

Yes, absolutely. How can we help today?

Yeah, so we've got open enrollment right around the corner, and I am just trying to get as much counsel as possible when it comes to making a decision on health care plan. I have heard a lot of good things said by you and others about health savings accounts, and we do have that option. We have a high deductible plan that has a health savings account, and I'm just wondering, under what circumstances, if any, would you recommend that someone not opt for such a plan? What should someone look out for to determine if it's right for them?

I love a high deductible plan. I have a high deductible plan. I love the HSA for the obvious reasons. The reason that I chose it, though, was not because of the HSA, although that's a perk. I chose it because it really is the best health plan If you are healthy, you're in that realm where I do my yearly physical. I pop in maybe one other time if somebody has a flu. You're not in and out of the hospital. You're not doing all of these doctor visits. Basically, if you're young and if you're healthy, yeah, high deductible plan is good for you. If you're a person who knows that you have health concerns or your children have health concerns, then you would benefit from a plan that has a lower deductible because you know you're going to hit that deductible every year, and so you don't want it to be astronomical. But for somebody, if you are healthy, then that's a great thing because the likelihood of you hitting the deductible is really low, if that makes sense. So are you young and healthy?

I would say so, yes. I don't have any health expenses or anything like that. And yeah, I guess in my research with this, I'm reading a lot of good things about it, and I just want to make sure that the grass doesn't look greener on this other side. And then I try it out and I wind up getting burned, which that is one thing that I had known to look out for. If you're going to be having constant health problems, I can see how that works.

Or if a wife, you're planning on your wife being pregnant or something like that, then yeah, I would go to a lower deductible. Does that make sense? All right.

Yes, it does.

Basically, if someone is young and healthy, they're not going to be experiencing a lot of problems.

They're probably not going to have to meet that deductible anytime soon. You'd say it's pretty much a wise decision all around?

Yes. I think so.

And that's what I have, too. And the HSA, like Jade said, is a perk that you can use for health expenses. And then if you get far along enough in the baby steps, you may not even ever have to tap into your HSA, which actually could build almost like another retirement investment vehicle, which is awesome, too. So that's another great perk. But yeah. So if you're young and healthy, high deductible plan, I think is spot on. I do not think you'll get burned. Worst case scenario, if something changes down the road, you can change your plan, too. That's something to think about.

Yeah, that's a good moment to talk about the HSA because we mentioned it, and a lot of people maybe don't know what it is or how it can help them, but I actually really like it. Once you're in baby step four and beyond, if you're beyond the point of maxing out a 401k or even a Roth, it's a great place to put extra money. You can invest it. I think you have access to it at age 62 as a retirement fund. It's either 62 or 67. Double check me on that. But that's a wonderful thing. And of course, you can pull money out at any time, tax-free for medical expenses, that thing. It's growing tax-free. So it's really a really wonderful deal there. Yeah.

So if you have an option for a health savings account at HSA, it's a great one that's happened, too. All right, next, let's go to Austin in Fort Myers, Florida. Hi, Austin.

Hello. Thank you for taking my call.

Absolutely. How can we help today?

Yeah. So I feel like I'm grounding here. I got about 74,200 in debt. I went from making a little over 100 to now I'd be lucky to make 50 a year.

What happened?

Well, my work slowed down. It's seasonal here from what I found out.

What do you do?

I work as a service adviser at an automotive dealership.

Okay.

And it really slowed down here for a few months, and I wasn't making enough to even pay our bills. So I left and went to another automotive company. It turns out it was even worse, and they took me back. But when they took me back, they changed the pay plan.

Oh, gosh. Like penalize you because you left?

Well, they changed it for everyone, not just me.

Okay. I hear you. Did you know that going in?

The day that I started, I found out.

Oh, my gosh. Oh, gosh.

That's strange.

Yeah.

Was it just an assumption on your part? Like, I'm just assuming I'll make the same amount?

Yes. And I know Seasons about to pick up soon.

A lot of the snowbirds start to come back, and that's where a lot of the income comes in.

Sure. But it hasn't picked up yet either.

Let me go a little deeper on this. What caused you to choose automotive? Was that your field of choice, or did you end up there?

I just ended up there. I've been in there for seven or eight years now.

Okay. I think that this is a time to consider the future, as a restart. Because I feel like you fell into this job. It was doing okay for you, and now it's not. So maybe it's time to look up and go, Okay, what does Austin want to do? What do you want to be and what do you want to continue to do? Where do you see yourself five years from now?

How old are you, Austin?

28.

Okay. Yeah. If the world is anything for you, what would you want it to be? If you do anything to make money, what's a dream?

I'd love to be a business owner of some sort.

I did open a painting company. It made about 75 a year, but I need at least around 100 to stay afloat, so that didn't work out.

Stay afloat because of the debt or because of- Yeah, because of my debt. Okay. Are you married with kids?

Yeah, I'm married. Three kids.

Three kids. Okay.

How long did you do the painting business?

Full-time, about six months. I did part-time, but I don't really make much off of it if it's part-time.

Well, I think that for six months of business, if you made 79,000, that's not bad.

Yeah.

What if you continued? I mean, I got to believe if you continued, you would continue to grow that income. And 80 is not that far away from 100 that you're trying to get to when you're the one going out, to quote Dave, going out, killing something, dragging it home.

Yeah. Yeah. I mean, it's 75, not quite 79.

I understand. But when you're the one out getting a job and those jobs are 3,000 a pop or whatever it is, there's a lot more hope there that I can get to a number than just waiting for somebody who's paying me, I don't know, $18 an hour to get there, right? So I don't dislike the idea of you keeping the current job that you have now because it is money coming in whilst you you start up this painting thing again. Because if you made 75,000 in six months, you could surely go out and get a couple of clients and get that up and running in the next month or so doing painting jobs on the weekend or whatever your free time is. Am I wrong?

Well, that 75,000 was the average I was headed towards for the year. I didn't make the 75 in that six months. I made about half that.

Okay, so you never got to it. That was the projection?

Yes, Okay, so you made 35 in six months, which is still not a bad side hustle. Mm-hmm.

So why were you doing that? Were you doing that on the weekends and at night?

No, that was me. I left the automotive business for about six months to do that. Got you. So that was me full-time painting myself.

Okay. Yeah. So what I would do is look at the debt. I would list out smallest to largest and attack the smallest one. If there's a car in there that you can sell to loosen up that 74. But I would be honestly doing the car during the day. I'd be painting in the afternoon. Painting at night. Yeah, night and afternoon. And then maybe you look for something else. Actually, hold on the line, Austin, and we'll give you Ken's book, Find the work you're wired to do, Ken Coleman, just to get those gears turning for you and maybe make some more income. Welcome back to The Ramsey Show in the Fairwinds Credit Union studio. Going to the phones, we have Sandra in Bowling Green, Kentucky. Hi, Sandra. Welcome to the show.

Hi. Thank you both for taking my call.

Yes, Absolutely. How can we help?

Well, for the last six years, I have been giving my son money for various reasons. First, it was around the COVID shutdown, and he's not very good with money. And then he stopped asking me for money, and then he started again. So I've given him around $35,000, and I want to stop. I want him to do better, and I don't know how to do that. I've tried to talk to him about this, but I'm his mother, so I don't know anything or I know everything. Let's put it that way.

Yes, that's right. Sandra, how are you financially?

I'm good. I have a good job, and I have good savings for my retirement.

Yeah. And how old is he?

47.

47. Does he have a family?

Yes. He's divorced, but he has one child at home.

Okay. And what does he do for a living?

He works in the automotive business, but he works, I'm not sure what they call it, but it's a press operator. Not an operator, but he does the upkeep on the presses.

Okay. And when he calls for money, is it What's his reasoning? Is it a situation that happens? Is it month to month? He just needs a little bit to cover the bills? What does he tell you?

Well, he filed bankruptcy twice. So this time, he did not have… They do a reconciliation. And this time, it made him... He paid so much for that He said he can't afford his bills, his food, and his gas. So that's what he asked me for. He says, I hate to ask you, but I need money for gas and food.

What's caused him to file bankruptcy? Is it all consumer debt, or is he going into business debt?

No, it's not business debt, but I couldn't tell you exactly what it's for because he doesn't involve me in that, and that's okay with me. I don't want to know. Now, I do know he had some issues a couple of years ago, and he got sorted out with that, but then he had- Like addiction issues? Yes. Okay.

Is he living out a sober lifestyle right now? Yes. He is? Okay.

How long ago was the divorce?

About seven years ago.

Okay.

And were the bankruptcies after the divorce?

Yes.

Okay.

Were they mostly- Well, the first one was after the first divorce, then the second one was after his second divorce.

Oh, he's been divorced twice.

Okay, that's right. I forgot.

Oh, man.

Boy, oh, boy. What I'm trying to understand about him is, is he still out of control, or is he a person who was out of control and has done some work to start getting his life back on track?

I don't know. I can't talk to him about these things. It's very difficult to bring it up.

For you or for him, or for both?

Both. Well, I'm fearful to bring it up because he... Well, I haven't brought it up, so I don't know. I'm fearful about what he might do.

Because it's going to pain you to hear it?

Yes, it's going to pain me, of course.

I think that if he were truly in a place where he's on the other side of this behavior and he's really doing the work to be well, I think he would be initiating those conversations with you saying, Here's where I've been. Here's where I am now. That's a great point. And this is a way that if you wanted to support me, you could. I think that he would have the maturity to do that since it sounds like he's not, I don't know.

He's still flailing. It still feels like a little bit of all over the place. And that's the sad reality, Sandra. Yeah, I think it's immaturity. Yeah, of what you're... You're hitting that wall over and over again of the reality that you can't change people. You could give him $135,000, and it's not going to help him. Yes, I understand. And so the hard thing is, too, is enablers are always the kindest people. And so that's your heart, Sandra. And it's your son. Jade and I both have sons. And I'm like, You don't want your kids to suffer. You want to be able to help them. And I think the question is, how can I help him the best? And throwing money at a situation over and over again because he's not changing his habits, I think, is a difficult reality, but it is a reality. And again, you go to the extreme, we don't see our family members on the street. There is a natural instinct that kicks in, and that boundary can be drawn however you want it to be, Sandra. But I think at the end of the day, knowing as his mom and as painful as the decisions that he's made in his life are, you can't change that until he chooses to change.

And so what you could say Jade, I think, was on a really great track, mentally, as you were talking through it, Jade, because if he comes to you, and maybe you can even say it to him, right? You guys can have this conversation of, I want to see healing in your life. I want to see change. And if you save up X amount, maybe, Sandra, you could maybe match that amount, right? I don't know what it looks like, but at least he's on a road to self-sufficiency because that's the best thing for him. And if you can help him get there because he is making positive progress, then maybe you can. But just throwing money at a situation when there's no change, that's hopeless. I agree.

This is a tough situation no matter how you slice it. I think for you, for the short term, I think maybe the first thing you do is maybe open up those lines of communication, and then you can better assess the situation. But it sounds like now is not the time to give money.

Right. The business that he works at is slowing down. So he was off last week for one day. Okay. Well, then he needs- It's never been a good time for the last five years.

Yeah. Then he needs to go get a job. He needs to go work at Target or something.

But if you give him the money, he won't.

Right. Yeah. He's got to figure out how to self-sustain as a 47-year-old. He's going to have to learn that at some point. And And that's a hard reality.

How old is the kid?

She should be 15 in January.

Okay. Now, I would be concerned about her. If you're looking and seeing that maybe she doesn't have some of the things that she needs in a serious way, I might step in for some things to help with her, and I would do that in a very protected way. Does that make sense? If you look over and realize, Oh, my gosh, they don't have the feet's not on, or something like that, I might reach over and pay that. Either have her come stay with me or just pay the bill directly. Something like that I could see wanting to help a minor.

Yes, for sure. That there's a vulnerable child in the mix. She doesn't need to suffer because of his decisions if you are able to help in that way. But setting boundaries, it can feel so unloving, but it may be one of the most loving things you can do, Sandra, for him, and especially you're wanting to stop. You feel it in your soul that this is not helping a situation, and it's going to be so hard, and there might be some verbal backlash. But man, if you hold that strong and hold that steady, I think there's a level of wisdom and clarity that comes with that when you remove yourself from a situation.

Many of you listen to the Ramsey show because you're sick and tired of getting nowhere with your money. You work too hard to live paycheck to paycheck with no money in the bank. But here's the deal. Just listening to the show won't change that. If you want different results, you have to do something different. We've helped millions of people save money, ditch debt, and build wealth, and you can, too. But you got to have a game plan, and that begins with our get started assessment. Go to ramseysolutions. Com/startnow. Com Take the free quiz, and get your free step-by-step action plan. If you've had it with money stress and are ready to take control of your money for good, go to ramsey solutions. Com/start-now.

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Okay, today's question comes from Madison in Colorado. She says, My husband and I just celebrated our third anniversary We're debt free and currently working on Baby Step 3. We both work full-time, and after saving our emergency fund, the plan is to save as much as possible before our first child is born. My husband is changing careers and wants to wait a few months until he settled into his new career with a better paying job so he feels more confident in providing for our future family. I know you tell people not to wait until everything is perfect to start a family. I absolutely agree with that, but I also I also agree with my husband that it's important to have more financial stability before we start trying. I've never met a man who wants children more than my husband, and both of us feel sad and stressed about waiting. I would love your advice on this. Okay, I personally love this question. First off, let me just say it is 100% your choice. I can tell you my thoughts, but it's your choice. It's your family, it's your life. I don't think there's anything wrong with family planning, and this is That's part of that.

You're saying, Here's what we want our life to look like, and the biggest part of that is whether you both agree on it. I'm saying that my husband and I, we made the decision that we wanted certain things in place before we started a family, and that was something that we agreed on. And there were moments where I was like, Do I still... It was like something we had to check back in on. Because for us, the idea was, Hey, we'll pay off debt, and then we'll start a family. But we also knew that that was a long journey to pay off the debt. So it was like checking back in. Like, are we still good on this? Because it's three years in, are we still good? So if you both agree and you both like the idea of whatever that is, him making X amount of dollars or whatever that goal is, then that's fine for now. But maybe you set it up and say, okay, every six months, we're just going to revisit this.

Yeah, it was an abstract. It could change. Yes.

Life can always change.

It can. And your desire for when a baby comes and when you want to start changes, too. I know it did for us. I thought we were going to wait a little bit longer. And then I remember being like, I think I'm ready now. I think I'm ready sooner. Here it is. And then I would also say to remember, once you get pregnant, there's still nine months. So he's wanting to change jobs now and wait a few months. You guys could be doing it simultaneously as well. So just remember that. So, yeah, we always say around here, don't feel like you have to have. You have to have a certain financial benchmark. We do not say you have to be debt-free before you family. You have to have X, Y, C. Have a baby when you want to have a baby, like what Jade said earlier. But if you personally say, No, we want to wait because of a time frame, because of a financial goal, if that's what you want, that's great. That's what you guys are choosing as a couple and as a family.

Now, there is one thing I will say about what you wrote, Madison, and I'll say this is giving me a little bit of like a... I don't know what. The fact that you said, We both feel sad and stressed about waiting, that's the part to me that I'm like, I don't know about that because for me, It gave me more peace to wait because I was like, I feel better waiting until I'm in a better spot. I feel more stressed about if I were to get pregnant today. So the fact that your emotions, and don't get me wrong, sometimes our emotions don't line up with what we're doing in a moment. But for something like this, I feel like they should.

Listen to what you're desiring. And the fact is what you're desiring is okay to desire and actually happen. So you're not doing anything wrong if you guys choose to move forward. I mean, you guys are debt free. It's an emergency fund. You're fine. You're fine. I promise you are fine, and you will figure it out. People do it all the time. All the time. Yeah. So the fact that... I think you're exactly right, Jade. The fact that you wrote that last sentence.

You should feel good about the decisions you're making in this area.

And if you're not feeling good, make a different decision. So it's a good question. We get that question a lot about, When do we get married? When do we have a baby? When do we start a family? All of it. I love talking about it with George Camel because he's always my practical friend because he's like, I mean, you can have a baby whenever, but it sure is nice to have a baby when there's no- It is. I'm like, I get that. But also, most people would say they don't look back and think, Oh, my gosh, I wish we had waited. You know what I mean? Usually people are like, We wish we had them sooner now that we know what we know, thing.

And your situation, I'm like, If there were a crazy situation, yours is not it. Do you know what I mean? That's right. You're not like, I'm in bankruptcy and we have nine kids and we want to have a 10. I'd be like, What's wrong with you? Yes, totally.

Oh, so good. All right, let's go to the phone. We'll go to Jessica in South Carolina. Hi, Jessica.

Hi. How are you all?

We are doing great. How can we help today?

So I have a decision to make. Basically, our baby is coming February sixth.

Another baby question. This is great. We were just talking about this. I know.

I I know. And I'm like, I feel like you all answered my question a little bit, but I don't know, our situation is a little bit different.

Yeah, tell us.

Yeah. So we have a baby coming February sixth, and I think it's smart for us to just go ahead. By that time, we should have enough money in our savings account to actually pay off all our debt, and we'd be completely debt-free.

Awesome.

Amazing.

But we wouldn't have nothing in our savings, and we have a new baby. So I don't know if it's smart to do that or I have no idea.

Yes. Well, what we always say is while you're doing the baby steps, and if you are on baby step two and you get pregnant, you go into stork mode, meaning you just pile up a bunch of money. You just save, save, save. Just pay minimum payments, stay current on everything, and just save money. And then when baby comes and mom is good, baby's good, you go right back to the baby steps. And so that's what you guys did, Jessica, which is amazing. You literally are the textbook example of, Okay, we're going to save and save and save. And then once we have the baby, we have enough money to become debt-free. Yeah. Keep a thousand. Keep a thousand. Yeah. So how much will you make the first month the baby's here? So let's say you took everything out and you paid off all your debt. I would still want you to leave $1,000 for an emergency fund, but let's just say you pay off all your debt, you have your $1,000. How much money will be coming in income-wise that first month?

The first month, probably about $10,000. Okay. Yeah, because I would still be getting paid from my I dropped my pay for the first house, and my husband.

Okay. So, Jessica, if you had no debt, no debt, no payments, but you had to pay the rent or the mortgage, the lights, utilities, all of that. If you had to pay your necessities, how much would be left in your budget?

Cable, all that, probably about 2,000 is our monthly expenses because we paid off our house 50 years.

Oh my gosh. I know.

It's- Jessica.

Wow.

Okay, so you would have $8,000 month one after the debt's paid off, so you're fine.

Yeah, I'm trying to tell my husband, but I don't know.

Well, even if you had to wait two weeks or get the paycheck and then pay off the debt, you're still going to be plus... You're going to be positive 8,000, even if you wait two weeks to pay off the debt till the paycheck is. That's crazy. You can do that. But how amazing, Jessica. Congratulations. How did you all do that? How did you all pay off the house?

So, yeah, it was just every extra money. I mean, I made commission most of my young life. Well, I'm 30 now, but most of my life, my job was just making commission, and all that extra commission, you get those good checks. I just put it on house. I didn't spend it on nothing crazy.

That's incredible. You're awesome.

You're awesome.

Good for you guys. Oh, my gosh. So if you wanted to hold your breath for 15 days till that paycheck hits, and then you have your eight extra thousand dollars, you can do that. If you got a new baby, I get that. If you are postpartum, you're three weeks in, sleep-suprived, and you want to wait one paycheck before you pay off the debt, I am okay with that. Wow.

Okay. So just hold the money a little bit.

And so- Yeah, if you want to wait a month, that's fine. Yes. You guys are in a completely fine position. So how much debt will you be paying off?

So we have 45 left, and that's a car, and that's also my husband's pool.

Okay. Where did you go? And what's the house worth?

Our house is worth Girlfriend.

That's what I'm talking about. Way to go.

Jessica, well done. Congratulations. And with the baby, oh my gosh, having a new baby and all of this, you guys are just... You're killing it. You're going to have so much peace. What a beautiful thing. What a beautiful way to set up your life with these decisions. You were making insane money in your 20s, and you didn't do the insane stuff. You literally did the boring stuff and paid off the mortgage. And now you get to choose if you want to stay home. I mean, there's so many-Amazing. Yeah, so many choices and options ahead, Jessica. So We're cheering on you guys. Congratulations.

Listen, your home is your most expensive asset, and now you're ready to sell fast and for a lot of money.

But in this whack-a-doodle real estate market, one mistake could cost you tens of thousands of dollars. Here's the deal. This ain't amateur hour. You need a pro in your corner, someone who knows how to price your home right, market it well, and negotiate the best deal. That's where a Ramsey trusted real estate agent comes in. To find one near you, go to ramseysolutions. Com/agent. That's ramseysolutions. Com/agent.

Up next, we have Jocelyn in Dayton, Ohio. Hi, Jocelyn. Welcome to the show.

Hi. Thank you for having me.

Yes, absolutely. How can we help today?

So I made this huge mistake about... I think it was four and a half years ago, I was with this guy, and I took out loans for him because he didn't have good credit. Oh, no. I took out... I know.

Oh, yeah. It's okay.

I took out a business credit card, which was one loan, and then I took out a personal loan, which he used to buy vehicles for his business. And then I also took out a golf cart loan.

Okay.

So fast forward. And then he was paying everything at the time when we were together, but it was always minimum payment. So in reality, it probably didn't really pay that much. Sure. So then two years ago, we split up and he promised me he would pay me monthly. We got a new girlfriend, and then, of course, he stopped paying me. Oh, Jocelyn. So when I left him, it was between 50 to $60,000 that I owed, and I've gone it down to $20,000.

Oh, good for you. Wow. Wow, thanks.

I sacrificed by moving him back home and with my parents, and then I just worked a lot. I'm a nurse, so I'm lucky there. I can find a good job. So I was always stuck between filing bankruptcy or paying it off. So obviously, bankruptcy is not an option, but I always just wonder if I should try to go back and sue him to get the money. People always tell me to, but when I've looked into it, it's a gray area because he never signed any document.

Because if your name's on it- I'm sorry? Because if your name's on the loan, there's a little bit of a dead end unless there was some contract that you guys had. Any type of legal documents?

No, there was no legal documents. I have text messages, of course, where he'll be like, Oh, I'm going to pay you, stuff like that, but nothing legal documents.

I mean, you could get a consultation to see, but I really think that for you, you're so close to being done. You've got $20,000 to go, and you could just wash your hands of this entire situation.

The cars that he bought with the loan, were the cars under his name?

Yeah, they were under his name in the golf car. It was really hard.

And he has all of it?

So whoever's listening to this, don't make those mistakes.

I'm sorry.

Does he have everything? He has the golf cart. He has cars.

The cars he bought with cash, they were like vans for his trucking company. And they ended up wrecked. Oh my gosh. So that could have been a sign. But this is a disaster. The golf car. Well, luckily, and then the golf car is in his name also. So I tried to call the bank because the loan's in my name, and this all happened in Florida, in the state of Florida, whoever's name is in the title, it doesn't matter who the loan is, the person the title owns it.

That's right.

It seems like there's nothing to even try to seize if you wanted to ask him and say, Hey, I bought these cars. The least you could do is send me one so I can sell it and get some of this money. But it sounds like that's not even a thing. He's AWal, right?

Yeah. Is he worth anything? Let's just say, Perfect World, you find an attorney and they're like, Oh, yeah, if you have text messages, we can prove this and take this to court and you can get your money back. Let's say they could. Does he have any money?

That's the other thing, because I was looking into it, I'm like, I mean, I'm sure he has money, but I don't know if he would actually pay me, because when I look at online, when they go to court, if they don't pay you, they don't pay you. I don't know if they can really hold it.

I don't think this guy has it. I think this guy is using women, and I don't think he has money.

And a part of me, too, Jocelyn would say, even if that did happen, and he did say, I'll make you monthly payments, he may be attached to you for the next eight years. You know what I mean? And there's a part of the freedom of It's a reminder every month that even if you're getting money from them, it's still like, I'm a nurse, and I can take care of myself, and I don't even want to be attached to this anymore. And so, yeah, we just... They coined the phrase stupid tax here on the show of just things that we do. All of us do it, right? I know. Maybe a different dollar amount and everything in different situations where you look back and you think that was so stupid, and now I'm paying for it. And I think, yeah, I think that's the situation. I mean, That's what's so hard, Jocelyn, is now if he was a good guy, he could say, Hey, let's refinance, and I'll put my name on the loans, and get your name off of it, all of it. But he's just disappeared into the wind. I mean, it's unbelievable.

Jocelyn, I hope that you... I I really hope that you allow this. As this lives in your mind, make sure you write the right story about it. I don't want you to look at this and be like, Oh, my gosh, I can't believe I did this terrible thing. I was so stupid. I hope that you write this in your brain as, This guy tried to break me, but I paid off every dime of this because I'm awesome and- Flip the narrative. Yes, please do. Because so many people would have just, I don't know, let that follow them for the rest of their life, never fix it. Wait on someone else, come fix it for them. And the fact that you paid off 30,000 so quickly, and then you're like, Listen, I'll just do the rest of it. I think that that's incredible. So keep going.

Thank you. Please.

Thank you.

Yeah. Well, and I think, like you said, Jocelyn, for everyone out there, it's a good learning, right? Because you do. You get sucked into a situation and you think... And they're believable. That's the other thing. It's like, you're not stupid, Jocelyn. Obviously, you're a very smart woman, and you get caught in a certain situation with a certain guy who persuade you in a certain way, and you think, Well, sure. You know what I mean? Good looking. It is what it is. But I'm proud of you for paying it off and going forward with it, just like Jade said. All right, let's go to Evan in Richmond, Virginia. Hi, Evan. Welcome to the show.

Hey, you all. I hope you guys are doing good today.

We are.

Thank you. Of course. My question is, I'm a college student here at Liberty University. I'm working to be a corporate pilot. I also work part-time as a server. I've got about $4,000 in debt. I've got about $300 to my name. My car has needed countless repairs over the last two years that I've earned it.

And one of those repairs was about $4,000 to fix a transmission that blew.

Obviously, as a college student, I didn't have $4,000, so my dad was gracious enough to help me with that. But in doing that, I've owed him about $200 a month for insurance as well as to pay that back. I've asked him if I could pay the rest of that after graduation. I'm able to work full-time, but he's just said no. He's paid about one-quarter of it, so a little over a grand. He helps me with grocery sometimes. I'm very grateful for that, but I'm just a little bit stuck. I want to be able to have an emergency fund, save up some money. I want to save up for a ring for my girlfriend at some point, and just be able to stand on my own without stressing about finances, especially in college, because my schedule is a little bit crazy, especially with being a pilot. So I'm just trying to figure out what I should do in my situation.

What's the $4,000 in debt? Is that student loans? Say that one more time for me. The $4,000, is that the transmission debt, or was that the... You said your $4,000 in debt, or was that student loans?

So $3,000 of that is the transmission, and then another thousand of it is on a credit card, which I used for more expenses for the car that I paid for on my own.

Okay, I got you.

And how old are you?

So I'm 21. I'm a senior here at Liberty. Okay.

There's part of this... I mean, I'm going to be honest with you. When I was in college, my parents were still helping me out with certain things that popped up. And then there was a point where it's like, Okay, you're graduated. You're making your own money. You're out there. And then it was on me. So yes, you need some breathing room. What can you let go? What can you pull back on to give yourself a moment to just chill for a second? Because I feel like you're trying to solve all these problems at once, and I don't know that you can. Is the pilot thing part of the Liberty degree, or is that something totally separate? And then you've got the server deal.

Yeah. Being a pilot, that's my degree here at Liberty. You mean just pull back in my spending?

Well, you've got to. I don't think now is the time to tackle debt is what you're asking. I think now is the time to focus on your education. Pay the minimum payments for now. You've got a little bit to go. I think you need to focus on graduating and get out of here. Keep things at a and then you can tackle that debt when you get out and start working.

Yeah, minimum payments. Stay current on everything. But I would just do that. Yep, just like what Jade said. Then when you get out and actually have a full-time job, then attack the debt.

Our scripture of the day comes from John 10: 10, The thief comes only to steal and destroy. I have come that they may have life and have it to the full. John Collins said, The people who don't have a great life are the ones who settle for A Good Life. Wow. There you go. All right. Well, buying and selling your home, if you feel like it's a big deal, it's because it is. And with all the clickbait headlines and conflicting data out there, it's really hard to know what's exactly going on in the housing market. So we are here to make the latest trends easy to understand. So median home prices dipped a little bit last month to about $426,000, and a typical season shift as we head into the fall. So it's pretty typical to see that buyers have now more options and more negotiating power, why sellers face more competition. So if you're buying out there, the market is in your favor. Mortgage rates dipped slightly to 5. 5% in September, giving buyers, again, some more breathing room. But since rates are really unpredictable, the best time to buy when you're financially ready is right now, not when the rates drop.

So if you are financially ready to buy a home and you've been sitting and waiting, get in the markets. If you want to learn more about the housing market trends and to get free tools to help you when you're buying or selling your home with confidence, go to ramsey solutions. Com/market, or click the link in the show notes if you are listening on podcast or YouTube. All right. Up next, we have... Is it Jemma? Jemma. Jemma in LA. Hey, welcome to the show.

Hi there. How are you?

We're doing great. How can we help today?

I'm in this unique situation where my employer will contribute 15 % of my salary into a traditional 401k without me having to put any in. So my question for you is, when I'm done with Baby Step 3, and I do have a small separate Roth IRA, should I contribute the 15 % retirement into the Roth, or should I contribute it into the employer-sponsored 401k?

Oh, wow. Number one, awesome company.

That's amazing. Yeah. How incredible.

There's a couple of ways to think about this. I'll tell you what my brain goes to. Rachel, you tell me. My brain thinks, number one, the 15%, it's great to get in the rhythm of doing that, because if you ever move from this job, it's great to set that habit of I put X amount of my income into retirement. Even though 15% is really awesome, I do want you to have your own skin in this game. And so part of me would treat it maybe a pension where I'm thinking of it as half, and then I'm doing the other half, and I do it into a Roth. That's where my mind goes. What would you do?

Yeah. So there's no matching at the company, correct? Correct. They're just putting 15%. So Yeah. So our normals formula is match beats Roth beats traditional. So since there is no match, I would, what Jade said, I would go to the Roth, and I would put 15 % of your income. You do this 15? Yeah. I think I would do the full 15 because the 15 going into the IRA, do you have control over where that money is going that your employer is matching? So that's good. So that's a great thing that you have the control. So yeah, I think I would just take that 15 that they're giving me as gravy. All gravy. And I think I would go 15 % of your income into retirement, and I would start with the Roth, and you can put up to, what is it this year? 8,500? 8,500, I think. So I would go ahead and max out that Roth, and then go back to your 401k at work to finish out your 15 %. I think that's what I would do.

So you would put seven and a half % in the personal Roth, and then the other seven and a half % into traditional- Well, it depends on how much you're investing.

So it's 15 % of your income. So I don't know what 8,000 of your income, what percentage that would be.

Oh, I get you. I understand what you're saying.

Yeah. So I would go ahead and just max it out. And if you have any percentages of that 15 % left, I would go back to the 401k and put the money in there.

Okay. All right. Well, thank you so much.

Yep, absolutely.

Gosh, that's a great gift.

Great benefit. Oh, my gosh. Not even having to put any money in, and they're just doing it. That's great. All right. Let's go to Megan in New Haven. Hi, Megan. Welcome to the show.

Hey, thank you so much for taking my call.

Yes, you are welcome. How can we help today?

All right. A huge fan. Love the baby steps. Always trying to get get better. But anyway, so I'm calling today. I'm a single mom by choice, though. I had my daughter on my own. I'm 43. She's two. I'm on baby steps four, five, and six. I've got my Always funded emergency fund, no debt, minus my house. I do my 15 % into retirement, and I am a teacher, so I don't have any match or anything like that, but doing the best that I can. I own my home. It's worth about 425,000, and I still owe 218,000. Good for you. I'm a teacher. Like I said, I make about $100,000 a year. So after taxes and insurance, I bring home about 4,800 a month. So basically, it's like I have enough. The budget is tight, but I have enough. It's just that I really want to change my family tree. I grew up with A incredibly loving, wonderful family who provided for myself, my sister, but zero financial literacy. I feel like I've had to teach myself everything. And like I said, I'm still learning. But I really want to set my daughter up for success.

I listen a lot about your trying not to go into debt for school, things like that. So as a single person, I know that Dave talks a lot about just the fact that if you are in a partnership, you're clearly going to make growth more quickly than if you're single. But I know it's not impossible. My income is at the top, basically. So I do have a little bit of a side hustle of conducting, choral conducting. And then I have the opportunity to have a tenant My father was living with us for the last couple of years and was helping financially a little bit. He passed away on Memorial Day. Sorry. So yes, it's been a big loss. Miss him a lot. But with the tenant situation and the side hustle, I could probably bring in about 120,000 a year. That's great. Total.

Yeah. Do you want to do that? Do you want to have a tenant? Is it like an attached apartment type situation, or are they in the house with you?

So it would be technically in the house, but we would... Well, not in the house. It would be like a basement, walk-out basement situation.

Do you want to do that? Because you're on baby steps four, five, and six. I mean, the hustle is great, but it's not absolutely necessary unless you're like, Oh, no, I want to keep- I'm okay with it.

Okay, great. I mean, obviously, it's got to be the right fit. It's small, so it would probably be great for an older, older, older, older, older single person, or it doesn't have to be an older person, but I was thinking someone with a calm- Well, someone that you feel comfortable with living in such a close proximity to you.

Exactly. And your child.

Exactly, yeah.

The trust is got to be there. What are you concerned about?

Well, Like I said, it's just... So one thing is, in terms of my savings, as a teacher, I'll have my pension. And if I work as many years as I plan to, which I think I still have another 15 years or something, but I can collect 75 % of my top three years. So one concern I have is that I'm at the top right now with my pay.

We're running out of time. We got about 30 seconds. What's the one question we can help you with?

Okay. So can I still become a Baby Steps Millionaire? Help my daughter pay for her?

Oh, yeah. Where you are. Yeah, well, Megan, I mean, honestly, the fact that you are You're so far ahead in the baby steps. The best way to help your daughter is showing the example of what to do. And you are doing that so beautifully, so beautifully. So your example, first and foremost, is everything. And then number two, you just keep working. I mean, you have 200 left on the house. You're making some great money. 120, 100? Yeah. And then if you're going to do this extra side hustle, you'll be able to pay it down even faster, even with the tenant. So I think, honestly, you just keep moving through it. And it may look different paces for different people, depending on their income, but you're doing exactly what you should be doing, Megan. I mean, honestly, I want you to be proud of yourself because you're absolutely incredible. So keep it up. So, yes, you can become a Baby Steps Millionaires as a single mom. Well, that's it for today, everyone. And remember, there's ultimately one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.

No matter.