Controlling Your Own Behavior Is Half the Battle to Building Wealth
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From the Ramsey Network app, it's The Ramsey Show. I'm your host, Jade Warshaw. Next to me is George Camel. And we are who you got for the next couple hours taking calls about your life and your money. If you want to get involved, it's an easy call. You can call 1-888-825-5225 and we'll hook you up with the best advice that we could possibly come up with. Isn't that right, George? Call us now for your free financial rating. All right, here we go. Let's go straight to the phone lines. We got Vinny in Atlanta, GA. What's going on, Vinny?

Hey, how you guys doing? We're doing good. How can we help today? Hey, so I am 24 years old. I live in Atlanta. I am doing my dream job. I'm a Bible teacher at a Christian school, and I want to kind of figure out how I can either up my income, do something to allow my wife to stay home. I am getting a lump sum of $50,000 in November on my birthday. So

So I want to know if there's something I can do to use that money to be able to up my income or if I'm able to use that in some sort of way to, you know, I want my wife to stay home. What's the 50K for? Why are you getting that? Yeah, so I've actually gotten, it was, there was a lawsuit from like my family from years ago. So I've actually gotten $50,000 before. This will be my last payout, but I've gotten that before. So I actually don't have any, me and my wife, we don't have any student loans, any card debt, anything like that. Nice.

What'd you use the last lump sum for? It was all school, my wife's school and everything. So I have money in my Roth IRA. We just bought a house in December. Okay, good. So no debt. I'm all out of the old money. Okay, good. No debt. You guys are paying for school in cash. Do you have money saved anywhere?

I got about $30,000 in my Roth IRA. Okay. Do you have any liquid money saved, like non-retirement? Yeah, we have about $12,000 in our safety, in our emergency fund. Okay, cool. And what's your income that you make off of the job that you have? It's about $32,000 after taxes. A year. Okay.

And is this the long, you said this is the dream job. Is there any upward mobility? Is there a ladder in this world? Can you teach at a college or what are your options here? Because 32K is going to be tough to live on as a household, as a Bible teacher.

That's for sure. Yeah, that's what I'm calling you guys. So yeah, that I don't really know. I don't want to teach college. I kind of like teaching like the little kids. I teach fifth grade through ninth grade. And so I love the people that I'm around and everything. So I would like to work at the school that I'm at. I love the people I'm with. It's

It's kind of affiliated with my church in some sort of way. So I like to stay there and do something else. I've looked at, you know, real estate or doing something with my money. So is it 40 hours a week? Are you working 40 hours a week or tell us more about your schedule? Yeah, I'm working 40 hours a week. It's full time school.

Okay. Yeah, I'm with George. The glaring issue here is your core income is not enough. And there's not, I mean, it doesn't sound like you're going to go jump careers to a 40 hour a week job and then do Bible teaching on the weekends for ministry. Yeah. How much of that do you take home? Like, what's your take home every month, just to put it in real terms?

It is $1,300. Okay. And then how much is your rent or your mortgage? You said you have a house. Our mortgage, yeah, it's $2,500. I mean, my wife, she's a teacher too. She gets $60,000 a year. Okay. And didn't I hear you say at the beginning you're trying to get to the point to where she's a stay-at-home mom? Yes, ma'am. You tell me how it works because the math is not math in where I'm sitting.

No, it doesn't. Yeah, I know. That's what I'm hoping to use this $50,000 to help me do something. So I'm kind of calling you guys for... But $50,000 is not going to replace $60,000 of income yearly.

Yeah. You know, so the problem is not going to get you very far. Now, you could, you know, pay off the mortgage and that's going to reduce your expenses. There's only two ways to get this margin is either make more or spend less. And you guys will likely have to do both. But the really hard truth you're going to have to have the conversation have with your wife is I don't know that I can continue doing this full time if this is our new dream. Yeah. What's the time? What's the time frame on this? I mean, is she pregnant? Tell us more about what you what the timeline is.

She's not pregnant, but I would like her to be. So we talk about it and everything. But people always say the Lord will provide, but I don't want to put the Lord my God to the test. Sometimes he provides by making us get up off the couch and go work our butts off. That's a good word, George.

He gave us the ability to work. And so that's my challenge to you. I'm not saying you need to leave your profession, but if you're saying this is what we want and this is God's will for our life, that might mean I need a total career switch and go, I'm still going to do Bible teaching for fun. I'm going to be very involved with my church. But what I do Monday through Friday, 40 hours a week is going to be completely different because I need to go make 65 to 90 grand to make this life work.

Yeah. What's the total mortgage? Tell us that picture because let's see if we can lower your expenses. Yeah. So we got a 7.5 interest rate, the house of $300,000 and we put 8% down or something like that. But the mortgage is 4,300? Yeah.

Yeah, yes. And I was kind of assuming you guys were, it was 2,500. And I was kind of assuming you guys were going to tell me this, which is okay that, you know, that I need to go get a different job. I'm totally fine with doing that. I just kind of needed to know that somebody, you know, put the name Ramsey on the title. Yeah. Give me the okay to kind of do this. Well, here's the thing. It's already tight. Just like it.

If right now, if your wife said, hey, I'm not going to work anymore with just the two of you guys, this would be almost impossible. But now let's add kids to it and it becomes 100% impossible. And I just, I don't think that you want to enter into that and thinking, okay, God will just carry me. I think that that's going to be a fool's errand if you do that. I think that you need to look at this and go, okay, let me count the cost before I build this tower and let's find out how this works. And the truth is,

The math that you're doing right now does not work. And so you're going to have to say, okay, what must I make in order to allow my wife to stay home with at least...

a little bit of comfort because what will happen is if she's staying home with no margin that means I'm home with one or two kids or I don't know how many kids you guys are planning on having and she doesn't have any place to go and that right there I can tell you that's a tough recipe when she's because she's going to feel that more than anything because she's if she's staying at home she's probably the one doing the grocery run she's the one having to look for things for the kids to do all day so if anybody's going to feel that lack of margin it will be her

That makes sense. Yeah, totally. I agree. I'm going to send you a great resource, Vinny. It's Ken Coleman's Find the Work Your Wire to Do. It comes with a Get Clear Career Assessment. I want you to read it. Take the assessment. It's going to help you figure out what are the underlying skills. Clearly, you love to be working with youth. You're a great teacher, educator. Let's use those underlying skills to find you some core income that's enough to sustain the life that you want. And right now, you're between a rock and a hard place. You're saying, I love what I do, but we also have this other dream here.

Well, one of them is going to have to shift. Yeah. You know, George, I love...

the idea of a stay-at-home parent. I mean, I love it. My wife now stays at home. Exactly. It's amazing. But how would you feel? I mean, the stress that, the blessing that that can be, but also the stress that can come from that if it's not the right time or if the finances are not there to support it. That's the part that... We get that call very often. You know, she stays at home. I make 40 grand. We've got three kids. We're drowning. What do we do? Well, he's got the blessing right now of kind of foresight.

it would be foolish for him to do this having heard what we've just said. Yes. They have two incomes. They don't have a kid yet. There's some planning we can do here. Yeah. So this isn't a giant shock to our financial future. Yeah, because a lot of the calls we get, they're already on that side of it. And it's really hard to get the ship upright at that point because time is limited. Resources are limited because now the kids are already part of the equation. So if on this side of it, if you can say, okay, what needs to happen? And he's

The point is, on any choice, there is going to be a measure of sacrifice, and you really can't get past that. That's just life. Very rarely do we get to make a list of wants and just jump into all of them with little to no sacrifice. There is a cost associated with anything you want. That's right. You got to choose. This is The Ramsey Show.

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You're listening to The Ramsey Show. I'm Jade Warshaw. Next to me is bestselling author George Campbell. We're taking your calls this hour. So if you want to get involved, it's easy to do. Call the number 888-825-5225. We'll get you on. All right. Let us go to the phone lines where we've got Lori in Orlando, Florida, my neck of the woods. What's going on, Lori?

Oh, hello. Thank you so much for taking my call. I appreciate it. Okay, so I noticed that we recently signed a lease for a place, and then at the end, there's a calculator that shows you like a mortgage rate, and the mortgage rate is a lot lower than the rent. So would you recommend, we're following Dave Ramsey's plan, and we were...

trying to save up for the baby's emergency fund. Yeah. Even though we're not in a position to buy now, I'm thinking, why would the mortgage, I mean, the mortgage seems lower. So what would your advice be? Follow the steps and become ready to buy a home or because it's, um,

better to rent. So I'm just kind of wondering about that. Yeah. I mean, the truth is over time, it's always going to be a better choice for you to buy over rent. But the biggest deciding factor in whether you buy or rent for the moment is what you can afford.

And so, and we have a very specific definition of what that looks like, because guess what? The bank is going to loan you way more than should be legal. And you'll go, oh my gosh, the bank thinks we can spend $2,800 a month on our mortgage. I guess we can, even though we make four grand. They'll take you up to 40%. So here's the parameter to keep you in line here. It's 25%.

of your after-tax income. So this is after taxes, but before other deductions like your 401k investing or healthcare, you want it to be 25% of your income. And we only recommend a 15-year mortgage. And then there's parameters before that. Also, Lori, we want it to be a blessing for you. We never want somebody to get into a house and then the house has them, right? And so for you, and not just for you, but for everybody, we want to make sure that you're out of debt, right? Because you're having a bunch of payments.

We want to make sure that you have three to six months of expenses saved because the worst thing ever is to buy a $500,000 house and then the $5,000 AC goes out and you can't afford to fix it. Right. And so that's what people don't factor in is the extra cost of home maintenance repairs. The risk is on you. The homeowner's insurance is more expensive. Property taxes can and will go up. HOA fees can and will go up.

And so that's why we want you to be debt-free, emergency fund in place, have a strong down payment, try to avoid that PMI, private mortgage insurance. And then you can use our mortgage calculator. You can go to ramsaysolutions.com slash real estate. We've got tons of tools and resources for you there. And so I know it looks like, oh,

we might as well just spend that money on the mortgage, but that could be on a, you know, 30 year high interest rate, all of these things. And you may not be quite ready to jump into home ownership. Yeah. Good question. Thanks for the call. All right, let's go to Nilly in Hartford, Connecticut. What's going on, Nilly? Hello. Hi. How's it going? Going good. How can we help? I'm good. Um,

It's, I've been running my own business for a little over two and a half years now. Okay. I've been having trouble finding services that give me good information. I've called all the biggest like accounting firms and stuff like that. What kind of information are you trying to find?

I'm trying to see if I should incorporate as an S corporation. You know, I see all these like TikTok videos and like if you do this and you have this board of directors. And they told you to write off a G wagon and go spend 150 grand? No, I'm definitely not doing any of that sort of stuff. Is it just for liability protection? Well, liability as well, because I've been working this business seven days a week. Mm-hmm.

since I opened it. I haven't hired anyone yet, but I am going to be looking to hire someone. I do have a lawyer who's very good. What kind of business is it? I do trading cards. Trading cards? Magic the Gathering. Do you have an LLC right now? No, I'm a sole proprietorship. Okay. And why do you feel like you've outgrown that? I started this business with like $3,000 in my pocket.

And I'm slated to make close to in sales a million dollars this year. Nice. So just the thing is I paid like it was like over $50,000 in taxes last year. So what are you doing right now? You're just doing business as...

Whatever. Yeah. Okay. I mean, yeah, I would sit down with an accountant and say, what makes sense for me to do? I mean, my husband and I, we did an S-Corp, but it's an accountant's going to be able to say what's the best for your tax purposes, for your business type, for your liability. They're going to be able to decide what makes most sense for you. But congratulations, a million dollars is pretty sweet.

Yeah. I've called all the biggest accounting firms in the area. You don't need to call the big accounting firms. I would get with a Ramsey Trusted Tax Pro. Go to ramseysolutions.com, click on Trusted Services. I'd get their opinion first before making any moves. Yeah.

And I think they're going to look at your actual number. Something we can't do on air right now is unpack your entire business and give you very specific tax advice. That would be unwise. We're not experts in that field. But I would contact one of our Ramsey Trusted Pros to walk you through this. And they might go, yeah, you're at the point where this makes sense. Here's how much money you'll save. Here's the reason you're doing this. Only work with someone that is willing to teach you.

who's willing to educate you on the next move instead of just go, just trust source. Trust me, bro. Yeah. I got this. Good call. It's a good thought. Thanks for the call, Nilly. Let's go to Zach. He's in Indianapolis, Indiana. We're just working, George. Let's go. What's going on, Zach? Hi, how are you all today? Doing great. How can we help today? So I'm in the process of looking at purchasing a new home. I kind of have some scares with the market the way it is. Just at least in my area, it seems like a lot of homes are

prices are valued a lot more than what the home really is worth. Um, and I'm actually in the process of trying to sell my home and trying to be fairly fair about it. But again, trying to buy something at some of the prices is making it a little difficult for me to sell mine. But the biggest question is my situation has kind of recently changed. My wife and I, uh, have no biological kids, but we decided to foster and ended up adopting three of the kids. Um,

So we're, my wife and I, um, I'm a trade plumber, done it for years, uh, almost 10 years, went through the UA and stuff. And I actually recently got out, took a maintenance position just to have more time at home with the kids, uh, to help my wife. Cause never having kids before, I'll be honest. We didn't really realize what we were doing. Not that I don't love every minute of it, but, uh, we're trying to figure it out. Uh, we've been doing it a little over a year now and it's been up and down, but that's

Aside from that, we're wanting to buy a bigger home. We're in a two-bedroom and three kids plus the dogs, and it's just not ideal. It was a perfect house for just my wife and I, but it's not practical anymore. What would you get if you sold it for what you're wanting? What would be the net profit after the mortgage is paid off, fees are paid, all that?

Well, I really wouldn't be walking away with anything beyond what would pay my down payment on the new home. Which would be what? Right around $15,000, $15,000, $20,000. So you'd net $15,000 and then you'd turn around and put that down on the new home?

Correct. There is more profit coming from the home, but I want to use that to pay off a couple things just to help balance out. Do you have other debt? What a mortgage payment would be. Not a ton. Tell us what it is. I'm right under $100,000. That's a lot. I owe $64,000 on my home. I have a one-car loan. That's $30,000 a used car.

My wife's income as well as mine together, we bring about $115,000 a year. So the $100,000 that you mentioned, that's including the current mortgage of $64,000? That is correct. Okay, so we'd clear that out, and then after that you'd only have the $30,000 car? Correct, because I'd be paying the rest off. Do you have any savings? I do have a motorcycle loan. Yeah, we do have some savings, not a whole lot. We've got roughly right about $8,000. And the big reason for that is because

We, and we didn't know about this until after we had adopted the kids, but we received benefits for them, which we'll only get until they're 18, but

I kind of feel greedy taking it. No, you try to use that money to help pay off debts as well as, and we do use it on the kids. You shouldn't feel bad for taking that money because that's, it's there to help you take care of the kids and they're now part of your household. You paying off debt is helping you take care of the kids. But here's the bad news, Zach. I would not move forward with this. Not because you're not, you know, in a good spot to buy a home with the market, but because you got some work to do. Get an emergency fund, get a bigger down payment. I would rent for a year.

in a house that makes sense for you guys, and then make the purchase once you're in a better spot. Yeah, I agree 100%. It's going to feel like more of a blessing. If you do this house right now, it has the ability to bring a lot of chaos financially into your life. So I agree with George. This is The Ramsey Show. For free tools and resources to help you reach your home goals, go to ramseysolutions.com slash real estate or click the link in the show notes.

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That's Fairwinds, F-A-I-R-W-I-N-D-S dot org slash Ramsey. All right, thanks for hanging out with us on The Ramsey Show. I'm Jade Warshaw. Next to me is George Camel. Hey, we're heading into fall.

And it's time to get your money on point. I don't know about you, George, but I feel like the holidays just hit. It's going to be Halloween here in a minute, which means in a minute it's going to be Thanksgiving and then it's going to be Christmas. And before you know it, it's going to be the new year. And most of us are going to look up and go, oh my gosh, I have...

made a real mess of my finances. Your brain just turns into pumpkin pie and you just go spend and spend and spend and go, well, what are you going to do? It's the holidays. Yeah, man. And everybody's demanding time and money of you around this season, right? It's like, aren't you going to, are you going to bring the kids for Thanksgiving? And people are giving you their Christmas list. And you've got to buy the costumes. Remember that party? You've got to buy a thing for that. And yeah, hosting the parties, going to the parties. What side are you going to bring to the party? There's just so much going on with your life and your money. But yeah,

Let's try to get ahead of it before it gets worse. It might be bad, but it doesn't have to get worse. All right. And I can help you with that. I'm doing a free live training here coming up Tuesday, October 29th. It's going to be at 1 p.m. Eastern time, 12 p.m. Central time. This is your lunch break. OK, and it's on Zoom. So no one has to see your face. If you're still in bed, that's fine. I don't care if you're in your pajamas. I don't care if you're sitting in your car on your lunch break. You can get involved. You can register for free at RamseySolutions.com slash register.

www.ramsysolutions.com slash webinar is where you're going to register. And now here's the thing. If you can't make it in real time, still register because you can watch

Watch the link later. We'll email it to you and you can watch it later. But the point is over 100,000 people have signed up for this webinar series. And I've gotten to sit on there and help with you guys' questions, help you put together your budget for the first time, help you find margin, help you stop living paycheck to paycheck. That's what this is all about. And we can talk about goals, how to reach those goals. But the point is a budget is the number one way to eliminate debt.

debt. A budget is the number one way to build wealth. We know that we've seen that. And a budget is the number one way to get on the same page as your spouse. So if that has anything to do with you,

You need to sign up for this. And oh, did I mention a budget is the number one way to achieve financial peace? We know what we've seen it time after time. So it's the holiday season. Enjoy the holidays, but don't let it get crazy. And this is your this is your way to get it all under control and make sure that you have a plan going into the holidays and going into the new year. Again, live training, October 29th. RamseySolutions.com slash webinars where you want to go to register. All right.

Bridget is on the line. She's in Omaha, Nebraska. Bridget, how can we help? Oh my gosh. Hi friends. I'm so excited to talk to you guys. Okay. Moral of the story. I'm in a 23 grand student loan debt and I'm living in delusion slash trying to get back to reality. I recently got my identity stolen. And what that entailed was two cashiers checks taken out and they closed my accounts and I've only gotten back 358,

$1.59 out of the three grand. So I'm in this delusion land of when I finally get my money back, I don't want to keep screwing myself over, moral of the story. And I just don't want to see your guys' recommendation because I have $1,300 saved up in cash for the emergency fund. So I'm trying to do the baby steps. I have an acorn value. Do I pull out the two grand? And then...

I just don't know what to do. So you bought some, is this single stocks, crypto? What's in the Acorn account? Single stock or the EECs or sorry, the Invest Later or, oh shoot, I'm going to pull it up right now. I should have been better prepared. Sorry. But yes, they're non-retirement funds. I would cash them out and use that toward your debt payoff. Okay. Who's helping you with the stolen ID? Is this just you tracking this down yourself?

Um, yes, kind of, but I do file the police report and then the detective is just not getting back to me. He hasn't responded since October 10th. So of the 3000 stolen, you said how much is recovered? Uh, I've only gotten a check from the bank for $358 and 59 cents. And that was me being absolutely insane to the bank, like going in every single day and being like, no, figure it out. Cause I noticed within 40 minutes,

that I went on to go get gas, and then it said car declined. Like, there's no way. There's no way. So have they told you the timeline? Is it under investigation? What's the status? Under investigation, but the detective hasn't even got back to me. Okay. And I've even gone down to the precinct, and, like, I sat there for, like, two hours. I'm like, I'm not leaving until you talk to me. And then finally talked to me. He's like, I'll look into it. Okay. Yeah, you've got to be the squeaky wheel here. Have you put a fraud alert on all of your credit accounts and frozen your credit with all the bureaus?

Yes. She also tried to open that day two different credit cards and I put it since I noticed it. So, yeah. Okay. So you acted quickly to kind of mitigate this to keep it from spreading, which is really, really good. Have you pulled your credit report to see if there's anything else that's been opened?

It just said she tried to, but when she did it, it was already flagged. Okay. I would pull it just to make sure that whatever's on there is accurate, and you can do that at annualcreditreport.com. You can pull all three for free and just verify that there's nothing TBGB on there. You can also file a report with the FTC, the Federal Trade Commission.

As well? Yep, I did that. Okay. Good, good. You've done all the right things. On top of that, I would, for the future, have ID theft protection. And I've got mine covered through Zander. You can go to zander.com to get that set up. And this is for anyone listening as well. Because I went through the same thing, Bridget, back when I was broke in 2013. I had just started at Ramsey, 36,000 student loan debt. And they opened up these cell phone accounts in my name, racked up debt. I had collectors calling me. It's scary. That is scary. You feel just so exposed. Yeah.

You lose just trust of humanity. It's not a fun time. So I'm sorry that you went through that. But it sounds like you've done all the you've done the hard work to climb out of this. And now the next step is let's follow the baby steps. So you're working on the student loans. Is that the only debt you have?

Um, yes. All right. Cause I paid off, which I, um, Oh, do you know how long? So I stopped paying my car payment, learned that the hard way. And then I was going to get repossessed. And then I was like, what are you doing? I was just being depressed, little girly. And so then I just paid it all off at once. I don't know if that was a stupid mistake or cause now it's saying on my credit report that, um, the close, the, Oh, she wouldn't say, um, close,

they just did as a write-off and i'm like no but i paid you guys what do you need was it in collections before um and no just went to collections once i'm not on my credit report oh well the the debt's completely cleared now you've paid it off completely yes listen i would uh try to i i wouldn't worry about it and then i wouldn't worry about it too much because you're about to pay off these student loans and your credit report's going to go to zero anyway

Okay. So that's the way that works. Next, let's list the student loans, smallest to largest. We'll make minimum payments on all of them, but put any and all extra money on the smallest debt. That's how it works. Oh gosh. Let's take another call. Brian in Baltimore. We're up against the clock. What you got going on, Brian? Hi, how's it going? Thanks for taking my call. My main question was, should I hold off on paying my student loans until I'm making more money? Well, how much are you making now and how much are your student loans?

So right now I'm making about $70,000. I'm currently a resident in training. Right now I have about $220,000 or so in student loans. Is it your only debt? I have about $3,000 in consumer debt, which I plan to pay off by the end of the year. Okay. Well, if I were you, I'd start, I mean, it's never too soon to start working the baby steps. And so if I were you, I would do that. I'd set $1,000 of savings aside as soon as you get it. Do you have any money saved?

Yeah, currently I already have my $1,000 emergency loan fund. I'm just working on paying off the consumer debt. Okay, yeah. To answer your question, would I wait? If the $3,000 is the smallest debt, yeah, I'm going to pay that one off first. So in that way, yes, I would wait. But then when it comes to these student loans, is it all one lump sum or do you have it divided into a bunch of little loans?

I haven't divided into a bunch of little loans. Okay, so what we're going to do is we're going to look at all of the debt, including the consumer debt, and we're going to list it smallest to largest. Now, with the student loans, some of them might be grouped together in a payment, and that's fine because we're going to make minimum payments on everything. But as far as what you have left after you've made minimum payments, you're going to put it at whatever the smallest debt is, whether it's a student loan, a credit card, a medical debt, whatever it is, you're going to knock that thing out.

And then that's going to free up money to go towards the next smallest debt. And so that's really the way this works. Is there any way to do some side hustling on the side? You said residency, right? Correct. Yeah, right now, not too much time to do any side hustling. How much margin do you have each month to throw at the debt?

If I were not paying the debt, I would have about $700 in the margin or so. Okay. Yeah, if I had $700 a month and you said, what should I do with it? I'd go, let's start tackling this debt because it's going to be there. And so let's not be the ostrich in the sand. Let's be already attacking it and then just increase momentum once we make more money. Yeah, and if these are federal student loans, this might be a good time to kind of utilize one of those systems where...

It's lowering the minimum payment. So that way you have more margin available to throw out whatever the smallest debt is. But I want you moving with intensity if you choose to use that method. This is The Ramsey Show.

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All right. Thank you for listening to The Ramsey Show. I'm Jade Warshaw. George Camel is next to me, host of The George Camel Show on YouTube. Today's Ramsey Show question of the day is sponsored by YRefi. Hey, it's hard to make progress when you're trapped under an avalanche of defaults.

faulted private student loan debt. I know for a fact, but YRefi helps you dig out and get momentum with custom refinancing based on your ability to pay and a lump sum payoff option you could qualify for after 24 months. Go to YRefi.com slash Ramsey. That's the letter Y-R-E-F-Y dot com slash Ramsey. May not be available in all states. Today's question comes from Sam in Pennsylvania.

My fiance and I are considering a new home build in the $500,000 range in our dream community. Together, we earn about $120,000 a year. We have a child and no debt other than my current mortgage, which doesn't have a lot of equity. We're cash-flowing our February wedding. We'll be putting down $25,000 to reserve the lot and another $25,000 for an additional down payment before closing."

Are we moving too fast considering everything going on in our lives? On one hand, this is a phenomenal opportunity that gives us exactly what we want and can afford. But with the wedding planning and moving costs on top of everything, we're still on the fence. Please give us permission or a swift slap in the face. Wow, I got aggressive real quick. I think she knows that they might need a little bit of a slap.

Yeah, this is, I mean, they say they can afford, but I'm out here crunching the numbers. And I'm going, okay, $500,000, they're putting about $50,000 down, it's 10%. With the interest rates where they're at, private mortgage insurance, because they're not putting 20% or more down. Property taxes, homeowners insurance, potentially HOA. What are we looking at? We're talking $4,700 a month. Didn't she say they make $120,000 a year? They make $120,000 a year. And so the question is, you know, what are they taking home? Because I doubt it's more than...

than eight grand or so. And so you're talking a five grand mortgage with an eight grand take-home pay. Wrong answer. Unless there's something we don't know about, this sounds like a horrible idea. This house in the dream community is about to become a nightmare if they do it right now. So the fallacy is...

If we don't do it now, we're always going to look back and go, oh, the one that got away. Why didn't we? Now that home is $700,000 in our dream community. Yeah, but you're not coming into it broke. Calling in the show going, Jade, we made a mistake. We did a lot at once. We had the wedding. We bought the house we couldn't afford, and we need to sell now. And we're going to lose money on this. Oh, my gosh. That's what I see in their future in my crystal ball. Yeah, plus I'm...

Listen, they're not even married yet. We always say it's a good idea, unless one of the people already owns a house of their own. Which he said he owns one, but he's got no equity. So he's probably going to break even on the sale here. That's fine, but they could live there for a little while. Or if he's going to sell it and they break even, whatever, go rent for a while. I would not rush into a buy. This reminds me, George, when my husband and I first got married, there was a community. Jackson Valley was the community. Sounds ritzy. Yeah.

here's my point is if you go in that community now i'm like why did i care about this so much back then you know what i mean what were did have nice amenities or just fancy homes at the time they were kind of like uh craft uh craftsman style yeah that craftsman style and i just thought this is amazing and now i go and look at it i'm like they're old just like you know they're 20 years old you know what i'm saying and so the idea that you won't love something else wears off quickly yeah

There's always going to be something that's the dream. There will always be a great opportunity. Listen, if you're about to just get married, get to know each other. Rent for a while. Home ownership and building a new home. It is a part to full-time job to be doing that. Yeah, to build too as you're...

That's a lot. A lot of decisions to be made, a lot of chaperoning to be done on that project. So I would just rent for a year, keep saving up, and then we'll see where we're at. Maybe you have 100 or 200 down a few years from now. Now we can step into this with peace. So would you call this a swift slap in the face? I'm not going to slap. I'm not slapping anybody.

But I'm going to, I can't give you permission and I will say not now. Not now. This is a wait. I like that. Not no, just not now. Yeah. All right. Let's go to Matt. He's in Toledo, Ohio. What's going on, Matt? How can we help you out? Hey, thanks for taking my call. How are you doing? Uh-huh. We're good. How can we help?

Yeah, so I just got a letter in the mail today from the local courts with a judgment against my name for a total debt from a credit card company, the amount of $2,380 for a card that I did not open. Oh, that sounds like fraud then, does it not? Yeah. Have you ever done business with this company? Did you ever have any accounts or apply for a card or anything like that?

No, I did not. It's actually a Spirit Airlines credit card. Oh, no. Insult to injury. Okay. Have you contacted Spirit's credit card department and said, hey, this was opened fraudulently and I need proof and here's the statements and, you know, all of that to get to the bottom of it? No.

No, I have not. I literally just got this letter in the mail probably 45 minutes to an hour ago. The other question, are you sure it's legitimate? There's a lot of scams out there where they make you think it's a collector and they say, hey, if you pay us this, then we'll call it good. That's a good point, George. And so I would be seeing what the name of the company is and then research that company elsewhere. Don't contact them through anything on that paper.

Look them up online. Yeah, on the summons from the court, the company that filed is LVNV Funds, LLC. Okay. Is it showing on your credit report? If you pull up your credit report, are you seeing that this credit card is part of it? I

I have not pulled that up yet. Go to annualcreditreport.com and pull your credit report from all three bureaus and see if it's reflected on there. If it's not reflected on there, it's likely a scam. And the other thing you can do is contact the actual court and go, hey, I got this in the mail. I know there's a lot of scams going around. Is this legit? Because...

I didn't open this and I know there's a lot of things going around right now before I, you know, people get freaked out and their goal is to freak you out and say, but if you just pay us a little bit of money, we'll make it go away. Yeah. Yeah. Yeah. I would do my due diligence on this. When I get off this call, that'd be my next move would be to check the credit report. If it is on the credit report, I'm going to freeze it and I'm going to drill down on this and make sure that,

The right parties know that this is fraudulent, but I agree with George. I would not deal off of that paper in front of you. And then document everything. Document your call with spirit, what happened, what they say, what was the name of the agent, what time, all of that so that you have all the info. Okay. And the other thing that says on here is it was filed, the judgment was filed on August 30th. Okay. Which is, what, two months from pretty much Thursday or Wednesday. So,

I don't know if that's... I don't know why it took so long to get the paper to me, but... Listen, we can't answer these questions until you drill down a little bit further because... You got some phone calls to make. I'd be calling the courts, I'd be calling Spirit, and I'd get to the bottom of it. But just know... I mean, don't pay this. Don't pay anyone a dime for anything. That's the bottom line here. And then make sure you freeze all of your accounts with all the credit bureaus. So you got your day ahead of you, man. And this is another opportunity for that...

ID theft protection. I mean, this is the second one in the last hour, George, where we're seeing this. Yes, it's happening more and more. Yeah, and Xander is where you want to go. They're going to make sure that you're protected. And here's the thing. What I love about Xander is they're going to fight the fight for you because...

When you have identity theft, the amount of hours that you have to put into tracking people down, trying to recover the money, trying to explain your case, trying to tell them what happened. Ain't nobody got time for that. But if you have ID theft protection, they're going to do all of that for you.

and it's so cheap. George, I think- Yeah, we're talking the cost of a pizza. Six, 12 bucks. It's not a lot. I know for my whole family, I don't think we pay more than $12 a month. And so if you don't have it, this is a good time for you to look into that because you never know. And especially around this time of year, George, coming up in the new year when people are doing their tax returns and they're waiting for that refund check to come through, that is where people experience a lot of theft. And so-

there's a lot going on. So you want to know, A, if it's real. I had a text come through the other day from a bank saying, somebody's been using your card.

Wow. Was it your bank? Did they say it was your bank?

through the email, through the letter. I'll usually say, okay, if it's Ally, let me just contact Ally from, you know. With the info on their website. Yeah, or if it's whatever. Because you can even spoof numbers and emails now. So it looks like it's coming from legitimately that website. Yeah. And it's not. But if you contact them through that same email, it'll actually go to Ally. That's right. So you got to be real careful and...

I know like the elderly, they're very highly targeted with these because they're not as savvy as the youngsters, but this affects everyone. So go to Xander.com, get their ID theft protection.

Every single team member at Ramsey, Dave covers it because it's that important to us. Yeah. And if you've been working our plan and your credit score has rolled to zero, make sure you've frozen your credit because there's no reason for you to access it. And when you freeze it, it makes sure that nobody else is getting to it either. All right. That does it for this hour of the show. Thanks for hanging out with George and I. Stay tuned because we'll be right back with another hour.

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From the Ramsey Network, it's The Ramsey Show. I'm Jade Warshaw. Next to me is George Camel. We are your hosts for this afternoon. We're talking about your life, your money, your relationships, your career. If you have something that's burning in your spirit that you need help with, you have a question that you need the answer to, George and I will do our best. We'll put our heads together and come up with a solution for you. If you want to call in, the number is easy, 888-825-5225. Kelly will pick up, screen your call.

Get you on the line. That's how it works. All right. Let's get into it, George. We've got Cash, very ironic, from Columbia, South Carolina. What's going on, Cash? Hey, guys. How's it going? Thanks for taking the call. You bet. How can we help? Yeah. So recently, I've been in contact with the bank looking to see if I shouldn't do a cash out refi and the goal to try to pay off my mom's house.

Interesting. What's going on that you feel the rush to pay off your mom's house? I mean, she's not getting any younger and there's been some recent health scares. So looking to kind of simplify for her and just kind of make sure that, you know, however long we have her, she has, you know, just a rock star rest of her life.

for many days he's got left you know listen i love your i love your spirit of generosity i think that's great uh generosity is one of those things i always want to make sure that we're in the position to be able to offer it uh without detriment to ourselves so tell us a little bit more about your financial situation to see if you're in a position to help maybe not with a cash out refi but in another way let's see tell us about your debt your income

Yeah, so income is currently $60,000 a year. Don't have any debt, paid off car, everything. The only debt that I have is the home that I'm in right now that I would be cash out refining, which is purchase price is $135,000. Current evaluation is $180,000. Okay. What do you owe on it? $90,000.

Okay, so you're going to do it. You want to do a cash out refi on your own home and then take that money to pay off mom's mortgage? Yes, sir. What's left on her mortgage? 90. Which is all the equity you have, if you're lucky. Yes, sir. What's her income situation? She makes about $20 an hour. I'm not sure what that breaks down to. Does she work 40 hours a week?

30, 30 hours now since the diagnosis. What's the diagnosis? Diabetes. Okay. And how old is she? 60. 60. Did she just become diagnosed with diabetes or is it something that's progressed and it's gotten worse?

It's progressed. Okay. You're breaking up on us, Cash. Sorry. Speak directly into your phone. Here's the bottom line. It's progressed. Here's the bottom line, Cash. Doing this is the equivalent to you going out and taking out a $90,000 loan at 7% interest in order to help mom out. So now you're going to have an $180,000 mortgage, which is going to be a lot for you to handle making $60,000.

All so that mom's going to be OK. I just think there's better ways to help. That might mean a stipend every month to help support her if she's low on cash or whatever it may be. Maybe she moves in with you eventually if she needs more care and can't afford the mortgage. But I would not do this, you know, this good deed that puts you way behind. It's moving you backwards financially. Yeah.

And I want to see you have your own mask on first. I'm 100% along with that. I think that I think it's a great, great that you have no debt. And I think it's great that you're looking for ways to help. I think paying off the mortgage causing you to go into debt is not the method. I like George's idea of maybe it's a stipend. Maybe you're coming alongside her and really asking her, hey, mom, what what is your need? Because she's making money, you know,

What other information do you have about her financial picture? Has she let you know, hey, this is tough for me. I'm having trouble making ends meet. What has she said to you?

Um, it's nothing too clear. Um, just, just the, the, you know, just the general sense, you know, you can feel it when somebody's got some anxiousness and the washing machine goes up, you know? And that's where I'd love for you to be able to step in. If you've got a bunch of savings, go, Hey, I'm going to get the washing machine fixed. Don't worry about that. There's ways you can be generous without making this giant financial move.

And on top of that, I would sit down with her and make a budget with her and say, hey, mom, what are your actual expenses? How much are you actually bringing home a month? What does this look like for the foreseeable future when you factor in, you know, maybe Social Security? And are we going to be able to make this work? Does she want a sustainable solution? Yeah. I mean, I know we're asking you a lot of questions about somebody else's financial picture. So you may not have these numbers, but do you know, does she have a nest egg of any type? You broke up on us, Cash. We're losing them. Are you there? Yeah.

I don't believe so at all. Hello? Yeah. Do you know, does she have a nest egg at all? I don't believe so. Okay. Well, you know...

to george's point you're going to need to sit down with her i don't know sometimes it's hard to get parents to uh divulge the information that we want right powdered butts yes that's how i'm looking for i don't want to i don't want your financial advice exactly so that's a tough one but the fact that she's 60 and she's working um and she's got a health concern and she's still working through that does does point to a little bit of a

That's a green flag that there's probably a financial strain going on. And I love his heart to want to help with that. But the truth is, I mean, you do not have to set yourself on fire to keep somebody else warm. Ooh, I like that. You know what I'm saying? I got that from Viola Davis. That's a very good quote. But the truth is, we do...

okay, we feel guilt. You know, if you're in that situation, here you are looking at your parents, they've taken care of you their whole life, right? And you see a situation where, okay, they could use somebody to help them out. There is part of us on the inside that feels like, okay, this is my duty to step in. And sometimes we'll do it, you know,

at a fault when we've got our own kids, we've got our own family that we could possibly put them in a worse situation by stepping in when we're really not equipped to do so. That's tough. That's tough. And again, it's going to be carried on generationally if you keep going backwards instead of moving forwards. That is true. All right. Let's take a couple of social questions.

Yvette says this, "Hey, do you have any tips for a stay-at-home mom to make income while she's at home?" George, I feel like you could speak to this. You got a stay-at-home mom at home. - Yes, there's a lot of things you can do from home, but you have to understand that unless you have experience and skills that you can work a remote job making serious money, a lot of them are just not worth your time on like, you know, I'm gonna do surveys or like one of those, or I'm gonna do multi-level marketing and build up a business.

Those things I do not recommend. So what I would do is find things with your skill set, with your experience that might be, you know, customer support roles. Virtual assisting is a great one to do. I love that. You can make 20, 30, 40 bucks an hour doing this remotely from home and sometimes on your own schedule. I said it the other week and I'll say it again. The other day I ordered two recliners from Wayfair.

They came and they were not what I expected. And so I needed to send them back and I had issues with sending them back and I hopped on the customer service. It was all via text. - Oh yeah. - And I thought to myself, whoever has this job, like this person calls into the Ramsey show all the time. They're looking for something that's work from home. Maybe there's a disability that's...

you know, limiting what they can do. But I'm like, if you can do a customer service job that is texting, which means nobody has to see your face, nobody has to hear your voice. Like there is, there are options out there. Uh, no matter who you are, stay at home, mom, if you've got some limitations, there's a lot. And you can go check out our free side hustle quiz, Ramsey solutions.com slash side hustle. Our team created a quiz that walks you through, Hey, how much time do you have? What are your talents? What is your target? Here's some ideas to get you started. Perfect. Perfect.

Perfect, George. Coming in clutch. This is The Ramsey Show.

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fieldofgreens.com slash Ramsey. Hey, Dr. John Deloney here. Data suggests people who have amazing marriages are happier and they're healthier. But in the modern world, marriage, especially a deep, intimate marriage, can feel impossible. And that's why I'm here today

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You are listening to The Ramsey Show. Thanks for hanging out with us. I'm Jade Warshaw. Next to me is George Camel. Hey, let me tell you, this weekend here at Ramsey was a really amazing weekend. We had our Money in Marriage getaway event. It was our second one that we've done here on campus in person, and it was amazing.

George and I were both part of that, but Dr. John Deloney and Rachel Cruz were kind of heading that whole thing up. It was great. We had 500 couples from all across America here on campus. They spent the weekend here with their spouse, and it was pretty freaking...

freaking awesome George if I do say so myself it was I can vouch for it and it was so good that they wanted to do this for people who maybe can't visit Nashville and so we're doing a brand new virtual event called money and marriage date night and this is one you don't have to worry about the flights and the hotels and all of the expenses that come along with that so grab a virtual ticket and

and you can tune in tomorrow night from anywhere, even your couch. John and Rachel will be ready to guide you and your spouse through this one-night refresh for your connection and communication so you can head into this busy season as a team. Tickets cost just $49. You can get yours at ramsaysolutions.com slash events or click the link in the description if you're listening on YouTube or podcast. Love it. Meeting people where they're at, be there or be square. All right, let's go to LaDonna. Houston, Texas is where she's at. What's going on, LaDonna?

Hey, how are y'all doing? I'm doing good. How can we help? Well, I'm 74 years old and I'm trying to get my estate in order. I have $400,000 in cash that I need to know.

What to do with it to protect it so that my two sons get it and that it doesn't go through probate and also that it's accessible and available in case I need it for care. Do I put it in a trust? I have a trust set up. You do? Do I put it in CDs? Do I invest it? Do I buy real estate? What do I need to do? Right now it's just in CDs. You've already got, what kind of trust is it that you have set up?

So just a plain, a revocable living trust. Perfect. Okay. So you could put it within the trust and then name the kids as beneficiaries, and that will simplify the distribution process. Okay. Is that the best thing to do? Yeah. That'll give you the most control over what happens with it. I mean, if you have them listed as beneficiaries on the bank account, they're going to get the money. Mm-hmm.

Right. Was there something you wanted to do with the money in the meantime? Well, there shouldn't be taxes. There shouldn't be taxes on this inheritance. And you're likely not going to have an estate that's going to trigger taxes. That's beyond the amount. We're talking millions and millions and millions. So I'm not I'm not worried about this. But I would also make sure that you're working with a good estate planning attorney walking through all of these different things and setting this all up in a way that, you know, suits your wishes.

Okay. Are you doing this alone? Well, no, my trust and attorney set up my trust. Okay. But this money was separate from that. I would ask them. I would just say, hey, I want to make sure that it gets split between them with very, you know, little, you know, very much an easy process to distribute this, and I want both of them on this at this age or when this event happens, and they can make sure that you do it in the best way possible. That's their job. And I'd be looking for a way, too, that it can grow over time.

The time between now and then. What happens when you live to 94, and for the next 20 years, the 400K is just sitting there making nothing? Well, I'm at a point in my life where everything is paid for. I don't need any more money. I don't want any more problems. I don't want anything else to have to take care of and worry about. She really said, no money, no problems. She said, I'm not trying to make more. That's more problems on my hands. I'm at the point in life where I want to just be simple. I want to put it up where they get it if something happens. Is it in a high-yield savings account?

No, it's in a CD. Oh, okay. What's the CD making right now? Is it like a four and a half or five percent? Yes. Okay. That's fine for now. Once the CD matures, you're going to have to do something else with it, right? Right. Because you might need this money. Is that true? Or do you have other money that you can use to live and cover any of your expenses?

Well, I do. I don't have to touch this. I have my retirement and my Social Security, and it's enough for me to live on. Okay. Yeah. I mean, after the CD matures, I talk with a SmartVestor Pro and see if there's another way that you can invest this, something that you understand that's easy to be managed and

And that way, at least it's growing from now until the day that your kids get their hands on it. And the other idea is you could gift it to them while you're alive. Yeah, I like that. I mean, you can do up to, what, 17 grand per year without triggering any of the gift tax issues.

uh pieces there that's a good idea and you know i like the idea of helping them giving them a leg up yeah while they're while they're still younger the biggest part of this the biggest part of this i think is to make sure that they know what's coming to them whether it's yearly like you're talking about um or if it's something that's going to be a lump sum kind of letting them know here's the money that's coming and just letting them know uh so it's not a surprise dave always talks about that which i think is a good a good idea

Love it. All right. Thanks for the call. Good subject matter there. Let's go to Mark. He's in Kansas City, Missouri. What's going on, Mark? Thank you for taking my call. You're welcome. How can we help?

Well, my wife and I are both 60 and we're living on my disability check because I have a terminal illness and we've racked up some consumer debt. Prior to that, we were completely debt free. Just things that I wanted to go out and buy. But now we're in a position where the roof on our house is

was not installed correctly seven years ago and we have severe water damage rot and water coming into the house okay and so i need to get the roof done and i'm questioning whether we should finance that um possibly put the consumer debt and the repair together i know you don't like

debt you're talking about doing a debt consolidation loan um what do you mean putting oh a HELOC tell us more about what are you what are you getting every month from disability tell us more about the rest of your financial snapshot okay I get three thousand and sixty dollars a month um and is your wife on disability too

She is not. In fact, she's never worked. She stayed at home and homeschooled our children. Is she able to work now? No. She is physically not able to. Okay. But not on disability? But not on disability. Okay. Do you have anything in savings? We have $750 in our emergency fund. Anything in retirement accounts?

No. Okay. Nothing. Okay. And I don't know, you know, when you deal with disability and Medicare and Medicaid, they like to tightly control disability.

your your amount that you can save and so uh there's really no way for me to save this up without hiding it away somehow how much is it how much is it going to cost what's it going to cost to get the repairs you need on this roof we have 14 000 in consumer debt and uh

The quote on the roof is just over $14,000. Okay. Have you gotten multiple quotes? Yes. Have you contacted your homeowner's insurance? We did and went through them, went to the people who put it on. You know, they only offered a two-year guarantee.

two-year guarantee on their labor. But you're saying they installed it incorrectly? They did, yes. That feels beyond the scope of, well, I'll guarantee it for two years. I would see if you can fight this between your homeowner's insurance and the company that installed it.

Truthfully, Mark, this is your only option. And then you're going to have to start looking around at maybe whatever you can sell. What are your vehicles? Tell us about your vehicles. We have one vehicle, a 2002 Chevy Venture. What's it worth? We paid cash, oh, probably around $1,500. Okay. The tough part here is, listen, we're never going to tell you to go out into debt to solve a problem. There's a lot here. Yeah.

And you may need to reach out to some other places for help. But I'm with you. I'm going to fight this because if I'm dealing with the fact that I got a new roof seven years ago and it was not installed correctly, there's no way I'm paying full price to get it fixed. Yeah. This is The Ramsey Show.

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You're listening to The Ramsey Show. Thanks for hanging out with us. I'm Jade Warshaw. Next to me is George Campbell. If you want to get in on the conversation, the number is 888-825-5225. George!

George! It's time, Jade. It's time. For our long-running segment, Talk Nerdy to Me. Hit me with that jingle. Here is the nerd topic of the day that I'm going to break down in less than two minutes to help people out there understand it. These $10 words out there that bother me when they're thrown out like jargon, but they're important, all right? Today's word or phrase, dollar cost averaging. The old DCA, as they call it in the biz. No one calls it that but nerds. I just want you to know that. Yeah, Instagram nerds.

Dollar cost averaging is an investment strategy to save for retirement. And it's this simple. It means you're making regular investments over time, regardless of what the stock market is doing. Yeah.

I don't feel like it even needs a term, but there is one. Why do we need a fancy name for that? I don't know. It's focused on the consistent dollar amount you invest. As opposed to dropping a lump sum every once in a while. Yeah, irregular amounts or a lump sum once a year. So we recommend dollar cost averaging for your long-term investing because the longer your money stays in one place, the more it's going to grow. And investing consistently over time in one place, that's how you beat the market fluctuations. So if you're scared of the roller coaster, this one's for you. I also think it helps build a nice habit for you.

Right? Yeah. You're building the habit of investing when you say, okay, every month this is automatically coming out. I know what the amount is. I mean, we say 15%. And then you live on less. When you know 500 bucks is going out of your account, you just tend to live...

After a while, you don't think about it. Yeah, exactly. Out of sight, out of mind. So if you put, let's say, $500 a month into your 401k or an IRA every month, you're essentially buying shares of the mutual funds. That's what you're doing with that $500. But remember, the value of those funds could go up or down each month. So sometimes, some months, that $500 goes a long way. It goes farther because the prices are down. Stock goes down, that means you're buying it on sale. Think of it that way. Price goes up, you're buying it at a more expensive rate.

But again, your dollar cost averaging. So think of it like your gas tank. Some months, your 200 bucks you budgeted for fuel gets you 60 gallons. But the price per gallon drops, the same 200 stretches further, you get an extra 10 gallons, you get 70. And so if the price goes up, that's great too, because your shares are worth more. So it's very glass half full kind of mentality here. And look at the numbers here. 40 years of investing 500 a month at a 10% average rate of return.

it would have grown over to over 2.6 million thanks to compound interest. Yeah, wow. And of that amount, get this, you only contributed. You only put your own money. 240 grand is what you put in. It turned into 2.6 million. The power of time.

So at over 10x, you made over $2.4 million of free money because of the power of compound growth, because you did dollar cost averaging. And here's the great news for you. We surveyed millionaires, over 10,000 of them. Investment consistency was one of the most important factors in building their million dollar portfolio.

They were actually average investors. They weren't great. They weren't prodigies. They just put the same amount away every single month for a long time. I love that. So if you want to learn more, go to ramseysolutions.com slash invest. We've got a free complete guide to investing, or you can click the link in the description if you're listening on YouTube or podcast. This guide is going to teach you everything you need to know, including how to develop a personal investing strategy, how to pick the right investments using the Ramsey principles. I love that. There you go. It was painful, Jade.

Painless. Oh, you're right. I don't know why. It was painful for me. Was it? Yeah. Well, let's take it a step further. So, I mean, somebody out here is like, yes, George, thank you for that because I didn't know. But how do they know when they're ready to start dollar cost averaging their way to millionaire status? Good question. A lot of people go, I want to start now.

There's a time and place for that now. And it's when you are out of consumer debt. You have three to six months of expenses saved in that emergency fund. And that really becomes you're never going to debt again insurance. Yeah. Now we're ready to invest because we have our income back in our hands. Before, we were giving it out to lenders every month. There you go. And the big question there is, George, why do I need to wait? It would be nice to wait. You're saying it's so important to start early. Yeah. Why wouldn't I want to start now? Tell us more. Because when you do 17 things at once, you never really get anywhere.

And that's most of America. If you've heard the calls, they go, well, I'm broke. And I go, why? You make a great income. Well, we were trying to pay off debt, trying to save for the kids college, trying to go on vacation. And that's why the baby steps are so powerful. It's focused intensity for the one through three, getting out of debt, get an emergency fund, focus intensity. Then we move toward intentionality in four through seven.

Yeah, because if you're investing the amount that we suggest, 15%, if you have debt, most people would not have that kind of income at their disposal until they paid off their debt. That's the other thing I get in the comment section. Where does this guy think we're going to be able to invest 15% of our income? And I go, hey, what's your car payment? Well, that's $600. What's your student loan payment? Well, that's $400. Well, that looks oddly like $1,000 that you could be investing. Right, right.

There it is right there. Which is 15% of an $80,000 salary, which is the household median income now. Okay. So it's possible, but you've got to decide, are debt payments going to be normal or is debt-free living and investing for the future going to be normal? Okay, so now you've convinced the person with debt to pay off their debt and...

before they begin this journey. What about the person who's like, okay, I paid off my debt. Why do I need to save up three to six months before I start? That's the kicker. Because you get thrown off the horse at every little ankle bite or emergency. You go, well, I kept my savings low because I want to invest. Well, the problem is life's going to happen in the meantime. And the goal is we don't touch the emergency fund unless we need to. Yeah.

Unless it's urgent and necessary. And if you don't have an emergency fund, if you don't have an emergency fund, your investments become your emergency fund. Or Capital One's credit card becomes your emergency fund at 25% APR. Yeah. How can you really build wealth when you've got that counteracting anything you might be building? It's dragging you down. Okay. So what you're telling us, George, is there's method to the madness. You got me all riled up, Jade. I'm sorry. I wasn't.

wanted to. I like when I get George's nerdy wheels turning. George is one of the smartest people I know. All right. You need to hang out with more people, Jane. That's sad, but thank you. You're welcome, George. All right. Let's go to Luke in Montgomery, Alabama. What's going on, Luke? Good afternoon, guys. How are y'all doing? We're doing great.

Good. Hey, I was just calling. I've been struggling with this for a while. I have been working in finance and banking my entire adult career. And I have been really good at it too, which means that I have gotten a lot of people into a lot of debt. We've even done equity lines and everything. And it puts more money in my pocket. But over the last few years, me listening to all of your financial advice and everything, it's starting to kind of become a

a little bit of a conundrum to me to continue working in this field. The retirement's great. The income is great, you know, and I do my best to help people. You know, some people come in saying, I need this, I need this, I need this. But I tell them, well, you think you need this, but here's really what you probably would benefit more from. And only recently I had helped somebody with an equity line and they came back in

After paying off what they paid off with their equity line, it was all swiped right back up. And I was like, this doesn't feel good anymore. You don't want to sell them dead anymore. You're getting a front row seat to people's misbehavior and you feel like you're a part of it. Absolutely. You helped them sign the dotted line. So that's understandable. And let me say that it's not evil or immoral to...

work in the banking industry. You can do good work and serve people and help people, but you have a personal value, a personal value, a principle line that you've drawn, and I think it's eating away at your soul. And that's what tells me, okay, how can we shift your skills? Because your skills are not getting people into debt. Your skills are helping people with their needs and serving people. And so how do we shift that to a different type of role and maybe a different sales role in a different industry or selling a different product that you can sleep well at night for?

Yeah.

What do you think? It's just a weird thing. As I've gone through more intense, like intensifying my own budget and getting out of debt and increasing my own investments and things like that, I start to want to share that with other people. Interesting. But in my own industry here, they don't want that. I assume you're heavily incentivized and commissioned to sell these debt products.

Sure, sure. And so that's where I go. Is there a job where you could...

be on salary and your job is not to push loan products, but you could actually help people make the right financial decisions. Maybe that's the mortgage industry where you help steer them toward the 15-year mortgage and you help them do it the right way to where you can sleep better at night, but you're still in the financial industry. It sounds like you enjoy being in the overall industry, but this specific niche of getting them lines of credit and equity is not fun for you. Listen, I dig into this further because the fact...

And I don't say this in a negative way, but the fact that you're calling us lets me know that this is really kind of bothering you. And rightfully so. I think there's moments in all of our lives, to George's point, you're not bad, you're not evil, you're not nothing like that. But each of us kind of comes up on these moments in life where we decide that something maybe that once was for us is not for us anymore. Like there's there's certain moments.

I probably at this point in my life, I'm like, I'm not watching this anymore. Like it's total crap. I just, for me, I would feel a sense of guilt spending my time watching certain things on television or, you know, eating certain foods. It's like I've outgrown it or I've realized the error in my way or whatever that could be. And I just call that maturity. I think it's a great thing. I think it's a great thing to explore. If I were you, I'd be like, all right, Lord, what you want me to do with this? This is The Ramsey Show.

I think we'd all agree that it's a lot harder to run a race if you don't know where the finish line is. But nearly half of all Americans have no idea how much money they'll need to retire with dignity. If you're ready to stop hoping for the best and start planning for your future, then check out the SmartVestor program. A SmartVestor Pro can teach you everything you need to know to get in the driver's seat of your

own financial future. Connect with a pro at ramseysolutions.com slash smartvestor. Ramsey Solutions is a paid, non-client promoter of participating pros. Learn more at ramseysolutions.com slash smartvestor.

Thank you for hanging out with us on The Ramsey Show. I'm Jade Warshaw. Next to me is George Campbell. Hey, if you want to get on the line, we'd love to hear from you. 888-825-5225 is how you get involved. Robert is involved. He's in Fort Worth, Texas. Come on, Robert. What's going on? Well, first of all, let me say it's an honor to speak to both of you guys. My question is, what is the difference between a high-yield savings account and a money market account?

And then where would I open one and which one's the best one to put the money in when I'm building my step number three, you know, the three to six month emergency fund? I love that you're even asking these questions. It's a good question. So largely, as far as the actual definition goes, there's not much of a difference anymore. There's two things of note with a money market account that is different from a high yield savings. Number one is that money market accounts, many of them include a debit card and check writing privileges.

which high yield savings account, they don't have that. The other one that's a downside for the money market accounts is a lot of them have required minimum deposits and balances.

Whereas a high-yield savings account, many of them have gone away from that. Now, there are money market accounts out there that may have no minimum balances, but that's largely the biggest differences you'll see. They're both going to have a competitive interest rate. I found that high-yield savings accounts have been edging out many of the money market accounts as far as interest goes. They may have withdrawal transfer limits on both, so there's that caveat there. And they both should be insured by the FDIC or the NCUA if it's through a credit union.

Okay. And then would that be through a bank or a financial institution like that? Yes. High-yield savings accounts are generally going to be with online banks. They have less overhead and they can pass on the savings to the consumers. But you can go to your local credit union. They'll have one. You can do one online. And I personally have an online high-yield savings account through Laurel Road. And they've been a great partner for our YouTube channel here. We have a new partner, Fairwinds. That's great as well. Jade's got one through what?

Ally. And I have Marcus by Goldman Sachs. So there we go. There's a lot of them out there and you know, you can, a lot of people, Jade, want to just hop as soon as one interest rate is a little higher than the other. And I'm like, you're talking point,

on your ten thousand dollar emergency fund that's right i don't know that it's worth doing all the legwork for the extra ten dollars you're going to get over the course of the year but if you got you're saving up for a house and a high yield savings you've got a hundred thousand and it's four percent or four and a half percent okay yeah i mean when i switched to marcus it was because you were like that's right they're at five percent i think mine was at like 4.25 and i thought well i could i could

I can make the switch. Yes. So depending on where you're at. Now, some people, here's the key. Whether it's money market or high yield savings, that's great. But some people have their money in a regular old savings account with their bank. It's costing them money and it's like 0.001% interest.

You can do better. And remember, the point of the emergency fund, Robert, and everyone listening, is not to make money. It is insurance, not an investment. That's the key to remember. So I don't look at this as a money-making scheme. I just want it to be growing if I can versus losing money with inflation. And I like the fact, I think that if you have savings and you've got check writing and you've got...

debit cards and you can easily transfer the money. I feel like in many ways, depending on your personality type, let me talk to the Jade personality types because I'm the type, if I see the money, I want to get to it. And if I have easy access to it, I want to get to it. And so I learned early on, I got to put the money away so that I don't

touch it and so I wanted to I want an account that I'm gonna have to work to get to the money and that was just me understanding my personality type you might be the type that George is looking at me like I'm weird so maybe no not at all George am I weird

No, but if you do want to check out the new Ramsey partner we have, Fairwinds Credit Union, you can go to fairwinds.org slash Ramsey, and they won't try to remarket with debt products. They've got a custom account bundled just for Ramsey fans, so be sure to check them out. Like it. All right, let's talk to Mac real quick in Austin, Texas. What's going on, Mac? Hi. I hope you guys are doing better than you deserve. We are.

Good, good. So I'm a debt-free 25-year-old living in Austin, Texas, and I'm looking to buy a house in the next year. And really what I'm looking for is guidance on setting my budget. Ooh, okay. Let's talk your financial picture. How much do you have saved? So I will be buying the house probably next July, and per kind of the way I'm paid, I will probably have about $200,000 to $250,000 saved. Wow. Amazing. Amazing.

And how much are you looking to spend outright? Well, that's kind of where I'm calling in for guidance because I could kind of buy a three-bedroom house, probably be good for the next five to seven years and come close to paying cash. Or I could go to take out a loan, buy kind of like a four to five-bedroom house and probably be good for the next 10 plus years. I mean, there's part of this, it's choose your own adventure. You said you're single, right?

Correct.

that's great too. So I don't want you to feel it's an awesome goal to have and you might be able to do it. But I also know Austin area housing is similar to Nashville and that it'd be cray. Yeah. At the end of the day, you want something that's no more than 25% of your take home pay. And that's with HOAs, insurance taxes, all of that.

All of it included, that's what you're looking for. And if you can put, I mean, you're going to be well above this, but if you can put 20% down or more, which will be you, you're winning. So regardless of which route you go, as long as you hit those marks, you're doing well. But I like what George said, and I think he's exactly right. That's a hefty down payment, and I would use it as a down payment. I would put down as much as you can.

All right. Today's Ramsey Network app question of the day is from Brian. By the way, Ramsey Network does have an app and we do the third hour there. So if you're listening on radio, stay where you're at. But if you're watching on podcast or on YouTube, you'll have to head over to the app to enjoy the next hour. But our question of the day is from Brian. He says, Dave recently took a call from a whole life insurance agent and said something

I was hoping to get clarification on. I bought $100,000 whole life policy 20 years ago and it is

It has a cash balance of $17,000. Oh my gosh. Did I understand correctly that when I die, my family will get the $100,000, but the $17,000 is gone? Yes, you did. And here's the deal, Jade. I see the whole life people in the comments and they're going, Dave's lying. It's not true. Listen, with almost every policy you see out there, this is the case. What Dave said. The cash value goes away. Can you set up the policy in such a way that you do get the cash value? Yes, there are scenarios where

But what a terrible investment that over 20 years, that investment portion only made $17,000. That's a crock right there. And they'll tell you, Jade, well, you've got to let it cook, Jade. It's going to take many, many years for that account balance to grow because the first five years, you're just paying commissions to the guy who sold it to you. Right. So it's being eaten up by all the fees. But yes, this is how it works. And they're often pitched to you by these folks that are –

They sell themselves as like wealth strategists, like tax-free wealth strategists. They're like really disgusting, creepy names. And what they do is they lock you in for years of high costs and commissions. And if you stop paying, your cash value that you've built up in the insurance vanish. And with most policies, your family won't get the cash value like Dave said when you die. It goes to the insurance company. It's a little parting gift.

because they go, hey, you're getting your face value. That's what you paid for, Jade. And while you're alive, you can use the cash value. Well, meanwhile, on my 20-year term life insurance... That costs you a fraction. A fraction where if something, God forbid, happens to me...

forget a hundred thousand dollars my my family is going to be nice and covered yeah the whole life policy is i mean you're getting a hundred thousand two hundred thousand we're talking about millions 10 to 12 times your income so if you're making 50k you should have 500k yes 700 and if you make a hundred thousand you should have a million dollars minimum minimum and it's not that expensive you go a million dollars that sounds no you're not paying a million

You're paying 30, 40 bucks a month for this coverage. Yes. And get it sooner than later because obviously when you're healthy, those prices go down. And so, yeah, 15 year, 20 year term. Yeah. The way a term works is they go, hey, we know the average lifespan. We're going to take the total cost it costs to insure you and then divide it out over the years as a term. That's right. As a level policy rate. So it's that simple. You're going to pay the same 20 bucks for the next 20 years.

And when it's done, it's done. And you'll be self-insured. Yeah. And I'd rather take the money that I'm saving because, again, we talked about it with term life insurance, you're paying less for the policy. And so you've got this extra money allotted to you. You could be investing that money. And instead of making a 3% or 4% return, you invest it in the S&P 500 or you're making a 10% to 12% return. That's easy math. This guy, George, I don't have my calculator pulled up, but if he had done that over the 20-year term- Your calculator would blow up if you did this. It would.

would blow up. Make sure if you guys don't have term life in place or you have whole life, cancel it. Get term life. Go to Zander.com. They're the folks we trust. It's who I have my term life through. Jade, Dave, the whole gang. We trust them that much to protect our families. And hey, don't forget, if you want to finish the show out, we've got another hour. We're going to do it inside the Ramsey Network app. We've got some great calls coming up

Jeremiah from Dallas, Texas. He says, how much is a reasonable investment to start a side hustle? We've got John coming up. He wants to know how to get a financial advisor. All this and more on the Ramsey Network app.

Hey, you're still here? What are you doing? You do know that the rest of today's show is playing right now over on the Ramsey Network app, right? All you got to do to finish the episode is search Ramsey Network in the App Store, Google Play Store, or just click the link in the show notes to download the app for free. Yep, you heard me right, for free. Then right there on the home screen, you can watch the rest of today's show. Bada bing, bada boom. All right, I'm getting out of here. Enjoy. We'll see you on the app.