You CAN Prosper Regardless of Who Is in the White House
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Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth.

Do work that they love and create actual amazing relationships. Open phones this hour at 888-825-5225. Number one best-selling author, Ramsey personality, and host of The Rachel Cruze Show. My daughter, Rachel Cruze, is my co-host today as we answer your questions about your life and your money.

Before we go straight to the phones, I want to make sure you guys don't think we're living on another planet or something. Obviously, we know that there was an attempt on President Trump's life on Thursday night and lost a hero firefighter protecting his daughter and wife in the process, shielding them from gunfire.

at that assassination attempt, and everyone knows the details. We certainly are not Fox or CNN or anybody else. We're not going into the details. It's not what we do here. But we are praying for this nation. We're people of the book, and the book tells us to pray for our leaders, even if we don't agree with them.

And Trump is one of our leaders. He was a president. And Joe Biden is one of our leaders. He is the current sitting president. And not many things that President Biden does that I agree with, but it is my job to pray for him anyway. And certainly to not bring him harm. I can disagree with him and still honor the office and still honor the person and certainly not engage in any kind of

stupidity like some of the rhetoric that has gone on in the last 48 hours and really has gone on for the last several years. Some of you people are really too serious about what happens in the White House. If you'd concentrate half as much of what happens in your house, you've been a whole lot better shape because that's really the common denominator of success. It hasn't got anything to do with those guys up there.

Yes, they do some things that affect our lives, but I've had several of them try to ruin my life and they hadn't pulled it off. And I've had several of them try to make my life better and they hadn't pulled that off. And so I'm old and I've seen presidents that were going to be the end of democracy and they weren't. And I've seen presidents that were going to be the second coming of Jesus and they were not even close.

So, I mean, seriously, people, I think the problem is that the level of anger has to do with the expectations of what the office can provide. And so treat these people like people. They have families. They have children. They have friends. I've got friends that are congressmen, friends that are senators, and the stuff that they have to put up with.

The stuff that is mailed to this office at me and into Ramsey Solutions, because some of you are just out of control and you should not spend your money on Financial Peace University. You should spend it on counseling because you need it.

you know, it's that kind of stuff. It's going on out there, Rachel. Oh yeah. I mean, for sure. And I think it's just a level of, of the anger comes from a level of fear, scared of what, what, where the country is going to go on either side of the spectrum. But I think that that's the sobering idea is going back to, okay, what's going on with my family in my home from the money perspective, when my paycheck hits my checking account, um,

what am I going to do with it? Right. So there's a level of control that we can have in our lives. There are, you know, you can go to the, go to the polls, right. You can go and, and vote in November. And that's a, that's a choice and a level of control you have. And then it's, and then it's, you know, up to, up to fate at that point of what, of what occurs. But I think, I think you're right. We, uh, Ramsey's and people that work at Ramsey are all very passionate people.

We have loud, arguing, fun discussions about things. But we don't wish death on people. Oh, gosh, no. No, no. I mean, I'll argue with you. It's really sad. The president of Visa. I mean, no. It's just the president of Visa. It's just a credit card. It's okay. Don't go in credit card debt. It's stupid.

And, you know, if you're a payday lender, you shouldn't be doing that. Well, it just takes humanity out of a system. But I'm not going to suggest that the guy be taken out. I mean, that's just nuts. So it's just out of control. It's really sad. It's a sad. It was a sad. Here's the thing. If you will concentrate on fighting ideas, that is a valid quest to argue about ideas.

When you have to vilify or destroy a person because you disagree with their idea, you've already lost the argument because you've lost the high ground. You've lost the ability to argue your idea.

Because you can't stay on top of the idea. Your idea loses ground, so you have to attack the person. And when you can't back up your philosophy, when you can't back up your belief and have an argument about that, a healthy, a good, have a strenuous argument. I mean, we yell and scream. We don't scream, but we argue in high voices around here sometimes because we're trying to figure out which play to call to win the Super Bowl. We're trying to figure out which product to put out there to help you folks next.

And we, we, you know, we, we struggle with that and passionately, but we, if your idea is so weak that you have to attack the person because your idea won't hold its own water is that's when you've already lost.

And so then you've only got a bunch of people that drop to the lowest common denominator are the only people that will follow a person whose idea has lost, but they're passionate about it. You know, it's just, you've got to be able to argue on the points of merit and that's basic debate. That's basic common sense. It's basic wisdom. And it's just, it's sad. It's a sad comment about what's going on in our country. And,

How someone cannot look at the ideas represented, the principles represented by different campaigns, and for that matter, the quality of the person that's going to implement those ideas. Can you stand with that or not? And that's, you know, if you think that, then go there. I mean, we've had arguments about that ever since there's been a president. Is the quality of the person good enough?

And, um, there's always been someone that said, I mean, the stuff that was written about Abraham Lincoln, unbelievable. The stuff that was written about JFK, unbelievable. And by the way, you ought to look at JFK's policies and ideas. You want to see some conservative economic thought bordering on libertarian thoughts.

Go read what JFK believed about economics when I was putting in place. It's very interesting for a Democrat. So, uh, it's, you know, these things, like the pendulum swings, people argue and push through different things and different people have different, uh, quality of reasons and reasoning, but this is out of hand. So our vote is for prayer for this nation. That's our vote. Our vote is for prayer for you and your house, uh,

That you get your act together and in spite of who's in the White House, not because of who's in the White House, you prosper. Because if you're waiting on one of them to prosper your life, you have a long wait. Your life's going to suck because government is not designed to make your life awesome. Sorry, it's not. Your cell phone has more power than your president to make your life awesome.

I mean, you can push buttons and stuff actually happens with it. I mean, when you push buttons in the voting booth, very seldom does anything actually happen. Think about it. I want to believe it does. I love election season. I don't want to believe it does, but name me a time it did. Well, put your vote in. A couple of things here and there, but nothing that I went, oh, everything's okay now. No, I know. Totally. Yes, I hear what you're saying. Yep. Yep. It reminds all of us to argue ideas, and you don't have to destroy people for your idea to win.

Otherwise, your idea is not good. This is the Ramsey Show. So here's a quick math refresher. There are only 24 hours in a day, so your business needs to streamline tasks that are time suckers and focus on activities that make money. So to reduce headaches as they scale, smart businesses use NetSuite by Oracle.

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Rachel Cruz, Ramsey Personality, number one best-selling author, is my co-host. She and James said that I said the attempted assassination was on Thursday. If I did, I was, I don't know why I would say that, because obviously it was Saturday. I know, I was like, uh, I don't know if that's the right day. Where were you? Well, the problem is, several years ago, I quit working on Fridays.

So Thursday is my new Friday. So you're just behind. And it throws everything off. You're always behind the day. I'm always screwed up. So anyway, I actually know when it happened. I just misstated it. Hey, do 15 or 20,000 hours of talk radio and see how many things you say wrong. So I'll make sure you get there. The Ramsey Summer Black Friday sale is here today through Wednesday. I got that right. July 17th, you get prices as low as $5.00?

You're kidding me on our bestselling books. I got more than that in them and tools to help you crush debt. Find the work you love that y'all not hear paper went up and teach your kids about money or simply live a more joyful life. This is like baby steps, millionaires for five bucks.

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But hurry, the sale ends Wednesday, July 17th at 1159 p.m. Unless Dave changes it early. Unless I change it before then. I'm a little bit aghast at these wonderful prices. Oh my gosh. We've announced them, so we will stand by them. We're like Costco. Costco hasn't upped their hot dog prices and something else. Oh, the Arizona tea guy. They don't up their prices because of inflation. So that's what you're giving. Yeah. Yeah. That's true. But the problem is...

In neither case are they losing money. So, and anyway, all right. So Gabriel is in Pontiac, Michigan. Hey, Gabriel, what's up? Hey, Dave, thank you so much for taking my call. Sure, man. How can we help?

So I'm calling in because I have a issue where my mortgage is actually a lot more than what I bargained for. The loan to value is super high. I bought the home for $275,000 back in October of last year and

And currently, that's how much I have to sell it at. I actually have to sell it at $250,000 due to the fact that the $275,000 included the closing costs, all the concessions, and all that good stuff. So right now, I tried to have it rented out because I'm currently not living there. I lost my job a couple of months back, and I had to move up here to Michigan. Where is the house? It's in Tampa, Florida.

Okay. If you lost your job in Tampa, Florida, why didn't you just go get a job in Tampa, Florida, dude? Well, the fact that I have to pay like $2.2K for the house and my other expenses, I needed a job that was able to pay somewhat what I could afford to pay, and it's a very blue-collar, dense area. I needed something that was more related to what I was going for, career-wise. What are you going for?

I want to work directly with the mortgage industry. One of the biggest pain points is the fact that since I got messed over on my loan, I want to be able to learn as much as I can and hopefully work towards making money within the mortgage industry in the future. Oh, there's plenty of mortgages industry in Tampa, Florida. Well, maybe more than Pontiac, Michigan. Yeah. Based on the...

Michigan itself has the two biggest mortgage lenders in the country, United Wholesale and Rocket Mortgage. Are you working for either one of them? Yes, I'm currently working for United. Okay. What are you doing? I'm an underwriter. You're a mortgage underwriter? Correct. What were you making before? I was making about the same. I was working as an accounts executive for an insurance company. What do you make? $55,000.

And you had a $2,200 house payment on 55K. Right. So there was the problem. It really wasn't even the job loss. It was just the stupid purchase. And you paid more for the house than it was worth?

Yeah, basically I think once everything was said and done, I didn't really realize that if I'm offering $255,000 that I'd actually be buying it. That plus the closing costs, which I paid like $16,000 for at the time. Why? That was a stupid mistake on my end. Why? Did you pay a bunch of points or something? What's that? Closing costs on $275,000 are not $16,000. You know that as an originator.

What'd you do? Pre-pay a bunch of points or something? I couldn't tell you what the closing disclosure said. I'm pretty sure that that included the, I think, $6,000 down and then $10,000 toward the actual closing. Okay, that still doesn't get you to, okay. All right, so how can we help you?

So, since I can't rent it out due to the fact that I bought a 6.1 interest rate and people in my area are renting out in their much lower interest at $1,800, I can't really break even. I'm trying to sell. I'm currently belly up with this loan. If I do sell it, anything happens.

like what i bought it for on paper it shows 250 that's not including what i actually put down for the home or anything else so i'd actually be cutting like a fifteen thousand dollar loss on the home so i just don't know but you can get rid of it and get it off your back right how can i do that well i mean you're talking about your down payment your down payment's just gone it evaporated right okay so if you sell the house for 255 you owe 275 on it

The loan was $250,000. Okay, and you got it on the market for $255,000. So now with real estate commissions and all, you're going to be in the whole $5,000 or $10,000. Can you scratch together the $5,000 or $10,000? I think so, but I prefer if there were any other alternatives out there. There's not. You have to pay the difference and get out of this. So let me recap for you because I think you've made a couple of assumptions that are wrong in your whole decision-making paradigm, all right?

In October, you paid retail for a house way more expensive than you should have bought making $55,000. Stupid. I've done stupid too, so I can say what stupid looks like. I know what it looks like. I've done dumber things than this. But you signed up, you put your name down for a payment that was asinine making $55,000. Would you agree with that statement? Yes. And then when you lost your job, it exposed the stupidity.

So the screwing of the mortgage company is not what got you in this mess. What got you in this mess is you paid retail for a house. Now you're going to turn around just a handful of months later and sell a house for retail, which pretty much guarantees retail to retail. Five months later, you're going to lose money. And that's just the story. That's the story. It's not some big mortgage debacle.

It's you signed up for a thing you couldn't afford and you are selling it very, very quickly and it has not had time to appreciate it all. So you're going to lose money. Write the check. And when I do something stupid, Gabriel, and I have done a lot of stupid. I've done a lot. This thing right here is not dumb compared to some of the stuff I've done.

I got you beat, man. I got a PhD in DUMB, all right? So I'm not picking on you, but I want you to own this. That's important if you own your part in this because you're acting like you're some kind of a victim. You're not a victim. You signed up for this. Now, when you write the check to lose money on this transaction that you, as an adult man, signed up for,

Put on the four column of the check stupid tax. That's what I do when I do something stupid and I have to give money away because of it. I put stupid tax on there and I try not to pay the same stupid tax ever twice. And that'll get you set up to go win, my friend.

But there's not a city. I mean, there's been a few times you could buy something for retail and a few months later sell it for retail. Well, and the $10,000, people are upside down on that on their car. Like, this is a house. So if anything, you're getting, I mean, see it as a gift to get out of because you're having to pay $2,200 a month in a place that you're not living. You have to get rid of it. Yeah. You have to write a check and be done with it because you're losing, you're going to lose more than $10,000 in about 20 minutes on this thing.

So you need to write a check and get out of this house as fast as somebody gives you a nice offer on it. Take it and go put the difference on a credit card. Go put the difference on a personal loan. You've already got the debt. I'm just moving the debt. I didn't date Ramsey. Didn't date him. I just told you to move some of your debt over to something else. I'd rather you have 10 grand in debt rather than 255.

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That's BetterHelp, H-E-L-P dot com slash Deloney. Thanks for listening, America. We're so glad you're here. I'm Dave Ramsey, your host. Rachel Cruz, Ramsey Personality, is my co-host at 888-825-5225. Justin's in Spokane, Washington. Hi, Justin. How are you? I'm blessed. Good. How can I help? So...

About a year and a half ago, we were gifted over $3 million into a particular stock from a family member. Wow. We've paid off, yeah, we've paid off debts. We've built our forever home. We now have about over a million sitting in that stock, but I hate having all of our eggs in one basket, and I'm looking for some tools to diversify and set everything up for our kids, et cetera. Ouch. That's wonderful. I hate it when somebody gives me $3 million. Yeah.

right oh man how old are you guys uh 45 okay so you're the guy with the rich uncle always wondered where you were you know oh my gosh um we all done so well already number one you've been very smart very wise i've been very smart so the person's still alive right

Correct. Okay. So you've already discovered from your tax people that your basis to calculate your capital gain when you sell this is whatever they paid for it. Correct. Okay. So in other words, if you have a million dollars in stock left and they paid $400,000 for it, you're going to pay taxes on the $600,000 gain. Correct. Okay. All right. As long as you know that, then we're a step ahead. You've done a really good job on this. Way to go. Thank you. And which company is it in?

Apple. Oh, wow. It's a great stock. Yeah. Yeah. No wonder. I mean, that stock's done extremely well. Well, that's cool, man. And you're very smart to not leave it all in one place, even if it is Apple. And I'm a fan. I don't own any Apple, but I'm a fan of the company, of the business and everything. They've done a wonderful job. I mean, I own some mutual funds that own Apple, lots of them.

So you're going to diversify it so that you don't, if Apple puts out a bad screen or something that stock tanks, you don't get caught, right? Correct. Very smart. Very smart. Okay. So your plan is to sell it and do something else with the money after you pay your taxes, correct? Correct. So what do you plan to do?

I'd like to find some passive income opportunities as well as setting aside for retirement and, you know, money for the kids if they decide to go to college or trade school or, you know, in the future. I mean, you easily drop $50,000 a kid into a $529,000 hold of the kiddos.

Five and seven. Yeah. $50,000 in each of those, you'll be done with college. That's it. That's $100,000 of it if you want to do that. If you want to save money for something else for the kids, just save it in your name and you can do something for them later. Okay. If you want to help them with a house or something later in addition to college, that's very cool. And then passive income, what do you mean by passive income?

I mean, my wife works full-time, I'm part-time, and I also take care of the kids. So I'm just looking for ways to just bring in money, you know, use our money to make money, essentially. Okay. All right. Using your money to make money may or may not be passive income. Correct. People on TikTok call real estate passive income. Real estate's not passive. No, no, it definitely is not. Yeah, I own a bunch of real estate, and if you go buy some real estate, expect it to be active.

not passive. So it's good. It's a good investment, but it's not something like you just sit and money shows up in your account. Mutual funds are pretty passive. I don't do much with those except just watch the number come into my email inbox, right? Perfect. So, I mean, you can do some of that. And if you want to buy a piece of real estate, now there are types of real estate that are more active, require more hassle and drama than other types. Okay. So they're very, um, Pat, there are very, um,

low maintenance versions of real estate for instance you could buy a little warehouse on what's called a triple net lease triple net means they pay the lights and water that the tenant they pay the insurance and they pay the taxes and they pay you rent oh okay and they do the maintenance so that is very that's close to passive it's about as close to passive as you can get in real estate so a little warehouse deal with a triple net lease is a is a low uh drama

type of real estate to own. The highest drama real estate to own is very high yielding, but it's a lot of drama, and that's lower income residential. Okay. You make a lot of money on it for the money you put in, but it's a major pain in the butt.

Yeah. So, and it's sometimes even dangerous, but the, and I've owned both, both of the two things we're talking about. I don't own either one of those two right now. I would buy one of those warehouses if I found one. But anyway, that's the kind of stuff you're looking for. And then just take your time. You've got time on your side. And, you know, the good news is you can liquidate this stock in 72 hours pretty easily.

So until you decide what you're going to do with it, I'd let it sit there.

Correct, yeah, and that's what we've been doing for the last year and a half. I'm just kind of getting to a point where I'm like, okay, we have all this here. I'm a little worried about what we can do with it in a smart way to sustain things, but also how to do something. Rachel's husband, Winston, handles all of our real estate, and he does some real estate for he and Rachel as well. So we're real estate people. We like real estate, but not everybody does.

And I buy mutual funds. That's the only two things I do. Okay. And you do whatever you want to do. But those are two things that are long-term, conservative, not fancy. Yeah. And even, Justin, going and getting paid for a couple of rentals.

And, you know, having that, that's kind of a medium way of going about it. Nice neighborhood. I mean, if you know what you're doing in real estate, I don't know if you are, flipping is great, but you have to like have a team. You have to know what you're doing. I mean, that's a, it's a, it's a learning curve if you don't know already, but, but there's, yeah. I have friends in that, so they're familiar with it. And that's something that's on my radar, but, you know, once again, not having a hundred percent knowledge,

knowledge on it it makes it a little more tough to just jump in I know there's a lot that goes into that and you could start with something small I mean even some stuff you know Winston's done I mean he got a house for like I don't know 80 80,000 I think down like in somewhere Tennessee and put some money in and flipped it and it was great but it was the first time of like okay you know it's not like it's it's testing out the water to see okay do we enjoy this is this fun and

uh what did we learn but like start small is what i would say but it but quickly that returned i mean it's it has shocked me over did real well well and and others i'm like it's just it is a it's a fun thing but again you have to love it and that's his job and that's what he enjoys and you know all of that but there's a sharp learning curve with it but if you can get it and take your time take your time don't get fancy make sure you set the tax money aside

because you're going to have a tax bill. And if you do all that, you've already done so many smart things. I trust you to do more smart things. I think you're going to end up with a $10 or $20 million net worth as a result of this gift. It's not going to be long at all. Very, very well done. Very well handled. Congratulations. Wouldn't it be cool to have an uncle or whoever, he didn't say who it was, family member, just hand you $3 million. And I get what he's saying where he's like, oh my gosh, we have everything paid for.

What do I do now? And like, I work part-time. I'm with the kids. My wife works full-time. But we have a million dollars. Like, how can we be living off that? I mean, like, there is a feeling of like... Invest in mutual funds. If you just drop the whole thing, ding. In a mutual fund. And then what? And you live off the... It might go 100 grand a year. Yeah, and you just live off that return. Pretty easy. Yeah. Pretty easy. Give or take. I mean, it might make 80 some years. It might make 140 some years. Yeah. It's somewhere in there. And that's a little bit of a different call when we talk about net worth millionaires. Usually, it's tied up in...

your primary residence or in your 401k that you can't touch. But when you have something that is so liquid, I could hear him be like, gosh, I feel like we could have more freedom in our lives or be making money off this money, right? So yeah, so I hear you, Gabriel. You know what, that's what passive meant.

When he said passive then. Yes. It wasn't the Tic Tac people. No, no, no. I think it was just like, gosh, we have a million dollars. I ought to be able to put that somewhere and it ought to send me a check. Exactly. And you would say in that case, a mutual fund is what you would do. That's exactly what I'd do. It's what I've done. But yeah, in addition to that, I bought income producing real estate. In addition to that, you can have, and real estate will typically folks yield you more money than mutual funds will.

If you purchase it properly, if it's income producing real estate, but it has a lot more hassle to it. Do not be confused that renters pay your payments. No, they don't. You pay cash for your real estate because sometimes renters are renters because they don't pay. This is the Ramsey Show.

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Thank you. And you can click share, send a share, copy the link, send it to somebody. Whatever the format is, there's a way to tell somebody about it. If it's talk radio, we've got 608 talk radio stations that carry this show every day all across America. And thank you for that, stations. And if you're listening to one of those stations, tell people where you're listening. Ann is with us in Lansing, Michigan. Hi, Ann. Welcome to the Ramsey Show. Hi there. Hey, what's up?

So my basic question is, is it okay for my mother-in-law to put her money into improvements on our property if we put it in writing that she can then stay with us rent-free for the rest of our life? I know you're not a fan of this. No, I'm not a fan of this. Why would you want to do that?

So my husband and I are in baby step two, so we can't really help much financially. We coordinated an FPU class, and my mother-in-law joined in that one. And in doing so, we discovered just how bad her financial situation really is. She's got a paid-for house, paid-for car, but nothing else except for about $1,500 in the bank, and that's about what she owes on property taxes. And how old is she?

She's 75. So she's living on Social Security? She's also still working part-time at about $1,400 take-home pay a month. Oh, good. Okay. Yeah. And so she's got about $3,000 or $4,000 a month to live on. Yes. So she's doing okay now. Yeah, she should be. But that's not going to last forever, and we'd like to have a plan in place before we are having to make decisions from an emotional place.

Is she in not great health? I mean, if she's still working at 75, has she a young 75 or? No, no. She is. Yeah. She has already like,

She's already broken a hip. She's got two knees replaced. She was just out of work for about two weeks for some internal problems. She has trouble walking. She doesn't use a cane anymore. She's rehabbed from that, but she's not the most spry of people. And she's working at a women's homeless shelter where the folks there are under a lot of stress and don't have the best conflict resolution skills. And she is not the most tactful lady.

So there's a concern that she's going to push somebody too far Sunday and they're going to respond physically. Okay, and your home is how large? So we've got three bedrooms and a dining room that we would then convert into her bedroom if she came to live with us. She doesn't really want to do that, but we know that that's what's coming because she

She's either staying with us or she's going to be enthroned to the mercy of a Medicaid nursing home, and nobody wants that. So there's no other kids? She has an estranged daughter who hasn't spoken to her in about the last 10 years. No other kids other than that? No, just my husband. How much is her house worth? She paid $75,000 for it about two years ago. It's a really small two-bedroom in not such a nice neighborhood. Okay.

Could you sell it for about that? It's paid off, right? You said? Right. Yeah. Yeah. So you think it would be about 75 still?

Right. I'm hoping it will be maybe more, but 75 is kind of what we're thinking at least. Now, our property is actually two lots back to front. On the back lot, there's already a two-story barn that has heat and electricity and really good insulation. We could convert that to a living space by just running water out there and then finishing the inside better. She loves that idea, but we don't have anywhere near the cash to...

make that happen we would have to she would have to sell her house use a portion of the proceeds to do that and then stay there being on our property but still having a locked door in her own kitchen yeah and when she passes you'd have a barn dominium outback right right so the there's a there's a cold wait a minute stop a second as codes allow that yes a second living unit in and on that piece of property in that neighborhood

Yes, because it's technically two lots. Okay. Yeah. Because you've got to have a building permit, because you've got to be able to sell this again someday. Right. Right. Okay. All right. Yeah, but you need to spend $500 with an attorney and have this drawn up airtight. Okay. That you're promising to let her live there in that property rent-free. Okay.

With you, what are you furnishing? Utilities? What are you furnishing? Food? What are you furnishing? Every detail, what you're furnishing, what you're not furnishing. I'm not buying the food. I'm not buying the electricity. Whatever it is you're not, or I don't care which one you buy, but you just write it down. Everything that is included and is not included, and that upon her death, that there is nothing owed by you to the estate.

Okay. Yeah, I have an attorney draft that. There's the other kids gone off the picture. And make sure she has a will that states the exact same parallel thing as this agreement. Yeah. Yeah, I believe I would do this. Okay. Yeah, you've thought it through real clear. I don't like the concept in general for the rest of you out there. Generally, this ends up screwed up. And the other thing I'm fishing for, and I didn't find it in Ann's call, was that you do something stupid to your house and make it unsellable.

Because you build some white elephant that nobody in their right mind would ever buy. But it worked for you for four years. You know, that's what people do. They get emotional about this stuff and justify it. But the way you've got this described, separate lot, separate piece of separate building. It's already got water. You've thought that through. That's very well done. It's marketable. Codes is allowing it. You're not destroying the value of your current home. You're not destroying the marketability of it.

You don't have another relative out there that's probably going to swoop in and give you a hard time. And if they do, you could have this hair tied enough, given the estrangement, that you'd be just fine. But make sure you've got a solid will and a solid living agreement, arrangement, whatever the attorney in Michigan wants to call that. But yeah, I would do this. She's up for that whole idea, right? She loves the idea. And your husband? And she would not have to work anymore. Right.

That's right. She would not have to work. She could live entirely on her Social Security, keep supporting the charities she wants to, have a wonderful life. Don't call me back and tell me you spent $115 and went in debt on the Barn Dominium. No, no. Like I said, we are rocking baby step two. Yeah, I know. You're going to rock this $75 and not a dime more on the Barn Dominium. Right.

Absolutely. All right. Making sure we get our boundaries here. And what I gave permission to do and not to do, for your own sake, I don't care. I'm kidding with you. But yeah, be very, very clear on what you're doing there. Yeah, that's an unusual...

And it's an elderly parent. And that's always a hard place to be. It's that sandwich generation, right? And adult kids, if they have them, come back and live with them because times are hard now and you can't buy a house. And then the parents are failing health-wise. You know what I mean? It's that sandwich generation. It's weird. I just spent an hour and a half this morning recording for Pat's Place, Pat Head Summit.

died of early onset dementia, a basketball coach at University of Tennessee. We knew her and our foundation is one of the people that come alongside that. And they're doing a whole website on how to prepare. And I spent an hour on camera this morning just helping them build that website out and giving them content pieces just exactly like this, you know, what to do, what not to do. And I was just addressing the same kind of stuff this morning. It's weird. Yeah. Yeah. Very.

Very cool. But yeah, the early onset dementia and memory loss, that kind of thing is a thing. Yeah. And to Anne's, you know, I mean, I applaud her and so many people that it's not always the American way to like take care of your family. Other cultures do this really well. But it's that, you know, there has to be a lot of boundaries in place and you want to do it wisely. But you also want to honor your, you want to help your parents, right? I mean, if something is going down, it's like, gosh, and they don't have anything. She's living on Social Security, working part time.

not in great health. Like there is a, I do, I do applaud. I heard a daughter-in-law that loves her mother-in-law. Yeah. Very clearly. And the way she described the whole thing. Very well done. This is the Ramsey show.

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Number one best-selling author, host of The Rachel Cruze Show, co-host of Smart Money Happy Hour, both on Ramsey Networks, and my daughter is my co-host today. Skyler's in Charlotte, North Carolina. Hi, Skyler. How are you? Hi, Dave. It's a blessing to see you both. You too. What's up?

Uh, yeah, I'm calling because my wife and I, we've been really struggling. We're trying to make ends meet. Uh, we're have debt that we're trying to overcome. Uh, we know what we need to do. Um, but the main, main thing to focus on right now is that a couple of weeks ago, she, my wife got a bill from discover. Um,

That we haven't paid is about $7,000 from our move here to Charlotte a year and a half ago. But two weeks after moving, I lost my job.

So it's kind of been a struggle ever since then trying to catch up on our bills, try to even tackle any kind of debt we both have. And then we're really trying to figure out what we need to do about the $7,000 bill because they want to take it to court now. So I'm just trying to find out how to address that and then figure out what steps we kind of need to take to be able to even try to think about tackling debt when we're just struggling. Yeah. How long have you guys been married?

Uh, we've been married nine years. Okay. This is probably the scariest y'all have been. Um, it's kind of high stress and terrifying, isn't it, dude? Yeah. Especially when we got three kids and my mother-in-law that we're trying to provide for as well. So yeah. Your mother-in-law lives with you? Yes. Okay. I'm sorry, man. That's hard. Um, it's the kind of stuff that screws up a marriage. So be careful. We can, we can definitely walk with you. We'll, we'll have some ideas over the next few minutes. Um,

But you guys are probably going to have to get a lot more radical than you've been getting. I hope you're ready for that because we're about to set you on fire. Okay. Here we go. You ready? Yes. Okay. Not working for a year inside of Charlotte, North Carolina is not okay. There's plenty of crap to do there.

You need to get your butt in gear and get six jobs right now. Ready, set, go. Delivering pizza, delivering DoorDash, cutting grass, cleaning out septic tanks, walking dogs, cleaning up poop. I don't care what you're doing. You need to get in gear. Skyler, have you been working? Yeah, just to clarify, I eventually did because right after I lost my job, I started driving for UPS with my own car and doing DoorDash. And I do have employment. It's just that

The money that I bring in is enough to pay the bills. What are you bringing in now? Take home is probably about $63,000 after taxes. Is that just UPS, or what is that? No, that's working as a recruiter. Oh, okay. So you've got a different job now. Yes. And are you working the other side job still? Yeah, just doing DoorDash. What's that bringing in?

Not very much. Not doing it much? Yeah, just trying to find doing it when I have the time. Yeah, you got time. All right. You're broke. What's your wife do? She had her own herbal poppy care business, but she had to dissolve that because after moving, she wasn't making much money and she's applying for jobs now, trying to find something to try to help supplement. Yeah. How old are your kids?

Uh, so we have a five-year-old, 15-year-old, and our other son has recently turned 21. Okay. He's still at home, too? Uh, yes. What's he do for a living? Um, right now he's working, uh, with someone doing, like, pressure washing and window cleaning. He's making about $16 an hour doing that. Forty hours at least? Uh, right now. No, he needs to be working. He's 21 years old. How old's your mother-in-law?

Uh, she's in her sixties. So am I. What'd she do for a living? Uh, she's, uh, retired. Why? She's broke. Yeah. She's been applying this to jobs as well. Okay. Here's what I'm pointing out to you, dude. Your problem when you called in and, and, and I'm, I'm going to mess with you cause I love you, but your problem when you called in is you can't pay your bills and you know why you can't pay your bills. There's not a money coming into the house.

And you know why there's not enough money coming in the house? All these grown adults aren't working. Right. That's why. Work is where money comes from. Everybody needs a job. Ready, set, go. We're broke. Mama Dunn got sued by Discover. We about to get in gear, people. I am sick and tired of living like this. 21-year-old, get your butt out of bed and don't talk to me about going to happy hour at 3 o'clock on Friday. Be happy you're working.

No, he's not saying he does work hard. I'm just saying. I've been 21. All right, get after it. Everybody, line up and get after it because that's what's going on. You're working your tail end off at less than you used to make, but you can't find time even then to do door dives. Yeah, you can find time.

Throw a brick through your television. Your wife just got, is threatened to get sued. This is where you're, this is when you get this kind of thing going, that's going to help. So the first step to solving your problem. Even if she made two, $3,000 a month, you know what I mean? Your wife. Yeah. And your mother-in-law too. And your son. Hello. Everybody that lives there. You don't make enough to feed all these humans that are sitting on their butt. They all got to work.

That's what's going on. I'm sorry, man. I would love it if everybody could lounge around, but we don't have this as an option. And your mother-in-law, whatever she's got coming in, social security or whatever else, it goes in the pool if she's living there. It goes right there on the kitchen table with everybody else throws their money in the middle of the table. We're going to pay our bills because I'm feeding you and housing you. So we're going to use your money to pay our bills. That's how this works.

Everybody bones up here. Now, once you're doing that, anything we can do to get your income up, then let's stop and get organized. So Discover hadn't been paid in a year, right? Who else hadn't been paid? That was the main one because we used that cart. That's the cart that we used to move. Okay. How much debt do you have total, not counting the house?

We rent, so me and my wife combined, we have about $70,000, but that doesn't include her student loans. Okay, what's the $70,000? Personal loans, credit cards, including my student loans, about $17,000 in student loans and that as well. Car? Yes, one. How much?

It's about $7,000, $8,000. Good. I'm glad you didn't tell me $50,000. No, no. Good. That way you get to keep the car. And so, all right, so you've got $7,000 in car, $17,000 in student loans, $24,000, but $70,000. So there's another $40,000 in credit cards and personal loans. Yes. Plus your wife's student loans is how much?

There's over six figures, I'm sure. Yeah, and what's her degree in? Is she a lawyer or a doctor? No, psychology. Psychology. And counseling. Okay. Oh, is she licensed? No, she's trying to get licensed. She's trying to get licensed as well. So she's actually in... She got her master's? Yeah, she has her master's, and she has an interview to get into the program to get licensed. Okay, good. Meanwhile, we make money. Meanwhile, we make money.

So, hey, we're going to put you guys into Financial Peace University and teach you how to work your budget and work together. But I'm going to work everybody in that house. I'm going to work you hard, man, because it's what I did. It's how I got out. It's where money comes from. Go get you some and then get these bills caught up. I'll show you how. I'll pay for it. Hold on. I'm going to give it to you free.

You know, it doesn't take a degree in statistics to realize this one stinks. 93% of undergraduate private student loans are co-signed. So when you're delinquent and drowning, mom or papa or uncle Joe is stuck in that financial stress along with you. But there is a way out. Why refi?

YRefi offers a custom refinancing option with a fixed rate loan based on your ability to pay. And the average interest rate YRefi offers is 3.9%, which can significantly reduce your monthly payment and decrease your total cost. Contact YRefi at 844-2-RAMSI.

Rachel Cruz, Ramsey personality, is my co-host today.

Among the Ramsey personalities, Ken Coleman and Rachel Cruz are by far the most way into politics. Behind the scenes, we hear some great discussions with these two. Ken came busting in just a moment ago. For those of you affiliates carrying us live, Trump has just announced J.D. Vance to be his running mate.

for anybody that cares and there you go and so i love jd by the way i may not have i may or may not have predicted that you might have actually predicted that about a few hours ago you and ken were having a lengthy discussion while the rest of us were watched and um the uh and uh the book hell hillbilly elegy was what brought him to the forefront uh one of the things it did and

He's the author of it. It's a great book, by the way. Regardless of whether you agree with Trump or politics or anything else, you'll enjoy the book. It's a great read. It caused me to go down a rabbit hole and read a whole bunch of stuff on Scots-Irish. It's very good stuff. Very good information. So I challenge you to read that if you want to know a little bit more about J.D. Because it's pretty much a... Well, it's his story. It's a biography. It's kind of like the educated Glass Castle. If you're a book fan, it's kind of in that genre. Yeah.

Educated Glass Castle. No, it's not. It's not more educated than Glass Castle was. Both of them were.

about your story it's about people's stories and how they grew up those are people that overcame yeah and then you grow up in these wild environments and you're just like oh my gosh like it's and then go be and then go be somebody yeah and they did yeah but i mean like the the stories and stuff that i mean people that i just grew up you know boring compared to some of these i was gonna say you probably promised for you based on those two stories aaron is in tulsa oklahoma hi aaron how are you uh better than i deserve um

My question today is I need a vehicle in the next month, and I'm wondering if I should wait and tough it out until I have enough money, which is $5,000 to $7,000. I want to spend on a good, reliable vehicle, or if I should go ahead and finance. How much do you have today? I have $800. And you have no car at all?

Uh, so this vehicle is for my significant other. You're going to buy a car for somebody you're not married to? Um, I mean, it's probably going to be in my name and then she'll drive it. You're going to buy a car for somebody you're not married to? Possibly going into debt for that too. Yeah. You want to know how to screw up a relationship? Go into debt and buy a girl a car.

That'll make you hate the girl. What? No, it won't. Not necessarily, but Aaron, no, it's just not smart. By the time this is over... Why can't she... Hold on, Aaron. Why can't she go buy a car? Oh, there's an idea. Well, I mean, because I'm the one taking her and transporting her to her job. Yeah. Well, why can't she buy a car? Because she just doesn't make enough to be able to have it by the time we need it. We? Why do we need a car? She needs a car. You have one.

By the time we need it, what do you mean? What does that mean? Is there something happening in the future? Yeah, I mean, she has to be able to get to school and then get to her job herself. Okay, so what was she going to do before you? I mean, like, what was her plan of life, to live life independently, right? Before she met you, how was she doing that anyways? I mean, with her parents. Okay. We were 17 and 18. Oh, you're 17 and 18 right now?

Yes. Okay. And she doesn't live with her parents anymore? No, not anymore. Okay. She lives with you? Yes. And you have $800? Yes. And you're 17 and 18? Are you all in high school? Yes. Yes. Oh, Aaron, I don't know. I just felt this like mom heart. You're a kid. This isn't your responsibility. This is not. This isn't right. This isn't right. You're a kid. You should not be taking care of another teenager. Okay.

regardless of relationship. So that's not, that's, yeah. Who's 17? Me. Okay. So you're not a legal adult yet in the great state of Oklahoma until you're 18. You can't sign a contract under contract law in the state of Oklahoma. Are you living with your parents, Aaron? Yes. What do they say about this? I mean...

They want her to pay for her vehicle, and I understand that, and it just wouldn't be possible. Yes, it is. It's as possible as you paying for it. Both sound pretty impossible, but her buying it is singularly as possible as you. Are you in high school when she's graduated? No, we're both juniors. You both are going into your senior year. You just finished your junior year of high school.

Yes. Okay. Why did she leave her parents' house? Just a lot of bad situations, a lot of it. That was pretty vague. Was there safety issues involved? Yeah. Okay. Yeah. Okay. Okay. So the answer to your question is very complex.

Uh, it's not as simple as you see it. Uh, you, you called and asked us, so we're going to love you well and tell you the truth because we care about her. We care about you. We want you to win longterm. Okay. The situation that has set itself up at a very, very young age has very bad statistical probabilities. And what I mean by that is the chance of you to ending up married and successful 40 years from now is close to zero. Okay.

Okay, and there's all kinds of data to back that up. It's not just some kind of old guy trying to pop your little love balloon here. Okay, but the deal is it's sweet that you all gave this girl a place to live because she's got a toxic home environment. Now you need to keep her life separate from yours. You are not a legal adult and you do not need to be buying a girlfriend a car. By the way, I would tell you that if you're 27 except for the legal adult part, I would tell you not to buy your girlfriend a car.

Because it's a good way for her to end up hating you or you hating her while you pay payments on the car. It really does happen every day. We talk to people all the time on this. So if she wants to get a car, I would suggest she work 24-7 and your mom and dad coach her and feed her daily.

and give her a place to live so that she can put all of her money in a pile and get a car, a little $3,000 or $4,000 car that she pays cash for while working her tail end off this summer. Then you drive your car and go to school and graduate from high school, sir, and she drives her car and goes to high school and graduates, sir, and then let's talk about combining our finances after we're married someday if that ever occurs. That gives you the best statistical probability of winning.

Okay, so there's an in-depth body of research done about 10 years ago that says if you follow the proper life order that your probability of not ending up at the poverty level is almost zero. 97% chance you will not be at the poverty level if you graduate from high school before you get married and if you get married before you have a baby.

So don't be making babies and don't be getting married until you graduate from high school and do it in the right order. If you do those three things, you have a 97% chance of not being at the poverty level in America today. Isn't that bizarre? Something that simple. And that's what this conversation is scaring Rachel and me for y'all.

Because you're going to get this out of order, dude, if you're not real careful. Well, and you're taking on responsibility, Aaron. That's not your responsibility. You're carrying something as a 17-year-old kid that you don't need to carry. You're a young man, and this is not your job. The adults in her life failed her. Your mom and dad are being generous and giving her a place to stay. It is not your job to finance her life at 17, okay? I want to relieve you of that. That's not an act of love on your part. It's an act of desperation.

and displaced, misplaced honor. Please let mom and dad, let her handle this. If your mom and dad want to give her $1,000, just give it to her and help her get a car. That's okay. I don't mind doing that. I don't mind helping the young lady. But let's keep this stuff in the right order. Because the way you presented all this stuff to us was like you were two people in your 20s or something. And we had to dig into the conversation underneath your bad language words

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Rachel Cruz, Ramsey Personality, is my co-host today. Today's question of the day comes from Erin in Washington. Erin says, I'm 32 years old and my fiance is 29, and together we are worth $1.4 million. We have no debt, but I'm having trouble justifying the cost of our wedding. With current quotes, we estimate the total cost to be around $50,000 to $65,000, and that is after cutting out a lot of things that you traditionally plan around a wedding, like a bachelor or bachelorette trip.

I was raised in a frugal household and I only recently started to embrace treating myself out from time to time. On one hand, I genuinely want to celebrate with our friends and family, but on the other, uh, my head and heart hurt the fact that it'll cost us over $50,000, almost $500,000 in opportunity costs based on a 7% compounding annual return for the next 30 years. Somebody give Aaron a glass of champagne. Uh,

So how can we analyze our options and make the right call without looking back with regrets? Erin, we know who the nerd is in the family. Who does 7% compounding interest on your wedding plans?

and compares it on the opportunity cost. Me, I would do something like that. This is where you want to live, Aaron. You are a fellow nerd. I salute you. Live and enjoy. Oh my gosh. Stop being so uptight. Go enjoy. Go enjoy. You have the money. The information we don't have is what your household income is. But if you're 1.4 million at 32 and 29, you're already millionaires. My guess is that you're

income is probably approaching you know 150 or 200 that would be my guess wouldn't you no i don't know i'm guessing i have no clue yeah i mean we don't assume they're doing very well yeah i can tell you this the average wedding cost in america today published surveys 28 000 i was gonna say i think it's and i saw some 35 okay maybe inflation so okay 30 let's call it 30 000 bucks all right and the average household income is around 70.

So people are spending a little less than half their annual income on a wedding these days, as an example. That's average. And you can be above average, you can be below average, and you can decide what you wanted to call, whether you call that whole thing crazy or not. Okay, you can have that discussion. That's all fine. But if you're making $150,000 a year, you're worth $1.4, and you spend $50,000 on a wedding, it is not out of line.

It's not like I'm a nerd and I'm frugal, but it's not like blowing my mind. Okay. So the way we look at expenditures is, are they unreasonable? It's not the amount. It's the amount in ratio to your income in ratio to your net worth. Can you put that amount of money in the middle of the kitchen floor and burn it and still be okay? Because that's what you're getting ready to do.

Well, it is. With a lot of happiness. There's a lot of happiness. There's a lot of happiness. And then it's over. Like 24 hours later. Okay. And memories that you lost forever. And the photos will not come out of the storage closet for the next 25 years. And the videos won't even be in the right format to watch them anymore. I was going to say.

to say so um dvd player yeah so who's got a dvd player who's got a vhs player everybody raise your hand yeah so um yeah that that's uh and paid a lot of money for that videographer so i had a big old chunky thing on his shoulder life is to be enjoyed it is it is and i think you spend it and i i think you do it i think you do it but you do it in ratio

to your income and in ratio to your net worth. And given your net worth and your age, I'm going to extrapolate an income out of that and say that in both cases, you're okay. If you called and said $150,000 or wrote in is what my mother-in-law-to-be wants to spend and we make $150,000, I would say, no, I agree with you, that's too much. Because it's a ratio. It's a ratio to what can you...

That's the way I ask myself about some of the things I spend money on that is consumption. And Aaron obviously says... This is consumption. Yeah, he has recently just embraced treating himself... Enjoying life. Yes, so...

Enjoy it. It's good. It's good. I think you're okay, Erin. And I think you're okay to stop it there, too. And you're okay to say, that's all I'm going to do. I'm not going to do more than that. And having a budget is smart, regardless of what money you have, because this is a black hole. A wedding can become a, there's the next, the next, the next. So you do want an amount of money.

That you're like, okay, this feels right. And we're going to budget around that. You know, that's a good thing to go back to because the wedding is one of those things where the players that are involved, if you're doing project management, the stakeholders are crazy and they cannot be told no.

No one can tell the mother no. No one can tell the daughter no. Oh, you're talking about like the florist and like the cake maker. It's like, so the thing that we did successfully, and Rachel obviously is the Enjoy Life Ramsey, and so we did successfully with Rachel, Denise, even Daniel, we participated some in that wedding, was we set a number of,

And then we said, okay, based on that number, what are you going to spend on the dress? What are you going to spend on the reception? Yeah, you have to budget from it. Yeah. What are you going to spend on the reception? And break down exactly what you're going to have, what percentage of that number. So out of your $60,000, what's going to be the dress? Out of your $60,000, what's going to be the reception? What's going to be the photographer? What's going to be the venue? What are you going to pay the preacher? Well, it just gives you a guideline. And you manage the, it's an event management budget. Mm-hmm.

And you lay the budget out. Oh, and by the way, you and your bride to be lay that budget out without any of these other crazy people in the room. And then you guys are in charge of your life and your money. And that's what we're going to spend. So when you go to the caterer and the caterer goes, oh, for 10,000 more, we can. No, this is what we said we were going to do. And the florist says, oh, for 5,000. No, this is what we said we were going to do. Because every one of them are used to jacking everybody up. It's a jack up industry.

And so you've got to have a plan and you got to stick to the plan and you got to be in agreement and unified. Yeah. And a lot of large projects you're going to manage together as a couple. And in a lot of these situations, even just the word wedding, wedding invitation, wedding cake. If you just went but cake,

or got an invite there actually been there's been studies done that it's significantly marked up because it has the word wedding next to it too so be thinking about that put baby in front of it too yeah yes yes it's like i can go to ace hardware and buy a stainless steel screw for for 12 and a half cents but if you say it's for a boat it's 12 if you say it's for an airplane it's 3700 so

It's the same screw. You know, I mean, it's the same thing. It's the exact same deal. Yeah. It's what does the space allow? And you've got to manage to that. So, Erin, you've got all of that to manage against already. But then enjoy the day.

Shut up and enjoy the day. But it doesn't mean no boundaries. That's right. Yeah. We're going to set the boundaries. We're going to set a game plan, detail, line item out the budget. You're a nerd. You'll be able to do that. You and your spouse agree to it. Be kind and gentle and just smile and tell everyone. Now that we've, you know, we've

whatever her name is, and I have agreed to this. No, we've agreed to this. No, this is what we've agreed to. We need to bring it back down to that. And this is what we've agreed to. Well, we can't do that because this is what we've agreed to. And you just keep that. You're going to say that 4,000 times in the next year. And I'll say this as the...

as the woman i think that the way aaron spelled i'm assuming he's a dude so i think if she has had a dream of like you know the flowers being this well then cut the budget somewhere else that's right so like let her aaron oh yeah like for sure if she wants to spend more or less on the dress whatever as long as the total doesn't exceed that's right

It's the same thing decorating a stinking house. Yeah. You know, as long as you do whatever you want to do, as long as the total doesn't exceed. That's right. That's right. Yeah. And so spend more in the living area and downstairs where nobody goes, put the cheap carpet. And let me just say, we were talking, we did a photo shoot for the show, the Ramsey. So all the Ramsey personalities, including Dave, we were all together at 10 o'clock this morning shooting pictures. So.

Some of us were talking before you got there. My favorite thing. Dave hates photo shoots, which, yeah, it's fine. You did great, though. You smiled. It was great. But we were talking about, you know, part of the Ramsey plan, like so much of this show, it is helping people get out. A lot of people are underwater, right? The inflation is high. There's not a lot of margin, right, for the average person listening. And our goal is that you do this stuff over a long period of time and you're going to see a lot of traction. You're going to look up and...

Being 1.4 million at 32. Yeah, five years and your life is going to look different. So when you get to that point, enjoy it. Like, enjoy it. Spend, save, and give. It's three buckets. And for some reason, sometimes our Ramsey fellow listeners that got to the point of winning, they don't enjoy it. So enjoy it. Live like no one else so later you can live. Go to concerts. And give like no one else. Invite a friend. Go to a concert. Go on a trip. Like, just enjoy life.

Not everything has to be on a compound annual return basis. That's true. That's great. This is the Ramsey Show. It's way too easy to put off making a will. And believe me, I've heard every excuse in the book. But not having the time is one excuse we can kick to the curb right now. Because these days, most folks can make a legally binding will on their laptop

between loads of laundry. If you're wondering if you can make your will online or if you need a lawyer, we have a quiz to help you figure that out in less than five minutes. Just go to ramseysolutions.com slash wills quiz. ramseysolutions.com slash wills quiz. Selling a house, buying a house in this weird real estate market is a little weird.

So I suggest you get the weirdness out because it's a big old transaction, baby. You get the weirdness out by having a pro in your corner, someone who knows what they're doing that's high-octane, high-protein, does lots of transactions a year, 50, 200, 300 transactions a year, whatever.

If they're in the Ramsey Trusted program, meaning they're real estate agents that are endorsed local providers and we have vetted them and we coach them, they're trusted by us, then they are high octane. They're not somebody got their license three weeks ago and just that's your Uncle Charlie at the church. No, no, no, no, no, no. Ramsey Trusted agents have years of experience. If you want to find who can represent you buying or selling in this weird market, go

Go to ramseysolutions.com slash agent for free. We'll tell you who the trusted agents are. Alex is with us in Miami. Hi, Alex. Welcome to the Ramsey Show. Hi, Dave. How are you? Better than I deserve. What's up? So my parents are in their late 60s. I just found out they only have $200,000 saved for retirement. I'm just wondering how I can help them this late in the game. Okay. Are they willing to accept your help?

Probably not, but at least advice. That's what I mean. They will accept your advice? I believe so, yes. It will be unusual. Yeah, well... It's hard for parents to listen to their kids because we call it the powdered butt syndrome. Once someone's powdered your butt, they don't want your opinion about sex or money. Okay.

Yeah, usually that probably will partially be the case. I mean, I'm 26, and I have about that amount saved up already. Which should give you street cred, but with anybody else it would, but it's probably less so with your old man. But you can try. Okay, so you're wanting to just sit down and talk to them, and you're asking how to do that?

No. The advice to use, I guess, you know, at 67 years old, there's only so much time, compound interest, a proper ETF investment. Do you have any idea what the $200,000 is invested in? I don't know exactly. I'm sure it's a lot of individual stocks and not ETFs. What makes you think that?

I've seen some of the portfolio. That's one of the things that I've been saying for years now is get rid of the individuals, go to a normal ETF. Well, an ETF mutual fund function about the same way. We recommend mutual funds typically, no big difference for purposes of diversification. They both accomplish that goal.

and they both have good long track records. If you're doing like an S&P 500 ETF, it's a pretty simple equation, just like buying an S&P index mutual fund, same thing, basically. So we put our money, and I'm in my 60s, across four types of mutual funds, growth, growth and income, aggressive growth, and international, and I look for mutual funds for my long-term investing that have long track records of outperforming the S&P.

Okay. And because if I'm not going to beat the S&P, I might as well just drop it on an index, right?

Okay, so somewhere in that 11.5 to 13 range is where most of that's going to fall over a long period of time as a rate of return. If you've got it invested where it averages 10, it will double every seven years. So if they're 67, when they're 74, it'll be 400 if they keep their hands off of it. When they're 81, it'll be 800 if they don't touch it. Now, do they have other income to live on?

Yep. Both parents work. My mom actually had just stopped recently, but about $270,000 they bring in. Wow. That's why it was shocking. Have they been making that for a long time? A decent bit. So they just spend like they're in Congress.

If only he had listened to you from the get-go. There's some loans that were taken out, still some money on the house that was purchased decades ago. Yeah. Well, I'm going to use the 270 to clean up any debt that's remaining and try to live on about 50 to 75 and pile up cash because we have a wealth. As you've noted, you have a net worth shortfall, and you've still got debt on your house. These are two problems going into retirement.

So I want to become debt free and build an estate as big as I can build it. While we've got this fabulous shovel, I've got a large shovel, but they can't live. They can't live on 275 the rest of their life. It's not sustainable. They don't have it. It'll be gone in one year. Yeah. So it's almost the discipline and the new habits of living on less going into retirement is going to be important. Yeah.

So they're going to have to set a new lifestyle. If I woke up in their shoes at 67, I would give it three really hot years and say at 70, I'm going to relax until then. I'm going to burn it, burn it, burn it down, baby. What does your dad do? What's for a job? He's an advertiser. Hmm.

Okay. Yeah. I mean, I would clean up all debt and stack cash as high as I could stack it by 70. And I bet he could do a lot by then, don't you? If they really got serious about it. Now, I have no idea because it sounds like somebody at that house has never told the other person no. Yeah. I mean, there's a little bit of that for sure. Well, I mean, some of the either we just know we live in a constant state of party. I don't know what the where the devil's 270 grand is going at 67 years old. And if you're broke.

I mean, you know, they're not broke, but they're dadgum close. So I share your concerns. I hope they will adopt a plan. Now, here's what I would do if I were in your shoes. I'll add one last thing to this. Here's how you, those of you that are facing something where you're trying to advise your parents and it's hard for them to listen to you, the powdered butt syndrome and all that. Don't talk about their failures or what they need to do or what's wrong. Talk about what you did. Just say, dad, you know, here's what I did. And I've already got 200. I'm only 26. Here's what I did.

and I did this and here's what I did I sacrifice now because I knew if I could get out of debt I would have stability and sustainability and have the ability to build wealth all these abilities are on there so get rid of the debt dad that's what I did and then I was able and gosh if you were to do that I can help you I would coach you I'd be your biggest cheerleader I'm not going to interfere in your business if you don't want me to but man I'm so excited about what this has done for my wife and I this for our lives and how we've changed because we're doing this stuff

In any of this that you would allow me to share with you, I would be so honored. And that's your only shot. I was going to say, and then temper your expectations because as many parents at that point want to change the way they've been doing money at 67, like you always say, Dave, sometimes you don't want to change. I'm not going to change. There is a point that they get, they're like, and you can't change that, Alex. Like, you know, I mean, as good of intentions as you have and as much as you want to see them do something different,

You can't you can't you can't force them to change. So there's so I'd say have some realistic expectations just going in to that conversation, too. Yeah, we've been transparent on this show a lot about that. I've said it many times on the air that the hardest stage of parenting is when your children are grown because you no longer get to tell them what to do and they can just go do stupid stuff.

And you just have to watch. Now, mine have not done anything extremely stupid, but they don't always do things. They don't do things perfect. They don't do things perfect. And, you know, here's another thing. Here's another stage that's really frustrating. When your parents won't do what you think they should do.

And you think what your parents are doing things that you think are stupid. That's hard too, right, Rachel? I don't do a lot of that. Right, Rachel? We're not doing anything extremely stupid. But the truth is you're all adults. I can't believe you bought that table. I can't believe you're spending that on that. I can't believe you. But you never say that because it doesn't do any good. And it's not your job to say that. You don't have a position to say that. So you just have to stand back and watch people that you love be different.

And that's hard for kids with their parents. It's hard for parents with their grown kids. And in his case, he's truly like the well, well, and the well-being of his parents is at stake is what he feels. You know what I mean? Like they don't have the money for retirement. He's got a reason to say it. Yeah, exactly. It's not, it's not a minor discomfort about how you cook a steak or something. That's not what it is, but it's right. But it is a, um, you made the mashed potatoes wrong or something, but it's not, it's not that, but it's, but, but, and it is coming from a good place, but you still have the same problem.

It's the hardest relationship is for grown people that love each other dearly to let them have boundaries and let them have their own space. This is The Ramsey Show. Live from the headquarters of Ramsey Solutions, it's The Ramsey Show, where we help people build wealth.

do work that they love and create actual amazing relationships. I'm Dave Ramsey, your host. Thank you for joining us, America. Rachel Cruz, Ramsey personality, number one bestselling author many times over and co-host of the Smart Money Happy Hour show with our own George Camel all on the Ramsey Networks. She's my co-host. Oh, and my daughter today.

political correspondent this week as well. So if you need any politics, she's our internal update on this and she has way too much fun. No, I just love watching the conventions. I love all of it. So I'll be watching now. I'll be watching the Democrat in August. I'm watching all of it. All of it. Every speech, everything. I love it so much. I do. I love it.

But in the meantime, we're going to harness all of that energy to help you folks right here. Susan's with us in New Orleans. Hi, Susan. How are you? Hi, I'm well. Thank you so much. Good. How can I help? Well, I'm learning how to navigate my finances alone for the first time in 30 years, and I am...

I hope that I'm not confused, but I have a $750,000 variable life insurance policy that I've had for about 20 years. It's something I carried after leaving one of my employers. And I've recently looked into this to try to understand more, and it has about a $1,500 cash value. Wow.

After years of paying hundreds of dollars a month in life insurance, and that's premium. You said recently alone. Are you widowed or divorced? I'm divorced. Okay. After how many years of marriage? 30? Yes, sir. Wow. I'm sorry. That's a heartbreak. And who's this policy with? Which company?

It's metropolitan. Yeah. Okay. All right. Typically, what a variable universal life policy applies to is, obviously, it's a type of cash value policy that you pay extra for beyond what you would pay for term. And the extra goes into an investment. And with variable, it generally is mutual funds that you select the mutual funds.

or they select them for you with a rubber stamp situation, and you don't even realize you did it. But basically it's going into that. Then they take all of their fees out, and so you don't get anywhere near the return that you would have gotten. Typically, nationally, the typical variable is about a 4.7% rate of return on an investment that, not counting fees, should be yielding north of 10. So it's an absolutely bad product, but it's hard to fathom that you paid 20 years and only got $1,500 out of it.

That's hard to believe. That's what it shows me, and it's one of those things where I never really tell it my fault. Have you called them? No, that's on my list, but I just wanted to really start to understand more about the policy so that I had some information. It's possible that it is a dumbed-down product.

That was sold as an HR benefit through a benefits company. And by dumbed down, I mean that they didn't charge you enough over what the actual life insurance was for there to be any going into savings hardly. Okay. And so I don't know what you've been paying, but the policy is $750,000, so it's less than a million-dollar policy. How old are you today? I'll be 65 in September. So you bought it when you were 45. Yes.

And was it guaranteed issue, meaning did they make you to go through a medical? No, it was one of the things, one of the benefits that I signed up for when I went with that employer. Right, but they did not have any medical check. Like if you bought a million-dollar policy, they're going to check medical usually.

Yeah, no, sir. Not any of that. So guaranteed issue is what that's called, and that is a standard in the benefits world. There's nothing wrong with it, but it's a more expensive type of insurance because they're taking more risk because they're not checking people's medicals.

That make sense? Okay. And so you're probably paying a lot more of what you were paying, a lot more of it was going towards insurance versus if you had just bought a regular variable universal from them out in the open market and done a medical.

So that's part of where you got ripped off probably. And my other guess is that if I knew the premium amount, it probably wasn't enough to have a lot spilling over into cash value. So it's very possible that what you've learned is true. I'm sad to say. Now, the good news is you can stop doing it.

You have a hole in your pocket. You don't keep putting money in it. And then we need to ascertain even if you need life insurance at 66 years old or 65 years old. So do you have assets? I do. I don't have any debt except for the mortgage on my house. Mm-hmm.

And then I have two fixed retirements, one from my military service, one from my current employer. Is there any children that came on late in the game that are still dependent upon you? No, sir. Okay. So financially speaking, not emotionally or relationally, but financially speaking, no one's counting on you. So if you didn't leave life insurance from a dependent standpoint, the family's not going to be damaged.

No, I would like to have life insurance that would cover any mortgage amount I would have so my children wouldn't assume that. They don't assume it. The house will cover it. Okay. Yeah. You don't need to leave your house mortgage-free by paying this policy. And buying another policy at your age or my age is not usually a good mathematical plan. Right. So how much money do you have in your nest egg?

I have about nine months worth of expenses. You have a retirement nest egg of any kind? Well, the 401k I had during my marriage, and I did not leave my marriage with that. Okay, so he got that. And so you don't have a, quote, pile of money in a retirement account somewhere? No, I don't. Okay. You're living off the pensions, and that leaves you just fine.

Correct, yes. Are you still working, Susan? I am. And I'd like to keep working. I love what I do. So I'm not in a rush to retire. Good. What do you make? About $100,000 a year is my salary. Good. Good for you. And what's the balance on the mortgage? $218,000. And what is the house worth?

325. 325 to 350, I guess. Okay. So if you were to pass away tomorrow without life insurance, the kids would sell the house, there'd be $100,000 on the table, they would pay for a funeral, and the smoke would clear, and they would all get a little bit, correct? Correct, yes, sir. Okay. I'm not buying this life insurance policy another day then.

And I agree with you. That was my first reaction. But then I'm thinking, I mean, and the premiums have gone up every year. Yeah, they do. It's FIH. But this is hundreds of dollars a month for years that I have been paying. But that doesn't mean you want to keep doing it. No, but I just made the bad decision with that investment. Yeah, yeah. I think you probably did.

But as they say, water under the bridge. But I would call them too, Susan. I want to call them and make sure I understand it. In ideal, they left off a zero or something. I don't know. Maybe there is more in there. It was a typo. It's possible. But I think with it being a guaranteed issue and I think with it being a benefit, they lowered the price on it so low that they didn't put enough in there to cover the insurance. Yeah, but it was just so expensive just for the insurance side. I know because she didn't do medical. That's because variable insurance.

Life insurance is a complete ripoff. It's the payday lender of the middle class. But, you know, she's and I'm here. She has 20 years later paying into it. I'm so sorry.

Listen up, trying to reach your money goals without a rock-solid budget is like trying to climb Mount Everest in ice skates. It isn't going to work. That's why we built the EveryDollar app to help you win with money. It's the simplest, most straightforward way to track your spending and give every dollar a job. That way, you can stop letting your money push you around and start reaching those money goals.

Download every dollar for free on the App Store or Google Play. Rachel Cruz, Ramsey Personality, is my co-host. Open phones at 888-825-5225. If you invest $100 a month from age 25 to age 65 in a decent growth stock mutual fund, it will be $1,176,000. So you should be taught this in the 6th grade.

So that you start investing in your 20s because it doesn't take a lot to become wealthy. Our last caller put hundreds of dollars a month for 20 years into a rip-off life insurance policy. My point is, if she had put that money in a fruit jar and just stacked it in the cellar, she would have a whole lot more than she has in that policy. Like tens of thousands of dollars. I mean, she's putting in...

uh, what let's say hundreds a month, let's say 200 a month. Okay. That's $2,400 a year. And, uh, and so in 10 years, that's $20,000, $25,000 in, uh, in 20 years, that's $50,000 would be stacked in her cellar. If they, if they have 1500 as her cash value, what that tells you is they screwed her. That's what that tells you. Okay. Okay.

She not only didn't get a rate of return, she got a negative rate of return. They stole from her savings to pay for high-priced life insurance. That's exactly what that product does, by the way.

If, however, she had not put it in the seller and it wasn't $50,000 and she had instead put it in her 401k or which she lost in her divorce, but or negotiated away in the divorce or whatever happened there, or she put it in just mutual funds, hundreds of dollars a month for 20 years, it would have been several million dollars. And so that's how bad these cash value life insurance products are.

It's not just a little bit wrong. It's millions of dollars wrong over 20 years. Millions with an S. Lots of millions. That's just bizarre to think about. And if you wonder how the, as a buddy of mine used to say all the time, there's two main towers in the skylines, banks and life insurance companies. And in the old days, particularly, that was true. And the skyline of the average company

city when you drive in there's two towers there's two sets of towers banks and life insurance companies and who you think built those well it wasn't built by santa claus you built it with your money getting screwed by those people in both cases yeah so instead of 200 going to an insurance policy she could have paid 30 40 for a term life mm-hmm

And then you would have had $150,000 to invest. Right? Like, that's the problem is the difference in what you pay. For a million dollars a term, you could buy that easy at 45 years old. And so you buy inexpensive term insurance for the time that you actually do need life insurance. Half the time she kept this policy, she didn't need it. She kept it because it was an investment. Yeah. In air quotes, an investment. Larry is with us. Larry is in Kansas City. Hi, Larry. How are you? I'm doing better than I deserve. Cool. How can I help?

So a little backstory, I come from Seattle and I ran a company there for 10 years. Basically we got it from 2 million to about 17 million, 17 million when I left. And now I live in Missouri, close to Kansas city. And I came across this business here that the couple that owns it, they're elderly and

And they're willing to sell it, I guess. I just kind of came across. I was buying blades for my mower, and this place, they sell mowers, zero-turn mowers, and they're number one in three states, I believe, here. So I don't know how much they want for the business or anything, but I've never had experience buying a business, and it's a small family business. What was the business you were running before from 2 to 17?

I was a steel flashing business and also created a store within the production. You were the CEO? I was just the general manager there. Oh, okay. So you had other leadership team that helped you do that, not just by yourself. Yeah, the owners and then there was me. Ah, gotcha. Okay. Yeah, but the owners were pretty absent. They just invested into new machinery. Okay.

pretty much, and that's it. Yeah, okay, all right. And so you're thinking about buying a lawnmower business just because you stumbled into it? Sort of, yeah. Yeah, okay. Well, we advise and coach about 10,000 small businesses under Entree Leadership brand across America. I do a podcast every week called Entree Leadership where we talk to small businesses, and I will tell you running a small business is too tough to do something that you just stumbled into. You better really care deeply about it.

Because it's going to take a part of your soul. Yeah, they've been here for 50 years already. I know. I'm talking about you. I'm talking about them. Yeah, yeah. They love it. You stumbled into it. You need to love it to do it, number one. So you need to search that part of your heart. Don't just buy a small business because the numbers work. That makes for a long day and a lot of stress. No fun at all.

Okay, it's just too tough. There's too much rough and tumble, too many splinters, too many black eyes, too many problems. You better love it. So you better love something about machinery. You better love something about the people that buy that kind of machinery, the people you're serving, the guys and gals that run lawn care businesses, the guy who just desperately needs a zero-turn mower for no apparent reason. All of these people, you better care deeply about them. Now, then I'm going to find out, you know, a solid P&L.

A profit and loss statement. And the value of the business has nothing to do with the gross revenue. It has everything to do with the net profit. Yeah. After everything is paid, what is the real profit? And that should match the last several years of tax returns. And I want to see both of those before we even talk about anything. Okay. And then let's pretend you said they're in several states. It sounds like it's maybe a $10 million plus top line, is it?

Well, he mentioned that they sell about 300 mowers a year, plus they have a service. Yeah, probably not 10. It's probably not 10 million. Plus they have 300 mowers. 300 mowers, yeah. Yeah, that's a few million dollars. Okay. No, I was wrong. Okay, it's not going to be 10 million. So let's pretend the thing, after everybody has been paid, managers and everyone, as if you were an absentee owner,

It's bringing in $100,000 net, net, net profit after all the smoke is cleared. It's worth a maximum of four times that. Okay. 25% rate of return on your money. So if it brings in $100,000, it's worth $400,000 max. And I don't care what the inventory is worth. They can sell off the inventory and get more than they should sell off the inventory.

Because the inventory's only got a value to the extent you can turn it over and turn it into profit. Oh, well, we've got a 50-year name. Name's not worth anything except to the extent it brings in profit. Business is not a hobby. Business makes money. And money is how you measure the value of a business, period. Not people's feelings. And people like you're talking to have a lot of feelings. And I don't want to be mean or anything, but I couldn't give crap less about their feelings. Yeah. When we put a valuation on this business, it's based on the actual numbers.

Not based on they've worked really hard or based on their very sweet people or based on their service to the community. Great. All to the extent you make a profit. Otherwise, you have a hobby. Or let's relabel the thing non-profit on purpose instead of accidentally. Okay? So that's how you get into this and lay it out. And you got some digging to do before you figure out if you really want to do this or not. And I'll go back to my first point, Larry. You better love mowers and people that buy mowers.

Because it's going to take a whole lot of your life if you buy this business. It's what you got to do, man. You got to lay into it. You know that from your experience before. You got to lay into it. This is the Ramsey Show. Listen, tickets for the Live Like No One Else cruise are selling fast. This is the ultimate debt-free vacation. And I can't wait to celebrate with all the folks who've worked their butts off and changed their family trees. We will be sailing through the blue waters of the Caribbean with the Ramsey personalities.

and other special guests. A bunch of cabin options are already sold out, so hurry and reserve yours with a $600 deposit today at ramseysolutions.com slash events. If you want to win, winning is an intentional act. As a matter of fact, it's a series of intentional acts that causes this thing we call success. No one accidentally wins the Super Bowl.

They practice, they work, they plan, they strategize, they lean in, they focus exclusively on their task. No one accidentally stays married 40 years. No one accidentally raises good kids. No one accidentally is successful with their career. No one accidentally builds wealth. It's not random.

It's a series of intentional acts. One of the intentional acts is planning and making every dollar behave. Every dollar needs an assignment. If you don't make your money behave, you will always be broke and wonder where it went. You have to make your money behave. You have to be a lion tamer with a whip and a chair. And that's what a budget is. You're making the money behave. Every dollar gets an assignment. That's why we named the world's best budgeting app that we built.

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in the App Store, or on Google Play, or at EveryDollar.com. Winning is an intentional act. Heather is with us in Nashville. Hi, Heather. Welcome to the Ramsey Show. Hi, Dave. Hi, Rachel. Thanks for taking my call. Sure. What's up? My husband and I are on Baby Steps 4, 5, and 6.

And we want to be intentional about how we plan our finances for our family. With a recent change two years ago, my husband's mother passed away from ALS. And we learned that it was familial ALS.

Normally, no one knows why anyone has it. 90% of chances are or cases are unknown, but 10% are actually familial with a genetic marker. So we learned that she died of familial ALS, and there is at this point a 50-50 chance that my husband will have it.

Did her parents have it? There's no way to know. Her father had it, and she has a sister that also died from it. Wow. Oh, Heather, I'm so sorry. Thank you. Is there testing to see if he has the gene? Are you able to find that out? He's got the marker. You said he's got the marker.

Well, there is a test available. I mean, you get half of your genes from one parent and half from another, so that's where we know there's a 50-50 chance. And there is a test to identify one of the 20 most common. Oh, so there's not a singular marker.

Correct. It's not a singular marker, but she wasn't able to be tested before she got it happened so quickly. If they don't know what the markers are, I'm just curious. I'm not questioning. It's not passive-aggressive. I'm just truly curious. If they don't know what the markers are, how do they know it's familial?

Well, they actually identified as familial because of the family history. Just the history, just the pattern. The pattern, but there's not any actual medical. It's just a highly statistically unlikely pattern. Precisely. That makes sense. But it's been my husband's decision. How old is your husband? He's 40. Okay. So you guys are checking those markers just to...

Yeah, will y'all run that test to see out of the 20 genes? For peace of mind or whatever? It's interesting you ask that. My husband has decided that he doesn't want to do it because he just wants to live every day to its fullest and not plan for a death, but we want to be financially stable and make the right decisions for our family. So he's looking for some advice. Wow. I'm sorry for the reason for your question, but it's a great question. The...

The answer is do the exact same things we teach everyone, but it's going to be with much more seriousness and attention to detail. For instance, you know, if you've been listening, Heather, that we tell everyone to have a will and everyone to have a detailed explanation of the will to everyone involved in the will. Okay? Okay. And so if his brother thinks he's going to get something and he's not, you need to tell him now.

Okay, that kind of stuff is what I'm talking about. My guess is in the situation you're saying he's going to leave everything to his children and his wife or to his wife to take care of his children, right? Yes, and we have very young children, a six-year-old and a six-month-old, and we didn't make the decision lightly to have a second child when we knew that there was that potential. Did he have life insurance in place?

Yes, and we both have like $750,000 in life insurance, term life with about 18 years left. Okay, that's good news. Good, good. Well, we're not dropping that for sure. And we're going to have a detailed will. And, you know, he needs to, what is the name of that book? Oh, there's a book, a thousand years ago I endorsed this book. Letters from Dad, I think it's called.

Google. Oh, you don't have your computer open. I got my phone, though. You got your phone. Whip that trusty phone out. See if letters from dad's not a thing. And I actually did this for about three years, and then I dropped it because I was lazy. But the guy. Oh, yeah. Greg Vaughn. Hmm. Greg Vaughn. Yeah, that's it. Green cover. Yeah. Yeah. That's it. Okay. It was 25 years ago. Yeah.

um you were a little kid and so it's writing letters to your kids and they he sold he sold like a wooden box and you could each kid had a box and write letters to your spouse and so these would be treasured items later in your life was the idea it's a legacy piece makes you cry when you read the whole book okay and it made me made me go do it for a while i did it for two or three years there's a wooden box somewhere in rachel's life i have no idea where it is but um it's got four letters in it or something but when she was five

But I made a run at it. But that kind of stuff and videos...

or occasionally you just throw them in a drop box or in a file somewhere, you keep them. I would just be cognizant about legacy things with the kiddos. Does that make sense? Sure, yeah. Probably more serious than the average bear. But make sure your will, your life insurance, your details of the estate plan are in place so that if you ever get a diagnosis, you don't even have to think about that. It's already done.

Okay. We're not rushing around and trying to do it in a period of months or whatever before he loses the ability to do it or something like that, right? Go ahead and do that kind of stuff. It's a healthy exercise for everyone listening, by the way. I have a very detailed estate plan. That I did not drop the ball on. And it's one of the ways you say I love you to your family is you take the stress of

how they're going to make it and what they're going to do and what they're going to do with this and that and who's going to fight over what. All that stress is gone because it's all handled while you're alive and in detail. And the more of that you have, the more peace you have on this issue. And then he can do what he's decided to do and go about his life and live. And Heather, the medical side...

Did insurance cover it for his family that has gone through this? How did that play out? I'm just wondering for medical bills on your behalf. She did not have insurance. Okay. And it actually happened very quickly. Within two months of diagnosis, she had passed.

Oh my gosh. We had missed some of the initial signs and warning signs. So we know what to look for at this point, but there is an average life expectancy between two and five years. Yeah. I've lost two friends to it and both of those were over two years. So from a medical bill's

Right. Does insurance. Do you have you guys like look through? Is it do you have adequate insurance that if this did come that most of it would be covered? OK, we do have adequate insurance. I'm not sure to what capacity, because, you know, you never know the longer you're alive. Obviously, the more expensive it is. Right. Yeah. The more I know about that kind of thing, the more I build my emergency fund up, the more peace I have. I would probably have just some more cash. Just yeah.

Okay. Yeah, most of our assets are accessible, cash, real estate. Yeah, no big change to what you're doing. Just lay out a detailed plan, and everybody knows the plan, which you should be doing anyway. And, you know, make sure your insurance is there. Whatever's not there, make sure you've got cash to cover. And then I'm with him. Go about living your life. I like that. That's pretty cool. This is The Ramsey Show.

Our scripture of the day, 1 John 5, 14. This is the confidence we have in approaching God, that if we ask anything according to his will, he hears us. Henry Ford said, if I had asked people what they wanted, they would have said faster horses. Oh. I like it. That's good. That's good. Helen is with us in Virginia Beach. Hey, Helen, what's up? Hey there. Thank you so much for taking my call. Sure. What's up?

So my husband and I are looking into buying a house probably in the next four years, and we're starting to budget out for a down payment. And I'm a longtime listener, and I've heard you all talk on the show before about building your deck.

And I was wondering if you guys could go into a little bit more detail about that as far as, you know, your down payment plus your closing costs and your inspection and all of that. And if you could give us kind of an estimate on how much we should be planning to set aside in addition to a down payment.

Okay. Well, I mean, you're going to have a few things that you pay for in the closing costs, and a good real estate agent can lay out what is normal and customary in your area. One thing you'll want to buy if the seller does not provide it and you don't negotiate it from the seller is a title insurance policy.

Typically, if you're getting a mortgage, the mortgage company is going to make you buy one for them and you can buy a simultaneous issue for just a few dollars. But you need to find out what that's going to be in your situation. I assume you'll be getting a mortgage. More than likely, yes. Okay. Title insurance ensures that the title is clear, that there are no clouds on the title. Never buy a piece of real estate without title insurance.

I've bought thousands of pieces of real estate. I've never bought one without title insurance. Okay, and I've actually had a few claims, and I'm really glad I had it because sometimes people screw the title up and do it improperly, and then you've got a mess on your hands that's tens of thousands of dollars. Doesn't happen very often, but when it does, it's a mess. So title insurance is one thing. Again, if you're getting it with your mortgage company, it's required, okay?

Because they want to have policy covering them. You can get a simultaneous issue for a few hundred bucks that covers you as well. So that's one thing. The second thing is you're going to have prepaids, they're called.

And you're aware in most house payments today, you have a house payment that is principal and interest to the bank. And they also collect approximately a 12th of taxes annually and a 12th of insurance annually so that they can build up the escrow account with those two things in it to pay the taxes out of that and pay the homeowner's insurance out of that to ensure that

the taxes are paid and the insurance is paid. That's why they do that. And to set that up will usually be three or four months of each of those. So whatever your property tax is, Bill, is four months of that. And whatever your homeowner's insurance is, four months of that to set up your prepaids, they're called. It's prepaying and setting up that escrow account to be able to do principal interest taxes and insurance, PITI, as you

go along. Typically, there'll be a survey fee. Usually, that's not super expensive if it's in a neighborhood, 75 to 200 bucks. Typically, there's an appraisal, usually 500 to $1,000, somewhere in there, depending on your area. And so you're going to have these miscellaneous things that fall under the heading of closing costs. And depending on your area and what your tax rates are and all those kinds of things, you're probably looking at about 3%.

Okay. Awesome. But again, what I would do since you're such a planner and you're doing this well, well in advance, get in touch with one of the Ramsey trusted real estate agents in the area and have them give you an example of a house in the neighborhood you might be looking at. Okay. Here's what a closing, uh, document might look like a closing statement. And you can say, okay, there's those things Dave was talking about line item down through there. And, um,

Then you're going to be able to say, okay, on that house, a $300,000 house, it was $3,000. Oh, okay, so it's 1%. Oh, so now it's $6,000. Okay, it's 2%, right? That kind of stuff. That's what you'll be able to figure out. And it'd be fun for you as a first-time homebuyer to see all the items that make up this vague category of closing costs because they all actually do make sense. They're not rip-offs.

They're all things that you do need. You do need a survey. You do need an appraisal. You do need title insurance. You do need to set up your escrow account. All those things are fine. There's nothing wrong with them. But when you add them all up, you kind of get a sticker shock moment. You go, they're ripping me off of these closing costs. And no, not really. You just got to know what they are.

And so dig in there and figure out what they are, and that'll help you get a good solid estimate because it does change from area to area, and a lot of it is based on the cost of insurance and the cost of taxes in your area. That'll throw this number a bit. Are you going to pay any points up front, which I wouldn't recommend, but are you paying an origination fee, which typically you are going to pay, which is a point difference.

or a half a point, or something like that, to get into the loan. All of that's going to be figured in there. And again, a good real estate agent can help you map all that out. And also, Rachel, we've got a great website on our stuff at ramseysolutions.com slash real estate that goes into a whole bunch of that stuff. It's an information hub.

Yes. And there's just so many details. I mean, as you were even just talking, I was like, oh my gosh, just so much. And that we have so many, so many blogs, articles, points of contact for people in your area to go and to get, yeah, to get this all. Because sometimes I feel like you, it takes a little bit to actually learn it. So go to ramitissolutions.com slash real estate and go and read, research.

research. And again, you can find, uh, Ramsey trusted pros there, uh, on that website too. If you want to call, just like you mentioned to reach out to somebody. Yeah. And just, well, it's okay to nerd out on it. One of the things when you're doing something the first time is it's always scary because of the unknown. Yep. And so the more, you know, the less fear there is.

And so just dig in, get sample closing statements on a property, either the size you're talking about looking at. And then you can back into it and tell every bit of that. All right. Allison is with us in New Jersey. Hi, Allison. How are you?

Hi, Dave. It's such an honor to speak with you and Rachel. I follow you on Instagram and I just have to say I love your post about all your Walmart finds and all your books and everything. Thanks, Allison. Appreciate that. How can we help?

So I'm in a really difficult situation right now, and I don't know what to do. So I'm getting a little emotional. So I'm in my early 40s. I've been in a long-term relationship, and my boyfriend is not sure if he wants a baby. And I want a baby, and I'm running out of time. And my question is, I don't know if I should...

take out loans to be able to even just start the process and afford like egg retrievals or if I should get a second job. I just feel like honestly kind of like trapped and I'm not sure what to do. Wow. I'm so sorry. That's a harsh, harsh situation. I am.

Well, how much I mean, I know there's two things. Go ahead. Well, women that are yes, that are at your point and they freeze their eggs, you know, they kind of go through a process to say, you know, can I, you know, freeze time for a little bit while it kind of buys you time? Have you how much is all of that? Have you looked into all that cost wise?

I have. I've met with the fertility clinic and it will be about, well, they think that I'll need multiple rounds just because of my age. I did have an initial screening and it looked like I had some empty follicles. They did a retrieval actually and it

wasn't successful but all my numbers went up and so it looks anyway things are looking better like physically but it's really expensive so it would be like probably like for three or four rounds which the doctor thinks only that will be about like seventy thousand dollars um just for egg retrieval um well for i mean a single a single round of ivf is around 7500

Well, I guess that means for everything. If I end up, you know, um, you know, let's, let's break this. I'm just, this is an emotional and a very important topic because nothing's more important to me than babies. I love babies.

And so I want you to do this, but I want you to do it in a wise way, not in a way that, because 70,000 is not the number. Well, get a second opinion. You need to get six more opinions. Yeah, you need to go shopping on this kiddo. Because I think you can do a simple egg retrieval. I'm not a doc. I'm not throwing out a number. I have no clue what that is. I mean, we've talked about IVF on here many, many times, and 7,500, 12,500 in there, not 70 grand. And that's the full freaking procedure.

So you need to get that. That number's not right. I want you to check, and then you've got to decide about your relationship issues and how you're going to go forward with all that, too. That's a whole other bucket. That puts us out of the Ramsey Show and the books. We'll be back with you before you know it. In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.

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