There's No Financial Progress Without A Plan

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From the Ramsey Network, this is the Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships.

I'm George Camill, joined by my friend Jade Warshaw.

We're taking your calls at 888-825-5225.

You call call us up.

We'll do our best to give you the right next step for your life and your money.

Sarah is going to kick us off in Houston, Texas.

What's going on, Sarah?

How can we help today?

So my question is, how do I tell my mother-in-law or my husband that my mother-in-law is holding us back financially?

She's 60 years old.

She doesn't work.

We pretty much pay for everything, her rent.

My husband has her car in his name, but she pays like the car note.

And she's constantly asking for money.

Like at one point, she was asking me for money and telling me not to tell my husband.

Yikes.

Well, this is a pattern.

This has been happening for a long time.

Yes, and he's in the past, maybe about 10 years ago, she actually lost her apartment, like stopped paying rent, lost it, and then had to move in with a friend.

And so he's been taking care of her.

Is she unwell?

Is she sick?

She's not sick.

She does collect like a check from the government.

I think it's only $1,000.

Disability?

Yeah, disability.

Do you know what that was for?

What's the nature of that?

I don't know.

Okay.

But nothing that you're seeing as a real issue to her working.

No, because I've seen her volunteer her time at like homeless shelters or like thrift stores.

And she'll tell me, oh, I volunteered my time and they gave me a...

discount on X, Y, and Z.

She's on the verge of being in a homeless shelter.

She needs to get to work.

Is she divorced divorced or did her husband pass away?

What's the story there?

She divorced maybe when my husband was like not even one.

Oh,

she's been on her own with two kids for a really long time.

So your estimation of her, I just want to make sure that George and I understand your estimation of her.

She is able-bodied, able to work.

She's all the lights on her on upstairs, so she could, you know, go interact and have a job.

And are you just feeling like she's kind of just coasting or a little lazy?

Is that how you're feeling?

Yeah, and she's really, that's how I feel exactly.

She's really lazy.

Right now, I have a newborn, and I have her in daycare, and they want me to switch and employ her and give her the $1,000 instead of the daycare.

But I feel like if I do that, she's going to just use the $1,000 for whatever she wants instead of paying her rent.

Ah, okay.

Would she do a good job taking care of the baby?

Do you feel like she would?

No, I don't feel like she would.

Okay.

Understood.

There's some triangulation happening here.

This should be between you and your husband, and then it should be between your husband and his mother.

And right now, she's trying to circumvent him to go to you to try to guilt you into it.

Have you talked to your husband about this?

Where is he at?

Is he just like, well, we need to take care of her, and she's my mom?

Exactly.

That's how he feels.

And I've even told him, like, hey, you know,

I would

like given an option.

I would give her the opportunity to watch my daughter if I could just pay us the $1,000 and pay it straight to her rent.

But you said you didn't even trust her to watch the baby.

I feel like that's a moot point at this point.

That's true.

Yeah.

So we got to take that off the table.

Here's the thing.

The only reason you're considering letting this woman watch your child, even though you don't think that she's really would do a good job, is because you're thinking of ways that maybe she could start paying her rent.

None of that's your job.

She's grown.

Like you said, she's grown.

She's able-bodied.

She's, you know, the lights are on.

There's no reason in your mind, and I trust that you're telling us the truth, that she can't go out and make some money and have an apartment and, you know, do that thing.

Now, at the very least, can I ask you this?

Let's pretend you were able to get her out into an apartment.

And it caused you to kind of say, hey, let's help you with first and last month's rent just to get you out.

Would you be willing to do do something like that?

Or are you like, hey, I don't want to put any money into this woman whatsoever.

I just want her out of the house.

I don't want to put any money into her at all.

Okay.

Then that's the conversation you have to have with your husband.

Have you talked about it?

And if so, what did it say?

What did it, how did it go?

It doesn't go really well.

It's usually like, Joe will just consider it.

And then that's the end of the conversation.

I have told him that I do consider it, but it's off the table because she owes me money.

She's borrowed money from me, and I don't think she's very good with money.

And so I just, I don't want, I don't feel comfortable giving her $1,000 a month and knowing that she could be homeless or asking me for more money.

What do you guys take home every month?

So I make $100,000, so a little over $100,000.

So my checks are usually like $3,000.

I don't give to my 401k right now.

Why is your check so low?

You mean like every two weeks?

Every two weeks.

Oh, okay, great.

Loving that.

You scared us.

I was like, oh, you're getting robbed here.

$6,000 for, yeah, $6,000 for me.

And it's like a lot.

How about your husband?

$7,000.

Okay.

For him?

Do you guys combine your finances or do you kind of keep it separate?

And, you know, you split the bills.

We keep it separate mainly because she usually asks for a lot of money from him.

And so I just don't want to be a part of that.

So I'm going to be honest with you.

I think that could be at the core of what's making this a very very hard decision between you and your husband.

Because if I am viewing my finances kind of separately, which means there's parts of my life that I view separate, and that means there's certain parts of my life that I believe that I have the only vote on, then if somebody comes along and says, hey, there's this thing that's affecting our life, if I'm thinking, well, I'm the one that's paying for it, she's my mom.

Do you see what I'm saying?

Because there's that separation there, I think that's where he's finding validation to be able to say, no, it's okay.

I'm going to keep her here because he's probably viewing it as a, I'm keeping it here.

I'm fine to spend some money on her.

It doesn't bother me.

But if you guys can get, does that make sense?

Like, George, are you?

Yeah, I mean, because it's separated, he's gone, well, this is a thousand bucks of my money.

So what's it matter to you?

That's probably in the back of his mind.

I don't know that he'd say that out loud.

But truthfully, you're saying this is holding us back financially.

It's not.

You make 13 grand a month take home.

You're doing great.

It's the resentment that is breeding inside of you that should be the thing you're paying attention to, going, I don't agree with this.

We never agreed on this as a couple.

We need to figure out an exit strategy here or a way for her to be independent because she could live till 90, which means 30 years of subsidizing her lifestyle.

That's the part you need to focus on, not the, hey, this is holding us back financially, husband.

Because mathematically, he's going to go, no, it's we're fine.

Yeah, and that's how I feel.

I'm like, we are investing so much money into her.

She could live until she's 90, and then our kids will have to take care of us.

And it's your house.

So much.

Exactly.

The money side part aside,

there's a person that's in your house that you don't really want them to be there and they don't need to be there.

And if you're giving her $1,000 a month, we can figure out a plan for her to go make $1,000 a month with a part-time job.

Yes, exactly.

She's 60.

She's not 86.

And so there's nothing wrong with her going to work if she's able-bodied.

And you can help her with that.

It doesn't need to be cruel.

You don't need to throw her on the street.

It's just, hey, what is something you could do that brings in $250 a week?

Mm-hmm.

Exactly.

Now we have a game plan here instead of just it being emotional.

Yeah.

So I think the I think the action steps here, I think the first conversation you need to have is one, well, I think first action step is you need to do some soul searching about why you've kept things separate financially and really get a hold on what your view on that is, Sarah.

Then the next part is having that conversation first about, hey, we need to, our lives are separate.

We need to draw our lives together.

And I think that that might start financially with us having this transparency there.

And I think the mother-in-law discussion comes further down the line, and you might have to bear this out a little bit longer until you're at that point in the conversation.

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Christine is up next in Los Angeles, California.

What's happening, Christine?

How can we help?

Hi there.

Thank you so much.

I've I'm my own worst enemy.

I'm going to call myself out.

I've choked a couple times

trying to keep up with the budgeting.

I just, I'm not technically savvy at all.

But I've come a long way.

I've got the first four steps done, I think.

But now I'm starting to question myself again because last year I was ready to start the life insurance and then I choked and didn't do it.

And then I'll start listening to the show again, and I'm like, oh, I need to get this done.

And what's stopping you from getting life insurance?

Because that's not even a baby step.

Because I'm putting money into other

things, getting those savings done and

starting to build, you know, the emergency front and everything.

And we have put our daughter through private school, so that's all done.

I just started a new job where I'm making more than I thought I would be making.

So I want to set that separately, and I was going to put that in the Roth IRA.

But I'm like, I really think we need life insurance because we ain't getting any younger and we're in our mid-50s.

So I'm kind of panicking.

I wonder if you're trying to do too much of this on your own because I hear the, I heard the word we, so you're married?

Yes.

It is me.

Okay.

Maybe.

It is me doing this.

Maybe that's part of it because it sounds, you sound tired.

Like you sound like, you know, you were like, oh, I tried to do this and, you know, I'm I'm my own worst enemy.

And I choked when it was time to do it.

Like, I feel like the way you're talking about it is very

like it's a

clean house waiting.

I mean, the actual process of like xander.com, enter age, birthday, health, submit, get quote.

I mean, like, it's not, I think there's more to it.

So, what happened after that?

Okay, I did that and I got the call, but I was unsure

what, how much.

Okay,

I wanted to get to some facts we could help you solve.

So, what is your concern about how much?

What is your current income?

I don't know if I can answer that off the top of my head.

Ballpark it.

Is it $10,000 or $100,000?

Monthly?

Every year.

A year.

Every year.

Oh, that I don't know because I don't know that.

Christine, not you working and putting your life into your work and not knowing what you're doing.

Someone like hired you because you're smart and stuff.

You got to know what you're doing.

And they probably said, here's here's your offer letter with the salary, right?

What was the number on that piece of paper you signed?

This is who wants to be a millionaire.

It's not salary.

It's not salary.

Oh, are you sales?

Is it commission?

Yes.

Oh, is it all commission?

I see it.

At a winery, yes, at a winery.

And it's not full-time, it's part-time.

Okay, so

on a monthly basis, like what's a kind of normal check for you?

On a monthly basis, our total income is probably close to $7,000.

But what's your income of that?

Because we want to know what percentage, like how to multiply and figure out your insurance that you need.

Okay, now I feel unprepared.

I shouldn't have done that.

So,

what you're going to need is about 10 to 12 times.

That's what we're looking for.

Your annual income.

Not household, just yours personally, because the point of life insurance is to replace your income should something happen to you.

Okay, so my annual income, my

homework.

Okay, 10 to 12%.

10 to 12 times.

10 to 12 times.

So if you made $100,000 10 times, you'd have a million dollar coverage.

If it's $50,000, you need at least $500,000 in coverage on a term life policy.

Ignore anything that says whole life or permanent life or universal life or index, ignore all of that.

Okay.

Stick to term life.

And the same thing for your husband, by the way, would be true if he's working outside the house, which it sounds like he is.

No.

no

elaborate

um he we have a special needs adult son okay 25 nonverbal low-functioning okay autism so he is now the primary caregiver understood in the home okay so then so you're telling him you're bringing home seven thousand dollars a month working part-time at a winery on a commission job no that's

i would

no that's what i'm like kind of estimating estimating is our total income.

How does he get money?

Or is that some of that money for your child?

It is.

So it's that whole in-home support services because we get paid to care for him.

Okay, which means your husband really needs life insurance because he's providing an invaluable service to your home.

You need private in-home care full-time if something happened to him.

Translation.

It's both of us, you know, technically.

Yes, but you're able to work outside the house.

My point is if something, God forbid, were to happen to your husband tomorrow, you would suddenly be like, oh my gosh, I need another body in this house.

I need somebody to do the things that he was doing.

So make sure he also has a policy, you know, four or five times that, you know, what he's, what his value is, if that makes sense.

Okay.

And we can monetize it by the money that is being brought in for your son's care.

Okay.

So let's straighten out your financial situation.

You guys are completely dead-free and you have an emergency fund?

Yes.

How much is in that emergency fund?

18.

Okay, good.

And now baby step four, we're investing 15% of our household income.

Are you guys doing that into retirement accounts right now?

No, that's where I'm stuck.

Okay, so you're going to do that regardless.

You're going to get term life insurance today and you're going to start prioritizing.

So there's no priority.

The 401k doesn't take priority over life insurance because they're not in competition.

Life insurance is going to happen today.

You apply for that.

You'll pay monthly, quarterly, annually, however you want to do it.

And then you're also going to put 15% of your future income into those retirement accounts.

Right.

Okay.

So that's what I was trying to do is just take my commission from this new job and all my cash tips.

And that's what I'm saying.

I'm working for my retirement friends.

That's what I'm trying to do.

Okay.

That's that's a way to think a bit of it, but it's not necessarily, it could do you a disservice because if that's not 15% of your income, you could be investing far less.

So what you need to do is I'm going to challenge you to get very organized here.

Because to do what George and I are telling you, you're going to have to really do some diligence and look back on your year and say, okay, what do I make a year?

What is a normal amount of money that I bring in?

And kind of get a sense of that.

And, or you could just do month by month, whatever I earned, I'm going to calculate what 15% of that was before I paid taxes.

And I'm going to, you know, park that away in a Roth IRA.

Okay.

But 15% is what you're looking for because if you're not doing that, you may not meet the goals that allow you to retire with dignity.

Okay.

How old are you, two?

You're welcome.

Hi.

I am 52 and he is 57.

Do you guys have combined finances or are you kind of doing this on your own?

Doing it on our own.

Okay.

On our own?

That's an interesting turn to phrase.

So is he doing his own thing?

And he's going, hey, do what you want to do, but I got my own thing going over here.

No, no, no, no.

I'm just trying to take over this role so he doesn't have to.

He does other things.

And it's kind of complicated.

So let's talk about that then because there's a difference between somebody kind of running point on a team versus I do everything myself because no one else is part of this.

So you running point on a team, which the team would be you and your husband, would be maybe you taking the lead and saying, hey,

we need to do life insurance and him taking a vested interest and saying, okay, great.

Are you calling Xander?

And you're like, yeah, I am.

And you guys having that communication because just having that communication takes some of the load off of you as opposed to, I have to get the life insurance.

I have to do the research.

I have to make the call.

I have to make the budget.

I have to, you know, sign up for the Roth.

You're going to get overwhelmed real quick.

No, you're not okay with that.

You're not okay because you're calling us.

You're calling us.

You're not okay with it.

So my point.

Planned.

Now I'm stuck.

Right.

So you need to start having a conversation with your husband and saying, here's the thing.

There's things that you're carrying in the house and there's things that I'm carrying.

But when it comes to finances, we need to carry them together because I'm getting overwhelmed.

Here's what I need from you.

And tell him what you need.

That simple.

Yeah.

And you can jump on, Christine, to ramseysolutions.com slash checkup.

We have a really great coverage checkup tool that will demystify all of this for you.

Make sure that you have the right coverage, not too much, not too little, not coverage you don't need, exactly what you need for your family.

So go check it out, ramseysolutions.com/slash checkup.

Hopefully, we can simplify your finances.

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Get it done.

Whether it's term life or the, I know it's the last thing you want to go spend 15 minutes doing.

Well, George, we had the perfect segue getting into this because during the break, we were talking about self-driving cars.

Oh, that's right.

We could have just.

That's why I have a will.

Just in case the car decides, no, no more.

This is my final destination.

I do think that would happen to me.

Like my car just stops on the interstate at 80 miles an hour for no reason.

I will, I don't think my heart can handle a self-driving car.

I don't think that I could do it.

Here's the thing.

I trust robots more than humans at this point, as far as their safety.

If they were all self-driving cars, maybe that's different.

But as long as, like, here's my challenge to you: next time you're driving, look over at every car and see how many of them are just texting on their phone,

scrolling Instagram, not even paying attention.

At least the robots have like sensors and cameras.

They're trying.

That's true.

Humans have just given up.

They've given up.

I'm like, they're on Instacart.

They're on, I'm like, what are you doing?

Don't you see your very life is at stake?

Anyway, there we go.

Moving on.

Get your will.

Michael's in Fort Myers, Florida.

What's going on, Michael?

Hey, guys.

So So I'm 22 years old, got married eight months ago, and we are currently living in a family friend's house.

They are missionaries, so they're out of the country for a year until next June.

So they're renting to us at $800 a month plus utilities, which comes to about $1,300 a month.

And my question is, when June comes, should my wife and I either rent a place nearby, rent an apartment until we can save up for a down payment for a house?

Should we go immediately and use all first-time homebuyer benefits to buy a house?

Or my parents are offering us to stay at their place for six months while we are able to save up some money for a down payment.

What do you guys make a month?

Currently, $7,000 plus

commission.

Amazing.

So what are you doing with all that extra money?

Sounds like your expenses are super low.

Well, currently

we have $27,000 in car payments.

Well, in car

loan total.

Anything else?

Any other down?

No, that's it.

No student loans?

No credit cards?

No, student loans.

No credit cards.

Okay.

So

how long would it take you to save up a down payment to where you have a mortgage that's no more than 25% of your take-home pay?

Well,

I think theoretically, if I see there's some

first-time homebuyer programs that allow you to do 3.5%.

The financer.

We said, how long is it going to take you to save up a down payment?

Not how do you get into a 0%

mortgage where you're underwater day one broke with a huge mortgage payment because you have 100% mortgage.

That's what you're telling us.

Got it.

So this is, we're talking a 15-year fixed rate mortgage where the payment's no more than a quarter of your take-home pay.

So when you use our mortgage calculator at ramseysolutions.com, it'll show you pretty quickly what kind of house you can actually afford, not what the bank says you can afford, not what the FHA, USDA loan says you can afford.

So let's work this plan.

Let's kind of work this out for you to help you out.

So first things first is we need to pay off the debt that you have.

So

this is the order in which this will take place so that you can purchase this house when the time comes and it can be a blessing for you and not a burden to where you're not calling us back a year and a half later saying, I'm underwater in my house.

I'm struggling with my house payment.

Okay, so the first thing what we need to to do is tackle the debt and the way we're going to do that is we're going to start by saving up a thousand bucks just getting that little money aside just in case because from that point on we're going to put all extra money all savings towards paying off this debt this twenty seven thousand dollar uh car debt that you have how much do you guys have in savings Well, currently, a thousand dollars because we're trying to pay off the debt.

Okay, great.

So you understand that part.

And I want you tonight, your homework, if you haven't already, is I want you to get on every dollar.

And then I want you to calculate how long with the with the margin and the income that you have, how long will it take you to pay off this $27,000 of car debt?

So that's your homework.

Then the next thing after you've paid the debt off is now we need to have an emergency fund because you can't be out here buying a house.

You can't buy a $400,000 house and then when the $4,000 AC blows out, you're up a creek, right?

That doesn't make sense.

So you got to have some money saved to be able to actually care for the house and the things that go along with home ownership.

So you need three to six six months of expenses saved in an emergency fund.

That comes after you've paid off the debt.

And then now we can start saving up a down payment.

So, you've got a ways to go.

You guys are newlyweds for crying out loud.

You're 22.

You're doing great.

You got a long ways to go.

You're not in a rush.

You're not in a hurry.

So, let's take your time and do it right.

I gave you, can I give you some napkin math to help you with this, Michael?

I think it'll give you some motivation.

Yeah, please.

You make seven grand a month.

Could you throw 4,500 of this at your debt if you got real intense?

Probably.

Every month?

Okay, then your debt is gone in six months.

So February of 26, you're debt-free.

Tracking?

Now take the car payments plus the $4,500.

You could throw $5,000 a month toward that emergency fund, couldn't you?

Yeah.

Four more months, we have $20,000.

Still tracking?

We're at June of 26.

Your missionary friends are back.

You guys go rent somewhere completely debt-free, still making $7,000 plus commission.

Now you could save $5,000, $6,000 a month toward a down payment fund, couldn't you?

Yeah.

That's 60, 70 grand a year.

So now we're renting for a year or two.

We have a six-figure down payment, no debt with an emergency fund.

Do you feel how peaceful it would be to buy a house like that?

Yeah, definitely.

And by the way, you're like, I don't know, 24 by then?

Just a young gun.

Just a whipper snake.

And there's no law in America as it stands that says you have to buy a home by 25 or else you're a loser.

That's just what social media told you.

Oh, gosh.

Otherwise, I'd 100% be the loser.

We'd all, hey, I've been called a loser for other reasons.

So I hope that encourages you, Michael.

You're doing better than you think, but I would not rent with family.

I would just go rent somewhere.

You got to be with your spouse.

Because when I'm at my mom's house, here's what happens.

Mom says, no, no, no, don't lift a finger.

I'll fold that laundry.

Let me cook.

Let me grab your plate.

And there's something about being an adult and leaving, low, leaving Cleave

and being one with your spouse to go, I'm an independent grown man.

You want to visit for the holidays.

You went to the nice example.

I'm like, you're in your room, you're with your lady, and here's mama knocking on the door, and you're like,

I brought snacks.

You're like, now listen.

My wife's going to be very happy to hear that.

And you guys, if you guys were in like some real desperate stage of life and you needed a place to crash for a little bit, sure.

There's no crisis happening here.

You guys are making great money.

You're going to get rid of the car payments fast.

You've got a good housing situation.

Use it to your advantage to get to a better place financially and avoid the FHA, VA, USDA.

Stick with the conventional fixed-rate loan.

15-year is going to set you guys up for success.

Because think about this.

If you get a house at 25, let's say, and you get a 15-year loan, worst case, if you just make the minimum mortgage payment, you are completely dead-free by 40.

You know how weird that makes you in America today?

Yeah.

So just know, it's not going to happen tomorrow, but if you just follow through on this plan to a T and don't veer from it, you will be completely dead free by 40 worst case.

And likely what's going to happen is you'll be dead free by 34 because you're going to go, oh, we can knock this out in nine years instead of 15

because you did it the right way with margin.

Michael, be honest.

Did we convince you?

You convinced me.

You convinced me.

One other question, if I could,

we do plan on having kids within this time frame.

Would that affect any of the finances or anything?

Oh, yeah, it's all out the window.

Forget I said anything.

I'm kidding.

I mean, you're kidding.

Kids are a a wonderful blessing yeah go definitely have the kids yeah you might have some daycare costs pop up obviously that like george said he did napkin math for you so there's going to be some variables in there that change but by and large you're still on track if you say four thousand instead of five thousand that you're still going to be yeah just fine the key is can you live on less than you make and use the surplus to get through the baby steps that is the key regardless of the number.

Now, the bigger the number, the better.

It's going to speed it up.

But kids are a blessing.

And if that's that's in the cards for you guys, go for it.

And you'll be making more money too.

All of it, all of it balances out.

Thanks for the call, Michael.

This is The Ramsey Show.

I get it.

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Madison is in Philadelphia, Pennsylvania.

What's going on, Madison?

Hi.

I am a teacher and my husband has a pretty good job in the city.

And we have a son and I had no intentions of being a stay-at-home mom, but now after a year and a half, I would love to be a stay-at-home mom.

Love it.

Love finds a way, doesn't it?

Tell us the limitations you feel you're facing in doing that.

So being an educator, I have really good health benefits.

I have a decent amount of time off in the summer and holidays.

So I do feel like it is a best case scenario job being a mom, but

we have a house, so we did our whole like budget and everything before we had the baby off of true income.

Of course.

So to go down to one income, I think, is terrifying.

What does it do when you were to go if you were to go down to one income, what does that do mortgage-wise for you?

So what percentage does your mortgage eat up of that one income?

I would say my salary covers the mortgage.

So, what's your husband's salary?

$120.

Okay.

So, what's he actually taking home every month?

That's a month he is taking.

Oh, my gosh, I feel like I don't even know.

That's okay.

Is it like

seven or eight?

Yes.

Okay, so let's say $7,500.

And then how much is your mortgage?

Our mortgage right now is $3,300.

Okay, yeah, I mean, you don't, it's, it's, that's tight.

Edging up to half of your income, half the take-home pay going toward that mortgage, which is a lot.

Now, is that, does he investing right now in his 401k and is he covering some health care premiums through his checks?

Um, yes.

So he, unfortunately, he can't be on my health care, so I cover it for my son and I.

But yeah, he is a big in retirement, like he is putting money aside and all that stuff.

Also, he puts money into an account for our son's education.

Okay, I just want to be clear that our 25% parameter is about your after-tax income, but before other deductions like health care premiums or retirement investing, which could help your numbers.

It could help them a lot.

So that, I think that'd be your homework is go home and find out what that number is.

Again, just the after-tax amount, like George said, and then say, okay, what percentage will our mortgage be of that money?

Now, if you're like 30, you're fine.

Like you can make that work.

Even maybe up to 35, you possibly could make that work for.

Well, like nothing's on fire.

It'll just be tighter and a little bit slower to get through the baby steps.

But if you start creeping to the 40s, you're going to really feel that.

So, my next question for you would be: do you guys have any debt?

So, right now, we just have our mortgage and my husband's student loan debt, but those are the only two debts that we have.

How much is a student loan debt?

$90.

Girlfriend, how are you going to save that to last?

By now, he like doubles what he puts towards a student loan.

We're on track to have that paid off in seven years.

Can I challenge you guys?

That plan sucks.

So, what I would have him do is pause investing, which is going to hurt his soul, isn't it?

Because he loves investing.

Yes.

You know what else it does?

Lights a fire under him to get rid of those student loans so he can get back to doing what he loves, which is investing.

Because right now, he's essentially borrowing money to invest.

That's what you're doing by delaying your debt payments to invest instead.

Okay.

So,

Madison, is it one baby or two?

We just have one right now, but love the idea of one more.

And we're also, I feel like it's like a blessing and a curse, but even if we had another baby, my, my salary is still more than child care would be.

So

I feel physical pain when I'm away from my job.

I get it.

Listen, you're preaching to the choir.

I understand.

Those, the, the mortgage piece of this is a very large piece of this puzzle and you doing the due diligence with your husband to figure that out.

And the $90,000 of student loans is a big piece of this puzzle.

If I were in your shoes as a mom of two and understanding what it feels like to leave babies at home, I would play out both scenarios because there is a piece of this that

the relational part matters.

You wanting to be at home with the kids and having that time, that matters.

But quality of life throughout that time also does matter, right?

So if you keep the $90,000 of debt and the mortgage is 50%, that's just you literally being at home with the kids because y'all don't have any money to go anywhere.

So, there's part of this where you do want to play that on and go, what would it look like?

Maybe just six more months of working could really change this scenario.

Maybe 12 more months of working could really turn this around to where we could pay off this debt.

And then, when we have baby number two or during that period, do you see what I'm saying?

So,

I don't think that I would jump right into this if you care whatsoever about how staying at home feels financially.

But again, that's for you and your husband.

I mean, I don't think there's,

there's not a wrong answer or, does that make sense?

Yeah, well, I mean, there's a math problem here, and there's also an emotional, non-logical thing here, which is I just want to stay home with that baby.

And if you're really wanting that, then it's going to require sacrifices.

And those sacrifices might mean, hey, we need to downsize the house.

You need to go make more income.

And or you need to do something part-time when he's at home washing the baby.

If you want to make this work for now.

Now, if you get out of debt and you have an emergency fund, it's going to change the game for you guys and reduce the stress.

Do you have money saved?

How much?

Yeah, our

savings account right now is like $17,000.

Okay.

Okay.

So essentially, that kind of puts you, you know, gives you a little boost on the debt because if you choose to do it our way, which I did it this way, George did it this way,

what we do is we say, okay, we keep $1,000 aside.

That is just our temporary basic emergency fund.

And everything else goes towards our debt so we can get it paid off really, really fast.

And so for you to do that, yeah, that drops you down.

And now you're in the 70s instead of in the 90s.

And you can clip through that a lot faster, especially if you're both working.

And he pauses investing and he pauses.

And you guys throw a little over four grand a month toward the student loans.

Well, they're gone in 18 months.

A few months later, you have your emergency fund.

So now it's like, okay, what if in two years I stayed home once I have the second baby?

And for now, we do the daycare thing or we find an alternative route for child care.

That might be the way you go.

I'm not saying you guys don't decide you're not going to do it today.

But if you want...

peaceful finances in the meantime and both of you aren't stressed out to your eyeballs, you might want to just go, hey, we're going to still accomplish this dream, but here's the timeline and here's what we're going to do.

We're not going to do 19 things at once.

We're going to do the baby steps with focus because we both agreed this is the priority.

And it's getting me to this place.

If I was voting on your situation, I'd vote for plan number two, which is you get everything on the right footing, you pay off the debt.

Maybe it takes a little bit longer, just you and the workforce a little bit longer, and then that's what I would do.

And I did have one more question.

So, everyone talks to me all the time about this magical pension that eventually I will get.

Is it worth getting, like, giving that up?

The teacher's pension?

What was that?

The teacher's like your teacher's pension

yes I mean when you say magical I would say no because I mean don't get me wrong it's nice to uh contribute to something and have funds there but the best way that you can re uh to me the best possible way is when you have more control over the funds so if you're contributing the same 15% and you're choosing the funds in a Roth IRA or you know you open another vehicle I think that that is just as great what Jade's trying to say is pensions perform very poorly and they die with you.

But if you invest on your own, you're going to see higher returns with more control and you can pass that money down generationally.

And so pensions aren't that they're not all what they are cracked up to be.

Hey, if you got one, great, I'm happy for you.

But I would not stick with this career for 25 years and

let down the dream of being a stay-at-home mom all for a pension.

You can create your own wealth and your own sort of passive income through your nest egg later on down the road.

And so this is going to be a tough conversation with your husband.

I feel like you're more on board to do whatever it takes.

And he might be like, oh, I'm not giving up investing.

Forget what those Ramsey guys said.

I know better.

Right?

Let him listen to this call.

Yeah, I will.

And we grew up very differently.

He was definitely had a little bit more heartache financially growing up.

And I, my parents were Dave Ramsey fans.

They kind of instilled that in us.

Okay.

So we have different like life

upbringing.

So I think it scares him to go down for one income where I'm like, let's just take the risk.

Well, it won't be a risk if you do it the right way, which is what George and I talk about.

We're getting about close to the dock if you follow the baby steps with intensity for another 18 to 24 months.

We are rooting for you to be at home with that baby, Madison.

Best of luck.

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Live from the Ramsey Network, this is the Ramsey Show, where we help people build wealth, do work that they love, and create amazing relationships.

I'm Ramsey personality George Camill, joined by best-selling author Jade Warshaw, and we're taking your calls at 888-825-5225.

Aaron is in Danbury, Connecticut.

What's going on, Aaron?

Oh, hi, George and Jade.

So nice to talk with both of you.

You too?

What's going on?

I, yeah, I wanted to run something by someone else that I've been thinking about.

A plan my parents told me they're going to do for retirement.

And I'm just trying to figure out if it sounds like at best it just has some pitfalls or if at worst it's sketchy.

Okay.

All right.

So they have found a retirement community that they think is spectacular.

They've put a little

down payment on a waiting list.

And they told me about the entrance fees.

And I can't understand the idea of a refundable, scalable entrance fee.

What do you mean?

Like every time you drive up or like a club fee?

Oh, no, that's a good question.

No, like a down payment on living there.

Yeah.

So you could pay, like, for example, $400,000 for a two-person condo and you don't get any refunds.

Or you could pay like almost a million dollars and get like 90%

back in a year or something.

To be on the waiting list, you're saying,

well, after the waiting list, this would be like they would pay a huge sum of money to these people, but they have a choice.

Like

help me understand.

$400,000, for example, and not get any.

Well, that's what I don't understand.

Are you talking about a down payment on the house?

Are you talking about like a

fee for being part of the club and having amenities?

Are you talking about some sort of fee to be on the waiting list?

It's like a retirement community where they're going to plan to live for the rest of their lives.

Understood.

So it's like just to live there forever.

So you're saying they're going to pay $400,000 on top of the price of the home just to live there.

Right, on top of the monthly fees, yeah.

But the people who go up the sliding scale and pay like a million dollars get like some kind of 90% refund after a year or something.

Just seems really weird to me.

I'll be honest, I'm having a hard time understanding it because I don't think you also have all the information.

Like, now have you talked to them personally?

Well, so that's yeah, so that's a good question.

And I don't have powdered butt syndrome.

I'm not going to tell them what to do at all, but I'm trying to like gauge where

it could potentially affect my my life.

Like,

oh, do they have this kind of money?

It might be like most of their nest egg.

Yeah, when they, yeah, when they go.

I mean, does that include the residents?

Is what I'm trying to find out.

Does the 400,000 include where they will actually live?

Yes.

Okay.

And then like a monthly fee on top of that.

So they're paying $400,000 for a townhouse?

Is it a condo?

Is it a single family?

What is it?

Right.

It's like a single family, but they won't own it.

It's just then they get to like move when they get a little older into like another dwelling.

Because the idea is this is essentially the last place you live.

Understood.

Exactly.

So it's like a ladder.

Yeah, there's like a ladder for the entrance fees, which I don't understand.

And then

I would get clarity on that.

I would say this isn't.

It doesn't sound like they're trying to scam you.

This is pretty normal in the retirement community field.

But this is kind of like a really high sort of HOA country club fee to buy in.

That's really what's happening here.

And it's covering their long-term future operating costs.

And, you know, it's very capital intensive to run one of these places.

And so that's kind of the skin in the game fee they charge to get in, knowing that you're going to be here for the rest of your life.

And we have to care for all of your needs.

The question for you is, how does this reflect on you if they change their mind or if they are they going to be broken five or ten years if they do this?

That's the scary part.

What happens if this company gets sold and the rules change or it goes bankrupt?

Oh boy.

I mean, I feel like we have to see the bylaws or like, I feel like I'd want to read that in the contract to find out is there.

Is there any language around that, that sort of thing?

So maybe just ask him, say, hey, you've been talking about this community.

Can I go with you to your next meeting with the rep or however they're going?

And get your eyes on some of the literature so you can read through it instead of going off of, because you know how sometimes your mom will explain something and it's like wait what and they leave things out because they understand it but they're leaving big chunks of it out so maybe if you can just get in one of those rooms in one of those meetings and get your eyes on the actual papers and contracts you it'll make a little bit more sense yeah and i would also look into alternative options for them this is just one and so i don't want them to get too starry-eyed because they were sold on the brochure and the landscaping kind of like what kids do with college they're like oh my gosh it was an amazing tour and the people are so nice yes and they're charging five times for that versus the place down the road.

So I would look into other options.

I would also research, just start researching entrance fee for continuing care retirement communities and you can learn about it online and kind of get your bearings under you before you walk into that meeting so that you're more equipped.

Or you could even call the place up and say,

you know, keep them anonymous and say, hey, my parents are going to be living here.

Can I come down there and can you walk me through

all of it so I understand just treat me as though I were somebody who was going to move in here?

And that way, you could understand it.

Yeah, that's a good idea.

And see what the options are for waiving it.

What happens if they don't pay that?

Is there no way to get in if they don't pay the upfront fee since there's varying levels, anyways?

So I would just look into all the options and do a whole bunch of homework.

Wishing you the best of luck.

You're an awesome daughter for doing that.

Corey is up in Florida.

What's going on, Corey?

Hey, you guys.

Wow.

I'm so excited to talk to both of you.

So thank you for taking my call.

Yeah, we're happy to talk to you.

What's your today?

So, I am a 27-year-old pilot, not currently working in aviation.

My wife and I have $328,000 in debt.

Mostly, it's a $246,000 mortgage, $52,000 in student loans from flight school, and $23,000 truck loan.

We make about $110,000 a year combined, bringing home $7,430 a month, no kids.

And

my question is, I really want to get back into aviation, but as you know, I think you've heard you guys talk about it maybe once before.

Aviation is very expensive, and it would take a lot for me to get back into it.

Maybe just, I have a commercial pilot's license, but it's like I'm not quite

experienced enough.

I don't have enough hours to really get a job right now.

What's it going to cost to float that gap?

I think

being realistic, if I paid for all of it, it'd be about $15,000, I think that I could really,

you know, I could get some time in and, you know, pay for some of it just to get back into it.

So $15,000 gets you to the dream job with making more money?

In part.

Okay.

Yes.

What's your truck worth?

It's going on the market tomorrow, by the way.

It's worth $22,000.

I'm cleaning it up to take some pictures of it.

Honestly, we just got blessed with

her parents wanted to give us uh a car and her sister wanted to give us a car so we're amazing two cars coming in um that are reliable

freed up truck payment why don't you use that and commit that to savings and save up that 15 grand to get you the education and uh then you'll tackle the student loans that's all that's left other than the mortgage so the the debt's not as much as you think you can tackle this pretty fast get aggressive with it to get to that pilot job and hopefully you can double your household income man.

Cheering you on, love that.

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All right, today's question comes from Carl in Georgia.

He says, I'm very disappointed with what you advise regarding combining all funds together when married.

What about when you've been married less than two years and the couple gets later married later in life?

My wife showed me your video and says she wants her name added to everything I have.

Do you think I'm supposed to put her name on everything I had before marriage and then she gets half of that if we divorce?

This caused a major problem and she has moved out.

No man on earth would give everything he had before marriage in his wife's name.

Please explain yourself.

I love this question so much from Carl.

Listen, Carl,

I'm going to have to take a quick breather because Carl, Carl, it's making me mad.

I just love that Carl in the question blaming us for the dissolution of his marriage is very telling about how Carl acts in his normal everyday life.

Carl, I'm going to tell you,

just because something is your second marriage doesn't mean it should be no, have no, you know, it's a marriage is still built on the same things.

A good marriage is still built on the same things.

It's still trust, right?

There's still those levels that need to be there.

So clearly, even in your second marriage, you're like, there's something about this woman that I don't feel like I can trust her because you're not willing to share your finances with her.

You're not willing to put her name on your assets.

And you're already anticipating a divorce because you're saying, well, what will happen when we divorce?

And I don't know about you, but I don't feel warm and cushy going into a relationship like that.

Now, don't get me wrong.

There are some things that we can plan for.

Let's say he had millions and millions of dollars, second marriage.

He's got children and she's got, you know, the person he's marrying has nothing.

There are some caveats in there and some nuance that can be discussed, but it kind of just sounds like you guys are just kind of like two

folks, like two regular folks, like me or George.

And it sounds like Carl was already on thin ice.

And then she saw this video and went, Hey, here's what these Ramsey people said.

And that sort of exposed the deeper issues in the marriage.

Even like that.

If she said, Hey, I want to combine everything and that made you mad, you must have gone, you must have given her the smoke for her to just up and move out, is what I'm saying.

So you already were feeling some type of way about this whole idea.

So the problem, my friend, is not with George or I.

The problem was you signed up.

The man in the mirror.

The problem is the man in the mirror.

I know that's right.

Here's my thing.

If I buy a house the day before I get married and then I go, hey, Whitney, not putting your name on this house, but you better pay half the rent, half the mortgage.

Also, you're not getting any equity in this house because I owned it before we were married.

Oh, Lord.

Oh, gosh, that's a recipe for a beatdown.

I'll be lucky to sleep on the couch in my own house.

I know, that's right.

It's just that

attitude.

crushes relationships, it crushes marriages.

Yeah, there's zero trust there.

And

it's kind of like the opposite.

You know, here we quote Zig Ziglar, if you aim at nothing, you hit it every time.

It's almost the opposite.

If you're aiming at something to dissolve or possibly divorce, it's like, then that's likely what's going to happen because you've put that out there.

And it's almost like you've created a target of when we divorce, when we go our separate ways.

And there's no way that you can avoid that.

I mean, I don't know about you, George.

When I was married, the advice I got was you never even need to say the word divorce.

Like you just need to, don't even put it in there and just act like every problem is a problem that can be solved.

And I mean, we know there's limits here, but do you see what I'm saying?

Here's the funny thing.

If you live your life and live your marriage with the gloves up in front of your face, eventually you're going to be in a boxing match.

100.

Love that, George.

That's how it works.

But when you live your life, hands wide open, hey, there's no ring here.

We're all in this together.

We're on the same team.

Amazing things happen.

You build wealth exponentially together.

And that's what my wife and I have done.

From day one,

we had one joint checking account, one joint savings account.

Her name's on everything.

And this is harder to do later in life when you've lived independently and you go, well, this is my money that I earned.

And whatever she earns, she can do with that, what she wants.

What happens when she stays at home?

Well, then, I guess I'll give her an allowance.

Okay, so you're going to treat your wife like a child and hope this marriage is successful.

Good luck with that, bro.

Good luck with that.

That's what we've seen happen in reality.

So, Carl, I'm sorry that I really hate that this is happening.

I hope there's hope for this marriage, but do not blame us because because the problems were exposed in your marriage.

Yeah, he said no man on earth would give everything he had before marriage in a wife's name.

I don't.

Listen.

I think you've created a category unto yourself, Carl.

I thought I liked every Carl I've ever met

until this one.

Carl.

Whenever I think of the name Carl, I think of On The Walking Dead, and the son's name was Carl.

I was thinking Carl Winslow, and that's very telling of ourselves.

Carl Lagerfeld.

There's a lot of great Carlson.

I've got a lot of fun that.

A lot of great Carlson.

Sports reference?

No, fashion.

Oh, okay.

Sports and fashion, the two things I missed out on.

Carl Lewis.

Track.

0 for 3.

0 for 3.

All right.

Justin is in Huntsville, Alabama.

What's going on, Justin?

Hey, so I'm calling in today.

I've just got a brief question.

I'm about to get married in about a month and a half.

Woo!

My fiancé is in school full-time and working full-time.

She is carrying about $20,000 in student debt.

She's going to be a teacher.

I'm self-employed and I am debt-free, thankfully.

I have a little bit of money saved up and I do have some goals and aspirations we do

to make some investments, to leave things to our grandchildren, hopefully one day.

But I want to make sure that we're doing the right thing financially as soon as we get married

for setting ourselves up to reach those goals and how to take care of this student debt that she has.

I love that mentality.

How much money do you have right now in savings?

About $50,000.

Woo!

Good for you.

And the wedding is paid for?

Yes, her parents and my parents both have contributed to that.

Beautiful.

So it sounds like day one, after you come back from the honeymoon, combine the checking account and write a check and pay off the student loans.

Okay.

And then you still have an emergency fund on top of that sitting there, right?

Well, the $50,000 was

$50,000 minus $20,000 for her student loans.

You still have $30,

absolutely.

Absolutely.

Is that three to six months of your basic budget?

It should be.

I mean,

it takes about $500 a month

for me, and then for her, we're thinking it'll add another $300 a month.

How are y'all living?

You living like a shoebox?

My grandparents worked really hard, and my dad and I are business partners together.

And my grandparents are a lot of people.

You're telling me your entire expenses to run your life is $500.

I live pretty cheap.

I drive an old truck.

How old are you?

I'm a landscaping company.

You rent?

23.

Okay, so you're still on your parents' insurance, still on their health insurance, still on their car insurance.

What are you paying for?

A phone and food?

Actually, no,

my business pays for everything.

I've got it set up that way.

My dad and my business covers

everything, phone, insurance, all of that.

But if you run the business, isn't that profits you would have taken home that are going out as expenses?

In regards to the business itself, just

can you restate that?

I'm sorry.

Let's say you're paying $100 for the phone through the business.

That's great, but that's $100 you're not taking home that you're instead putting out there as an expense.

So I just don't want to pretend like you have no expenses.

When you really do, you're just running them through the business as sort of a write-off, I imagine.

Exactly.

So it's covering your utilities.

It's covering your

vehicle and your insurance and you're on your parents'

health and medical insurance.

So yeah, you have low expenses.

Just remember, it's not going to stay that way.

Yeah, 30,000 of an emergency fund is perfectly fine.

So which means as soon as you're married, you're debt-free with an emergency fund.

Now we can begin investing for retirement, 15% of our household income, and saving up a down payment for a house as a newlywed couple.

You guys are in great shape, Justin.

I'm cheering for you, man.

That's awesome.

Way to go.

She's lucky to have you.

You're lucky to have her.

That's the kind of marriage you want, where you both feel like you've got the longer end of the stick.

And when he's willing to put her name on the stuff.

That's right.

He's combining finances day one, unlike Carl.

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Welcome back to the Ramsey Show.

I'm George Camel, joined by Jade Warshaw.

Give us a call, 888-825-5225.

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Tony is in Indiana up next.

What's going on, Tony?

What ails you?

Hi, how are you guys?

I appreciate you taking my call.

Sure.

So this coming weekend,

we've got my mother-in-law moving in with us.

You sound stoked about it, man.

Well,

I'm trying to not have it affect me financially,

not have it affect our marriage.

You sound like a puppy whose tail stopped wagging.

So, why is she moving in?

What's going on?

What's the impetus for this?

She's had some substance abuse issues.

Okay.

And we have convinced her to sell her condo so she's at the point where she can walk away, pay all her debt and not owe anybody anything.

She'll probably have a few thousand dollars to her name, so she won't be hurt that way.

So we're trying to help out and do the right thing.

And then is she working?

Oh,

no.

She hasn't worked since October.

How will she get help for the substance?

That's been a thing, too.

It's kind of voluntary, so

there hasn't been any progress there.

What do you mean, voluntary?

Well, I don't think they can make you go into a program.

You have to do it on your own.

But that would, I mean, if someone is moving into my house who has a history of substance abuse, there's no way I'm letting them in the front door unless there is clear progress towards healing.

AKA, she is in a program.

She's in AA, rehab, whatever it may be in her situation.

Yeah, do you have kids in the house?

We have two kids, yes.

That's a no for me, dog.

Yeah, that's a no, even for your mother-in-law.

I guess that's the biggest thing I'm wrestling with.

It's my wife's mother, so yeah, I mean,

you're creating an unsafe environment at that point.

What's the nature of the substance?

Is it like alcohol abuse?

Is she on like opioids?

Hard drugs?

No, it's alcohol abuse.

Okay.

I think that you're, you,

this is hard, okay?

So I'm not, I don't, I, I don't want to say anything it's

you know I'm not trying to be trite here but

alcohol that that has an there's an expression of that right when she's under the influence of that and she has not said that she wants help with it so you have to know that she's going to be in your environment under the influence of alcohol and i don't know how she how she expresses that is it anger is it rage is it does she get really quiet i don't know what that is but you now know that your kids are going to experience that as well so that's the part where I,

unless she had said, I would like to get help, I would like to go to rehab, that could paint a different picture, but she has not said that.

So, part of me wonders if you guys are not letting

consequences associated with her actions hit her so that she might then say, you know, I do need help.

And I'm not, you know, I'm not, you know, I wish Dr.

John was here.

Matter of fact, if he's around here, roll him in.

John, come on in.

But

there needs to be a clear plan here of saying, hey, there's going to be a clear sobriety expectation.

We need to have a plan.

What happens if there is a relapse?

We need to talk about all of this up front before any of this happens.

Yeah, we've had that discussion about sobriety and being in the house.

I just, I'm worried it's going to fail pretty quick.

Well, because she's not been, like, she's not shown that she can do that.

Is she

willing and able to work?

I want to say yes, but I mean, the fact that she's been unemployed for, you know, almost a full year now makes me question otherwise.

I mean, a lot of it for me,

that would be another expectation.

You're going to be working 40 hours a week if you're going to be living with us while staying completely sober.

Yeah, otherwise, what do we do with a mother-in-law and I was completely detached from the situation?

It would be a lot easier for me to make the call of it being a no.

But like you said,

it's a tough situation, and I just, I want to not be like, I don't know.

It's not you being a journalist.

It's you setting the boundaries.

And if she can't adhere to the boundaries, then that's her opting out.

But why does she have to live with you?

I understood her selling off the house to get out of debt.

Why can't she now go to an apartment?

And you guys say, okay, we took the, you know, you had a couple thousand left off of the sale of your house after paying off your debt.

That's your, you know, down payment on your, on, on your apartment, first and last month's rent.

And then, mom, it's up to you you to keep this thing rolling.

You got a fridge full of food.

You got this.

It's up to you to keep it rolling.

What does her living with you do?

Because you guys are not addiction specialists.

So what does that, I'm trying to understand what does her living with you provide for her other than

a roof over her head.

But she can have a roof over her head.

In theory, but she hasn't been able to maintain a job since past October.

So are you on the path of homelessness at this point?

But has she ever gotten that close to where it's like, I'm on the street?

Do you think that she'll let herself get that close?

I honestly don't know.

I guess

we haven't gone that route of just saying good luck.

You may have to see because if she's given, okay, your debt's gone.

Here's your apartment.

This is a

rent that you can afford if you just go out and grab a job at Walmart.

Everything is here and you've gone over the budget.

Here's what what you need to earn.

Here's some of the places that you can apply.

It's up to you, mom, to go.

Like, you know, maybe you fund her first month and it's like, it's up to you to keep this going versus you just giving her.

Does that make sense?

And you're also putting your family in a very precarious situation.

Yeah, I would not do some kind of handshake.

I'm not really incredibling in a way.

Well, what I would do personally, and this is not to be cruel, but I would have her sign a house rules and sobriety agreement that has very clear stipulations, very clear checkpoints as to what's going to happen and what happens if she doesn't comply.

And that's just to be kind.

Because you've probably heard this phrase, to be unclear is to be unkind.

To make up rules on the fly and kick her out when she's like, whoa, I didn't know.

And so just lay it all out there and say, if you're going to move in with us, it's going to be you have 30 days to get a full-time job.

If you don't, you're going to need to go find your own place.

That's it.

And if you don't remain sober,

if there's alcohol in this house, you're out.

If you come home drunk, you're out.

Game over.

And then it's up to her.

She's a grown woman who makes her own decisions.

It's not you being cruel.

It's you saying, here are the rules so that we can create a safe environment for our family, which is your priority.

Yep.

And your wife needs to be on board with this too.

It can't be like they're ganging up on you and they don't agree.

You and your wife need to be in total alignment walking into this as a United Front.

Yep.

And I guess that's my biggest fear.

I feel like this is going to go bad in some sort of way, and I just don't know which way it's going to go bad.

And we've had a great marriage so far, and I don't want it to be affected by somebody else's poor decisions.

Listen, I'll be honest with you.

And I think I'm willing to stand on business that I don't think I would bring her in.

I think a caveat to me bringing her in and doing George's deal would be you must go through rehab first.

That would be,

once, if you, mom-in-law, if you do that, you can come stay with us.

And then when you come stay with us, here are the rules.

But I don't think, I don't think I could, like you said, invite that level of chaos.

Like you said, because it will affect your marriage.

It will affect what your kids see.

Like that is, I feel like you got to hit this rehab first and then we can talk about it.

And your spidey sense is tingling.

That's all very valid.

And if your wife disagrees with this, I think she's kind of a little starry-eyed by the situation, just wanting to help her mom because she's a sweet daughter.

But you guys need to be united on this.

This is going to be a lot of discussions, a lot of homework, figuring out: okay, what does this contract say?

What must be true for her to live with us?

And if she doesn't comply, that's her opting out.

You gave her the choice, but we're not just going to give her carte blanche to do what she wants in our house and bring invite crazy in when we've got young kids.

No, thank you.

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Titus is up next in Pennsylvania, Pottsville, to be exact.

Okay.

It's exciting.

Titus, what's going on?

Hey, thanks for taking my call.

Absolutely.

How can we help?

Quick.

Yes, quick question.

So basically, looking for some financial advice here, would you take or would you pass?

28 years old, married, two little boys.

We're farmers here, and my dad is getting older.

He's ready to transition the farm.

He is offering to us bank appraised $2.7 million.

It cash flows between $360,000 and $400,000 a year.

He's offering it to us at $1.9 million.

My situation is

I own a 50-acre farm

and they said it's appraised at 805.

I owe just under 600 on it, so basically 200 grand in equity.

Would you sell your 50-acre farm and buy his?

Is that the plan?

That's correct.

Yep.

Okay.

And you said it's appraised at 800?

That's correct.

Yep.

Okay.

So you'd walk away from your farm with about 150K, maybe?

Probably 200.

$200 to put down on a $1.9 million deal?

That's correct.

But you're saying it's going to increase your income by $400,000 a year.

Or would that replace your income?

That replaces my income.

The other caveat is

it's not completely a full-time job.

It's like a 40-hour a week job.

I could probably pick up another 20-year-old.

That's full-time to city slickers like me.

But I guess to the farmer, you're like, no, that's part-time.

I normally do 60 to 80.

That's right.

Yeah, yeah, that's where you go.

That's interesting.

I mean, it sounds like it's a good deal.

Is he in good health?

Is he just retiring?

He's retiring.

Yep.

He's off to some other enterprises.

Okay.

I'm just trying to figure out.

There's some real estate stuff here that I would want to at least ask a tax pro, maybe even a real estate attorney to figure out, which is step up and basis.

And if you inherited this instead of purchasing it, but it sounds like he needs the money.

That's actually, we've been working through that.

Um, yeah, there is some interesting things there that can be done with inheritance.

Yeah, what did he buy it for?

He will, he so he bought it as a bare field for like $200,000 and built every building that's on it.

So it's a poultry-raising operation.

We raise about 700,000 chickens a year.

And it's all the money is basically in the facilities there.

Wow.

Have you run the numbers on taking out a $1.7 million mortgage for this?

I have.

I'm looking at like $130 clear after running the operation and paying the mortgage.

Interesting.

And what are you making?

What are you taking home on your current farm?

So I'm working full-time

away from the farm.

And I just do the farm on weekends and evenings.

I'm making just around $100K.

So all this for a $30K bump?

But you would be working less, you said.

Yes.

And I would lose my 100K salary now and just go to the 430, to the

360 to 400K, I would make that.

That would be your gross salary for the year.

That's correct.

Yep.

What does your wife think about this?

She's good with it.

We love the farming lifestyle.

We like

living in the country and raising our people age that way.

Yeah, 100% on board.

Wow.

I mean, on paper,

if you've run the numbers going, hey, our income is going to increase this much.

We can very comfortably afford the payment on this farm.

It's going to consistently yield this.

You know, there's definitely more risk with this situation.

I mean, you still owe that lender regardless of the harvest.

You know, you know the farm life way better than I do.

I'm beyond my skis on this one.

But I would get the advice of multiple experts in this field.

No pun intended.

Is it more about half the work?

Is that the biggest allure?

No.

The allure is basically we could own our own operation.

I can be at home.

Once this thing is paid for, I can be at home full-time with the family.

But wouldn't you be able to do those things?

Wouldn't you be able to do those things quicker if you stayed in the farm you had?

Because you'd owe less?

Well, I'd have to get a job, basically.

So I'm working on this farm full-time, and that's where my salary is coming from.

And so if I don't want it, dad's going to sell it.

And at that point, probably, you know, I I don't keep my job there.

And I'm taking a lunchbox somewhere.

Do you also lose benefits that would affect your family?

If you're just farming?

Not necessarily.

I mean, yeah, no, not necessarily.

I'm not against it.

Okay.

Because here's my thing on paper.

You're tripling your payments and tripling your income.

So I just don't want it to be a kind of like a net wash in the end where you're going, hey, we're making great money, but man, it's going way back out.

And there's a lot of upkeep here.

That's kind of what it sounds like.

That's why I can't understand why I don't really see the benefit other than the less hours of work.

How I run the numbers, I could, if I pick up a part-time job, I can have it paid for in maybe 15 or 16 years.

And at that point, you know, I have no debt and it should be all just straight income.

That's a long-term plan for something that is very physically taxing.

You're like, well, 16 years from now of me working 80 hours a week, hopefully we can be debt-free.

Can we go back to your current farm for a little bit that you work on the weekend?

You just said you do it on the weekends.

Is that what it is?

That's correct.

Yeah.

What would happen if you poured 40 hours a week into that farm?

It's difficult.

So it's difficult making a full-time living on a small farm.

Understood.

It can be done.

It can be done, but you're working 80 to 90 hours a week.

for probably you know an 100 to 125k return okay so your acres are limiting your output obviously next question, what does dad do if you don't go through with this deal?

What's his plan?

Probably puts it on auction.

Ooh.

And takes the 2.7.

I just don't want you to do it to help out dad.

Obviously, he's giving you a deal on this.

Would he sell it for 2.7 million if it went to auction?

Yes, it would go to that.

Wow.

Whew, man, these numbers just kind of, you're taken aback by it.

And so it would definitely give me pause.

I would want to just cross the T's, dot the I's, get seven people's eyes on this thing, have everything drawn up, contracts, lawyers, make sure it looks good on paper, run the number seven times in the budget before I would make this leap.

No dad.

Because it's going to add stress.

I feel like I've done that, but I just wanted to get your opinion.

What about the, sorry, one more thought.

So the living situation, when you go to your dad's farm,

is there a residence that you'll get to live in?

How does that play into all this?

Is it

very much inhabitable right now?

Your family would love it?

Or is it going to cost $100,000 to renovate it?

No, it's very much inhabitable.

Very nice house.

Okay.

Whew.

Yeah, the big red flag to me is the step up and basis inheritance piece.

So I would talk to a real estate attorney on that one and a tax pro to understand the implications of this deal for both your father and for you.

But man, if you're, you know, you've done the math, your sites are set on this thing, and you've crunched the numbers, your wife's on board, your family's on board.

It's undoable in a sense.

Like, if you hate this place and it's a nuisance, could you sell it for 2.7 million a few years from now?

I could, yep.

But you wouldn't because it's too sentimental at that point, isn't it?

It's dad's farm.

He wouldn't have wanted this, right?

I would forfeit some collateral with

my parents' relationship there.

Yeah, I think

you would take it over and then I would cash out the 800K.

And then, yeah, you make all the profit.

Dad did it.

He's gone.

wait, I gave that to you.

So that's the other part of this you need to think through: is the what-ifs and the feelings and the relationships and what could be damaged if things don't work out perfectly on paper.

That's a good point, George.

That's all we've seen so far is on paper.

But life, as you know, exactly is much more than that.

So, man, I mean, it's a sweet deal.

You're basically getting, quote, free $800,000 in discount from dad, which is nice, but it's also still a $1.7 million mortgage, hoping that we can still create this level of income consistently.

But it sounds like you're willing to do the work, get seven jobs if you have to to keep this dream alive.

So

you have a green light for me, but it's sort of like it's caution.

It'd be a flashing yellow.

How about that?

Flashing yellow for me on this one.

But man, you know more about this than I do.

So again, I'm beyond my skis.

But man, it makes me want to get on a farm, Jade.

Do you think I could survive out there for at least an hour?

Oh, no.

If it was 70 degrees in the shade and I could only lift like things under 50 pounds, I could be out there.

You could be out there out there.

Yeah.

I'll take your word for it.

I'd wear some skinny jean overalls.

Make everyone upset.

Hey, what's up?

Dr.

John Deloney here.

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From the Ramsey Network, this is the Ramsey Show.

I'm George Camill, joined by Jade Warshaw.

This is the show where we help people build wealth, do work they love, and create amazing relationships.

Christian is in Denver coming up here.

What's going on, Christian?

Hi, there.

Thank you very much for taking my call.

So,

sure.

Yeah, I'm in a bit of a pickle situation.

I have an older sister who started a business under my name in LLC and

under her covert time.

Yes.

Is it your business?

It's not my knowledge.

Did you know that she was doing this?

Yes.

I consented

because

I know she asked me as a favor kind of thing.

Is this like a co-signer for debt?

I don't understand how this was a favor.

Why did she put her own name on it?

I was like, I'm not sure what she was doing company, And it was kind of so that she didn't have

she's a bit of a

con artist, and she did it so that she didn't have too many businesses under her name.

Oh, what?

And you agreed?

Yes,

like an idiot.

Yeah, I was going to say, what does that say about you to work hand in hand with a known con artist?

I know.

I didn't think it would have caused this many issues.

Yeah, she's in a loan out.

Tell us the issues you're facing.

Yeah, so she

during, and then years later, COVID happened, and she decided to take a loan out under this LLC.

And so as you found out, she just hasn't been paying it at all.

To use for personal whatever?

Just blowing money?

What was that?

What did she use the debt for?

She personal.

Personal uses, she did not use it for the business.

So she's been fraudulently starting LLCs, taking out debt against that to then spend personally.

Yes.

And then you were like, sure, I'll help you out, sis.

I'll be an accomplice to this crime.

Yeah.

So how much money?

Unfortunately.

How much money?

How deep is she in this?

Yeah, the loans.

It was two loans.

They were a total of $122,000.

And now with interest, they're about $135,000.

You do understand that you're the one liable here.

You're the one who's going to get sued.

You're the one who's going to have your credit totally trashed.

I feel like there's a legality there, too, because it's completely.

The debt is in your name, correct?

Yes.

Oh, my God.

And

there's no operating business.

It's just totally fake?

Now, there was, yes, there was an operating business, and she ended up losing that business in 2022.

Moving it to where?

She just lost it.

Oh, lost it, losing it anymore.

I misunderstood you.

Yeah.

Okay, so you mentioned earlier that she has done a lot of this.

How many times, how many fake businesses or failed businesses has she run through?

Well, under this LLC with my name, she started off as

a retail shop selling candles and things, and then she ended up doing

a barbershop salon.

And then you said she also had a construction business.

And then she, yes, she also had a construction business, which

I'm not even sure if she had that under her name, but she.

Do any of these businesses still exist?

They're actually operating day to day?

Nope.

Now, can I ask you a question?

What in the world would make you say yes to this?

Where where was your mind at?

We've spent enough time talking about her.

Tell us about you and what would cause you to agree to something so like clearly

bad.

Yeah, she was just like when when she first convinced me to do the lo the the business under my name, she she pretty much was just saying like this is going to help your credit out.

Um if you need to take a loan out in the future, this would help you out.

Um and you believe her?

Like, yes, like full.

Well, here's the bottom line.

If we're starting today, you're not going to refinance this in her name.

She's not going to do that.

And she probably can't do that.

That's the solution here.

She takes over the payments, refinances the LLC and all the debt in her name.

But she won't do that.

Have you talked to her about that?

I have not.

That would be, I would fight to the death to make sure that happens.

Because if not,

here's the bad news.

You're on the hook for $130,000 and you have to pay that off.

And you may as well fight to the death on the thing

that George just told you because your relationship's ruined anyway.

If she says, do you see what I'm saying?

The fact that she conned her own sister is disgusting.

First of all, it's despicable.

So this relationship didn't exist.

It was transactional and she used you.

And that should make you angry,

right?

What are you doing for work?

I'm a server, but I just

stopped working because I'm expecting the baby, so

I'm expecting a baby pretty soon here.

So, is that father in your life?

Where's dad?

Um, he's um, he has some mental health issues, so he's unfortunately not

going to support me much.

I don't think

So you're going to be a single mom?

Yes.

So we must, this is like, we must talk to your sister.

And she's got to understand.

You've got to put this in terms that she can understand and say, listen,

you tricked me.

And I am now in really hot water.

I cannot pay this loan that is actually your loan.

I have another life coming into this world that I have to feed and take care of.

You need to come down with me to the bank, and you have got to refine.

We've got got to refinance this so that you can take the payment.

Otherwise, you are effective.

That means you're effectively trying to ruin my life if you don't do this.

And that's what I'd say to her.

You're going to have to find the last ounce of empathy that exists in her body

if it's in there to convince her to do this.

Because you've got your own crisis going on.

The last thing you need is this.

Do you have any other debt?

Yeah, student loan debt.

How much?

Right now, I'm not sure, but maybe like $65,000.

What's that degree in?

Or what did you start school for?

That was a communication degree and a double degree and

business,

Spanish business

translating kind of.

Oh, okay.

So what what type of job were you hoping to do with that?

And can we still start headed towards that direction?

I mean, like interpreting, untranslating.

Have you looked for jobs in that field?

I have not.

No.

How come?

I don't know.

I just got used to the serving and making tips and just like I just stayed doing this.

So what are you doing for income now?

You just said you'd stopped.

Yeah, right now I'm not doing anything.

I just stopped about a week ago because how are you paying the bills?

Well, I just moved in with my mom

and I was able to save.

I have some money saved, and the worry is that the government will just like grab it.

Well, if you don't pay your student loans, they will.

And the creditors are going to come after it.

And so, Christian, I am heartbroken over your situation.

I'm going to gift you a session with a financial coach on us who can walk with you, you know, for much longer than we can on this call to try to unravel the pieces and find some hope in this very desperate situation.

I'm so sorry you're going through this.

Hang on the line.

Chris is going to pick up.

We're going to hook you up with a financial coaching session.

And start looking for translator jobs today.

We've all done dumb things with money.

I've done them with zeros on the end.

One of the biggest mistakes I see people make with money is not having a plan for it.

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Buying or selling your home is a big deal.

And there's a lot of clickbait headlines out there, doom and gloom, fear-mongering, conflicting data.

It's hard to know what's really happening in the housing market.

And so we're here to make the latest trends easy to understand.

Median home prices stayed steady last month at about 441,000.

The number of homes for sale hit a million for the second month in a row.

And buyers have more options than negotiating power and sellers are facing more competition.

Average 15-year fixed rate held steady at about 6% last month.

So if you're debt-free, you got a fully funded emergency fund, a solid down payment, now is a great time to buy and even sell your home.

So to learn more about housing market trends and get free tools to help you buy or sell with confidence, go to ramseysolutions.com slash market or click the link in the show notes and description if you're on podcast or YouTube.

Teresa is up next in Chattanooga, Tennessee.

What's going on, Teresa?

Hello.

Just down the road from you, we're hoping you can settle a marital argument.

Oh, we love juicy.

We love doing this.

All right, who's right and who's wrong?

I'm right, of course.

Perfect.

My husband and I are both 57.

We are both currently transitioning our careers, which is a little weird timing, but it's happening.

It's about time you had a midlife crisis, Teresa.

Yes, I know.

I've been in my job for 20 years, so it's a good time to transition.

We have two and a half million dollars saved

and we're debt-free.

Good cars, we're all set up for that stuff.

We have

$290,000 mortgage,

and my husband

thinks, says, Dave says, Dave says, all day long, Dave says, pay off the mortgage.

My financial advisor says, you're making about 10% on your investments.

Your mortgage interest is 4.25%.

Let's not pay it off and just be making the money on the mortgage money that's in the bank.

Can we play a fun game, Teresa?

Let's do it.

Who is incentivized for you to stay investing instead of pull out $290,000 to pay off the mortgage?

Who benefits from that the most?

And I totally agree with you.

Who is it?

Say it.

She does.

Exactly.

Your financial advisor is incentivized to keep you investing.

I was going to say that.

So just, I think it's important to have the full context.

And also, yes, we always say, hey, the market will generally do 10, 11% over the long haul.

But we also know the market could be negative 22% next year.

And so there's a forced savings plan with a known variable when you pay down the mortgage.

And we also know, and you know, it's more than just about math.

You'll have emotional peace as you head into what could be retirement in the next five years.

That's what he's, that's his thing, is to not have that hanging on us, especially in this transition time.

And we didn't factor in this.

You can now invest your mortgage payment when it's paid off, can't you?

Yes.

Have you calculated those numbers?

Have you factored that into the equation?

Well, no, because at the moment we're transitioning, so I don't have a real idea of what our income is going to be in the next couple of years.

Well, let's say there is none.

What if you have a real hard time transitioning?

There's a layoff.

Man, having no mortgage would really free you guys up to be flexible, wouldn't it?

Yes, and having that extra $300,000 in the bank would give me a little more security.

So, see, this is what we do often.

You have $2.5 million.

Let's not act like this is your entire nest egg we're asking you to deplete.

How much of this is in non-retirement?

Oh, he's really smiling now.

Can you not do this?

I don't think you're not.

Oh, your husband's next to you.

No, he's on the other end of the soup and he can hear you.

Oh, good.

Okay.

He's loving this whole conversation.

I mean, you also have to remember this.

If you paid off the mortgage and you hate it, you could always borrow against it again and put it right back.

You could.

It'll be a slightly higher rate, but you could do it.

The banks will always lend you more.

But I bet you won't.

Like, I'm willing to make that deal because I know you won't.

Hmm.

Okay.

Okay.

Well, I was just, to me, the math math, you know, and,

you know, I was showing him like what 10% looks like compared to 4%.

But we're not, here's the thing.

The truth is we're not making a guaranteed 10% every year.

And there's more to the equation than math, which is what George also highlighted.

And go look at what you're actually paying in interest this month

because the mortgage is front-loaded with the interest.

Right.

So this month I paid $1,000 in interest and $500 in principal.

Exactly.

And so you have to look at the actual numbers of what's happening with the interest.

It's not the same as compound growth in the investments.

That's a good point.

As it is paying the interest.

So there's the mathematical argument, there's the emotional argument, there's the logical argument, but the truth is you're going to have less risk in your life and more peace if you pay off the mortgage.

Could you have potentially made a little bit more if you left it?

Maybe.

We don't know.

The world could implode next year.

We just don't know what's going to happen.

And so not owing people money is always going to put you in a better position.

I was going to say that.

Usually when people come, when they have times of distress, the number one thing they think about is their home.

They want to keep their home and their family safe.

That's it.

Right?

I mean, you've been on this earth 57 years, so you know when the moment comes, if somebody loses their job or you're unsure about a paycheck or a health scare, those are the things you think of.

You want to keep your family safe.

You want to make sure your home is safe, right?

Right.

So here you have it.

And think about this, too.

Ultimate security.

When you pay off that mortgage, it lowers your monthly expenses forever, doesn't it?

Yes, by $1,800.

Which means you need less in retirement than you did previously to cover your expenses.

Y'all killing me.

I hate to use logic.

I'm trying to hit you in every angle, Teresa.

Here's the thing.

I think your financial advisor is a better salesperson than your husband.

That's what it comes down to.

They're more persuasive.

I was looking at the math, and the math made sense to me.

And we've been with her for a long time, and her numbers have been pretty good.

You know, the numbers have been solid recently.

I'm not saying she's a bad person.

I'm just saying that

people tend to follow.

They tend to follow the incentive, whether they're sometimes realizing it or not.

That's all I'm saying.

I agreed.

I agree.

The bad news is I lost the argument.

The good news is I don't have to listen to day says, Dave says, Dave says.

I love this so much.

Hey, call us back when you're completely debt-free.

Let us know if you like it or not.

Now you got to listen to George says, George says, George says.

I'm just telling you what I have done and what I would do.

And so I don't tell people to do things that I wouldn't do.

And I paid off my mortgage at a very young age because even though I could have made, man, you could have made X, Y, Z in the market over those next 30 years if you hung on to a low,

I didn't care because life happened.

And my wife wanted to stay home.

And guess what?

She could do it because we didn't have a mortgage payment.

And so you got to think about the reality of life on top of, yes, some of the logic, some of the math, some of the variables there.

But it's a fun discussion.

We're having fun with you.

I'm so proud of you guys.

You're multimillionaires.

It's a moot point either way.

You're doing great.

Laura is up next in Portland.

What's happening, Laura?

Get right to the question.

We're up against the clock.

Okay, should I sell my house or not?

We bought it last February 2024.

We owe $421,000 on it.

I could make about $50,000 according to the realtor if I sold it for $490, $4.95.

Our payment is actually 37%

of our take-home.

My husband makes $145,000 a year gross.

We, after insurance and 401, all that, our take-home is $8,822 a month.

We have a total of $17,877

in that.

After all of our expenses, we have for the month about $4,000 left over.

I feel that our mortgage payment is just too out of, it's just too much.

It's way over the 25%.

But you factored in investing, didn't you?

So if you just looked at after-tax income, but then took out these other deductions,

it'd probably look closer to 30%.

Right?

Yeah.

So I just said exactly what goes into our account after like,

yeah.

So that's after insurance.

Okay.

So likely insurance is coming out of his check that you healthcare, investing, all of that.

It feels tight looking at the parameter.

So I want to free you from that.

Nothing is on fire here.

You guys have an incredible income.

I would be aggressive at cleaning up this debt and then getting an emergency fund back in place.

But you're not in a place where I would say, you got to go sell the house today, Laura.

You're in a real pickle.

I think you're doing better than you think.

I have like, I put thousand dollars on something, and after everything, I have like fifty dollars till next payday.

That sounds like a budgeting issue.

Are you guys budgeting together?

I just got the Every Dollar app, and I'm just kind of confused.

We'll coach you on that.

Jump on there.

You get the premium one.

If not, we'll gift it to you.

You can jump on a 10-minute one-on-one coaching call with an Every Dollar Pro on our team.

They'll help you overcome the obstacles you're facing with budgeting.

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 WillsQuiz.

Welcome back to the Ramsey Show.

Let's go outside the studio for a second because we've got some special guests in the lobby on the debt-free stage.

Kyle and Emily are here to share their story.

What's up, guys?

Hey, how are you?

Where are you guys from?

Gettysburg, Pennsylvania.

Love it.

And you traversed the terrain to be here in Nashville, Tennessee for the debt-free screen.

How much did you guys pay off?

We paid off $150,000.

Nice.

How long did that take?

26 months.

Wow, that's aggressive.

Okay, what was the the range of income during this time?

So we started at $130,000 and ended at $90,000.

Okay, somebody stayed home?

I knew it.

Baby time?

Yep.

I knew it, son.

Wow.

Oh, my gosh.

This baby is cute.

If you're watching on YouTube, you need to, because that's one cute baby.

That is a cute baby.

That's the best reason to have a dip in income right there.

And debt-free in the process.

What kind of debt was this?

I knew it!

You guys are amazing.

Wow.

If you're not watching on YouTube, this couple looks like they might be 22 at most.

They're so young.

24.

24 and 25.

Oh,

my pay-for-house.

Okay, what caused you guys to be so weird at such a young age?

Who hurt you?

Who caused this trauma to get you guys debt-free in your early 20s?

I don't think anybody caused us trauma.

We were looking for peace, so

we solved for that by getting rid of all of our bills, simplifying our life, and ultimately following Christ.

So we put him first in our life.

That's amazing.

So how'd you get connected to the Ramsey stuff?

Well, Kyle actually found it first, but he showed me John's show, the Dr.

John Deloney Show, and that's kind of how I got segued into Ramsey.

But Kyle was the one who really found the Ramsey show.

Yeah, so I run a lawn and landscape company.

So when I was outside working, I needed something kind of positive to listen to.

So I stumbled upon Dave and

I started following the principles and it paid off.

That is incredible.

Okay, so you weren't like a financial peace baby.

Your parents didn't instill this in you.

You have some common sense principles.

It sounds like you were not in crippling consumer debt at any point in your life.

No.

Did you go to college?

Yeah, so I started, I went to school for a year and racked up 22 grand in debt and then decided that wasn't for me.

So So I left,

started the company,

finished at community college my associates in business management, and then

used the business to pay off the $22,000 in debt.

That's incredible.

Wow.

Yeah.

So now you're doing that.

You're the income provider for the family with this lawn care business.

Emily's at home with the baby.

Right.

This is a good life with a paid-for-house.

Okay, what's the house worth?

It's worth $250,000.

Wow.

And how much do you guys have in the Nesteg?

You guys been saving?

Not too, too much.

We're probably right around.

30?

That's great.

Yeah, you've been busy with this house.

So you're on the path to become Baby Steps millionaires.

My guess is by 30, you guys are going to be there at this rate because now you got your income freed up.

It's your greatest wealth-building tool.

So the world is your oyster.

I'm so proud of you guys.

So exciting.

What was the hardest part over that 26 months?

Honestly,

God has just blessed us so much.

I feel like when bumps would come into the road, he would just provide.

Whether that was someone just giving us like a random financial gift,

I don't know.

God just provided so much throughout the journey.

That's awesome.

Yeah.

So the most important question then is, how are you going to celebrate?

Well, I actually took my mom to Florida for a weekend, so that was funny.

Just your mom?

Not him?

Well,

with a baby at home, we didn't want to leave him overnight.

First time parents.

But he's getting ready to take his dad to Florida, too.

Okay.

So who were your biggest cheerleaders?

Maybe your dad was a big cheerleader.

Yeah.

And honestly, you guys, like listening to you guys.

Yeah, you guys are crazy.

We're happy to be motivated.

That's amazing.

So how does it feel to be completely dead-free, especially at 24, 25, you're like, this is crazy.

Yeah, it feels great.

It feels great.

We have more freedom to give.

We have more freedom to spend on little things just when we're out.

We can just grab something extra if we want to.

Was this a secret?

Do your friends know about this?

I mean, now they know.

They do now.

Yeah, they do now.

But honestly, we weren't telling a ton of people, not for any reason, just supporting it.

Now they're going to be asking you.

Can you tell me more about this Ramsey stuff?

It's going to be in their algorithm now.

Yeah, feeding them videos.

This is not normal behavior, guys.

This is really amazing.

I love this.

So, what would you tell that that young newlywed couple out there who's gone, well, we got to just get a big house, we got to get a car, just take on the payment.

We can't save.

We got the student loans.

How would you encourage them?

I would say if you're able to take on, you know,

even if it's like a $400,000 mortgage or more, just stay within your means, buy what you can afford.

You don't need to get the biggest, best thing that

you can spend money on.

Try not to finance anything.

And if you get a mortgage, pay it off as quick as you can.

Wow.

What was your interest rate?

5.75%.

Wow.

Knocked that thing out.

Sure did.

Did you get it 26 months ago?

Was it that?

You just got the mortgage and immediately decided we're paying it off.

March of 23, we got it and paid it off in.

Wow.

So the bigger question is: how do you get a spouse on board like that from day one?

Were you guys aligned on finances before marriage?

Yep.

Yeah.

I think it was like the second date we were talking about finances and

kids and everything.

So just right from the get-go, we realized that we were aligned.

And honestly, I think that would be the biggest piece of advice is to get on the same page with your spouse.

I couldn't imagine doing it.

Yeah, it's amazing what happens when you're going in the same direction instead of pulling each other in two different directions.

I don't want to.

And I had to drag her on board.

26 months, you guys are dead-free.

Yeah.

That's the rest of your life.

Oh, my goodness.

I'm so proud of you guys.

You're an inspiration to us and to many out there in the lobby and many watching and listening at home.

So thank you for making the trip to be here.

Celebrate with us.

Thank you.

You ready to do this thing?

I think so.

I think so.

Okay, we've got Kyle and Emily from Gettysburg, Pennsylvania.

$150,000 paid off.

That's the mortgage in 26 short months, making $130,000 down to $90,000 so that Emily could stay home with that sweet baby.

Count it down.

Let's hear a debt-free scream.

Three,

two, one.

Oh, glory to God.

We're dead-free.

So sweet.

There it is.

They're even aligned in their pitch, the tone, the words.

I mean, this is a couple of.

This is everything.

Lock step, baby.

Two peas in a pod.

Yeah.

I love to see this.

It's amazing what happens, Jade, when you have that alignment early on in a marriage.

And it's why we fight for this.

When people call in and we say, combine your finances, combine your life, combine your goals and see what happens.

Shared goals, shared effort, shared intensity, all of it.

They just, I mean, some people don't see this progress in 26 years, let alone 26 months.

Exactly.

Yes.

They're still hanging on to the mortgage, hanging on to the loans, not aligned what we're going to do with our money.

Yeah.

And look at the options and flexibility they have, too.

When they have that margin, she decides, hey, I want to stay home.

Yeah, absolutely.

We can afford that.

The math checks out.

This is our goal that we're both aligned on.

Go for it.

Yeah, they're unstoppable.

Totally unstoppable, I tell you.

Very inspiring.

It is inspiring.

Oh, man.

Social question?

Yeah, let's hit.

What do you got for me today?

I'm a little nervous.

Depending on which platform, I kind of get nervous.

There's one on here that's specifically for me.

Okay, let's hear it.

I'm deciding if I want to answer it.

Okay, Jade,

what change made the biggest impact on crushing your student loans?

Oh, okay.

So, how much student loans did you guys have?

It was $280,000 of student loans.

And the biggest impact on crushing my student loan debt was the realization that no one else is going to pay it.

Like the realization of going, okay, there's no more deferment.

There's no more putting it aside.

There's no more forbearance.

There's no, you know, no more $10 words.

No, yeah, nothing's going to say coming for you on the white horse.

Yeah.

And so the biggest impact was realizing I get to decide who I want to be in this scenario.

I can be a person who is about it, or I can be a person who is waiting to be rescued by a hero that doesn't exist.

The hero is me.

Oh, that's so beautiful.

And that's, I think, the heart behind this.

Yes, I'm super happy they paid off their house.

But really, behind that is they have agency over their life.

Yeah.

They don't owe people money.

They feel invincible because they know, hey, if we can pay off 150 grand in 26 months, what can't we do financially?

Oh, so good.

They're unstoppable, I tell you.

And 23, I mean, this is just what are they gonna do the rest of their life?

Just sit around and watch the prices right.

I mean, that's all.

That's all that's in the cards.

No, it's better.

So much better than that, especially with that sweet baby.

Congrats, guys.

This is the Ramsey Show.

Our scripture of the day, Proverbs 3, 3.

Let love and faithfulness never leave you.

Bind them around your neck.

Write them on the tablet of your heart.

Then you will win favor and a good name in the sight of God and man.

And in a wild transition, Taylor Swift said, no matter what happens in life, be good to people.

Being good to people is a wonderful legacy to leave behind.

Ooh, I like that.

I mean, I'll amen that, Taylor.

That's like the, what is it?

It's nice to be important, but it's much more important to be nice.

Oh, I never heard that.

Have you heard that?

I like that one.

That's a good one.

All right.

I'll credit Jade Warshaw with that quote.

All right.

Same mine.

Anthony's up next in Ohio.

What's going on, Anthony?

How can we help?

Hi, thanks, George and Jade, for taking my call.

I was calling because my wife and I are, our oldest son is getting ready to start school, and we are back and forth on if we would like to homeschool or send him to public school.

And we get to decide?

Just looking for advice.

We're kind of split down the middle, both of us, just looking for some outside perspective as well.

Okay.

Okay.

So pub, it's not private school, so there's not like a price tag attached to it.

It's just, do we want him going to public school or do we want him to have the education?

Does homeschool mean one of us has to stay home and forego income that is currently there?

Yeah, so So that's kind of one of the things that we're hung up on.

So my wife has been a stay-at-home mom since our oldest was born.

He's five.

We've been living off of my income.

I just kind of stumbled upon you guys a few weeks back, and I really want to start to try to get aggressive with paying down debt.

And I think, you know, with him going to public school, and we have a daughter as well, they'll be starting school next year.

So, you know, them going to school, that'll free up some of her time to

add some additional income and get more aggressive with our debt.

So, what would be okay?

So, we kind of understand why it could be good for public school.

What was the homeschool argument?

Was this a values thing or just convenience?

Yeah, kind of that.

Yeah, I mean, so

she's more on the homeschool side, and I'm, you know, it's kind of like a percentage.

I'm like 60-40 public, and she's like 60-40 home.

We've been praying about it, just trying to figure out, you know, which way we should go.

But

she's more along the lines of like, she doesn't think our five-year-old son should be on the same schedule as me going to school for seven hours or eight hours like they're.

Okay, gotcha.

I understand that.

She wants to kind of

let them ease into it, wake up on their own time,

not spend eight hours, more like three hours a day doing school work.

Understood.

So go back to the financial side.

Tell us more about your financial picture right now.

Do you guys have debt?

What do you have saved?

And what are you trying to accomplish?

Yeah, so we do have debt,

not a crazy amount.

So we have, outside the mortgage, we have

about $45,000 in car loans between two two vehicles, and then we have about $5,000 in credit card debt.

And then our mortgage is about $160,000.

Okay, so the cars,

it's kind of one of these things where there's a way to solve for the financial side of it.

I mean, if you guys really wanted to do the homeschool thing while still accomplishing the financial side, then it comes down to these two cars.

You know, maybe some.

What are you making?

I earn $120,000 gross a year.

Okay.

Yeah.

I mean, a lot of it's tied up there.

Is there one of those that you could downsize?

Yeah, potentially.

So I've been kind of tossing around the idea of selling my truck.

That's the larger of the two.

What is it?

It's a 2020 Chevy Silverado.

We owe about $30 on it.

$30?

Yeah.

I mean, there's a big chunk right there.

Are you underwater on it?

Could you sell it for what it's worth or more?

Probably about what it's worth.

I don't think I'm too much underwater on it.

I just bought it last September.

Do you have any money saved anywhere?

Not really.

We got about $2,000, and I'm thinking about what I should do with that $1,000 since I just started listening to you guys to get it down to $1,000.

So if you sell the truck, you still need another vehicle, right?

Correct.

Yeah.

So,

yeah.

I mean, I drive an hour one way to work.

Wow.

So I would definitely need a vehicle.

And then, you know, for her, just doctor's appointments and various different things.

And she also does, we do earn a little bit of additional income.

She has a photography business that doesn't earn a crazy amount.

It's mainly around the holidays.

It's probably about $10,000 a year.

What would she do full-time if she did go back to work?

So that's another great question.

I think it would need to be something that's somewhat flexible because I think we would still want her to be off during the summers to be at home with the kids because that's how it's been for the last, like I said, five years.

So probably something in a restaurant.

I mean, she did that when we first got together for a while.

You know, just, or she could really focus in on her photography and try to expand that a little bit.

We don't really need to invest any money into that to grow it.

So that's something that we could probably go down as well.

Here's the thing.

I think that you, I mean, this is just my

thought when I look at your numbers.

I think that you guys should be totally fine on $120,000 a year.

Like that's your salary.

The problem is you guys need to live on less than you make.

That's what it is.

So although her going back and picking up a job for a while could help you pay off this debt a little faster, I think really what you guys need to do is really lock down the budget to get this thing done because

you guys having $120,000 shovel to work on this debt is pretty decent if you sell the truck.

And I think that will allow you to still clear it in the time period that we...

You could be debt-free by the end of the year.

Yeah.

But you got to sell the truck.

And then get a fully funded emergency fund.

That's going to put you guys in a really solid place for her to stay home, homeschool if that's what she wants to do.

And hey, if she doesn't like it, you can always turn back to public school.

If they go to public school and they hate it and they're not thriving there, she can always pull them out and homeschool.

So nothing is fatal here.

But I would, I think the bigger thing is, what is our plan to aggressively get ourselves in a better financial position so that we can make this decision from a place of strength instead of stress?

Yep, absolutely.

Yep.

I keep telling her that I, you know, after listening to you guys for the last few weeks, I really just want to get all the stress out of our life and just make peaceful decisions and be able to make this decision no matter, you know, if we were debt-free, this decision would probably be a little bit different.

I don't know.

You might not even be talking about it.

It might have just naturally happened that you homeschool them.

Right.

Yep.

Okay.

I love it, man.

Yeah.

Best of luck on the journey and cut up those cards.

You don't need those things where you make 120 grand.

We don't need the points.

We don't need the possibility of debt.

We need some peace in our life right now so we can create some stability for our family.

Appreciate the call.

Kelly is up next in St.

Louis.

What's going on, Kelly?

Hi.

Oh my goodness.

I'm so excited.

Okay.

So we are in baby step two and I'm looking forward to baby step three.

We only have about $5,000 left in baby step two, so I'm looking forward.

Can we do like, okay, so it's three to six months and can we do like three or four-ish

perk it in a high yield savings and let it do the rest or do i need to like do i need to shoot for six months that's a good question i actually really like this question um so there's a couple of things to consider with baby step three um first off just always remember that it's your kind of your basic budget a lot of people think it's like three to six months of income like their full whatever they make in a month and it's not that it's if you were to whittle your budget down to kind of emergency mode you know obviously your four walls daycare insurance, like it's not your budget with all the bells and whistles built in.

So that's the first thing to think of.

And then second, determining between three to six months.

Yeah, you want to look at a couple of things.

Are you a dual income household?

Because if you are, then yeah, there's a little bit less risk there.

If one person loses their income, there's still another income coming in.

So you could look at something like that as you're determining, is it three months?

Is it six months?

Other thing you could determine is your health.

Like, are you guys in good health?

Does anybody have chronic issues that are keeping them in and out of the hospital or could you know take away their income that sort of thing so those are the factors to determining if you're going to set it at three and like you said let the interest maybe do the rest over time it would take years for the interest to award because i mean look at this 15 grand yeah in a high yield savings you're gonna make 500 bucks a year yeah but i'm just saying at that point okay i'm just saying at that point you would be okay if it were just three months right if it two incomes solid jobs everybody's healthy right um i'll be honest with you george and you throw a a flag.

I just tend to err on the side of six months kind of regardless.

I don't know the way the world is.

I just like six months.

I mean, that being said, I wouldn't let it stop you from moving on to baby step four or 3B.

Yes, is the next step for you trying to save a down payment or invest?

No, the next step is pay off our mortgage.

Oh, great.

Right?

Yeah.

Yes.

And we only have to go to the bank.

Well, you got to be investing 15%

on it.

So

you got to be investing 15% first.

Any money beyond that goes to college and paying down the mortgage.

So, yeah, if you wanted to get to three or four and then begin the other steps and maybe slowly add to that emergency fund, that would be okay.

But again, to Jade's point, man, there's nothing like having a six-month emergency fund ready to battle whatever comes at you.

It feels good.

Yeah.