You Can Build Wealth No Matter Where You Are in Life

Speaker 1 Live from the headquarters of Ramsey Solutions, it's the Ramsey Show where we help people with their money, their relationships, their work, just about any and everything.

Speaker 1 I'm John Deloney, joined by my great friend Jade Warshall, and we are taking your calls live, toll-free and if you don't know what toll-free means it's because you were born in the 2000s.

Speaker 1 But we're taking your calls are toll-free John. I know I know.
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Speaker 1 Okay, let's go out to Sacramento, California, A, and talk to Julia. What's up, Julia?

Speaker 2 Hi. Good afternoon, guys.
Hey, I really, it's such a pleasure to be able to speak with someone and get some advice.

Speaker 1 You got it. Well, it's an honor to talk to you today.
Thanks for calling. What's up?

Speaker 2 Oh, thank you. I'm calling to get some advice on retirement, please.
I'm 66. My husband is 67, and he's an automotive service director.

Speaker 2 So we do okay, but as you know, California is so expensive. We bought a home and

Speaker 2 it appreciated in value, luckily. So we have a little bit of equity, but we still owe $300,000 on it.

Speaker 2 I mean, and we didn't buy it at a high price. You know, the thing is,

Speaker 2 we're still paying it off. He's working.
I teach school.

Speaker 2 I'm not working right now, but I thought maybe it would be a good idea to move out of state and, you know, get somewhere less and I could work, you know, as a teacher.

Speaker 2 Maybe I'm older, so it's hard to get a position. I already had an offer in

Speaker 2 Texas. I'm certified there for fourth grade.
I turned it down because we were here.

Speaker 2 I don't know, he just refuses to think about retirement. We have no savings.
He's thinking he's going to get Social Security, keep working, put that money into the house payment.

Speaker 2 I said, well, what are you going to live on? You know, I thought maybe we could start a little business.

Speaker 2 I'm not talking a dealership. I told him, because he said, oh, yeah, I have money for this.

Speaker 1 But I said, well, I like the idea of you guys.

Speaker 2 I'm going to have to go to a coffee shop or a daycare.

Speaker 1 Sure.

Speaker 5 I like the idea of you guys moving out of an expensive area like California because the truth is that that's a cost of living you may not be able to maintain but maybe living somewhere less expensive you mentioned Texas that could you know depending on the part of Texas that could be good the problem about living in Texas is you're gonna have to figure out how to spend that extra money money because there's no state income tax there.

Speaker 1 Hey, hey. I don't know how you're going to spend all that, Julia.

Speaker 2 But there's a very high property tax.

Speaker 1 Yeah, they do. I know.
I know. There's the other side of that teeter-totter, but I just like taking my digs where I can get.

Speaker 4 I don't know. The thing is,

Speaker 2 he's also afraid that he won't be able to get a home at our age.

Speaker 1 I know.

Speaker 2 He won't get a job.

Speaker 5 Well,

Speaker 5 let's look at the facts. Like, let's look at the money because right now it's like a bunch of question marks around our head.

Speaker 5 So you mentioned that he kind of has his plan of living off Social Security.

Speaker 1 Do you guys have any clue?

Speaker 5 Like, you're 67 or he's 67, so you're eligible, but if you begin taking it now, obviously you're taking it at a cut as opposed to waiting.

Speaker 5 So when you wait and take that later distribution, do you know how much it'll be?

Speaker 2 No.

Speaker 2 How about he's thinking about 35, a little less.

Speaker 5 Okay. So let's say it's 35.
You know, you can check in and find out what you think, what that number is going to be on the IRS. But then let's look at your budget.

Speaker 5 And so it's really about taking these numbers out of the air and getting solid facts of what it will be. Can it work? If it doesn't work, how much do we need to be earning? Does that make sense?

Speaker 5 And I think that's going to give you a lot of peace when you can find the facts around.

Speaker 1 It won't work.

Speaker 2 You know, you're right. It won't work.
I told him, what are you going to live on?

Speaker 5 But do you know that or are you guessing that?

Speaker 5 Julia, do you know or are you guessing? Do you have a budget?

Speaker 5 No. Okay, that's what we need.
So before we get off the call, we're going to set you up with,

Speaker 5 Christian's going to pick pick up and get you an every dollar budget. And it's really just going to be you plugging in that income and then plugging in what you guys spend money on.

Speaker 5 You've got this mortgage. How much do you pay a month for the mortgage?

Speaker 2 $3,000.

Speaker 5 What?

Speaker 5 Okay, you're right.

Speaker 1 It's not going to work.

Speaker 1 So, Julia,

Speaker 1 here's a common thing. I want you to know this.
You're not crazy. Your husband's not crazy.
Y'all are facing a very common dilemma that

Speaker 1 millions and millions of 60-plus-year-olds are facing, especially married couples,

Speaker 1 is A, there's an ecosystem that has descended upon you the last 25 years, telling you that everything in your life is coming down.

Speaker 1 Everything's going to end. And you grew up in the era of Walter Cronkite and Tom Brokall, folks that

Speaker 1 people trusted.

Speaker 1 And now

Speaker 1 that same ecosystem is telling you, you're not going to have enough money. You're going to die.
You've got to move it all into silver.

Speaker 1 The whole world has shifted on your generation.

Speaker 1 My generation just assumes everybody's lying to me, even the people telling the truth. Your generation is stuck assuming these people are telling us the truth.
It's all coming down.

Speaker 1 So number one, I want you to know your fear

Speaker 1 is okay. It's normal.

Speaker 1 But also, as Jade said, here's what you desperately need with your husband. Y'all need actual facts.
Remember this line, facts are your friend.

Speaker 1 You have made up a story in your head that you're too old to be a teacher. That is false.
My mom is in her 70s and she's still a college professor.

Speaker 5 My dad's a teacher.

Speaker 1 Wow. He's 60 years.
70s.

Speaker 1 Yeah. Yes.
It's just a story because when you were a kid, 60 years old felt like a million years. And now you're there.
You're still fun, exciting. Your students love you.

Speaker 1 They could definitely use your wisdom. No, it still feels like a million.

Speaker 1 I know, I know. But listen,

Speaker 1 you and your husband, this idea of like, I don't know, I think Social Security, that's not enough. So instead of talking about, what are you going to do? We have to move.

Speaker 1 I want you to sit down and use this line with your husband.

Speaker 1 I need know what our money situation is because I'm scared to death. Will you help me be less scared?

Speaker 1 And very few husbands will look at their wives when they say that and go, nah, I don't care.

Speaker 1 If you say, I need to know.

Speaker 3 He thinks he's got it all planned, though.

Speaker 1 Then he needs to show you the plan. And if you use the words, I'm scared because I don't know the plan.
I need to see the plan.

Speaker 2 That's a good way to phrase it. Okay.

Speaker 1 Because you're scared.

Speaker 2 My parents were, you know, factory workers and soda motors. I mean, we grew up in Detroit, Michigan.

Speaker 1 Yeah, of course.

Speaker 2 So, you know, everything was, I don't know, I want to say easy for lack of a better word.

Speaker 1 Well, hold on.

Speaker 1 You grew up in Detroit, just like I grew up in Houston, and you grew up in Detroit when it was all golden and great, and it all went away overnight.

Speaker 1 And I grew up in Houston where Enron was the greatest thing in the world until one morning Enron didn't exist. And so you have both of those things going on.

Speaker 1 That it's just going to all work out. And then you also have that

Speaker 1 understanding in your nervous system. There's a day when everything, the factory shut down.

Speaker 1 You got to address that fear with him. And then, yeah, it's a math problem.
You want to move to Texas? You want to move to North Carolina? You move wherever you're going to move. Jade was right.

Speaker 1 You can't afford a $3,000. I applied to Houston.

Speaker 2 I applied to Houston. I got a call.

Speaker 1 Listen, the world is desperate for great teachers, especially licensed teachers. So you're not going to have a problem getting a job.

Speaker 1 What you might have a problem doing is convincing your Californian husband to move somewhere else. So that's a whole different story.

Speaker 5 And just remember, wherever you move, whatever housing situation you choose, you don't want that payment to be any more than 25% of your take-home pay. That's right.

Speaker 5 That's what's scaring the pants off you right now.

Speaker 1 It's just too expensive. So, we're gonna send you every dollar, we're gonna send you the budgeting tool, and we're gonna send you Financial Peace University, the whole digital class.

Speaker 1 It's nine lessons, and you and your husband commit to watching them together. And then you can sit down and talk about your plan together.

Speaker 1 Welcome back to the Ramsey Show. Are you ready? Tomorrow night is Ramsey's biggest free live event of the year.

Speaker 1 Take control of your money. It's a live stream coming directly into your house.
350,000 people are registered and ready to do something different with their money and their lives. Wow.

Speaker 1 Jade Warshaw and Dave Ramsey are going to give you the practical steps and motivation you need to find more margin in your budget and get out of debt so you can start building incredible wealth.

Speaker 1 Here's the deal: Election's over.

Speaker 1 You woke up and you looked yourself in the mirror and you are still you. And you got online and looked at your checking account.
It is still what it is. You look at your savings.

Speaker 1 It is still what it is.

Speaker 1 You look at your savings and your heart stops.

Speaker 1 I understand. I've been there not wanting to call anybody, not wanting to ask anybody's help.
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Speaker 1 Five different people.

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Speaker 5 I also want to say we're showing live, we're showing every dollar, but we're also answering all your money questions. That's right.
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Speaker 1 And I don't care how much money you have, how much money you make. Okay.
This is for you. Yeah.
All right. Let's roll out to Pittsburgh and talk to Emily.
What's up, Emily?

Speaker 2 Hi, I'm so blessed to be speaking with you guys today. I've been kind of struggling with this question.

Speaker 2 It's more of a family matter than mine personally, but I'm really looking to get your insight on it. So we had a strange family members.

Speaker 2 for like the last 15 years that recently reached out within the last two weeks because one of them passed away and the other needs financial support, but they're not explicitly looking for it.

Speaker 2 So basically what it looks like is

Speaker 2 the relation to me is that my grandmother passed away and my uncle had been living with my grandmother and it was just the two of them for the last period of time. And my uncle basically had no job.

Speaker 2 So they were living off of her Social Security and her life insurance that we found after she passed. And essentially there's nothing left.

Speaker 2 And he's dropping hints to us as the family saying, well, I don't know how I'm going to like make these payments. I don't know where my grocery bills are coming from.

Speaker 2 He's not explicitly asking for things, but it's the way that he's phrasing things that is making us concerned that he's looking to us to be his savior.

Speaker 1 I wouldn't be concerned at all. Like, because I know how this, I know how he can get his groceries paid for.
He can get a job.

Speaker 1 Ta-da.

Speaker 2 Yeah.

Speaker 1 Right? Well, he's...

Speaker 2 He says that he can get a job.

Speaker 2 He's not sure that he's going to be working because he does have a health condition

Speaker 2 that is prohibiting him. I'm not exactly sure.
I don't know all of the details on exactly what it is. I personally don't even believe that it is a health condition.

Speaker 2 I think he's just trying to use it as a guilt trick.

Speaker 1 Exactly.

Speaker 2 But that's my personal view on that. I don't have the facts.

Speaker 1 You're probably right.

Speaker 1 So

Speaker 1 let me ask you this. Why are you letting this person you haven't talked to in 15 years suddenly have a voice at your kitchen table about your integrity, your character, what you do next?

Speaker 1 Like, why are you giving him a voice?

Speaker 2 It's a moral issue. Like,

Speaker 2 I always want to try and be like the best that you can be, right? And so I see this person that needs help because they were honestly just poor planners.

Speaker 2 They put themselves in this position, and I get that. But I'm also kind of like the person that's like, well, I do have a little bit that I could contribute towards this.

Speaker 1 What would you? But I don't want to.

Speaker 1 What would that be? Yeah, I don't.

Speaker 5 What would that be?

Speaker 5 If you did help him, what would that look like?

Speaker 2 It would probably look like, well, maybe I can give you

Speaker 2 like so much money towards like her burial or something like that, because they're struggling even to come up with funds for that.

Speaker 1 Okay.

Speaker 5 Listen, if you wanted to, this is grandma, right? That we're talking about. If you wanted to help, you know, grandma's funeral costs, I think that that's fine.

Speaker 5 I don't, that part I don't have an issue with, but Uncle Boo-Boo is the one that I'm like, okay, what would it look like for you to help him in your mind?

Speaker 5 If you thought this is my job to step up and help him, what would that have been? Or what would that be in your mind's eye?

Speaker 2 I think what I'm looking for would be just like

Speaker 2 knowing that I didn't just leave him and that he's just withering away with nothing.

Speaker 1 No, but he hasn't even asked you.

Speaker 2 No, he hasn't. And I guess that's kind of where part of my struggle is coming from, too, is that he's not asking for it, but I think he's too proud to ask for help.

Speaker 2 But I think he needs it, and I don't know another direction to point him in.

Speaker 5 How old is he?

Speaker 2 He's probably,

Speaker 2 I want to say 62.

Speaker 1 Where's your parents? Where's your mom or dad?

Speaker 2 They're right there with them, and they're trying to kind of keep distance as well. They don't want to be the ones that are

Speaker 2 saving him either, but I think they're looking at

Speaker 2 the same question. What is our obligation? What should we be doing as Christians? What should we be doing just as family members?

Speaker 2 I mean, to me, he truly is a stranger, but even a stranger on the street, I'd like to assume I would help.

Speaker 1 Yeah, there's two things that are going through my mind here. Number one, I would take my cues from

Speaker 1 a struggling uncle's brother and sister.

Speaker 1 That would be number one. So I would look to my mom and dad because they're going to know, or whoever he's related to, they're going to know better than I do.

Speaker 1 Right. The second thing is, is I am

Speaker 1 all about

Speaker 1 helping and supporting and walking alongside and being there for the people on the margins in our world.

Speaker 1 I also have been humbled dramatically over the the last 20 years because of my arrogance and my savior syndrome.

Speaker 1 Okay.

Speaker 1 And so when you see somebody that you in your head tell yourself a story that he needs this, this, and this, and I can be the person to come, that's less about Christian value.

Speaker 1 And that's more about you in a weird way using him to make yourself feel whole and okay. He hasn't asked you for help.
He hasn't said we need your help.

Speaker 1 He's done some passive-aggressive-y dribbling of things here and and there.

Speaker 1 And I would leave that to my mom or my dad, his brother or his sister to step in and say, Hey, man, what do you actually need? Like, let them have that communication together.

Speaker 1 And maybe if I was in your case, I'd probably reach out to my dad or to my mom, whoever's closest, and say, Hey,

Speaker 1 we're in a position where we could contribute 500 bucks or 1,000 bucks to the funeral if y'all need that. And I'd go that way

Speaker 1 instead of going to some basically a stranger, a guy who opted out of his niece's life for a decade and a half before I needed to go in in there and feel like I need to save the situation.

Speaker 1 Does that make sense? Yeah.

Speaker 6 Yeah.

Speaker 2 That does make sense.

Speaker 5 There's also an issue of this just on the financial side of it that the reason I was asking you before, what would that look like, is because sometimes we get in moments where we're like, okay, you know, if I'm going to help them and what we're trying to help them do is really not sustainable and long run, it's not helping at all.

Speaker 5 Like if the issue is he doesn't have income coming in and he's not looking to get income coming in, you stepping in and paying an electric bill one month long term is not really a sustainable thing.

Speaker 5 So it's like, okay, what can we do? What would it look like to help in a real way that's long term? Well, that's probably going to help him find options for him to work, right?

Speaker 5 So just reframing if you did want to help, what that help would be, it might not actually be financially, if that makes sense.

Speaker 2 Yeah, and I think that that makes a lot of sense.

Speaker 2 I think that's kind of what I was kind of sitting on, but I was really debating because like I feel sorry for him because of the situation that he put himself in.

Speaker 1 Right.

Speaker 2 And I, and that's what I'm struggling with. Like, he, he did it to himself, but I, I can help sometimes, but I don't want to help all the time.

Speaker 2 Like you said, I don't, I don't want this to be a long-term thing because, as he so nicely put, he did opt out. Yeah.

Speaker 2 So it is kind of like this struggle, which, again, which is why I'll have to be speaking with OTV today because it's just such an internal struggle for me.

Speaker 1 I would work through my parents and

Speaker 1 just know that feeling uncomfortable does not mean your decision is wrong. That's right.

Speaker 1 Thank you.

Speaker 1 If you're a person of compassion, like hopefully all of us are, anybody who's hurting,

Speaker 1 and we'll go one step further, okay? So we'll help out here, Emily. Hang on the line.
We're going to send you an electronic version of Financial Peace University.

Speaker 1 If the call ever comes that, hey, I need some help with some of this stuff, you can say, hey, we got you. I'll send you Financial Peace University Uncle for free.
And here's all nine lessons.

Speaker 1 And it's going to walk you step by step how to take control of your financial future. And that way, you're giving him a fishing rod, and some bait, and a place to fish.

Speaker 1 But he's going to have to bait the hook and actually throw the line in the water. Thanks for the call.
We'll be right back.

Speaker 1 Welcome back to the Ramsey Show. I'm John Deloney, joined by Jade Warshall.
Let's go out to Dallas, Texas, and talk to Mary Mary.

Speaker 1 What's up, Mary?

Speaker 1 Mary.

Speaker 1 Oh, whoops, I pushed the wrong button. I'm not the smartest.
That's all right. What's up, Mary?

Speaker 1 Hi. How's it going? I pushed the wrong button.
Sorry. James is rolling his eyes in there at me.
I'm getting better, James, I promise. What's up, Mary?

Speaker 2 Hi, it's going good.

Speaker 2 So we moved to Dallas, Texas. Last summer, my husband's work relocated us here.

Speaker 2 There was no way out of it. He tried to find another job in California and was unsuccessful.
And so now we're here. We're in the Frisco, Texas area.

Speaker 2 I'm just wondering if

Speaker 2 this was a good move because it's the houses are expensive here. It just seems expensive.
And we're currently renting right now and we rented our house in California.

Speaker 2 And

Speaker 2 we have some savings, but I just

Speaker 2 the houses are just expensive.

Speaker 5 Did you guys do any research before you loaded up the truck and moved to Beverly?

Speaker 2 We

Speaker 2 We did, but I mean, it was we move or my husband doesn't have a job and then I would be the breadwinner.

Speaker 1 Yeah, this doesn't sound like it's about houses, though, because it's expensive in California, too.

Speaker 1 This sounds like you haven't found a community or a connection or there's a cultural fit or something like that.

Speaker 1 It's okay to say it's okay to say we moved and we tried something and we don't like it. That's okay.
That's also true, yeah.

Speaker 2 Well,

Speaker 2 I'm trying to like it. My husband likes it.

Speaker 4 He likes Texas.

Speaker 1 So what is it that you don't like about it? California.

Speaker 2 Well, my family's all in California.

Speaker 2 And then just the prices are here. They're in the $600,000, $700,000.

Speaker 1 Well, you're also in a very, very expensive part of Dallas.

Speaker 2 Yes.

Speaker 1 Very expensive. And so it's both

Speaker 1 true. Frisco, Texas is a very, very expensive place to live.
And it's not super all the way 100%

Speaker 1 when you can move over to Arlington 30 minutes away or 40 minutes away. I mean, there's places where you can move that are less expensive.

Speaker 5 And I think I heard you say that you kept your California house and you're renting it. So there's, I'm assuming there's equity there that would have gone into rolling over into a house.

Speaker 5 Is that playing into it too? Like, were you planning on selling the California house and using the equity to buy a home in Texas, or what was the plan there?

Speaker 2 No, so our plan was to just keep that as an investment.

Speaker 2 So we owe about $289,000 and the house is worth about $620,000. Okay.

Speaker 2 And we're renting it out. We don't make very much.
We come up making about maybe $300 every month.

Speaker 2 But we just wanted to keep it as a rental property. And we do have about $294,000 in a high-yield interest account right now.

Speaker 2 And then about $40,000 in our checking and savings. So we don't, I don't know, but we just pay off the house in California or use that for a down payment.

Speaker 1 Yeah,

Speaker 1 your money issues are not money issues. Just, just, just hold that

Speaker 1 because

Speaker 1 you are investing

Speaker 1 in your right hand and in your left hand, you're renting.

Speaker 4 Right?

Speaker 1 So you have this one dream, like, we want to have a rental property, as some people in America, like so many people think that. But it's at your expense.
Yeah, but you're the one suffering from it.

Speaker 1 And so you could sell that, have $400,000, plus you got a couple of of hundred you could write a check for a house where you are right now and so it's not about the money

Speaker 1 what is it about texas you don't like or about your area that you don't like or about you the changes in your husband that you like what is it besides i miss my family or i miss the weather or i miss which are big things like those are all real things but be honest about what you miss

Speaker 2 I missed my job back in California.

Speaker 1 There you go.

Speaker 2 I was making a little bit more over there too than I am here.

Speaker 1 Yeah. Wow.
Okay, so have you had like a this sounds cheesy? Have you had a funeral for what was? Because it sounds like keeping the house in California also allows you to keep a foot there.

Speaker 1 It's kind of like you broke up with an old boyfriend, you're dating somebody new, but you kept the photos, you kept all the photos, and y'all still talk all the time.

Speaker 1 Yeah. And so you're never going to give this new boyfriend a full shot because you're still longing for the old stuff.
That's good. And the old stuff was great.
It was awesome.

Speaker 2 Right.

Speaker 1 Hello? Yeah.

Speaker 1 What do you do?

Speaker 1 Bear it out.

Speaker 5 I mean,

Speaker 5 I want to ask the question.

Speaker 5 So you made this move. The purpose of it, was it just, tell me the full purpose of it.

Speaker 1 What you were trying to accomplish.

Speaker 2 Okay, so my husband's job, the headquarters is moving to Dallas, Texas.

Speaker 2 And

Speaker 2 he kept telling me, you know, it's going to be great over there. You know, you'll be able to, I'm a nurse practitioner, so you're going to be able to get a job.

Speaker 2 You know, we'll be able to rent this house in California and it'll be our investment property. And then we can buy something else over there.
It'll be good. It was, you know, this big old dream.

Speaker 5 So it's a good thing. And then for him here.

Speaker 2 Right. Yeah, because he didn't lose his job.
He has his job.

Speaker 5 And he's still loving his job.

Speaker 2 No, he doesn't like his job.

Speaker 4 He doesn't.

Speaker 2 Listen, the job market right now is so bad that he's having a hard time trying to find something else.

Speaker 5 Yeah. I mean, I'm thinking about the first thing John said, which is you try something, it doesn't work.

Speaker 1 That's okay if it doesn't work. Yeah, call it.

Speaker 5 Call it, you know, but I do think you're talking about, let me leave you with two thoughts. A,

Speaker 5 when my husband and I moved here to Nashville for this job from South Florida, we've been here two and a half years and I'm just married, like just starting to be cool. Like

Speaker 5 it takes time. So I want to say that, that they're like, you're not going to move from an area, uproot your whole life, leave your family, leave your friends and be good in six weeks or six months.

Speaker 5 Like it takes time to like get in and get settled.

Speaker 5 So there's that side of it. But then there's also the side of it if you're looking at him and he's looking at you and you're like, listen, we made a mistake.
Or I hate my job. You hate your job.

Speaker 5 We don't even like the price of the houses. We don't even like the people.

Speaker 5 Like if you're really checking all those boxes, I like, I'm the type of person, John, I'll sit down and make a checklist like old school style and check the things that are positives and check the things that are negatives and like weigh it out literally and see, okay, of all the things that we said are important,

Speaker 5 we're not checking any of the boxes or we're only checking one.

Speaker 5 In California, it was checking nine, you know, and that helps you get a clear read on what's really going on, like real time and not just how you're feeling in a moment because something happened at work.

Speaker 1 And sometimes when people say the job market is so bad, it's so bad, it might be in your field or in his field. And that's when you have to ask yourself a bigger question.

Speaker 1 And you got to do what I did. You got to do what Jay did.
And that is shift your entire career trajectory into another job.

Speaker 1 The job I have right now did not exist. There was no such thing as a podcast or YouTube when I graduated from college.

Speaker 1 And so the world has shifted, right? And so y'all may have to ask yourself that question. I love Jay's.
You know, it'd be awesome if y'all two just went on a

Speaker 1 year one retreat

Speaker 1 and just did a retrospective. I love you.
You love me. We're on the same team.
We're going to make this. We get to pick whatever we want to do with our one wild and crazy life.

Speaker 1 We have half a million dollars in equity and a quarter million dollars in cash. We're okay.

Speaker 1 Let's be honest and don't, you can't be deceitful, Mary. You got to be honest about what you have loved about this move.
And you got to be honest about what you don't like.

Speaker 1 And both of y'all make your list. Y'all talk about it.
And then you can put your hands together and say, all right, I've been a nurse practitioner forever. i'm gonna start looking at home health

Speaker 1 or he's been i don't know he sells oil products or something and now he's gonna start selling jackets i don't know but that's because our priority is we want to go back to california can i also throw one other little variable in there

Speaker 1 yes mary you there

Speaker 1 yes let me throw one more thing in there when i left

Speaker 1 My childhood area of Houston area and I moved out to West Texas and the first big giant storm came through Houston.

Speaker 1 I remember being glued to my phone because those were my people and that was my home. And I felt so powerless being that far away.

Speaker 1 And if you are finishing up year one and you have been glued to your phone for the last month watching these fires ravage

Speaker 1 parts of your home, then I want you to be honest about it just feels weird not being there with your people and with your family and being able to put eyes and hands on those that you love.

Speaker 1 And that's normal. That doesn't mean you uproot everything if everything else isn't needed to be uprooted.

Speaker 1 But that feeling of powerlessness because you're not right there with it, that's real and that's good and that's holy and that's right. And you just have to acknowledge it.

Speaker 1 So y'all go on a one-year retreat, go through it all and say, what do we love? What do we not love? I love Jade's idea there.

Speaker 1 And then y'all make some fact-informed decisions about what you're going to do next. You get one shot at life.
Go live it well.

Speaker 1 Welcome back to the Ramsey Show. I'm John Deloney, joined by one of the greatest people on the planet, Jade Warshall.
Today's question of the day is brought to you by WhyReFi.

Speaker 1 Why ReFi refinances defaulted private student loans. Defaulted means when the borrower can't make the required payments.
So, if that describes you and your private student loan, contact YReFi.

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That's the letter Y, R-E-F-Y dot com slash Ramsey. And this is not available in all states.

Speaker 5 All righty, today's question comes from Mark in Pennsylvania. He says, I'm engaged to a wonderful woman.
We earn about $150,000 combined.

Speaker 5 We have a joint bank account because I want it to be our money and not my money. Love that.

Speaker 5 The problem comes up when we have our monthly budget meeting and she sees that we have $1,000 extra in the account once everything is paid. I know by the next payday in two weeks, there will be zero.

Speaker 5 We have gotten our total debt down from $75,000 to $35,000, but I want to get that to zero. How, what can I do to regain some financial peace?

Speaker 5 So if I'm understanding this correctly, John, they've got $1,000 of margin, but it sounds like it's just getting spent. on whatever.
Yeah, it's not a sound. And in two weeks, it's a lot of fun.

Speaker 1 That thousand bucks isn't getting assigned.

Speaker 5 Yeah. So exactly.
John just hit the nail on the head. When you do an every dollar budget, let me just clear up a common misconception.

Speaker 5 A lot of people think that when they do their budget, the budget is just for the things that I'm supposed to plan for. Like those, the things that make me an adult, right?

Speaker 5 My rent, my electricity, my phone bill, like I got to plan for groceries. But then they see the extra money and go, okay, like that's treat yourself.
Like that's up for grabs. We can do what we want.

Speaker 5 And in a way, it is up for grabs, but you decide what you're going to grab it for, if that makes sense.

Speaker 5 So So when you do an every dollar budget, you decide how you're going to spend every single dollar ahead of time, not just the important dollars. Does that make sense?

Speaker 5 So I say to people all the time, it's not to say that it's got to be like this negative thing. When you're planning every single dollar, you're still planning the fun stuff too.

Speaker 5 So if your wife has a fun category, although in this phase, I would say not yet because you're paying off debt, but let's just pretend, yeah, you're spending that thousand dollars as well.

Speaker 5 So you're saying, okay, $70 is going to go to get nails done. $100 is going to go towards entertainment.
$200 is going to go towards restaurants. And you're deciding how all of that is spent.

Speaker 5 That way, if your wife rolls out to Target, she's got a $75 line item that says, yeah, this is like my blow money at Target, right?

Speaker 5 And then you walk away from all of your spending for the month, feeling fine about it because you didn't break any rules, right? Because there were guardrails there.

Speaker 1 How important is it, Jaden, as you're talking?

Speaker 1 This is probably the worst analogy I could think of, but I'm thinking back to like middle school and high school with the youth pastor who says, you need to make a decision about your boundaries before you go on the date.

Speaker 1 Because if you wait till you're on the date, it's too late, right?

Speaker 1 It feels like it's important to make a decision with this quote-unquote thousand extra on the first day of the month. Because if you just know it's in there,

Speaker 1 It's so easy to go out to eat and be like, let's get baptizers and drinks too. Yeah.
Because and then you wake up and it's gone, right? You spent it on stuff that you wish you hadn't spent it on.

Speaker 1 So it feels important to when everybody's of sober mind and they're being less emotional and more rational, just looking at a budget, let's go ahead and assign this where it goes.

Speaker 1 That way, on the 21st, when we're out of eat out money, we got to figure it out. We got to eat at home.
Yes. It's too hard when there's a thousand bucks there.

Speaker 5 Absolutely. You're exactly right.
Taking it out of the heat of the moment is great because nobody makes good decisions when they're feeling the emotion of like, I want this now.

Speaker 5 So that is a great thing. Also, I feel like

Speaker 5 when you do that ahead of time as in an espousal relationship, for sure, it takes the sneakiness out of it. Do you know what I'm saying?

Speaker 5 Like, when there's just a lump sum there that's up for grabs, anybody can do it.

Speaker 5 If you get to it first and you spend it, you kind of feel this thing of like, I don't want to show them that I did it because they're going to be asking questions. So, I'm going to hide it over here.

Speaker 5 I'm going to like bring it in

Speaker 5 pieces into the house, right?

Speaker 5 You're doing all these things to kind of hide that you've spent the money as opposed to being a grown adult and saying, no, I have $200 I get to spend, or we assigned this to that.

Speaker 5 And then you're like, you're golden after that. You don't have to be feeling bad.
Now, in his case, he's like, I want to use all this to put it towards the debt. My guy, Mark, is absolutely correct.

Speaker 5 In baby step two, now's not the time to be spending on a bunch of extras. Margin should go towards debt, the smallest debt.

Speaker 1 It's funny you mentioned that in my marriage, when there's extra money like that in the past,

Speaker 1 I was such an idiot. I might spend $40 of that.
And then if my wife spent 60 bucks, I would somehow feel superior.

Speaker 5 Like you did better.

Speaker 1 Why are you spending all this money? Yeah, exactly. Like, I only spend it.
I'm keeping score. It's so stupid.
That's yes, but people do that. Just budget it and budget it.

Speaker 1 And you spend whatever you want. That's right.
That's right. All right, good deal.
Let's go out to Little Rock, Arkansas, and talk to Mark. Hey, Mark, what's up, man?

Speaker 8 Oh, not much. How are you doing?

Speaker 1 Good. Sorry I messed up the phones there earlier on an earlier call.
What's up, brother?

Speaker 8 Yes.

Speaker 7 We're trying to get out of it.

Speaker 8 Got about $250,000, including our mortgage and doctors and credit cards. And so we're working on that.
And we just wondering,

Speaker 8 both I'm 51, wife's 48,000. So we know in the next 10, 15 years, so we'll retire.
So is it still wise to hold off on investing

Speaker 1 and

Speaker 8 pause that and pay the debt? Because also we have an opportunity to if we can sell our house, we can move on to some family land and put a trailer there to cut down on costs.

Speaker 8 So just didn't know what the best plan is.

Speaker 5 Okay, so we've got a couple of things on the table. We're talking about debt, we're talking about investing, and we're talking about future home settlement, right?

Speaker 5 Like living on land, living in a different house. Okay, I love this question because I think what you're facing is a

Speaker 5 flurry that all of us are facing, right? What do I focus on first? They're all really, really important things.

Speaker 5 Enter the baby steps because it really helps us focus on the right thing at the right time.

Speaker 5 Because everything that you're talking about are important things, but you got to prioritize them in order of importance.

Speaker 5 So, first off, in order to be able to do the things you want to do, you want to be able to invest in this land one day. You want to be able to invest for retirement.
That takes cash. That takes money.

Speaker 5 And Dave Ramsey would say all the time, your income is your biggest wealth building tool. Therefore, how can we get more of our income back in our pocket?

Speaker 1 Pay off your debt, right?

Speaker 5 Because you're probably giving away. I mean, if you were to calculate how much you're giving away every month in payments, what do you think it would be?

Speaker 8 Oh, it's close to 60%. We've already done that.
Yeah.

Speaker 5 So that's a lot. So that points to your first answer.
Yes, I think you should clear the debt first. So how much is it?

Speaker 8 About $240,250,000, something like that.

Speaker 5 And is that including

Speaker 8 our mortgage?

Speaker 5 Okay, so let's pull out the mortgage and tell me what you have in consumer debt.

Speaker 8 What's 100 and take about 180 out of that? I'm going to do it with math off the top media.

Speaker 5 Okay, that's fine. And so tell me what type of debt it is.

Speaker 5 Credit cards, a personal loan, and and medical bills okay tell me how much the credit cards are tell me how much the personal loans are and tell me how much the medicals are

Speaker 8 the credit cards are

Speaker 8 they're probably close to twenty thousand okay then that personal loan

Speaker 8 personal loans uh probably about twenty three thousand okay and then that medical debt

Speaker 8 i don't have an exact number on the medical debt because i just figured it all up as one

Speaker 8 Because there's a bunch of little different doctors probably say

Speaker 8 if you had to guess I don't know probably

Speaker 8 about 2,500. Okay,

Speaker 5 okay, so of course, that's going to go first since it's the smallest debt in this whole thing. And tell me about what you guys earn: what's your income combined?

Speaker 8 Uh, combined combined, we make about 115,000 before that is if I don't get any overtime or anything.

Speaker 5 Okay, so monthly, what does that look like every month? What does it look like you bring in?

Speaker 5 Uh,

Speaker 8 probably about uh 30,

Speaker 8 uh, 2,600. Okay, 2,600 plus 3,000, so 56, 6,000.

Speaker 1 Okay, good.

Speaker 5 So off the bat, my first like thing for you, and it's always going to be the budget, I want for you to know these numbers. The budget's going to make you know the numbers like the back of your hand.

Speaker 5 There's not going to be any guessing.

Speaker 5 There's not going to be any, because you're going to be so dialed into it because you're focused on taking every little bit and throwing it at this debt is what it's going to amount to.

Speaker 5 So with your income,

Speaker 5 assuming that your current housing situation is in its proper place, what are you paying every month for rent or mortgage

Speaker 5 uh about 1600 a month okay yeah you're good so there's no reason that you shouldn't be knocking this debt out going very quickly 2500 on that medical debt should be gone super fast right how many kids do you guys have

Speaker 5 right quick three still at home okay so this is going to be everybody the whole family we're sitting down together dad and mom are saying here's what we're doing next we've got to get out of debt because we've got to get our life together and here's how we're going to do it you guys are going to see us cutting back back big time.

Speaker 5 Once you cut that, once you've knock this debt out, you're saving up three to six months of expenses. And then you're going to start investing 15% for a retirement.
You're in your 40s.

Speaker 5 I promise you, it's not too late, but you've got to get on this now.

Speaker 1 And don't go move into a trailer on family land just yet.

Speaker 1 This is the Ramsey Show.

Speaker 1 Live from Nashville, Tennessee, it's the Ramsey Show. I'm John Deloney, joined by Jade Warshaw.

Speaker 1 We are taking your calls on money, life, building wealth, your savings and checking accounts, your relationships, your work, whatever you got going on in your life. We are taking your calls live.

Speaker 1 AAAAAAA-825-5225. Let's go out to Orlando, Florida, and Orlando, Florida.
I was just making Orlando. That's right.
Orlando, Florida.

Speaker 1 I called it Orlando, James, because it's snowing there right now, which is very strange. Let's go to Orlando and talk to Jessica.
Hey, Jessica, what's up?

Speaker 3 Hi, how are you?

Speaker 1 I'm fantastic. How are you?

Speaker 3 Can't complain. Well, I can, but it does no good.

Speaker 1 Right? I was going to say, lots of people complain, just doesn't do anything. What's up?

Speaker 3 Okay, so my question is:

Speaker 3 my husband and I

Speaker 3 are, we were in the process of buying a home.

Speaker 3 Found out we can't do that. We let our apartment go so we could save up our closing costs.

Speaker 3 And now we are, I guess, technically homeless.

Speaker 3 How can we.

Speaker 1 Wait,

Speaker 1 why can't you buy a house? Yeah.

Speaker 3 Or get another apartment.

Speaker 7 Right.

Speaker 3 Well,

Speaker 3 he had an eviction from a few years ago.

Speaker 3 We let our apartment go, which is, I guess, technically, according to the courts in Florida,

Speaker 3 like an eviction.

Speaker 1 When you say you just let your apartment go, you mean y'all just moved out and quit paying on it? With a signal?

Speaker 3 We broke the lease

Speaker 3 because the lender that we were working with completely assured us that there was no problems. We were going to be in our home in 30 days.
Just make sure you have the closing costs.

Speaker 3 We had the down payment covered.

Speaker 1 Yeah, I think you did that.

Speaker 1 The apartment would have sued you because you broke your lease.

Speaker 5 Like, you have to write a lease out.

Speaker 3 They actually were very, very good about

Speaker 3 the whole situation.

Speaker 1 Except that

Speaker 1 y'all have a broken lease on your credit.

Speaker 1 Yeah.

Speaker 2 Right.

Speaker 5 Help us understand.

Speaker 5 Because what John and I are hearing is that you're saying, hey, we let the lease go and it's all good.

Speaker 5 But at the same time, you letting the lease go is what caused the eviction, which caused you not to get in your house.

Speaker 1 And people might have been nice to you, but you can't just walk away from your lease.

Speaker 2 Right.

Speaker 3 Well, we explained a situation that we were in, that we, you know, we weren't going to pay the rent for the last month. And they said, okay, as long as you're out by a certain date, it'll be fine.

Speaker 2 So.

Speaker 1 Do you have a name and number of the person who said that and the date they said it? And in writing? Yes. Yes.
They sent you something in writing? Yes. Then I'd go back into

Speaker 1 the office, into the main office, and say, hey, I have this documentation here. It says it's good.
Y'all filed on my credit report. You have 15 days to remove it.

Speaker 2 Okay.

Speaker 1 Or we're going to have to get an attorney because y'all are violating what you told us.

Speaker 7 Okay.

Speaker 5 Yeah. I think it's as simple as that.

Speaker 5 I mean, if you have it in writing that said that your lease is terminated and it's all good and you owe zero dollars and it's terminated on this date, yeah, that's that's that feels simple to me.

Speaker 5 I don't know why, but I feel like there's more to it than that. Yeah.

Speaker 1 Is there? Okay.

Speaker 3 Not really, no.

Speaker 1 Because here's the thing. A bank, if they pull up

Speaker 1 your credit report and you've been evicted from a house, you have just bailed on a lease because you don't want to pay it anymore, and somebody somewhere told you, no, it's cool, man. It's cool.

Speaker 1 It's totally cool, dude. Of course they're not going to loan you money because your track record says you just don't really care what you sign your name to.
You just do whatever you want to do.

Speaker 7 Right.

Speaker 1 So that makes sense. So, yeah, you need to go fight for your credit report on that front end.
And then I don't know what your husband does about the eviction. Did he actually get evicted from a house?

Speaker 2 He did, yeah.

Speaker 1 Okay.

Speaker 5 How long ago was that?

Speaker 3 Uh, 22.

Speaker 1 Okay, and what caused what caused that?

Speaker 5 Was that was this before you entered the picture?

Speaker 3 No, we were together at that point, but the apartment was in his name.

Speaker 5 Okay, what what happened to cause that um

Speaker 3 it was like right at the end of covid okay so

Speaker 3 um his income wasn't um

Speaker 1 he couldn't afford the apartment

Speaker 3 right he couldn't afford the apartment he had qualified for um rental assistance but the place that we were living in just refused to take it okay so they were just like all right you guys gotta go okay i i

Speaker 5 i hear what you're saying i want to make sure um

Speaker 5 I would just check and double check that this

Speaker 5 home purchase that you're making coming up is a great fit, that you guys are crossing all your T's and dotting all your I's because I don't want a pattern.

Speaker 1 I see a pattern. Yeah.
Yeah.

Speaker 3 I don't want that pattern either.

Speaker 3 And I, you know, I am a stay-at-home mom and he's the, we only have one income.

Speaker 1 So

Speaker 3 it's like.

Speaker 5 I just want to make sure because when I go to buy a house, and don't get me wrong, when you buy a house, it is an eye-opening experience.

Speaker 1 You're learning something new at every you sign a phone book's worth of papers and it's a whole thing.

Speaker 5 But there is also a level of due diligence that you want to do ahead of time before you start getting other folks involved.

Speaker 5 And a lot of that is reviewing your credit, reviewing what your numbers are, looking at the income, all of that stuff. I want you guys to take so much control of this.

Speaker 5 and not make rash decisions like getting out of your lease before you've even checked your own credit, right?

Speaker 5 Because you should, you would know that that eviction is there, you know, and that's kind of what I mean by that.

Speaker 5 I want you guys really dialed in, doing your due diligence, getting ahead of things and not letting it just kind of happen and not making rash choices of like, we love this house.

Speaker 5 Let's get out of the lease.

Speaker 5 Forget the payment. We don't have to, like, I just, John, I'm not trying to

Speaker 1 read too much in. I just, I just, I feel like I'm here, I'm, I'm, I'm hearing part of the story, Jess, because is there another layer to this?

Speaker 6 Um,

Speaker 3 no, there isn't. I mean, you know, the lender that we were working with,

Speaker 3 you know, we asked all these questions. Is there going to be a problem? You know, can you assure that we are going to get into this house? Because otherwise,

Speaker 2 we weren't going to do what we did.

Speaker 3 And she was like, no, no, no, everything is fine. On my end, everything is fine.

Speaker 3 And then, you know,

Speaker 2 it wasn't.

Speaker 5 So tell us, okay, well, if that's it, then it's as simple as John said before. I mean, I'm not going to beat a dead horse.

Speaker 5 Yeah, go to them, say, you need to remove this from my credit, contest it on your credit. And then once it's removed, go back through with the situation.

Speaker 5 If you want my advice, which I know you didn't ask this, but I would not be buying a house unless I was completely debt-free with three to six months of expenses saved in a high-yield savings account.

Speaker 5 And I'd want to make sure that I'm putting down five percent, anywhere between five to 20%. You could do more, but no less than 5%.

Speaker 5 And the payment doesn't need to be any more than 25% of your take-home pay. That's wisdom in this situation.

Speaker 1 I hope that you take it. Well, and here's one layer deep.
Again, you didn't ask for this, Jessica. I hear something in your voice.
And man, I don't mind being wrong

Speaker 1 that you know you're married to a guy who all of your eggs are in this basket,

Speaker 1 not just relationally, but financially. You're at home and for a second time, he assigned his name to a piece of paper and just walked away from it.

Speaker 1 And rarely does that pattern of behavior exist in only one sphere,

Speaker 1 that you're a person of integrity everywhere except when it just comes to leases, I don't really care about them.

Speaker 1 And so, if that's the case and you have just doubts in your gut about buying a house, because dude, they will come for both of you if you buy a house. They'll take your home from you, right?

Speaker 1 And that's a scary, scary proposition. So, before you buy a house, make sure we got the money.
And if we sign a 30-year note, We're prepared to be here 30 years or pay this thing off.

Speaker 1 Or a 15-year note, we're prepared to sign this thing and not leave because you can't just walk away. You can't just walk away.
Jade,

Speaker 1 it's frustrating when life changes and I have a new idea, but I've signed my name to a

Speaker 1 contract.

Speaker 1 And the right thing to do almost always is to, I said,

Speaker 1 this is what I said I was going to do, and I'm going to honor that thing. It almost always comes back to bike check.
Yeah, always. That's right.
That's right. We'll be right back.

Speaker 1 This is the Ramsey Show.

Speaker 1 Welcome back to the Ramsey Show. Are you ready? Yes, we are.
Tomorrow night is Ramsey's biggest live stream, and it is totally free.

Speaker 1 It's the Ramsey team, Dave and Jade, in your living room, on your phone, on your iPad, on your big screen, however you consume it.

Speaker 1 350,000 people have already registered and they are ready to do something different with their money.

Speaker 1 And so listen, Jade and Dave are going to give you practical tips and the motivation you you need to start building wealth, find margin, get out of debt, do all the stuff we're going to do step-by-step playbook.

Speaker 1 And Jade, I take calls for like personal calls on my cell phone from folks all over the country

Speaker 1 who have incomes that I can't even wrap my head around. Yeah.
And I could hear the courage. It's taking their, it's building and building and they say, hey, okay, walk me through this budget thing.

Speaker 1 Yeah. Right.
And it's embarrassing. It's embarrassing.
Right.

Speaker 1 It shouldn't be. It shouldn't be, but it is.
Yeah. It is, right? Yeah.
And so this is a way you can learn step by step and you don't got to ask anybody anything.

Speaker 1 But if you do want to ask, at the end of the live stream, Rachel Cruz and George are going to join you guys for live QA.

Speaker 1 Your questions are going to get answered and you're going to help a whole, whole bunch of people.

Speaker 5 Yeah. This is going to, I mean, to your point, this is one of those almost like asking for a friend, right? You know,

Speaker 5 you don't have to put yourself out there. You can put on your pajamas and heat up your lean cuisine and just watch it on the couch and get all the answers you want.

Speaker 5 But, you know, I hope you do get involved. Get involved in the chat.
Ask your questions.

Speaker 5 I would love to remove the stigma from, you know, talking about money and being real with your money because chances are, the way you're feeling, the person next to you is like, oh,

Speaker 1 me too. And then your question becomes a blessing for everybody.
Yeah. Right? Yeah.
It makes people feel not so alone, and one question answers it for everybody. That's right.

Speaker 1 Go to ramseysolutions.com/slash live stream. We're also giving away five to five different people $4,000 in cash.
And there are few things in the world more fun than giving away Dave Ramsey's money.

Speaker 1 So sign up. And if you create a free Every Dollar account, you'll get a bonus entry into the giveaway.

Speaker 1 We're going to be using Every Dollar throughout the live stream, and they're going to show you immediate ways you can take control of your money.

Speaker 1 So go to ramseysolutions.com slash live stream tomorrow night, 7 p.m. Central for free.
No more excuses. Bluff called.

Speaker 1 Get right with your money in 2025. Let's go up to Nashville or let's go right down the street and talk to Johnny5.
What's up, Johnny?

Speaker 1 Hello. What's up?

Speaker 10 I have $40,000 in debt, and

Speaker 10 I have been put on short-term disability, and I'm at a breaking point to where my credit card bills are going to go behind.

Speaker 1 Oh, man, what happened, brother?

Speaker 10 Mental health issues. I had to have medication changes, and they took me out of work for it.
And

Speaker 10 it's been a month and a half. I had $1,000 saved up for it, and I floated all my bills for that month.

Speaker 10 And I'm out of funds, and I'm at the point to where everything's about to run behind.

Speaker 1 Yeah. Is there any chance you, I'm assuming you've looked into this, any chance you had

Speaker 1 disability insurance through your job?

Speaker 10 Yes, I'm on short-term disability right now.

Speaker 1 So you're getting some money, just not enough?

Speaker 10 I'm getting $300 a week, and my wife does work, but she's only bringing in $1,000 every two weeks.

Speaker 5 What does she do?

Speaker 10 She works in a factory.

Speaker 1 Okay.

Speaker 5 And she's getting $1,000 every two weeks. Okay.

Speaker 5 So you guys are at $3,200 a month.

Speaker 9 Yes.

Speaker 5 Is she working full-time or is that part-time work?

Speaker 10 No, that's full-time. Prior to me going on short-term, we were bringing in roughly $5,000 a month, but me being on short-term has cut my funds by about $2,000.

Speaker 1 grand how long are you going to be out brother

Speaker 10 i'm dated to go back in march but it could be sooner or they could decide to extend it i don't really know it's up to my doctor how are you feeling

Speaker 10 uh i'm all right right now but like i said this debt's you know stressing me out sure absolutely

Speaker 5 okay um

Speaker 5 I'm looking at this, and

Speaker 5 there's the issue of the short-term disability.

Speaker 5 You're going to be off of that soon.

Speaker 5 When are you projected to be back full in action?

Speaker 10 3-2.

Speaker 5 3-2. Okay.
So in March,

Speaker 5 the clouds part and you can start to see a better day.

Speaker 5 But in that meantime, I still think that there's an income issue here. You know, your wife's working full-time to make $24,000 a year before, you know, after tax.

Speaker 5 That's tough right there for 40 hours a week. I'd love to start looking at a trajectory that gets you guys' income up so that you can start making headway on this debt.

Speaker 5 Um, that's what I would be interested in long term.

Speaker 5 So, before you get off the call, I want to get you guys set up with King Coleman because he's got a lot of great materials out there just for career projection, whether this is for your wife or for you.

Speaker 5 I want to get you guys in a better situation to where you're paying off this debt faster, you're doing work you love, and you're really getting to that point of financial peace that we all want to get to.

Speaker 1 Here's a couple of things you can, Johnny, you can do, okay?

Speaker 1 If I'm just trying to project myself, I'm your neighbor, I live here in Nashville.

Speaker 1 If I'm you, if I woke up and found myself in your exact spot, the first thing I would do is I'd sit down with my wife and y'all have to figure out a way that at least for the next 30 or 60 days, she can make some more money.

Speaker 1 And no husband wants to have that conversation, but that's just the financial reality y'all find yourselves in.

Speaker 1 So if she goes and does this job and then she delivers pizzas in the morning or in the evening and drives Uber people to the airport in the morning, she's going to be exhausted in 60 days two months but y'all aren't going to get buried underneath this underneath this deal and you can say hey i'll take care of the house my purpose for the next 30 days while i'm getting well is i'll make sure there's we got breakfast and dinner i'll take care of that but y'all y'all y'all need to get some cash in your home quickly the second thing i would do is i would call those credit cards and just

Speaker 1 i don't know i don't know if this will you know this in five cents will buy a cup of coffee but you can plead and say i need a 30 or 60 day stay on my account I've had a medical issue.

Speaker 1 I'm on short-term disability. I'm scheduled to go back March 2nd.
Can I roll these things? And that might, they might do that for you.

Speaker 10 See, I did that with one credit card, and they cut my bill in half, but they canceled the card and put me on a 60-month plan. Okay.

Speaker 10 And by doing that, dropped my FICO score by about 70 points.

Speaker 1 Could care less about my FICO score.

Speaker 5 That's the least important thing in this equation. Could care less.

Speaker 10 Okay, so so here's my next question.

Speaker 10 One of my

Speaker 10 ways of thinking was I don't care about my credit cards. My house payment's only $300

Speaker 10 plus land taxes plus insurance.

Speaker 10 Not counting my debt for credit cards.

Speaker 10 My the bills to run the house is about two grand.

Speaker 1 Okay.

Speaker 10 Now,

Speaker 10 I don't care about my credit cards. I don't care about my debt.
My house is five years out from being paid off. Great.
My car is 10 months out from being paid off.

Speaker 1 Okay.

Speaker 10 I want to keep my house paid. I want to keep my cars paid.
I was willing to let my credit cards get behind and then call them and see if I can get the same deal off of them once I get to it.

Speaker 1 Don't do it after it's already saled. The ship's already sailed.

Speaker 5 And why would you need to do that? Because you told me, as it stands right now on disability, you're at 3,200, but then you just told me it takes 2K to make your house run.

Speaker 5 So what's happening to the other 1,200?

Speaker 10 It's more like 2,300. That leaves us about 700 bucks for food.

Speaker 1 Okay.

Speaker 5 When you said it's more like 2,300, what happened to the other money? Because before you said $1,200 for you and your wife brings home $2,000, $1,000 a week, or I'm sorry, $1,000 every two weeks.

Speaker 10 Yeah, she's bringing in $2,000. I'm making about $1,200.

Speaker 10 The lights, the gas, the

Speaker 10 all that added up together on top of my car payment and my house payment coming out just over two grand.

Speaker 5 Okay, so what I want you to do, I want you to throw this in every dollar because you're doing the type of budget that I,

Speaker 5 the type of budget where you only plan the things that you think are important, but you forget to add the other stuff. I want you to budget every single dollar of this money.

Speaker 5 So before you get off the line, we'll get it for you. And I want you to put your income at the top, your wife's income at the top, top, and then go through line by line.

Speaker 5 Every dollar, I'll have some default categories there to kind of prompt your mind and get you thinking of what you're spending money on. But be sure to add everything in there.

Speaker 5 I'm talking about grandma's birthday, you know, you stopping off at

Speaker 5 Wawa to get a snack, all of that. Put it into the budget.
And I think you might find that there's more money than you think.

Speaker 5 And that might give you a little peace in this situation.

Speaker 1 And that $700 in food for the next 30 or 60 days, y'all are beans and rice in it. Yeah.
And you can bring your kids in there to help cook and

Speaker 1 make the food, but y'all are eating as cheaply as possible.

Speaker 1 Thanks for the call, brother. We'll be right back.
This is The Ramsey Show.

Speaker 1 Welcome back to The Ramsey Show. I'm John Deloney, joined by my great friend, Jade Warshaw.
Let's go out to Raleigh, North Carolina, and talk to Jake. What's up, Jake?

Speaker 10 Hi, thanks for taking my call.

Speaker 10 I'll get right to the point.

Speaker 7 I live in an expensive city, and my question is regarding buying a home.

Speaker 9 Am I better off liquidating my brokerage accounts to put down a down payment? Or should I aim for the, you know, I know

Speaker 7 Mr.

Speaker 9 Ramsey talks about, you know, 15-year mortgage, 25% of my income,

Speaker 9 which would be

Speaker 9 a very,

Speaker 9 very, not a very good place where I live.

Speaker 1 Okay.

Speaker 10 So the question is, you know, do I save up and hope that I can save up to buy a home cash?

Speaker 9 Do I liquidate these brokerage accounts that I've saved up over my years? I'm almost 50 years old, by the way.

Speaker 1 Okay.

Speaker 9 To lower that mortgage payment. I'm getting varying advice from friends and family and so forth and online as well.

Speaker 1 Okay.

Speaker 5 That's a good question. So

Speaker 5 first off, what are you looking to spend? Do you kind of have a range that you're like between here and here? Or does that depend on what we need?

Speaker 9 Yeah, so I'm, I mean, I'm in a good financial situation. The houses I'm looking at are probably in the 1 to 1.5 million range.

Speaker 1 Okay.

Speaker 9 And the reason why I can't, I would love to move out rural, but, you know, I have a special needs child. All the resources and the schools are in the city.

Speaker 9 It's just not realistic to have to drive, you know, 45 minutes or to.

Speaker 1 have my kid wake up early. Sure.

Speaker 1 And we can't make a lot of business, you know, appointments that are in business hours.

Speaker 9 So I'm kind of stuck in this range. I'm renting right now.

Speaker 9 So, yeah, that's the kind of range I'm at, the 1 to 1.5 million.

Speaker 5 Well, what's in the brokerage account? What's non-retirement?

Speaker 9 500K.

Speaker 5 500,000. Now, when you put that money aside in that brokerage account, in your mind, was the purpose of it to buy a home or was it for something else?

Speaker 9 No, this is just lifetime. It was just for

Speaker 9 savings and to add on to retirement.

Speaker 1 Got you.

Speaker 5 And what do you have in retirement?

Speaker 5 401k plus ira is probably around uh a million okay i'm thinking nice to it today dude yeah um cash in today yeah i i'm i'm with john i think that this money of course i'd keep three to six months in your case i keep six months of expenses liquid or in that you know you could i i wouldn't keep it in the brokerage i'd throw it in a high yield savings do you have any money liquid in a high yield savings

Speaker 9 yes uh i i sold my old home uh to move to the city we recently moved here so that that's why I'm asking this question now at my age.

Speaker 1 What's in that?

Speaker 10 I took that money about 250K.

Speaker 9 I put that in a high-yield savings, you know, 4.something percent, you know,

Speaker 5 get what you can get. So what else? Any other money we should know about?

Speaker 9 No, that's it. That's it.
So, yeah, just

Speaker 1 $750,000 you could put down on a house. You're good, homie.
You're good.

Speaker 5 I get it. Now,

Speaker 5 you might decide, based on

Speaker 5 how how you're trying to keep your expenses low, it sounds like you are. You might decide, yeah, I'm going to go more for the 1 million range instead of 1.5 because the truth is that's a big swing.

Speaker 5 That's a $500,000 swing. That's your entire brokerage.
So I would, if what you're looking for is to get as close as possible to a cash home, yeah, you're looking at a $1 million.

Speaker 5 And you're going to want to keep, like I said, six months of this out. So you got $700,000 to put down on a $1 million home.
How do you feel about carrying $300,000 in a mortgage?

Speaker 9 Well, I'd feel much better.

Speaker 9 It's just, you know, people are like, why would you give up all that brokerage when you can just do a 30, you know, I know 30-year mortgage, pay less, you know, long, take advantage of compound in the market, blah, blah, blah.

Speaker 1 You know, that can be a lot of money. Yeah, but you'll be losing compound on the other end with a 30-year mortgage at 6%.

Speaker 9 Right.

Speaker 1 You know what I'm saying? So the net compound is,

Speaker 1 I call it my sleep tax, my soul tax.

Speaker 1 If I'm earning 8% on one end or 10% on one end and I'm spending 7% on the other, that 3% to not have a mortgage, I'm glad to pay that.

Speaker 1 Especially with a special needs kid because no one could take our house away from us.

Speaker 9 Yeah, I guess it's just a little scary to lose my non-retirement account because I kind of treat that as untouchable, right?

Speaker 1 I got you. And that was another question.

Speaker 9 Do I also stop contributing to my 401?

Speaker 1 No.

Speaker 5 You need to continue to

Speaker 5 continue to contribute 15%.

Speaker 5 And I want to be really clear here. If you don't, like if you say to yourself, listen, Jade, I have my eye on the house I want.
My down payment's going to be 20%.

Speaker 5 I'm happy to put, you know, 250,000 down on this and the payment's fine for me. Like you, this is your money and you have the choice.
You can make the choices you want to make. Right.

Speaker 5 So you have to decide what do I value most? Do I want, do I like this money in the brokerage sitting there and waiting for, you know, working for me? Do I only want to use half of it?

Speaker 5 Do I want, you know, you have options here, which is the wonderful thing about your position. You're not, your back is not against a wall in any way.

Speaker 5 So you kind of have to decide what am I comfortable with parting with. And also keeping in mind that long term,

Speaker 5 the goal is to not have a home payment, like John said. And so run those numbers out and go, okay, by the, when do I want to retire? Because by the time I want to retire, I want this thing paid off.

Speaker 1 Right.

Speaker 5 And so you get, does that make sense?

Speaker 9 Yeah, I guess generally speaking,

Speaker 9 most of the advice I've gotten has kind of been along those lines. Figure out what you're comfortable with.

Speaker 9 But I think a lot of people are like, you would be crazy to liquidate everything and reduce that mortgage.

Speaker 1 So, Jake, let me just tell you. I'm getting over it.
Can I just tell you? I just did that.

Speaker 1 Yeah. I did that less than a year ago.

Speaker 6 Yeah.

Speaker 1 I didn't have it in a brokerage account. I had it in a high-yield savings account.
But I, growing up in the house that I grew up in,

Speaker 1 was very uncomfortable with

Speaker 1 money. And I accumulated a chunk of change and I did not realize how much of my identity and safety I was putting in that savings account.

Speaker 1 So when my wife and I, for reasons not quite similar to yours, but very similar to yours,

Speaker 1 she's one of these newfound wives that wants sell signal and she wants to not have to drive an hour to drop the kids off in school, stuff like that, right?

Speaker 1 And so, yeah, I took that money out.

Speaker 1 And here's the thing.

Speaker 1 I had two or three months of, oh my gosh, I put all of my faith and all of my safety and security, not in my faith, not in my family, not in my work, not in, you have a million dollars in savings, by the way, in your retirement account, right?

Speaker 1 Yes. And so

Speaker 1 nobody's starving here. You're good.
You're fine. It became, oh, this is all about me and me putting safety in the wrong things.

Speaker 1 Yeah.

Speaker 5 Maybe you run out, run the numbers out. If I were you, I would sit and go, okay, I've got the million dollars.

Speaker 5 And what's that going to look like 10 years from now when I'm 60 if I continue to contribute 15% of my income?

Speaker 5 You already know a lump sum is going to double every seven years, but continue to add your contributions on top of that.

Speaker 5 Knowing that retirement-wise, you're going to be fine is also going to play into the decision that you make here.

Speaker 5 And then, yeah, run it out with, okay, well, what if I take, what if I keep 250 of the, of the brokerage in there? What is that?

Speaker 5 How does that change the numbers? And then ultimately, yeah,

Speaker 5 run that through. Okay, what's my legacy going to be?

Speaker 5 I've got this special needs child what do I need to leave to them like run those numbers and you're gonna see all of your options and what makes sense what you're gonna feel like you know at the end of the day is excess and better serve that that would better serve you now today in this new house so I think that's gonna give you a lot of insight there's not a wrong there's not a wrong answer here the only wrong answer is to you know go into debt and do it at 30% and do it to the point of you're never paying it off and that sort of thing so and I think the other thing that that I would classify as quote-unquote wrong here, and I don't like to use that language all the time,

Speaker 1 is don't not do something because you're scared. Yeah, that's good.

Speaker 1 Yeah. You have $1.5 million,

Speaker 1 not including a cash account with $250,000 in it. And I missed it.
What's your take on? What's your salary?

Speaker 9 After taxes and contributions, about $15,000 a month.

Speaker 1 Yeah, listen. So here's the thing.
You're playing on house money.

Speaker 1 Yeah. And so the thing, I wonder how much of it is just fear.
It's just fear.

Speaker 9 A lot of it's fear. A lot of it's fear because I don't know how long I'm going to be working and what my daughter's going to need when she's older.

Speaker 1 How old's your daughter?

Speaker 9 She's nine.

Speaker 9 And I'm older. I'm an older parent, obviously.

Speaker 9 But it sounds like you guys are on board with if I decided to just put it all in,

Speaker 9 that is not an unreasonable or insane decision to make.

Speaker 1 If I were you, I would do that.

Speaker 5 And I'd keep a good emergency fund, maybe a little bit more, because you do have a special needs situation.

Speaker 9 Right. Yes, I would, yeah, it wouldn't be all $750K that I have in cash and brokerage.

Speaker 1 It would be, you know, $650 or something about that.

Speaker 5 Thank you so much for the call.

Speaker 1 That's awesome, man. This is why we do this show: so the people who have curveballs in life have options.

Speaker 1 This is the Ramsey Show.

Speaker 1 Welcome back to the Ramsey Show. I'm John Deloney, joined by Jade Warshall.
Hey, we have this rad new segment on the show. It's called Sorry We Missed Your Call.
And here's the deal.

Speaker 1 People call and leave us messages. Sometimes the messages are hilarious.
And sometimes they are

Speaker 1 critical in a good way. Like they point out some things.
And sometimes, as they usually are, they are questions. People are asking for help and they tried to call into the show.

Speaker 1 They couldn't get through because so so many people were calling in, or they called in after hours, or they caught the show not on radio, live radio, but they caught it on YouTube, and they just wanted to reach out and ask a question.

Speaker 1 So we have a new segment called Sorry We Missed Your Call. Here is the question from Amber.
Amber writes, hey, my name is... Oh, oh, we're going to listen to it.
Okay, we're going to listen to it.

Speaker 1 Sorry, James. Go ahead.

Speaker 12 Hey there, my name's Amber, and I just have a question about donating to the needy. I know that kind of biblically and,

Speaker 12 you know, morally, it's good to help out those that are poor and needy. I have this one family that phone me all the time asking for money and I'm just wondering

Speaker 12 if I should keep giving them money or if there's a limit to when I should be giving them money.

Speaker 2 So that's my question. Thanks.

Speaker 1 Okay, bye.

Speaker 1 What do you think, Jade? Ooh, I always love a generosity question.

Speaker 5 Listen, I will be the first to tell you that I think that generosity is one of the five pillars of personal finance.

Speaker 5 Super duper important.

Speaker 5 And it really is the concept of going through life with an open hand, right? Money comes in, money comes out. It's not too tight of a grip on it, which means it's in its rightful place.

Speaker 5 I'm fine with it leaving or coming in as

Speaker 5 it sees fit. I do think that

Speaker 5 creating boundaries around anything is a wonderful thing. And just having a clear intent on what it is that you're trying to accomplish is a very good thing.

Speaker 5 So this kind of like limitless, it's just an open well that never stops could be detrimental at some point.

Speaker 5 But if you've also gotten yourself to a point financially, let's say you've, John, you've, you've paid off all of your debt, you've got your three to six months of savings, you're doing your investing, you have secured yourself and your families back.

Speaker 5 Then if you say, hey,

Speaker 5 like a lot of people will decide to give 10% to their local church, love that.

Speaker 5 If you're not a, you know, religious or affiliate or anything like that, you say, you know what, my thing is, I just pick a family and I give 10% of my income to supporting these families in need.

Speaker 5 Fine. I just think that you need to create some sort of rhythm and boundary around whatever it is that that is.
And it's not so much of a, hey, whenever you call me up, you know,

Speaker 5 I'm here to, you know,

Speaker 1 what you need. Yeah, yeah, yeah.

Speaker 1 We get to bypass reality sometimes because we'll just call you. Yeah.
Right. So I love what you asked.
I want to always go back to that question is why, of why are you giving? Right.

Speaker 1 And if you're giving because you think you're superior to somebody in need, then keep your money.

Speaker 1 If you're giving because you have just been insanely blessed or even a tiny, tiny bit blessed, and like you said, you live life with your hands wide open.

Speaker 1 And by the way, we're all in a season. All of us are in a season, right? Yes.

Speaker 1 And it might be really cold in your season, or it might be the harvest may have come in, but we are all in a season.

Speaker 1 And if you happen to be in a great season and you want to be supportive and you have your eyes open, you can help people. And that could be tipping really well.
That could be strategic giving.

Speaker 1 That could be giving to local school, any church, anything.

Speaker 1 In this kind of situation, after one, two, three, four, whatever number is in your head, it sounds like she has reached a point where she is no longer comfortable.

Speaker 1 I'm giving money and it's not helping this family

Speaker 1 or this person. And that's where the harder thing I think to do is to have a personal conversation.
We're going to go to coffee

Speaker 1 and you just talk to me about what's going on. And then to say, okay, this is the last time I'm going to give you cash.
I'll give you Ramsey plan. I will help you get a job.
I will walk you.

Speaker 1 I'll take part of the time off my job and and I'm going to walk you over to a local, one of those like day-ready places where you can get you a job. Like, I'll walk with you.

Speaker 1 I'm going to walk next to you.

Speaker 1 But the cash ATM part of our relationship is going to come to an end. Yeah, OT.
And so I think it just expands what, quote-unquote, help means and giving means.

Speaker 1 And there is some time,

Speaker 1 dude, like right this second is not the time to get a lecture. My light bill is about to get cut off.
Right. Right.
There's those moments you step up and you help out your neighbor. Yeah.

Speaker 1 The larger conversation is, I'm not going to pay your light bill for the rest of your life. Yes.
Let's have a deeper conversation about what's actually going on.

Speaker 5 Yeah.

Speaker 5 And I think that, I mean, that that's the whole kind of like nature of benevolence is like, hey, I'm going to get you out of this jam, but ultimately, we're making sure you don't end up in this jam again.

Speaker 5 There you go. So that's kind of how it works.

Speaker 5 Yeah.

Speaker 5 Yep. I guess.
Covered it.

Speaker 1 Yeah. And I guess the last thing I'd say is

Speaker 5 don't give out of guilt.

Speaker 1 Yeah. Yeah.
Yeah.

Speaker 1 The thing here, I guess, is

Speaker 1 you have to look yourself in the mirror. That's right.
Right. And probably if we took me and you and Dave and Rachel and George and Ken and we all sat down and said, what's our philosophy of giving?

Speaker 1 And it'd probably all be different. A little different.
And so I think all of us are united. Like giving is just a way of being.

Speaker 1 It's a responsibility all humans have to each other. What that looks like day in, day out with each family in each situation, that's just different.
And so

Speaker 1 it's easy in this situation to go around and ask person to person to person.

Speaker 5 Amber, if it's just you at home, look yourself in the mirror and be honest and then set your own boundaries and then go give recklessly within those boundaries and then if you're married y'all sit down and decide who we're going to be this year financially with what we give and go get it right yeah and just another note to that i think typically i mean we could all come up with a situation where that's not exactly been the case but typically financially the best time to give is from overflow so that you're making sure you're taking care of your family your own home situation and if you're not in that point there are so many other ways that you can be generous that aren't directly dollars in your pocket right?

Speaker 5 Like there's so many ways with your time and your effort and your words.

Speaker 1 Your expertise.

Speaker 5 Yes, your expertise. You can trade skill sets and things like that or do

Speaker 5 a trade or something for free for somebody. So there's a lot of ways to be

Speaker 5 generous that don't put you or your family in a situation where you're not paying your own bills.

Speaker 1 It's amazing. All right, let's go out to Atlanta, Georgia, and talk to Michael.
Hey, Michael, what's up?

Speaker 6 Jay, John, how you guys doing?

Speaker 1 We're doing fantastic, brother. We're up against the clock, so hop in right on top of your question.
What's up?

Speaker 6 Hey,

Speaker 6 I was just wondering if I could give you some of my financial life insight and if you can help me figure out a two-part question.

Speaker 1 You got it.

Speaker 6 The first question being, how can I budget mine and my wife's irregular income? And the second question

Speaker 6 being, where should I go next?

Speaker 6 So my wife and I's income, I make about $80,000 a year.

Speaker 6 And she is a stay-at-home mom, but she has a side hustle where she's watching children, and she makes anywhere between $100,000 to $400 a week.

Speaker 1 Okay.

Speaker 6 And that's,

Speaker 6 I'm currently working on making more money. Within the next month, I'll probably

Speaker 6 work on making $100,000 a year.

Speaker 6 And I'm saving for retirement at the moment.

Speaker 6 6% match this company I'm with now is doing.

Speaker 11 And

Speaker 6 yeah, that's where I'm at. I've got a one-year-old and I've got a $1,700 mortgage.

Speaker 5 All right. Thanks for the information.
That's super duper helpful. So you mentioned the first issue is kind of like figuring out how to do this irregular income, which is such a common question.

Speaker 5 It's not, it can be befuddling. So

Speaker 5 tell me, every month, when you guys kind of tally up your paychecks, how much is it when you get paid?

Speaker 6 So, like, I'm I make no more. Assumably every week, I bring home about $1,100.
Okay. And on most weeks you bring home about $200.

Speaker 1 Okay.

Speaker 5 So okay.

Speaker 5 So what I suggest when it comes to a regular income is you kind of take and you plug that that $6,000 into your budget and you're going, you're first starting with the idea of priorities, right?

Speaker 5 The most important things, we call those the four walls, right? So number one, you're always going to make sure your rent's covered, your utilities, your food, your transportation.

Speaker 5 And then quickly after that are the things usually associated with our kids, right? Whether it's child care, insurance, that sort of thing.

Speaker 5 And so you kind of have this prioritized list of when the money comes in, these are the things that must be covered.

Speaker 5 And if I have enough money to cover all of those things, then I can go to the next most important things. I can start talking about, I don't know,

Speaker 5 cell phone bills and keep going down that list, right? And if you look and you realize, okay, I have enough money to cover everything, that's a green light.

Speaker 5 Like that, that feels great, knowing that even on a lower month, you can cover everything.

Speaker 5 Now, if you're in a situation that you go, hey, I've kind of looked back on 12 months and on my lowest month, I still can't, I can't cover everything.

Speaker 5 Then you know that when you have a higher month that comes in, you need to kind of pull some reserve and set it to the side. So, we kind of call that peaks and valleys.

Speaker 5 When you have a great month, you keep a little extra aside. And when you have a valley, that money is there when you need it.
A better tool for you probably to utilize is going to be an every dollar.

Speaker 5 It's a premium feature. It's called paycheck planning.
A good budget tells your money where to go, but paycheck planning tells it when to go. So you're planning when you spend every single dollar.

Speaker 1 All right, that's the second hour in the books on the Ramsey Show. You can find the rest of the show live on the radio or behind the Ramsey Network app.

Speaker 1 We'll see you there shortly, right here on The Ramsey Show.