You Can’t Outearn Bad Spending Habits Forever

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Ramsey personality, my daughter, is my co-host today.

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Elena is in Huntington, West Virginia. Hi, Elena, How are you? I'm doing good.
How are you? Better than I deserve. What's up in your world? So I've been watching you for a long time, for years now, and I have just saved my $1,000.
Good. And I am also drowning in student debt, credit card, and my car loan.
I do have a job. I make about $50,000.
My debt is a little bit more, around $65,000. I hate my job and I want to go to school, but I don't know if that's a good idea because of the amount of debt that I have.
I'm trying to figure out what the best way is to get out of this mess, basically. What's your current job? What are you working that you're not enjoying? I work in property management.
I'm an assistant property manager. Okay.
And is it the field that you're not enjoying or is it the specific company, do you think? Because you said you want to go back to school. I'm just curious what else is out there that you're thinking.

Yeah, so I think it's just the field.

This is actually a Christian-based company, which is super awesome.

So I think it's just the field.

I'm not happy here.

It's just not fulfilling.

I do love kids, so I've always wanted to pursue NICU nursing.

But I graduated in Hawaii, and the diploma I got from there is not recognized.

I would have to go back to school for a GED and then go to college.

But with all the debt and the mess that I have, it's just kind of overwhelming,

and I really don't know kind of where to go.

Well, I think we're doing this a little bit backward you want to run to something not from something as far as your career goes um and so what i would do if i were in your shoes is i would very clearly identify and spend some time and some soul searching and we'll even give you some tools to help you with this,

identifying exactly what you want to do with your life in this next chapter.

Going back to school, in air quotes, is a really bad idea

unless that particular degree is necessary to do the thing you want to do. Okay? Right.
And sometimes when people are running from something, they, air quotes, go back to school, as if that's going to solve anything. It's not going to solve anything.
You need to actually be studying toward becoming the thing you want to be. Did you say you wanted to be a pediatric nurse? A NICU nurse.
A NICU nurse. So yeah.
Okay. And your high school diploma does not count? Yeah.
So I graduated from a competency adult community school and apparently that is not recognized nationally and I have to go back for a GED which is crazy because I've been using that pretty much my whole life. Okay, so right now you're a high school graduate that needs to pass a GED to prove it, right? Basically.
And then you would have to go through all your undergrad and go through nursing school to be a nursing NICU. Okay.

So what Ken Coleman would tell you to do,

that is one of our Ramsey personalities that's written extensively on this idea,

is he would tell you to go over there in your off hours

and volunteer in the NICU to rock babies.

That is true.

And talk to the nurses that are there

and tell them it's going to take you six years to be one of them.

Is it worth it?

Yeah.

Now, I'm a huge fan of nursing as a career field, but I like little babies is a long way from I want to go to school for six years to be a NICU nurse. That's a different thing.
It's a lot different. Okay.
So because nursing at times is gross. Nursing at times is very stressful.
Nursing at times will break your heart. Nursing at times will cause your back and your feet to hurt and ache.
It's hard work. It's a great career field, but it's way different than I have a heart for children.
You follow me? Yeah. So what I want you to do is get your arms around what it is you want to do and exactly what the cost is and then we're and i don't want you to spend six years and end up on uh in a field that you hate accidentally you wouldn't want to do that so number one we don't want to go back to school in air quotes as an escape mechanism number two we want to if we're going to go back to school let's make sure that whatever we're studying gets us there.
And then number three, what are some interim steps we can take to move in the direction of the field while you're talking about going to school there? So while you're working on your undergrad and passing your GED and getting your undergrad going at your local community college there in West Virginia, which you can do your first two years there just fine, you're probably keeping the job you've got. Or you're getting a better job making more money, but maybe not in your career field.
Or if you can find something where they'll pay you $40,000 a year to be in and around the medical field and you can get a sniff of what it is you're signing up for, then I would go along with that. Yeah.
And I would tell you too, Elena, just with the numbers you gave, not even thinking future, just presence, right? You're, you're the money you need. Yeah.
And so what are things you can do? Cause I would tell you, regardless if you wanted a career change or not on this call, part of the solution of you getting out of this debt is going to have to be upping your income. And so whatever you're doing beyond your current job, let it be around kids.
Like I would go on care.com and see if somebody needs a nanny from 6 to 9 p.m. or whatever, right? Like finding things in that that are going to make you more money to get out of debt and start your financial process and this ball rolling to get you ahead financially.
but then also if you compare that with some level of your passion of what you're talking about

while start your financial process and this ball rolling to get you ahead financially. But then also if you compare that with some level of your passion of what you're talking about while at the same time doing exactly what you're saying.
But you need more money right now. I mean, in my opinion, for the amount of debt that you have.
You can scratch the kid itch by joining the children's ministry at your local church. Yes.
And they need your help, by the way, because they're always perpetually understaffed. And again, this isn't about...
I do have a... Go ahead.
Do you have a what? I was going to say something really important, too, because I am a believer and a follower of Christ, but I did do something really stupid. And when my sister passed away early this year, I would say I was super vulnerable and dealing with grief, not knowing how to deal with grief for the first time and I ended up moving, of course, from my first job early this year, paying about $70,000 to live with my boyfriend and now we're living in this house unmarried.
We're not seeing eye to eye in terms of finances. That's easy to undo, isn't it? Yeah.
Yeah, yeah move out my dad always said my dad always said why pay for the the cow um when you can get the milk for free right so i'm kind of struggling that's a wise man and um so yeah but you can fix that you can just move out where where were you living when you were making 70 in arlington virginia can you get that job oh that's more expensive Huntington, West Virginia. I don't know that you were netting 20 more.
That's a very expensive place to live. Okay.
Yeah. I mean, you can, you can reverse that.
You can just say, Hey, I'm doing something I'm not proud of and I'm not going to do it anymore. That's a decision.
Just like the decision to do something wrong is you can make a decision to do something right. So go do that kiddo.
Hang on. We're going to get you signed up for Ken Coleman's everything.
I want her to get the assessment and the proximity principle book and the whole thing. Hey, listen up.
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For those of you that got kids and grandkids, be sure and check them out. Because you do, hey, listen, you teach a child gratitude.
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Hello. So, I mean, that's part of being a good dad, a good mom, a good grandpa, good grandma too, by the way.
Do not think that Papa Dave is not above reading his daughter's books to his daughter's kids. I have been known to keep it all in the family here.
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Justin is with us in San Diego. Hi, Justin.
Welcome to the Ramsey show. Hey, you guys.
Good morning. Uh, thank you for your time also.
Sure. I'm trying to figure out, um, I have a three year old and all of the money that we get for her birthdays and like holidays and things like that.
Uh, we just kind of been putting into a CD that's yielding about 5.29% annual return. And I want to give it to her when she's 18 as like a life starter kind of fund.
So I don't want to put it into a 529 or a retirement fund. Is there anything better that has a higher yield or better return for her when she does reach 18? Are you saving for her college? I'm active duty military and I just finished my master's.
So I've already transferred all of the benefits over to her. So I'm going to take her through, you know, community college.
And then I'll pay for that. And then pretty much all of her master's is going to be completed.
I already paid for. Okay.
She has all that already. Okay.
The answer to your question is just a simple mutual fund. And when I'm doing something like that, I just pick a good growth stock mutual fund that has a long track record.
And I did that for our kids because when Rachel was a baby, there was no 529s or ESAs. And so we used just put the money in the kid's name, and then it's taxed at the, the growth is taxed at the kid's rate, which is nothing for a long time because they have a standard deduction.
And so the, it's called an UTMA, Uniform Transfer to Minors Act, which is, by the way, the exact same document you used to open up a savings account if you put her name on that savings account you opened. That CD? I did.
Okay, that's called an UTMA. It's an UTMA as well.
Anything you do in a kid's name that's not 18 years old where the parent is the custod, falls under the UTMA, the Uniform Transfer to Minors Act.

It's a law, okay?

It's a process because you can't contract and do financial transactions until you're 18 years old in America.

So children can't have a standalone account.

It's impossible.

Parents have to be on it or someone has to be on it as a custodian and and the utma now the downside with the utma is when they turn 18 years old technically speaking the money is theirs and you have zero control so if you have a 17 year old heroin addict with a hundred thousand dollars getting to come her way you know you don't have control well i mean you don't have control maybe a 17 year old who likes to shop someone i don't know someone has 17 year olds out there somewhere someone did okay so you don't have control over this money you're getting ready to fund her misbehavior if she's misbehaving at 17 okay okay so because you need to be aware of that or like with our kids, we told them is if you're misbehaving i'm going to steal the money and sue me good luck but that's illegal okay you can't really do that and i can't advise you to do that so but i'm not going to fund your misbehavior i'm not going to save up a hundred grand for you but come on justin's i mean like like he's gonna give her money i believe you justin you feel like a solid parent yeah i'm sure his angel's not gonna make any mistakes no i'm not saying that she's not okay so but the thing is this that's what you're up against i okay so would you i personally did not i went that route for your all's college fund yeah i did not go that route for the little savings account that he's dealing with. We kept that little savings account, birthday money and that kind of stuff in place.
Right. And that was the money that helped seed the car first car.
That's right. That's what I was going to say, Justin, depending on the amount.
Yeah. You know, this could be something that she gets earlier that is attached to something that she's wanting whether it is you know a car at 16 um but something that that is useful for her that doesn't necessarily have to be this like big investment and put in a big investment fund but would you um still i mean still with the longevity of being three to 18 you know that 15 years you would still probably put it in would you still put it in a mutual i don't mind five percent because it's not gonna be that much money i mean it's not it's not gonna be twenty five thousand dollars it's gonna be twenty five hundred dollars so if it's just putting birthday money in there grandma's 20 bucks yeah but if he wants to be funding more of his money then you would do a mutual fund over here for more money to be putting in there for the daughter yeah i would but and so to expand on that one step further what we did do also was we took the kids little miscellaneous savings account and we added to it and then when they started talking about being like 10 or 11 years old we started talking to them about uh we're not buying you a car when you turn 16 we will match whatever you put in we're going to do 401 dave and i'll match whatever you put in and so if you put in nothing you're going to have a nice bicycle when you're 16 so get you know let's start talking about doing some chores and putting some money in adding to this little account that we've already got started for you and then they save up and if i recall you can correct me but if i recall you had somewhere around with you had somewhere around five or six thousand dollars and we matched it i hold on okay i had eight eight okay thousand dollars and i put eight with it yeah and you got a little used Beamer.
$16,000 car. $16,000.
And it was a great little car. Took me all the way through college.
It was a great little car. It was good.
It sure did. And the other two siblings did the exact same thing.
I will tell you, parents, if you're going to use that matching idea, be careful in case you have one of those kids that is a nerd super saver, and this highly motivates them, you may end up having to match 30 grand if you don't put a limit on it. So I would suggest you put a limit on it.
I did have one of those, her brother named Daniel, and he just about, it was ridiculous. And so we had to come around and come negotiate a different thing not i did match him but he was generous with some of the money and used some of the money for his car because it was so stinking much and he bought your old jeep or something i mean he even yeah yeah he's he's just a conservative dude but i mean he saved everything it was crazy so put a limit on it we will match it up and he got a head start parents too you you're implementing it you implementing it, you're implementing it.
You know, I'm like four years shy. He had four extra years on us.
Yeah. Well, he watched you two and found out we were serious about this, that it wasn't a game.
We weren't kidding. And he went, oh, crap, I really got to do this.
And he turned on the goals, and there you go. So put a limit on it, and you can do match.
And I use the small accounts for something like that. I use the UTMA for a big thing.
If you're doing a big thing, Jerry, that's what I would do if you're going that way, Justin. This is The Ramsey Show.
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How are you guys? Better than we deserve. What's up in your world? Nothing much.
I was wondering if you guys could tell me what the benefit is of not using an escrow account to pay for home insurance and taxes. Two things.
One, you get to keep the money all year and earn interest on it instead of it sitting in an account that's not interest bearing until you pay your taxes and pay your insurance so it accrues interest and the second one is you don't screw up the accounting and mortgage companies notoriously screw up the accounting on escrow accounts and they get out of balance and there's an escrow shortage and then they raise your payment to make up the shortage or they just miscalculate something and you've got somebody that's the lowest common denominator running the calculation too many times and when i used to own a bunch of property with debt back in the day i would say as many as 40 percent of the accounts were screwed up so i don't know if it's still that bad because i haven't had a mortgage in 30 plus years but um but but i suspect it is still a problem the benefit of using the escrow account is it's on autopilot you don't have to think about it right okay and most people don't manage their money well enough they end up not having the money to pay their taxes or not having the money to pay their insurance. It sneaks up on them like Christmas.

Yeah.

And I know that some mortgage companies don't even give you the option.

Sometimes they require you to use an escrow account.

Correct.

A typical conforming mortgage, meaning a Fannie Mae FHA or VA will require it because they

want to make sure that the house they have a lien against doesn't burn or it isn't taken for taxes. Right.
Okay. And so, yeah, you don't really have a choice.
I personally, if I were you, I would just use the escrow account, but I would stay on them to make sure it's the proper amount. Okay.
How do you recommend staying on top of them? Well, you just want to make sure that the amount being taken out of your payment,

your payment is principal interest.

If it has escrow, it's taxes and insurance, P-I-T-I.

And you want to make sure the amount being held out for taxes and insurance each month

is one-twelfth of the total of your taxes and insurance.

It shouldn't be less than that because you're going to come up short and then they're going to have a shortage because they're going to pay it either way. They don't want to get, they don't want you to be behind.
And then, or there could be an overage. Let's say they're taking out more than they need to.
And so just make sure that the numbers are right and just look at it once a year and make sure they're not, you know, if your taxes and your insurance actually go up and they don't change the amount being withheld for it, you're going to get behind, right? Right. That's one of the ways you'd look at it.
So that's the kind of thing you're doing. So I would use the escrow if I were in that situation.
I don't recommend because I put everything on autopilot that I can. Just so you don't have to, yeah.
Everyone. Yeah, even though it's not earning interest.
It's not enough interest to matter. It's okay, yeah.
Yeah, and more people are going to screw it up by not saving up the money than the mortgage company is going to screw up the escrow account. Yeah, that's probably true, totally.
Yeah, and we have a part of our website that talks all about this and all real estate at RamseySolutions.com slash real estate. That's kind of our real estate home base because it's one topic when it comes to your money that we get so many questions.
So if you guys need more resources, there's free stuff, videos and articles and calls from the show. There's so much there to help you in this topic of your money when it

comes to your home. Yeah, ramsaysolutions.com slash real estate.
Honestly, that portion of

our site is massive because we get so much question on real estate and it's really a nice

resource to help you. Yeah, for sure.
So good stuff. Good question, Courtney.
Yes, excellent,

excellent question. Jerry is with us in Norfolk, Virginia.
Hi, Jerry. Welcome to the Ramsey Show.
Hi, thank you. So my question, I have a bunch of accounts.
I have a Charles Schwab brokerage account. I have Charles Schwab IRA traditional and a Charles Schwab Roth.

Now I also, well, I also have a principal.

Now principals, the company, my employer handles are 401.

So I was looking at their website and it looks like they charged me about a

hundred bucks a month to have that account.

But I have the option.

Yeah.

I thought that was kind of high. Myself.
That's wrong. Well, that's what it says under fees.
You have a 401k, and they're charging you with your company? Correct. I'm a hospital employee.
And there's a 403B or 401K? 401K. And they're charging you $100 a month, $1,200 a year.
Actually, $300 a quarter, if you want to be specific. But yes, basically, yeah, it says it right here.
Plan Administrative Services, 288.70.

Is that being deducted from your account, or is your employer paying that?

I don't know.

I'm just looking at the website where it says plan fees.

So I'm assuming I'm paying it.

I'm not, because you shouldn't be.

Okay, well, that's a plus.

It would be very unusual.

As a matter of fact, your employer shouldn't be paying that much per employee.

That's a plus. It would be very unusual.
As a matter of fact, your employer shouldn't be paying that much per employee. That's an asinine amount of money.
Yeah, I kind of thought so. Yeah, I don't pay anywhere near that.
I've got 1,200 employees with a 401k plan here. Not even close to that.
I would fire those people in a heartbeat if they were charging me that. Well, how i find out if i'm paying that then call hr on the website it says plan fees yeah well i mean it can be a plan fee but the plan wasn't instituted by you as instituted by the employer so it's possible they're being charged that that's just ludicrous i i would call hr and i would call principal both and ask them okay just call call principal and go hey i got a 401k and i'm looking at the statement here and this feels like you know like you guys should be wearing a mask like you're robbers oh my gosh no really that's just ridiculous what was your what was your question though jerry your original question you called in so my question was now i now have the option of instead of the money going to principal to take care of it i can have it go to charles schwab which then i would have the hospital is allowing that yes yeah they i don't know if that's new or not but i was actually talking them, and they said, if you want, we can have it go to a Charles Schwab account.
So I'm assuming it's some kind of lockdown type account. But then I would have total control to buy, sell, or do whatever I want with it.
But that kind of scares me because at least with principle, I have theoretically an expert looking after it versus me, the amateur looking after it. So I'm basically

looking for your advice. Is the $1,200 that I thought I was paying worth an expert looking

at it?

No. But you can get another expert.
You don't have to do this other thing. Okay.
I'm

Shabbat shalom at it. No.
But you can get another expert. You don't have to do this other thing.
Okay, I'm seriously confused. I have no idea what the flip your company is doing because a company has a single 401k administrator.
If principal is their administrator, they cannot send your 401k money to Schwab. It's illegal.
They can't do it. You have a single, you can't have four different 401k companies at your company.
There's no such thing. It doesn't work.
Okay. So I absolutely have no idea what you're up against.
The only thing I can do is tell you to call one of our SmartVestor pros and see if they can unravel this for you. Just go to RamseySolutions.com and click on SmartVestor.
By the way, they can help you if you're going to be doing side investing. This is The Ramsey Show.
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Joshua is in Seattle. Hey, Joshua, how are you? Doing good.
How are you? Better than I deserve. What's up? So I recently retired from the military, medically retired from the military.
And after I had gotten out, there was about a month of no household income whatsoever. And we kind of ran into some financial hardship.
And with Christmas coming up, I have three young children, and I'm wondering should I kind of sacrifice their happiness Christmas morning to continue to pay off this debt. I'm about $1,800 in credit card debt and about $4,000 in collections right now.
Roughly bringing about $5,500, $6,000 a month.

$6,000 a month.

How old are you, Joshua? Yeah, I'm 24.

Thank you for your service.

What happened that you were medically discharged?

Are you okay?

So I was injured in the line of duty.

My back was injured, and they decided that I could no longer

serve how they needed me to. So are you, are you okay to the, for other things though? Are you

able to, are you back to work doing a job now? So I'm currently not working. Um, I am drawing

pension from military. Why are you not working?

I'm currently going to school full-time.

Okay.

Why?

I want to, I've always kind of worked more labor type of jobs, hard on your body.

What are you studying? I'm going up to the school for business administration with a major in project management. Okay.
And you just started? Yes, I did just. So you're planning to not work for four years? Yes.
Is your wife working? No. We have three young children.
She's a stay-at-home mom. Okay.

Hon, when I went through four years, I worked 40 to 60 hours a week while I was going to school.

Absolutely.

You need a job.

Yes.

I have been networking a little bit, trying to get an internship or an apprenticeship somewhere.

I don't want you to get an internship or an apprenticeship.

I want you to get a job.

Okay.

You need money.

Yes.

I'm going to get a job.

Okay.

You need money.

Yes.

I'm aligned with you using your military benefits to get a degree.

I'm not aligned with you not working for four years while you have three kids and you're calling me about them having no Christmas.

Absolutely.

No, no, no, of course.

But I'm bringing in around $63,000 a year.

I'm sorry. christmas absolutely um no no of course um but i'm i'm bringing in around 63 000 a year i know but you're calling me about not being able to buy your children christmas and you're not working absolutely that's that's just because of the uh well obviously military doesn't pay very much.
I just got out of active duty. And we hit a...

So, Joshua, military doesn't pay very much. I just got out of active duty.
And we hit a... So, Joshua, I think here's the hard thing.
If you're... Go ahead.
Well, if I can just be pretty frank with you. Absolutely.
You know, what you have done, service for our country, like incredibly grateful for you and all military families out there. I can't imagine like what you all go through so i so appreciative um but now on this side you know you're 24 you have a wife and you have three kids and there's a reality of a world that is hey i'm a grown-up and we have responsibilities and we don't get a choice just to go do what we want we kind of have to do what what we need to do.
And what you need to do, right, is start having money in. So if I were you, Joshua, and I don't know how far you are into this, maybe one semester of school, but if it's too much of a load not to be working full time, and maybe it's you're driving Uber.
But I'm just saying, even for a year or two, this is where you want to go. But you guys are underwater financially financially so that to me there's not a choice to go to school like you know like i would be i would be finding a job well you can go to school and job yeah that's a lot though but and i work 40 to 60 hours a week and graduated in four years i know but they have four thousand dollars in collection so like so go to work yeah so here's the thing when does classes let out dude um so i'm i'm currently on online fully online okay good so you control when you want to go to class yes oh that makes it even better so you can work like an eight hour day yeah but we did just have a newborn uh that's another reason your wife is at home with three kids that'd be like her job absolutely you need money you need to go get a job joshua like right now you need to be doing grubhub and uber and something else by the end of the day and you can buy your babies christmas and by the way the newborn don't even know it's Christmas.
So it's not an issue here. Okay.
You feed them and change their diaper. They're happy puppy.
All right. So let's move on.
About five years old. They don't really know.
They don't have any idea what's going on here, but dude, you can't call me up and act like that. You can't fund Christmas.
This is Thanksgiving. You got a whole freaking month.
You can save up the money for Christmas by working during this month. That is the answer to your equation.
Go get six part-time jobs that equal eight to 10 hours a day and do your stinking online at night while the babies are asleep. I wrote Financial Peace from 10 p.m.
to 3 a.m.

That's when I wrote that book because I had babies I had to feed and I couldn't sit there and go I'm now an author. I don't work anymore.
I didn't have that as an option. The freaking electric bill guy didn't care if I was an author.
He wanted like money or they cut off my electricity. Because he's and he's pulling the six thousand from his pension he's got a lot of money coming in but yes and that's but is that is that robbing from his retirement no no no no no this is his military retirement is huge because he's military disabled because he's disabled okay okay he's getting i was thinking this is taking from their like when they want He's got a bazillion dollars coming in.
No, it's just that he makes $72,000 a year sitting on his butt. And they pay for him to go to school.
And we, the taxpayers. Should.
And we should. Yes.
That's fine. Yes.
But, dude, the answer to your question is not only do your kids have Christmas, you keep working after Christmas you only need fifty eight hundred dollars to be debt free you can have that by March so first let's go get the kids some Christmas and then let's get Joshua out of debt by March and and and Joshua can I just tell you too as a mom with little kids like especially if they're a newborn a two year I mean he's 24 so a two-year-old and a three-year-old like i'm assuming they're all under six i would think they don't know like go to the target section and they just want to open up gifts like they don't really care what's in it they just want to have the wrapping paper and the experience of opening gifts so like go so cheap like go so cheap that stuff is gonna be thrown out by april anyway crap we buy so like it's right yeah so even that and that's for all of them.'s well i gotta tell you i mean rachel when she was little we would spend all this stinking money on the kids christmas and then dadgum uncle mac would go to the dollar store and come in with like a garbage bag full of toys that were garbage and he was a bigger hit than we were and he spent like 20 bucks and we spent like 200 and let's just say was the fun uncle that's right and in this consumer driven world and especially in this season you're like i want to you know i think his phrasing was and this is not to pick on you joshua because this is everyone to make my kids happy it is just stuff like the most like we are such a disconnected culture anyways like the amount of people that we are on devices and phones and tvs and screens like your kids want you parents they want you so like go find an experience to do with them and that's going to create more memories not Joshua so they want him to go to work do what I said his kids want him to go to work they don't want him they want him to go to work well he needs to go to work and he needs to be with them when he can not he can be with them a little bit later right now he needs to go to work right now he needs some money you call me up and tell me you can't buy your kids christmas i'll cry for about 30 seconds and until i find out you don't have a job okay and then my crying's done's done. I know, but my point is, last Thanksgiving, we took the kids to a school parking lot, and they rode bikes around.
We all rode bikes around for an hour, and they still talk about it. That's what I'm saying is kids are so low-maintenance, so Joshua, don't put that pressure in parents out there this Christmas.
And by the way, they already had the bikes, so it was built in. That was like a freebie, so there we go.
Yeah, there you're fine. Wow.
Joshua, you got this. You can do it, babe.
Go to work. You got this.
Hey, we are proud of your military service, and we love you so much. We're going to tell you the truth.
Don't call here if you don't want that. This is the Ramsey Show.
Live from the headquarters of Ramsey Solutions, it's the Ramsey Show, where we help people build wealth, do work that they love, and create actual amazing relationships. Open phones this hour as we take your calls about your life and your money.
The phone number is 888-825-5225. number one best-selling author Ramsey Personality and host co-host of the Smart Money Happy Hour

Rachel Cruz.

My daughter is my co-host today.

Thank you for joining us.

Teresa is with us in Fort Worth, Texas.

Hi, Teresa.

How are you?

Well, how are you?

Better than I deserve.

What's up in your world?

I know.

I have grown children that I need off my payroll.

And I'm on baby step two.

I've over saved actually on one.

And I can't seem to get any further because I have a 30-year-old that works part-time.

He says he can't find a job.

His resume is three pages long. He has no education, no skills per se.
His father, we can go way back, was abusive. So he was put in a mental place for a while for PTSD and some bipolar issues.
So when he gets out of that and now we don't have a full-time job. My daughter is wanting to start back to school in January.
And I'm still doing a student loan from when she was doing it before. I know I'm enabling it, and I don't know how to stop, and I don't want them living on the street.
I can go on for days. Let me help you.
If they're 31 and they're on the streets, it's their choice. I know.
Not yours. And I know it's hard.
You don't want them to be that way. I don't want them to be that way either, honey.
From what you i mean from what you outlined is he taking care of himself like medically care of himself medically though like take medication all of it for bipolar like is he he will he'll start it and he doesn't take it and he'll start it he doesn't take it he does not because that would cause conflict and i don't i put him in an apartment he had a beautiful apartment and i took him out the beautiful apartment and then I put him in a crap hole it's literally a crap hole thinking he'll win he'll go there's a chance he can afford that the um the it's still 1200 it's still 1200 I'm still helping pay for it all right so what you have to ask yourself is 10 years from today, what is best for him?

What is best for your daughter?

What is the most loving act you can give them?

I'll answer that for you.

Please do.

That they have the dignity of having stood on their own two feet like adults. Okay.
You are taking their dignity away from them. I'm writing.
And I have screamed, cried, prayed. God thinks I'm just being funny now.
100% of enablers are sweet people.

You are a sweet person.

You are devastating your children.

You're hurting them.

I teach.

I know better.

I know how to make my children at school, you know, problems solve.

If you get it through your head that you're harming them, you'll quit doing it.

Okay.

You've got to actually accept the reality that you're harming them, you'll quit doing it. Okay.
You've got to actually accept the reality that you're harming them. Okay.
And once you do that, you'll quit doing it. You wouldn't ever give a drunk a drink.
You wouldn't ever give a bag of heroin to a heroin addict. You would never do that.
You're too sweet a person. okay yes absolutely bring harm to them yeah but i will say there there's a a level of complication and complexity from what you kind of just outlined that he he he has some he has issues i mean he he spent time in a mental facility he has mental health health.
How long ago? Oh, gosh, that's been a good five years ago. And they both have this abusive father thing going on, but they can't get rid of it.
I'm like, let it go, let it go. We'll go see a therapist.
The thing is this, okay? We've tried that. I'm not suggesting that you're mean-spirited or even that you just announce suddenly in a fit of anger that I'm done, I've had it.
That's not what we're suggesting. But I would say that I'm going to look at this young man at Christmas and say— And daughter.
And daughter and say, okay, I can do 60 more days of this. And so I'm making that number up.
You can decide whether you want to do 30 days or 60 days. You can't go longer than 60.
I won't let you. All right? Okay.
But I'm going to support and I'm going to give you some help for the next 60 days. This is your warning.
so you need to ramp up to get ready to receive zero as of February, as of March 1, the end of February. Okay.
And you tell them that they're in Christmas here and you say, I love you. And I'm really so sorry that I have mishandled my relationship with you because it's kept you from going and being all that you want to be.
And I'm going to be so proud of you when you go and be all that you're supposed to be. And I'll be cheering for you.
And I'll be here to cry with you. And also, Teresa, just know you're not in a place to be able to help someone financially.
You're in baby step two. You're broke.
You have debt, right? I'm like, so that's, I mean, that's part of the equation. I mean, honestly, and I think, you know, maybe there's other options if you were on the other side of all of this financially of things of like, okay, but you, you don't, you don't have money.
If you were a multimillionaire, I would tell you exactly the same thing though. But you can say, Hey, mom's, mom's broke.
And part of the reason I'm broke is i've been supporting these adult children which is an actual oxymoron this is a weird phrase we use adult children what does that mean even but the um but yeah i'm and i'm i'm not able to do it anymore and i'm not going to do it anymore because i've come to realize that i'm bringing you harm when i'm doing that and so um the good news is I'm giving you a little warning. The bad news is as of March 1, you will receive zero from me going forward, except my love, my prayers, and my cheerleading.
But there will be no more money after this date. And you set the date and make it very clear.
Don't hedge around it and don't go, well, if you think, no, shut up. Very clear.
This is the date. It's a contract.
And then follow it up with an email. Just reminding you what I told you over Christmas.
I love you. I'm cheering for you.
I'll be here for you. If you need a meal, come over.
I'll feed you dinner. But there'll be no more money after March 1.
I'm broke, and I'm having to clean up my mess, and I'm cheering for you to go be your best self. Okay.
Okay. Are you going to do that because you love them so much you're going to make them have their own dignity? I love you so much I'm going to do that for everybody.
You're sweet are the sweetest lady all the enablers enablers are the nicest people but it's but it's so i mean theresa seriously though like as a mom it's it's devastating i mean like it that would be so difficult if you really did believe if i'm not helping my child they're going to be on the street if you really do like you really do, if you don't believe that you're bringing them harm, you're not facing reality. I know.
Because it's not a sustainable life to live without dignity. I hear you.
I know. But it's just hard.
I'm just empathizing with Teresa. It's hard.
That's why you bought your own milk shortly after getting out from under my control. I don't buy stuff anymore.
You're going to make your own.

Oh, I know.

Make your own way, little pig.

I know.

Make your own way.

There's a big bad wolf out there.

Be careful.

Make your own way.

I'll be cheering for you.

I hate to admit this, but I don't always eat right.

I know.

I need to eat more fruits and veggies,

but sometimes I just have to pound some chips

because they taste so good. That's why I love my field of Greens.
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That's fieldofgreens.com slash Ramsey to save 20% on your first order. You spend hours researching before making a major purchase like a home or car, but it's also a good idea to put in the work searching for the right insurance coverage.
To protect your biggest assets, I recommend using Ramsey Trusted Pros. Whether you're looking for car, home, or any other type of insurance, Ramsey trusted providers have been coached and vetted to serve you like we would.
Find what you need at RamseySolutions.com slash insurance. Rachel Cruz, Ramsey Personality, is my co-host.
The Ramsey Show question of the day is brought to you by Why Refi? If you've made student loan mistakes with zeros on the end, well, we're not judging you. But we are saying it's up to you to do something about it.
Contact Y-Refi. They were created specifically for people with defaulted private student loans, not government loans.
If that's you, go to Y-Refi.com slash Ramsey. That's the letter Y-R-E-F-Y dot com slash Ramsey.
Might not be available in all states. Today's question comes from Daniel in Alaska.
I tithe and donate extra to the church where my family and I attend. Our donations this year will be around $20,000 in tithes and offerings.
The church is not registered as aprofit organization. Should I keep donating big sums to them? We still want to give our tithes even though we don't get a 503 non-profit letter, but we are hesitant in donating more because we're afraid we won't be able to claim it on our taxes.
Churches don't have to be 501c3s to be deductible. It's not required by the code.
The IRS code does not require that. They have to be formed as a religious organization.
They can't be involved in politics, and they can't be running a for-profit under the same roof of some kind. But if they're operating as a true standalone church and their job is to minister to the flock and take care of the widows and orphans and serve the community as a typical church would you are fine they're those yeah the irs does not require them to be a 501 but he says i'm yeah but i'm afraid we won't be able to claim it in our taxes you can you can it's deductible oh okay the irs does not require that they be a 501c3 oh i'm Oh, I'm sorry.
Okay, I hear you. It's not required.
And also, I don't know, to me, the giving aspect, like giving out of your heart's, you know, desires and what you want, and the tax write-off is just like an added great thing, but that's not the main motivator. I would not give to somewhere because you don't get a tax deduction.
Exactly. That feels weird to me.
Exactly. Now, I will ask this question, though, Daniel.
Most churches, and we've had Financial Peace University taught in 50,000 churches in North America, so we interface with the church community all the time. We're a huge supporter of the Bride of Christ.
We love the church, okay, and most churches go ahead and apply for and get their 501c3 just so there's no question by anyone about what's going on over here um and so maybe it's a startup maybe it's a church plant in the early in the process but i would want to ask leadership why they haven't gone ahead and applied for because getting a getting a 501c3 certificate when you're in church

is really not much of an effort.

I'm curious why they wouldn't do that, and I would ask them that,

but I wouldn't not give, and I would not worry about

whether everything's a deduction.

Now, if they're running a political action committee

out of the back back there, out of the back room, yeah, you could lose your deduction there. That's one of the guidelines.
But if they're running an actual church, then you're not going to have any trouble with the tax issue. But I still would ask the question, why not? I don't understand.
I can't think of a biblical reason to not do the paperwork it would be like okay we have a church building but we didn't buy in fire insurance on it well why well we're trusting jesus uh jesus sent the insurance guy there so you probably ought to buy insurance on your building i mean that's that's like, it's in second hesitations. So, I mean, he's been using that joke for 30 years.
I know, and it just keeps giving. It's the dad jokes that just keep working.
So as long as they keep working, my ratings don't go down. Yeah, I would get insurance on my building, and I would get a 501c3 if i was the pastor of a church if i was on the leadership team of the church so asking why would be good just be out of curiosity but also don't be giving just to get the tax deduction exactly but you can get the tax deduction according to you and 100 just you can ask ask papa google he'll tell you.
It's right there. It's right.

Pop right up. Hey, I'll answer your question for you.
All right. Pierre is in New York City.
Hi, Pierre. Welcome to the Ramsey Show.
Hi, Dave. Hi, Rachel.
How are you guys? Better than we deserve. What's up in your world? None much.
Just wanted some financial advice. I'm kind of in a unique, unique for me, at least position.
I'm thinking about, uh, well, I'm looking, I'm thinking about maybe buying an apartment, an investment, uh, property for 200,000. And I kind of just want you guys advice if I'm ready for it, not ready for it, or maybe I should just put on the back burner.
Okay. Are you out of debt and are you going to pay cash for the apartment? So, um, so sorry, I should tell you my situation.
So currently I have a two jobs, my income, uh, I have about three incomes. Um, my salary is about 200,000 more or less.
And I also, the house that I currently live in, I make about $3,000 comes in in total. My only debt is my mortgage and my wife's car, which is about $25,000.
Okay. All right.
Well, Pierre, I own a bunch of real estate. I love real estate.
Rachel's husband is in the real estate business. He owns a bunch.
They own a bunch of real estate. And both these families sitting here love real estate as an investment.
The rule we live by is we pay cash for it or we don't buy it. And we only start buying investment real estate after we're 100% debt-free home and everything.
That's the rule we live by. But having done that, you will thoroughly love the real estate business when you get into it.
It sounds like you want to do it. But if you buy this apartment right now, it's probably going to cause you financial problems, not blessings.
Because you're broke. You got a freaking car payment.
You don't go buy a $200,000 rental property. So I could pay a little more in my situation.
I understand it. A little more in my situation.
I have $50,000 in the bank. Then write a check and pay off your car today.
Understood. Understood.
I could do that. Yeah, you should do that.
I also had another question for you also. So I was thinking, I was thinking of saving up to a hundred K and I'm actually pulling a HELOC on my house.
I know you're really against it, but I feel like it will be a lot easier to pull the HELOC out the house. How I have an income, well, I have money coming in from the rental of my primary residence.
Pierre, are you 24? I'm actually 32. 32, okay.
Because you sound like I sounded when I was 24. I used to say stuff like that.
Ambitious. I used to say stuff like that when I was broke and it made me broker.
Okay. Cause here's what you're not anticipating.
You're not anticipating all the things that are going to go wrong when you own a rental property and the renters that don't pay. And now you got a HELOC on your house and now you have to come home and tell your wife we're losing the house because the apartment deal went sideways and we're getting foreclosed on.
You don't want to have that conversation. I'm so stupid I had that conversation when I was your age, and you don't want to have that conversation.
You want to do this debt-free, but you're going to go ahead and do it, so I hope it works out for you. I don't think it's going to, and you ask me, so I told you the truth because I love you.
I don't think you should do this. I think it's a really, really bad idea.
But I don't think I can stop you. I think you're going to go learn the lesson the hard way.
Some of us are knuckleheads, and it's just how it works. We have to get bonked on the head to catch it.
Pierre might be listening and might be reconsidering. We don't know.
He's not. Because I think what's difficult is in the present, all of that sounds good, right? Like you, you can line it up a situation and say, Oh, if this sits in there and I have that and that carpet, you know, and it's all working, all these moving pieces.
And here's the problem too, Pierre. When you start leveraging yourself like that, statistics show us and studies are showing us that stress goes up, anxiety goes up, lack of sleep starts to occur.
And you're trading your peace of mind for complications of trying to build wealth. And you're doing it in a really fast way, in an ineffective way, because it's going to cause other issues in other parts of your life.
So be as peaceful as possible. Pay off the car.
Work and pay down your mortgage. And then say hey let's save up and buy.
And in 10 years. You know 5, 10, 15 years.
You guys could be wheeling and dealing. And it's all your money.
And with a lot of peace. So just do it the right way.
Everything you're talking about can be done. Just slow it down and do it with cash instead.
The best way to get rich quick, get rich slow. This is the Ramsey Show.
What does the future hold for business? Ask nine experts and you'll get 10 different answers. Economic growth or a recession.
Business taxes will go up or down. AI will help us work or it will replace us all.
But there's no such thing as a crystal ball. That's why more than 40,000 businesses have future-proofed themselves with NetSuite by Oracle, the number one cloud enterprise resource planning system.
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It's free at netsuite.com slash Ramsey. I talk to people every day who want to know how to do better in two areas, money and relationships.
That's why I'm pumped to bring the Money and Relationships Tour to a city near you. Join me and Dr.
John Deloney for a night that will challenge the way you think about this stuff and possibly change how you live forever. Starting April 21st, we'll be in Louisville, then on to Durham, Atlanta, Phoenix, Fort Worth, and Kansas City.
Grab your tickets at RamseySolutions.com slash tour before they're gone. Rachel Cruz, Ramsey Personality, is my co-host today, my daughter.
One of our favorite things in the world to do is talk to one of you when you're doing your debt-free scream because you paid a price to win. You've lived like no one else, and now you're ready to live and give like no one else.
We even put a debt-free scream stage in the lobby of Ramsey Solutions, and people come by and watch this show, and then they sign up and do a debt-free scream on the debt-free stage. And our favorite of all is when one of our own Ramsey family, Ramsey team members, has become debt-free, and they are on the and that would be true of matt hudson and his wife terry matt congratulations you did it thank steve well done terry way to go thank you wow so matt is a software engineer with us has been with us 12 years yeah i know i was like i know matt's been here i was like has it been over 10 years and yeah 12 years 12 years and in the in the ramsey in the financial peace area ramsey plus working with every dollar and working with financial peace and all that so you've seen a lot here over that 12 years how much debt have y'all paid off uh so this was our mortgage and so uh it's 133 000 way gosh.
How long did this take total? 11 years and three months. Okay.
So great. So after you came here, Yeah.
Right after you came here, you got the mortgage and you said, all right, we're doing this. Yeah, so our oldest son is 11 and so for the first year I was here, we were both working and we didn't have kids yet.
So we saved up a really nice big down payment, got our house with a 15-year mortgage. And Terry quit work after Everett was born because it was a priority for her to stay at home when they were little.
And in the past few years, then with her being able to go back and work part-time, then we've made some really good progress to be able to get it knocked out early. to go what's the house worth it's worth 4485 i love it i love it well i'm not going to go into your personal stuff since half since half the ramsey team is standing around and i'll tell your business in front of your co-workers that would be unfair so i won't ask what your income is or what you have in your 401k that we have here but uh you guys ought to be approaching Millionaire, and I'm proud of you as soon as you get there.
I love having millionaires work on our team, and that's the most beautiful thing I can think I've ever heard. Way to go, you guys.
Thank you. So very, very proud of you.
Congratulations. So working at Ramsey is weird to start with because we're a weird bunch.

But paying off debt while you're working here,

it's like peer pressure to do it, isn't it?

Yeah.

He says it's a good thing he works here because he's the spender.

Oh.

Which is true.

Okay.

So are you spending money on gadgets?

Just kind of, yeah.

You're a software engineer, so I'm guessing, yeah.

Yeah, gadgets.

I just have a, like, you pick an expensive hobby, I'm probably into it.

Okay.

All right.

All right.

And, Terry, but you use the coworkers here and you to rein him in then.

In the budget meeting, it's a good thing for both of us to get on the same page. So that's been a big key for us is to have that monthly conversation

to make sure we're both working towards the same things

and have our priorities together. Yeah, that's a big deal.
Well done, y'all. things and have our priorities together yeah that's a great deal well done y'all i'm so proud of you that's a big deal i mean to have no mortgage half a million dollar house how old are you too i'm 42 i'm 47.
wow very cool our goal was by 50 so we're glad we beat that you did it you did it slid in under the bar okay so tell me because when people are on the ladder baby steps, you know, when they're in four or five, six, a question we get a lot is okay. So how much, how much should we be throwing extra at the mortgage to pay it off faster? So just like walk through high level, how you guys decided, uh, month to month or season, maybe it's season by season, year to year.
Like how, well, what did that look like a putting extra? Was there sometimes that it was like, no, we didn't. Cause we were saving for a vacation.
Were there sometimes that you're like all the extra goes on? Like, what did that look like for you guys? Um, my youngest started kindergarten the year of 2020. So I was planning to go back to work when he started kindergarten, but with COVID being so unpredictable, I was like, let's just hold off.
So I started working part-time in 2021 and we had decided that all of my paycheck would go to house payoff so we lived off of what Matt made and hit our savings goals with that for like vehicle replacement and stuff like that but all of my paycheck went to house okay so great are you still going to continue to work part-time or now that yeah we've got some other goals we want to do some house renovation some vacation and of course like college funding so yeah yeah yeah that's awesome what are you gonna do the house we want to get some new floors we want to update the living room just we really haven't done much to upkeep the house since we bought it so we just kind of want to make it prettier there's yeah there's a lot of things we put off because it's like well we're almost we almost have the house paid off and once we get that done it'll well you got no payment now. You got all this room.
Yeah. Yeah.
Putting new flooring in, it goes a lot quicker when you don't have a mortgage. So totally.
It's so great. You guys, amazing.
Amazing. So how does it feel when you, when you guys paid it off and you like sent it, you know, what, what was that like? It was amazing.
We were at Chase like five minutes before they opened and we're taking pictures outside of Chase and And then the employee saw us and he's like, are you Terry and Matt? Come on in. And so he told us the payoff balance and wrote the check and we're just sitting there like, we just did it.
We did it. I love it.
Woo. And go into the parking lot, do a little dance.
I like it. Very well done.
Well done, you guys. All right.
Working here. Does that make it harder or easier, seriously? I think it made it easier because it's just like you said, you have kind of that positive peer pressure.
It's not weird that we were not borrowing money and that we were paying extra on the mortgage and that kind of thing. It was just, I don't know.
You have the benefit of your coworkers not making fun of fun of you yeah that's an interesting thing to have yeah and quite the opposite they might be making fun of you if you weren't doing this but yeah yeah like we're you know just doing handling money weird and everybody else is doing the same thing so it's not like you're an oddball around the people you work with for doing it so well obviously you don't have to work at Ramsey to do this. Millions and millions of people have.

We've got tens of thousands of debt-free screams on the YouTube channel

that people can watch, people from all incomes and areas of the country

and situations have overcome all kinds of things.

But what would you tell folks that are listening and watching the main thing

from your perspective, Terry, that you have to do if you want to get out of debt? What is the key to getting out of debt? I think it's having the budget and making sure that everyone's on the same page and that you're working towards the same goal. And then also to like daydream about what happens after that helps you stay focused.
Because like for us, it was 11 years, which felt like forever. And we had to keep up with our dreams.

So, like, focusing on that after the house payoff, too.

Hey, when you mapped it out the first time, what was your prediction of how long it was going to take?

We thought we would be done by the time our oldest entered high school, and he's in sixth grade.

So, we got done about three or four years early.

You thought it was going to be 15 years, and it was 11.

Yep.

Yeah.

Yeah.

Okay.

Most people bring it in earlier than they originally planned. Yes.
Yeah, that's not unusual at all. Good job, you guys.
Very proud of y'all. Great job.
All right, bring the kiddos up. Everett and Spencer are with us, good-looking young men.
And so who's who and what's the ages? This is Everett. He's 11.
And this is Spencer. He's 9.
Okay. So Everett came the year we bought the house and uh now he lives in a debt-free house because his mom and dad are heroes oh thank you way to go you guys we're very proud of y'all it's so good to see you guys too I feel like Terry I just see you at Christmas parties every year so it's good to see you outside of it and I'm so happy for y'all thank you guys so excited all right Everett and Spencer you you guys been practicing debt-free scream you know how to do it all right you better get ready man because this is your minute this is your moment right here you're gonna be famous in just a second matt and terry everett and spencer matt hudson from the ramsey team for 12 years he's been with us they paid off the house in 11 years and three months.
$133,000.

House and everything.

They're weird.

They're heroes.

Count it down.

Let's hear a debt-free scream.

Three, two, one.

We're debt-free!

Yeah!

Woo-hoo-hoo-hoo!

Way to go, you guys like any good software engineer he's very precise and they had a plan and they executed it early yep wow knew what they knew what they wanted it's incredible absolutely incredible i mean have a paid off house like I mean, it's crazy. Crazy, crazy.
It's when normal is broke in America, your goal is to be weird. So one of the best compliments you can hear around the Ramsey Show is if we call you a weirdo, it's because you're doing very smart things in a culture that has nothing smart to do.
This is the Ramsey Show. Listen, guys, I've heard just about every excuse for why folks think they can't get ahead with money.
So let's go ahead and settle this right now. You get the final say on what happens with your money.
That's why you have to start telling your money where to go so you can stop wondering where it went. So if you're going to start winning with money, you have to get on a budget.
The easiest way to get started and stick to it is with the EveryDollar budget app. It'll help you make a plan for every single dollar coming in and every single dollar going out every single month.
And guess what? It's free, so every dollar in the app store or google play today rachel cruz ramsey personality is my co-host thank you for joining us america it's a free call if you want to call anywhere in north america this is the last segment that you'll be hearing on the podcast. The next segment of the show is on the Ramsey app.
The third segment is always on the Ramsey app every day. Ramsey Network app is a free download.
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So download the Ramsey Network app. It's completely free and it's a way to get access to things earlier and really for you to control your listening environment a little more than you can on the normal podcast or YouTube broadcast or talk radio.
Talk radio stays exactly the same. What you've always gotten, you're always going to get exactly that as long as your local station carries us there, and that's perfect, and we're glad they are.
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Eric is with us in Key West, Florida. Hi, Eric.
Welcome to the Ramsey Show. How are you doing today, sir? Better than I deserve.
What's up? Yeah, so like many investors, I pay my financial advisor an asset under management fee. In my case, it's 1%.
My wife and I have been married for 20-ish years, and over the time we've built our assets under management to about half a million dollars. We have other assets, but under management from them, about half a million dollars.
That would be $5,000 a year for their fees. A couple years ago, my parents passed away, and we inherited a substantial sum.
So now our assets under management are a little over $2 million. My questions are, you know, or my problems are two.
First, you know, by doing nothing extra, no effort on their part, suddenly my advisor has gone from $5,000 a year to $20-some thousand a year for doing the same work. The other thought is, you know, when it was $5,000 a year, I could stomach that.
Now I'm thinking, over the next 20 years, even if my assets remain flat, that's $400,000. And if they go up, plus lost investment opportunities, that could be $500,000, $600,000, $700,000 that I'm losing.
So are there any alternatives to asset-centered management fees? Are there any recommendations you can make? That's a very standard way of running a brokerage, I mean, an advisory company right now. Most of our SmartVestor pros run a very similar fee base.
I have seen some of them, the fee decreases as the assets on percentage decreases as the assets under managed increase. And so when you've got a portfolio the size of yours, it probably could be less than 1%.
Some keep it there. And then the question you've got to say is, okay, what am I getting for this money? And, you know, I'm a firm believer in having an advisor.
I'm like you, though. I want to know what I'm getting for what I spend.
And so I think I'd have a conversation with them about two things. One is tell them exactly what you told me.
Guys, this is a lot of money and I'm not sure what I'm getting for my $25,000 a year. Show me what's, because I can buy a nice car once a year for what I'm paying you all.
Okay. And have a whole basement full of cars, right, and so in a couple of years.
So, I mean, what is it I'm getting for what I'm paying you, and show me your value, and or do you have any kind of a sliding scale now that this has gotten so much more? Like a lot of times when it's over a million dollars, you start to see things slide down. Uh, do you have anything that you run a less percentage on, on a portfolio this size? Ask them that question.
Those two questions. One is show me why, you know, make the sale again.
Why do I, I mean, I'm not mad at you, but show me, I, right now I'm, I'm, I'm, uh, confused, uh, disillusioned about what I'm getting for 25 years. The effort hasn't changed or the process, the strategy hasn't changed.
It's the same thing, right? Then the third thing I would do is jump on RamseySolutions.com and click SmartVestor Pro and talk to some of our SmartVestors. They're in the exact same business.
They run the exact same. Most of them run a management fee like that.
You know, it's usually the, you know, it's very standard in the business. The industry runs about 1%.
Some people do three quarter, some do a sliding scale. When you got more assets under management, some don't.
But I mean, they're not ripping you off. I don't think that at all.
But you're asking a valid question that you deserve an answer to. And it is enough money that it's fair to ask the question.
So I would ask the SmartVestor pros, ask any of them, do you have a sliding scale when a portfolio gets to this size? I got about two and a half million. I'm really concerned that I'm paying a one percent fee on that because I don't know what I'm getting for that.
And it's not a belligerent thing. There's no belligerence in your voice, by the way.
Okay. You're not being a jerk about it.
You're just going, okay, I'm sorry. And I probably wouldn't use the phrase, you're doing no more work.
That's a bit insulting, but I would say, you know, what am I getting for what I'm paying you? Why would I do this? And what's going on here? I mean, because I do value what they do, and I think you should, Eric. I think you ought to have someone in your corner to talk to.
Rachel has a SmartVestor Pro. She wants to meet with.
I have one that Sharon and I meet with and they don't, in my case, they do less than they might for Rachel and Winston because we do all our own estate planning off to the side and we do all of our own, for that matter, do all my own selections on the mutual funds. But yeah, what I found, Eric, the value for us is that they're looking at more than just investments.
I mean, ours are looking, they're looking at taxes. And like, if there's like, real estate involved that you can sell within this five year period and get this I mean, like, they're kind of strategizing with you.
I mean, everything from our giving to investing, I mean, they're looking at the whole thing. And that's always helpful.
But my question, Dave, to you, is there ever a point from like, Eric's perspective, which I know is not a lot of people out there to have this substantial amount of money just investments that you would ever pull a million out and do your own and put in an index funds and keep a million in do you know what you mean like spread out where you're not no it's not all under someone's no i would get i would get happy where i am yeah and if i can't get happy there i'm get happy somewhere else. I want somebody in my corner and I want it all in one place, invested in different things, but under one set of eyes.
There's no advantage to diversifying your advice. No, I think that's just bifurcating your brain.
Well, not your advice, but would you ever just individually go open up a Vanguard and just put your own money in for the S&P or something? Do you know what I mean? I mean, the only thing I do there is I do have an S&P that is independent of these guys, but that's just me throwing money in there, extra money laying around until I get some money for a piece of real estate that they don't have anything to do with. And you're going to go buy it out of that.
And I'm going to buy it out of that S&P. I don't invest in the S&P.
I park in the S&P. So, which last year was a really good thing.
It made 30%, but, um, uh, not a bad parking spot, but the, uh, um, yeah, so that that's, yeah, it's a good point. I don't want three different investing.
It's like, I'm not going to go to three different churches. Cause I sort of agree with them, you know, no, it's not, you need to find a home and deal with the discomfort of the home and the comfort of the home.
Yeah, that's good. Yeah, that's what I would do.
It's a good question. It's an excellent observation, Eric.
You're not asking the wrong question. You're asking the right question.
I would just ask it carefully and somewhat humbly, but it's a fair question that I'm going to dig to the bottom of. So three things.
One is shop around, go talk to some other SmartVestor pros,

see if they have a sliding scale, ask your guy if he's got a sliding scale,

and ask your guy why he's worth $25,000 a year. What am I getting for that?

That's all fair questions and should be asked. That's you managing your money, and that's as

it should be. Well done, sir.
Very well

done. This is the Ramsey Network app, right? I Hey, you're still here? What are you doing?

You do know that the rest of today's show is playing right now over on the Ramsey Network app, right?

All you got to do to finish the episode is search Ramsey Network in the App Store, Google Play Store,

or just click the link in the show notes to download the app for free.

Yep, you heard me right, for free.

Then right there on the home screen, you can watch the rest of today's show.

Bada bing, bada boom.

All right, I'm getting out of here.

Enjoy. We'll see you on the app.