Debt Always Comes With Strings Attached

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Normal is broke, and common sense is weird.

So, we're here to help you transform your life from the Ramsey Network in the Fair Winds Credit Union Studio.

This is the Ramsey Show.

I'm Dave Ramsey, your host.

The phone number is 888-825-5225.

The call is free, and some say the advice is worth exactly what you pay for it.

Rachel Cruz, Ramsey personality, number one best-selling author, and my daughter is my co-host today.

David is in New Orleans.

Hi, David.

How are you?

I'm good.

How are you today?

Better than I deserve.

What's up?

So I have about $100,000 to $110,000 extra that I just don't know how to invest at the moment.

I'm not sure whether to put it towards my house

to pay off mortgage or to invest in like a money market fund or like a high-yield savings account.

I'm just not sure what to do with it.

Good for you.

Where'd you get it?

Just saving.

My wife and I are very, very frugal.

Well, way to go, man.

Congratulations.

So we teach a process to become wealthy.

We have proven that it's the shortest path to wealth called the baby steps.

Have you ever heard of that?

Yes.

Okay.

So baby step one, save $1,000.

You've done that.

Two is become debt-free, but the house, I suspect you've done that

no we still have the mortgage at 250 i said except the house

except the house oh yes yes yes you're debt-free except the house yes sir okay then baby step three is a fully funded emergency fund which is three to six months of expenses for rainy days do you have that separate from this 110 or is it included in the 110?

Yes, that is separate from that.

Okay, how much is in that fund?

I would say between, I mean, we have $20,000 in the savings, but we have extra that we can put towards that of up to 80,000.

I would say up to about 50,000.

Okay, so you have 50 plus 110 plus 20?

No, I have more than that.

In total, we have

that isn't that's included in the money market funds and everything

besides the stocks that we have, which is 450,000 that we don't really touch.

We have total 217 through all our accounts.

Okay, so is the stock in a retirement account?

No, it's in like dividends.

So it fluctuates, but we have a guy

that

monitors all of that and deals with all of that.

And so it started off at $300,000 and now it's at $450,000.

How old are you?

I am 29.

My wife is 30.

What kind of income do you all have, household income?

About $150,000.

Well, you have done an amazingly good job.

Congratulations.

David, how much is left on the mortgage?

$230, you say?

232.

So I would write a check today

from your cash, the slaying around non-emergency fund, and a little bit of the stock if you had to, and pay the house off

today.

The reason why we're not sure about if that's the right decision.

You called and asked me what you should do.

We're not sure if

this isn't our forever home.

Like, we're

thinking that we will probably move in 10 to 15 years.

So that means you need to stay in debt?

Well, I guess that's yeah i mean

no when you sell the house when you sell the house and move they're going to give you a check at the closing you're not losing the money

gotcha okay so here's the thing this is coming from two things number one we know that families that pay off their homes especially families like you guys you guys are like super savers you're amazing what you've done man okay so i'm just all I'm doing is fine-tuning one little thing.

When we did a study of 10,167 millionaires, the typical model of the typical millionaire that we found was they had a million to $2 million net worth and they had

$700,000, $800,000, $900,000 in their 401ks, retirements, and stock investments.

And they had a paid-for home that was $600,000 or $700,000 or $800,000.

And the paid-for home, here's what it does.

It gets rid of the cash drain on your income.

You're going to be able to save the house payment.

You know how much that house payment, how quick that one house payment is going to be a million dollars in a mutual fund?

Oh my God, son, so fast.

It's going to blow you away how quick that one move turns into a million dollars.

So,

and you don't have a house payment.

And when you walk out in the backyard and you take your shoes off, the grass feels different.

You don't even understand that you're setting down 300 pounds of weight that you've been carrying around.

And when you set it down, you're going to breathe deeper like cool mountain air into your lungs.

So that's where I'm going to tell you to go.

David, what causes you to be hesitant about it when you were like, well, whoa, whoa, and you were backing up?

What's in your mind?

What are you thinking?

Well, because it's not our forever home, we, you know, we are thinking we're likely going to move in about

the home.

Yeah, yeah, but you do understand that you still have the money.

It's just in equity.

It's in the house versus cash in the bank.

So to his point earlier, you get it back out.

So that's not really

an argument.

So do you have another one, though?

Are you wanting to keep these stocks?

Well, yeah.

So, yeah, we're definitely going to keep this, like, as in we're keeping the, you know, whatever amount that we have in stocks left or keep it in there for long term because it's been growing very well

in there.

It's just,

we just weren't sure if that makes the most sense.

Because, of course, we've talked to the financial advisors at

the, I'm also not naive.

Yeah, they won't tell you to cash that out.

What's the best for the bank as well?

I know that.

So that's why I'm calling into the show.

I want to get the personal device that's in our best interest, not necessarily

the best bank for the business.

The thing that I didn't understand when I first started doing this, David, and you're a wonderful saver, so you're a math nerd like me.

I thought this was all a math equation.

It's also a psychological, spiritual, emotional, relational equation.

When you don't have a house payment, it changes stuff you don't even know was stopped up.

It's weird how it unleashes you, your creativity,

just you and your spouse walk in.

My wife and I went for a ride in a little car.

I've got a 1960 convertible.

We went for a ride in it last night.

We pulled back up in front of the house and we both said, that's a good house.

And it wasn't like a bragging thing.

And it wasn't like flex thing.

It was just me and her.

Two old people in the old car.

I mean, come on, you know, I mean, but we're just looking at the house going.

And you wouldn't have felt that if there was a mortgage, is what you're saying.

Like, there's a.

Well, I mean, because you don't own it.

Yeah.

Yeah.

It changes.

You might have said that it's a good house, but you would have said it with a different,

even a tone.

Yeah.

Even changes your tone of voice.

I mean, it's hard to grasp all of this stuff until you actually do it.

Here's my challenge for you.

Pay off the house, and if you hate being debt-free, you can go get you another mortgage.

And I've never had any, it's the only piece of advice we give on this show that I've never had anybody call and give me hate mail for after they do it.

Now, all these people that have theories give me hate mail, but they're broke people with theories.

I don't care about their hate mail.

We burn that.

That's good kindling.

But we really don't get, I mean, I've been doing this for almost 40 years, y'all.

The number of people that call me back and said, Dave, you told me to pay off my house, I hate you, you're awful, is zero.

Zero.

And it's the one debt no one ever goes back into.

Like we will talk to people on the show like we were debt-free, but now we have $15,000 of credit card debt.

I'm like, What?

Why did y'all do that?

Or we were debt-free, but we now have a car loan.

Why do you know?

Like, we'll get those every now and then.

Yeah.

But we've never.

Once you get the mortgage gone, you're like, oh my golly.

Oh, my.

I just was so stressed when we didn't have a mortgage payment.

And so I was like, we got to go back and get one.

Let's just go back and borrow on the house so we can invest and do all of this.

I'd rather have that.

I can't stand being debt-free.

It's killing me.

Nobody ever says that, guys.

Nobody says that.

And David, do it.

You're 29.

Give it a try.

If we're wrong, you can go back in debt.

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Christina is in South Carolina.

Hi, Christina.

How are you?

I'm good.

How are you?

Good.

How can we help?

So my husband and I have been having this real issue lately.

He believes that he can spend the money any way he wants because he earns it, because he works for it.

And because I stay at home, I can't spend it because the luxuries of being at home with our son, like the power and the water, are my little luxuries that I get.

So he can go spend it on snacks, he can go spend it on drinks, he can do whatever he wants with it, but I'm not allowed to do the same.

How old is this little boy?

He is 25.

How long have you guys been married?

We've been married for over a year.

How many kids do y'all have?

We have one.

Okay.

It's a very dysfunctional

marriage, Christina.

Yes, I have been told that

I should

just let him deal with the finances because he's

not.

Whoever told you that's as dysfunctional as he is.

Who told you that?

His mother?

No, that was him.

He said that.

Oh, he told you that.

Okay.

I bet he did.

I bet he did.

Little twerp.

Oh, my gosh.

So

you're dealing with a child.

That's the problem.

And allow me, I try to save money where I can.

Honey,

honey.

That's not the point.

Let me back up and tell you the way this should be, and then we can put that against where it is.

The way it should be is when you are married, regardless of where the income comes from,

we

have an income.

We...

both have a vote on where every one of those dollars goes.

My wife has not worked outside the home in about 40 years.

She has an incredible income.

Because

we have an incredible income.

Okay?

And she

gets to decide with me

what we will do with our income.

Are you hearing these words clearly?

None of that's happening here.

Just because I I earn the income at Ramsey and with the things I do in my life and she doesn't have an earned income personally does not invalidate her power or her right to a vote inside the household.

She has the same exact rights as I do, not only morally and spiritually, but legally she does.

And if he thinks he's in control of his income, let me teach him what a divorce attorney will teach him.

He's not in control of his income.

They're going to take a big old chunk of it and give it to you and the kid to take care of the kid.

So he really does not have as much power as he thinks he has in the law, much less morally.

And he's relationally bankrupt.

You treat your wife this way, you won't have a wife long.

Because, honey, you may put up with this for a while, but you're going to wake up in a few years and go, I'm done with you.

Being a jerk.

And treating me like a second-class citizen.

I'd like him to stay home with a kid.

Let me tell you, Christina, it's much easier being in a workplace with a bunch of adults than being home all day.

It's exhausting.

It's absolutely exhausting.

You work harder than he does.

I can't.

I think that he does.

He's a hard worker.

No, Christina, that's not what I'm saying.

Christina, it's not that.

I'm not saying that.

I'm just saying the value you bring to the household is as important.

If not arguably, maybe more important.

You're raising human beings in this household full-time.

And so the fact that financially, from a a numbers perspective, he has and wants full control and treating you like a second-class citizen is not okay.

This is not okay.

You have a dysfunctional marriage, honey.

You guys, I really think this guy needs more than I can give him on this call.

If I had him on the call, I could box his ears, but it wouldn't last, okay?

But

what you guys desperately need is to get involved in a good, strong local church.

A church that is healthy and doesn't

supporting his life.

Yeah, that's what I'm going to say.

I mean, you get some support.

But I mean, you get a church that lovingly will teach you exactly what we taught you and get some men in his life to teach this little boy how to be a man.

Because masculinity that's true and not toxic is service-oriented.

He serves his wife.

He serves his kid.

And that's what he should be doing.

And he's doing the opposite of that.

You guys desperately need marriage counseling, honey.

Desperately.

We can't fix him on this call.

You're too messed up.

This is just a mess.

But what I do want to do for you is to confirm that you're not the crazy one.

Okay.

The feelings that you're having, that this is improper, are accurate feelings.

They're accurate observations, logical observations.

And these are two people sitting completely outside of there.

Rachel's marriage does not run this way.

My marriage does not run this way.

And both of them have a lot of fun.

And any good therapist, marriage therapist would say, it's not run that way.

That is a complete level of control and can start to be in the sense that you don't even have the ability to access the money, which then becomes another huge problem.

And so it's not okay, Christina.

It's not okay.

And I didn't like this guy earns a lot of money either.

He's a big deal on nothing.

So this just, yeah, there's so much immaturity here.

So it sounds like about a 14-year-old boy.

Well, and the reason to press into this, Christina, and why it's worth the fight is not only from the financial financial perspective, getting that cleaned up, but also that mindset doesn't just stay in the money lane of your marriage.

That mindset and what he believes about you and your value and what you're capable of starts to bleed into every other part.

And so it's not just a one-off thing.

This is his character and who he is and how he views you.

And that's the problem I have.

If your baby is a daughter,

You're teaching her how women are supposed to be treated by accepting this treatment.

Don't do that to her.

That's not fair.

If your baby is a son, you're teaching him how he's supposed to treat women by accepting the way that you're being treated.

Don't do that.

That's not fair.

So you guys are horrible parents because you're modeling out a dysfunctional thing before this brand new baby right now.

And so you've got to work on this, kiddo.

You've got to go get some help.

And you've got to demand it.

And we're going to go get some help.

I'm going whether you're going or not.

And if you don't go, then I may go

because I'm not going to put up with this.

And that's where you're going to end up.

And I will tell you this.

I've coached families on money for 30 or 40 years now.

And

I don't like stereotypes much, but I see this more often with ladies than I do men.

Like 98% of the time, this is a lady.

They will put up with stuff for so long.

And then I don't know what it is in the female psyche, but once that switch flips, once you're done, there'll be nothing he can do to get you back because you will be done.

Guys will come back around, but a lady that's just fed up, fed up, fed up, and finally switch flips, they are done.

And you can't reel them back in.

I've tried, I've sent them to marriage counseling.

I've begged them to give them another chance and everything else.

And they're like, nope, I've had it with this guy.

I'm done.

And you can't get them back.

And that's going to happen to you, kiddo.

It's going to build up, build up, build up.

And the switch is going to flip and this whole thing is going to be over.

And you sound like sweet and naive and you are right now, but

you'll get over it.

You'll get over it over time and you'll get tired of the abuse.

So you guys need to desperately get some help for your dysfunctional, screwed up marriage because your husband's view is dysfunctional and screwed up.

I hope I wasn't unclear.

I hope it's all here.

And we have a couple that's on their honeymoon in the lobby.

So there's your marriage in five minutes.

They're going, oh, God.

Oh, God.

No, no.

No, I don't think they're that way.

I know, I know, I know.

I can already tell they're not that way.

You could tell just taking one picture.

Well, what it is, though, is, and we say it on the show all the time, majority of relational calls that we get

is rarely about, well, rarely about the money.

So she calls in and says, well, he says I can't have any say in that my, what, did she say her privilege was electricity and food or what?

No, that was her luxury.

Oh my gosh.

So like, you're getting,

but I need money is how it's presented, but it's like, no, dear God, you need a new marriage.

Like, it's a marriage issue.

So, whenever those things start bubbling up, majority of the time with couples, and I would say in our marriage, probably with you and mom, too, like, when there's a money thing that flares up, usually a deeper-rooted thing is something is happening.

Yeah,

money problems are not the problem, they're the symptom.

And that's the case here, too.

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Dylan's in San Francisco.

Hi, Dylan.

How are you?

I'm doing great.

I'm excited to be on the show.

Thank you, sir.

So, my question is: my wife and I have a bunch of debt,

about

$2.3 million worth of debt, but it's all really low interest rate debt.

And I'm wondering if we should be trying to pay it off as quickly as possible, or since we can make more in a high-yield savings or in the market, should we sort of take our time in paying off this debt?

What is it owed on?

So $2 million on the primary residence at 2.4% on a 30-year fixed.

We have a rental residence, which has about a quarter million

at 3%,

80,000 student loans at 1.6%,

and then a car loan of about 40,000 at 4%.

And what's your household income?

About

$1.5 million, but that's new.

Congratulations.

It's gone up a lot.

Way to go, man.

It's gone up a lot.

You're doing wonderful.

What do you do for a living?

I'm a lawyer, as is my wife.

Okay.

Good.

Well, here's the thing.

Well, real quick, Dylan, do you love it?

Do you love having 2.5 million?

Like, are you good?

I'm okay with it.

So

our net worth is like 5.2, so I feel like it's manageable.

I want to have no debt, but

part of me feels like it's kind of backwards to.

pay down 2.5% debt when you could earn 4% in the savings account.

Okay.

All right.

It's a good question.

Valid question.

All right.

So

here's the thing.

The thing that we

forget that no one talks about and no one teaches is debt equals more, equals risk.

More debt equals more risk.

Huge amounts of debt equals huge amounts of risk.

Huge amounts of debt as a percentage of your net worth equals huge amounts of risk.

Let me illustrate, okay?

You said you had a $5 million net worth.

What if you had a $5.5 million worth of debt at 1%?

You would feel that risk instantly because your net worth is not enough to cover it.

You have a negative net worth.

You follow me?

Right.

And so even though the interest rate was great, you felt the risk increase when I just gave you the example, didn't you?

I did.

That would...

stress me out.

Yeah.

And so

that illustrates accurately that debt equals risk because you can literally feel it in your physical body and you didn't even do it.

You just talked about it.

And your body started going, ugh.

And so that's your risk meter is measuring that.

You're feeling that.

So what is left out of your calculation of I can borrow this money at 2% and I can invest it at 4%.

I'm making a 2% spread or a 2.5% spread or whatever it is.

What's left out of that is you've not calculated mathematically for the risk.

Okay.

And there is actually formulas to do that in graduate-level finance.

If you're comparing a risky mutual fund with a not-so-risky mutual fund, we measure the volatility of the fund with a statistical measure of the height and distance to the valley of the, you think the wavy line that represents the returns, you know what I'm talking about?

If it's a real tall wavy line and a real steep wavy line, that's a risky one, you know what I'm saying, versus a real smooth one would not be risky.

The measure of that mathematically is called a beta in statistics.

And you can actually use a beta to

adjust the high-risk versus the low-risk mutual fund and compare them apples to apples.

The reason I'm bringing all that up is there's actually

a thing until you talk about debt, and nobody does it with debt except me.

And we started doing it with that a long time ago to say more debt equals more risk.

And so you would would divide your supposed spread out by the extra risk you're taking using a thing called a beta.

And you would see that there's actually no perceived value after adjusted for risk.

And so you're kidding yourself mathematically is the point.

You're not really making the spread because the math formula that you're using is naive.

It left out the risk.

So you're not being a simpleton at all when you pay off the debt.

On the contrary, you're very sophisticated when you choose to pay off the debt, making this wonderful income you guys have just found yourself in, and you're extremely successful lawyers.

Thank you.

I'm so glad for you.

I'm happy for you.

I want you to win.

So, the other thing you ask yourself is: if you extrapolate these things out way into the future, where do you want to be?

You're how old?

29, maybe?

I'm 48.

48?

Okay, whoa, okay.

You sound youthful, Dylan.

Okay.

All right.

Well, so when you're 68, when you're 68, do you want a $50 million net net worth with a $25 million debt load?

All I want is

I don't want to extrapolate this out.

I don't want to 10X this,

if I'm you.

And if you don't stop it, you're going to 10x it.

And the only reason you would stop it is you decided it's not good.

I decided I want to be free.

I decided I, even though there's a little bit, I might make a little money, but adjusted for for risk, I'm not really over the scope of time making a ton of money, and it's not worth it.

I can pick and choose my cases differently.

I can grow my law career even more exponentially if I have zero things riding around on my shoulder when I'm making these choices.

And so I'm going to encourage you to work toward.

I don't think it's an emergency.

I don't think you're bankrupt.

I don't think you're stupid.

I don't think any of that.

But it's almost a philosophical discussion in a sense that we're having.

It is a math discussion, and the math I pointed out is wrong, but

it's not going to cause you harm.

You can out-earn this level of mistake.

It's not that big a deal.

But I wouldn't set out to say, as my net worth grows, I'm going to grow my debt.

And if I'm not willing to grow my debt as my net worth grows, then must be because I don't think the debt's good.

And so since I don't want to 10x it, why would I keep it?

Anything that's great, I want to 10x.

Anything that's not, I'd love for you to 10x your income.

I don't see anything wrong with that.

That'd be cool.

Wouldn't call you out, wouldn't say you're doing something wrong to do that.

And so,

yeah,

that helps me.

But

you are hanging out with some very sophisticated people who are not very sophisticated with their mathematics if they're making you feel like a simpleton for paying off your debt.

Because I just walked you through a fairly sophisticated formula that you probably never heard before, I suspect.

I told it to a bunch of MBAs in a college thing the other day, and they looked at me like I had invented fire.

And so,

but the,

so that it's, it's, that's how it works.

I would pay it off, but I wouldn't be in an, I wouldn't be breaking my back to pay it off.

You make a million and a half dollars have a car payment, it's ludicrous.

It's ludicrous.

Yeah, especially the consumer stuff.

I get rid of that.

You're serious.

That's crazy.

I get rid of that one.

That stupid student loan, that car payment.

I pay that off in about the next two months.

But we could make the argument about the rental house and the house a little bit more cogently,

but you still lose the argument.

Counselor.

Session is a jerk.

I'm so proud of you, man.

You're just killing it.

I'm just so happy for you that you're making all that money.

Yeah.

Because you work so hard to get there.

Well, on the other part, and we talked about this in an earlier call, but the humanity of money, it is not just about the math.

There is a level of peace and security and autonomy that you get when you just own everything.

I mean, it is.

Like, there's just something there.

And so um, that element will not be in a formula or, you know, but it will be at night when you go to sleep and everything's owned, and there's just a level of peace, and there's not really a price on that.

Like, there's something there that's very real, and you can out-chase and out-earn the interest rates here and there, whatever.

That can be the game you play.

But, um, as Dr.

Don Daloni says, solve for peace, have peace in your life.

We live too much of a stressful life.

You have a stressful job, Dylan.

You know, just eliminate some stress, feel free, have autonomy over your life and money and those choices.

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Mike's in California.

Hey, Mike, how are you?

I'm doing great.

How are you doing?

Better than I deserve.

How can we help?

Love it.

I just have a quick question to cut to the chase.

I had to take out a loan that I didn't want to take out because of some damage to a home I just purchased.

We're currently in a lawsuit to get that money back.

So

do I pay it off, Gazelle and Pence, the Ramsey way?

Or do I, since I stand to make this money back, do I use my margin to not miss out on compound growth?

No, you pay it off as quick as you can.

Because when you get the money later, you'll have the money later.

But until then, you'll have the debt whether you win the lawsuit or not.

Yeah.

So we need to get rid of the debt.

And they're independent of each other.

Having the debt doesn't make you have a stronger case for the lawsuit.

The lawsuit will be answered on its merits only.

Heard.

So, yeah,

I'd be done with it.

I'd be done with that debt as fast as I possibly could.

I'm sorry you're going through that, though.

That's a really

there's nothing worse than a home being broken except a home being broken and a lawsuit.

These are two of the worst things you can go through.

It's just awful.

I'm so sorry.

Wow.

Wow.

Josh is in Illinois.

Hey, Josh, what's up?

Hey, how's it going?

Better than I deserve.

How can we help?

All right, so I had a quick question.

So I live with my two younger brothers.

And one of them works full-time, and he, you know, fully does his part.

and another one works just barely enough to just barely cover his pay-part of bills.

How old are these men?

I'm looking.

So the one that's barely working is 20, and the one that is working is 23.

And you're how old?

25.

Okay.

So you have one lame roommate, one good roommate, both of which happen to be brothers.

Yes, my brothers, unfortunately.

All right.

So I am currently working on paying off the last bit of debt that I have, and I was considering moving out at the beginning of next year.

But I have this like weird sense of like guilt if they're going to be able to survive because the one brother would probably end up still staying with the younger brother.

And the younger brother, I don't know if he's going to be able to drag his weight.

So I feel like I kind of have to stay.

And I was also thinking of staying anyways because I'm still working on paying off a car that I purchased a couple years ago.

What's the motivation to move out?

Just because of the financial craziness?

Partially, but also I have a girlfriend of two and a half years, and sometime within the next two years, I want to, within the next year or two, I want to propose and get married and then, you know, of course, live with her.

Okay.

Where would you, would you just go rent somewhere else?

Is that what you were thinking in the meantime?

Yeah, most

likely.

Do you think you can find something cheaper?

Cheaper?

I doubt it.

Okay.

What do you make?

I make $67,000 a year.

Okay.

All right.

Okay.

You make the decisions

and you give them enough notice, and you make the decisions based on what is the right thing to do.

Propping up someone who will not work is not ever the right thing to do.

That's enabling misbehavior.

Okay?

That's what I was saying.

And so, you know, you can love someone who misbehaves, but you don't have to love their misbehavior.

Okay?

You can love your little brother, but you don't have to love his laziness.

All right.

And so I would just tell them, hey, guys,

this worked for a while.

We were three young guys coming out of the house.

We did it together.

It worked for a while.

And I'm ready because of this dating relationship.

I'm going to start talking about moving out.

And I'm giving you like four, five months of notice here that that's what's going to happen.

And so you guys need to start making plans to be able to move somewhere else or to make up the difference with me being gone or to find another roommate to replace me

or whatever it is y'all want to do.

But then what they choose to do

with that knowledge is on them, not you.

So that removes all guilt.

All I can do is present to someone what the situation is.

How they react to it is their decision.

Now, Josh, there's not a contract that you guys signed that you'd be breaking in anyway, right?

No, Arley's been in, I believe, the beginning of February.

Okay, is that when you would move out then?

Yeah, okay.

Well, that's great.

Yeah.

Yeah, yeah.

I would tell your brothers, I'd tell your brothers over dinner, and then I would tell, and then I would send an email to the landlord and copy your brothers

that I'm making plans to leave in February.

My brothers will let let you know what their plans are, but I will not be here after the lease expires.

I want to let everybody know that and just give everybody plenty of notice.

The landlord knows what's going on, but that also gives your little brother, it gives your brothers a little shock to the system.

It's like,

this is really happening.

Talk to them in person first.

Yeah, yeah, yeah, yeah, yeah.

Don't send an email.

That's why I said have dinner with them.

Yeah, yeah.

Have dinner with them and tell them what's going on.

Okay.

You check their Gmail.

And they're like,

where's Josh going?

Josh, don't make this about them.

This is just what you're doing.

Yeah.

This is what I'm doing.

I just want to let you know what I'm doing.

I love you guys, and it was fun for a while, and now I'm going to go do this.

And,

you know,

it's not you, it's me.

And so, you know,

right?

So when it comes to, you know, making this about me, I was considering staying with them because I currently have about $23,000 in debt.

It's a car loan.

Well, sell it.

I've,

see, I've looked into that, and I got it back in 2022 when stuff was super expensive.

Kelly Blue Book puts you at at most, I'm thinking, maybe $9,300.

Okay, well, you're pretty stuck.

You probably need some extra jobs.

I'd work my tail off and get some extra jobs.

Yeah, just have at it and tear into that thing.

But I don't think that's a reason to stay.

I think you can pay off that car or get rid of the car problem, whatever it is you do with it, whether you're there or not.

Yeah, but

I also heard him say, the little brother is paying.

He's barely making the bills is what he said, but he's doing it.

So if it's a situation where you have cheap rent and it's not like affecting the, I don't know.

I don't know if there's like a reason to get out.

No, if he stops paying and then you have to pick up his slack, then that's that's one issue.

That's what's happening.

We only exit if everybody's bills are being paid.

He's not, that's he, he's, he's, it's time to go, man.

It's time to go.

Time to go.

Open phones at 888-825-5225.

You got to be real careful with

the

here's the thing.

I've learned it the hard way on the show answering these questions for 30 years and also in my personal life that

the better angels in all of us, the nicer parts of all of us, all have the ability to enable.

We all have the ability to want to make everything okay for someone else.

And sometimes we want it more for them than they do.

And that's when enabling happens.

Enabling is never good.

Enablers are always, when I'm talking to one, they're always the nicest people.

They're just the sweetest people.

They just want everybody to be happy.

And they're just helpful.

But they took their sweetness to a toxic level and ended up giving a drunk a drink.

Yeah, the drunk's really happy, but you just gave a drunk a drink.

You just said, hey, here's some Jack Daniels, buddy.

And, you know, I mean, just, you know, and so if you're covering for your little brother who's not working much, mm-hmm.

And.

Well, I agree if he wasn't paying the bills.

But he said at the beginning of the call, though, his wording was, which I listened, the wording was,

he's barely making his bills, but he's making, I mean, yeah, but we know

probably, yes, there will be a time.

The pattern is there.

That's fair, fair.

That there's going to be a problem.

But would you pay an extra $500 in rent somewhere?

Like, would you up the rent to move out?

He's going to have to of some kind.

But I think he's got to get in a functional situation if he wants to enter a functional relationship with a young lady.

Yeah.

Instead of hanging on back here cleaning up behind him all the time.

And so

there's some gain there.

And I think it's going to be the best thing for the person that you're enabling is when you stop.

It's really good for them.

It's like, I love you too much to participate in your crazy.

I am no longer signing up for the trip to Crazyland.

You taking a trip by yourself.

And you just got to, you got to talk this through, man, and just go, I love you.

And no way.

No, no, you go do that stuff by yourself.

I don't do that.

And I'm not going to help you do it.

And I'm not going to finance it while you do it.

Child of mine, parent of mine, uncle of mine, little brother of mine, whatever it is.

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Welcome back to the Ramsey Show in the Fair Winds Credit Union Studio.

I'm Dave Ramsey, Rachel Cruz, Ramsey host, Ramsey personality, number one best-selling author, is my co-host today.

Robert is in Florida.

Hey, Robert, how are you?

I'm doing well.

How are you?

Better than I deserve.

What's up?

I am calling because my wife and I recently went to Montana for a couple weeks.

First time we've ever really experienced a country other than the East Coast.

And

we're close to retirement, and now we're considering buying a motor coach and spending two years,

you know, with still having a home base, but two years going on long trips and seeing national parks and, you know,

it's just something that's in our gut that we want to do.

But I know how you feel about things with motors and wheels and, you know, things of that nature.

So

considering our net worth, do you think

we should do this or do you think we've lost our minds?

Well, what's your net worth?

Right around $3 million.

Okay.

All right.

So what would you spend for the bus?

Probably $200,000.

Okay.

So there's a couple ways to look at it.

One is you say, okay,

when you just did this other trip, did you take a coach or did you just drive the car?

No, no, no, we flew out there and

we bounced around.

We went to Glacier National and a couple other

really beautiful places.

Beautiful, yeah.

That's cool.

Good, good trip.

Okay, so the answer is yes, you can afford it, okay?

And the way I determine that is this.

I use the

burn the money in the middle of the floor analogy, okay?

So if I take $200,000 and I burn it in the middle of the floor,

or I throw it out the window of the car on the interstate just to watch the traffic swerve.

Okay.

Does that change my life if I have $3 million?

No.

Right.

So if this is the worst possible decision ever,

your life is still okay.

So the answer is yes, you can afford it.

But then I'll give you some suggestions on things that Sharon and I have experienced.

A correlation might be a second home.

Okay.

You go, we have friends that go to the beach, and while they're staying at the beach, they go, I've always wanted a house on the beach, a condo on the beach, okay?

Yeah.

And it sparks their interest just like yours is sparked on this.

They've never had a house that was a second home and they've never lived on the beach.

They've stayed there two weeks.

Yeah.

So what I suggest to them is before you spend $2 million

on a beach house, why don't you just go rent one for five months and live there

and see if it's all it's cut out to be?

They came home and didn't like it and were glad they didn't purchase.

So the correlation here might be, why don't you rent a motor coach for a month

for 20 grand

for 20 grand and let's burn 20 grand up before we burn 200 grand up and make sure it's as much as romantic and as much of a thing as you think it is.

It might be and it might not be.

You might be, I prefer to fly in private,

charter, and rent an SUV than I do drive with all these Yahoos.

You might decide that.

Right.

And pay about the same amount of money, by the way.

There you go.

I know I'm not going to come out of this

on top as far as money goes.

No, you're going to lose the money.

Oh, yeah.

Oh, absolutely.

This is going to.

But it's what you'll enjoy, Robert.

So one couple doesn't like the beach.

Well, we know plenty of couples that do and have a house.

Yeah.

And they love it.

Go try it.

And if they had liked it, then buy the house, right?

If you like the motor coach after renting it for a month, go do that.

But, I mean, the number of guys that buy a motorcycle and it sits in the garage 24-7 and they drive it twice a year and they thought they were going to go on all these trips and stuff is a bunch.

Okay.

Yeah.

And you could have rented the stupid motorcycle for the weekend and had the best motorcycle on the planet and gone and done road through the fall leaves or whatever it is you want to do, right?

It's okay.

Go do that stuff.

But I'm just saying

try it before you buy it is what I would do.

I'd invest a little bit of money in that.

Sharon and I actually did that on a second home area that we did.

We rented a home for 30 days and looked at other homes in the neighborhood while we were there, and we loved it and ended up buying a second home in that neighborhood.

And but we, by that time we had been there 30 days, we knew everything about all the ups, downs, sideways.

We knew how bad it and and that and so yeah.

And when you own another vehicle, you got one more thing that breaks all the time.

I was going to say, that's the other thing: the matrix.

It breaks all the time.

And you got insurance.

It's just the more crap you own, the more repairmen you have to know.

Houses, cars, all that stuff.

More money, more problems.

Mo money, mo problem.

That's it.

Yeah.

That's it.

So, I mean, I want you to try it out.

I want you to go do it.

You can afford it, is the answer to your question.

But before you turn this one-weekend trip into this $200,000 decision,

I would baby step into it, no pun intended.

That's exciting, Robert.

Yeah.

From the way you were talking, I think you and your wife, I think this will be the retirement.

I'm excited for that.

I think they're going to like it.

I think they'll like it.

Yeah.

There you go.

There you go.

That's the thing.

So

now, if, well,

Mark, is it Mark?

I'm just, I'm not going.

Raleigh, North Carolina.

Hey, Mark.

Hey there.

Thanks for taking my call.

Sure, man.

What's up?

So I'm at this crossroads.

I'm 57 years old.

I've been trying to do the baby steps.

I'm all out of whack as far as the order, I'm sure.

But sort sort of where I find myself is I'm looking at potentially work changing a little bit for me in the next, say, by the end of the year, or me changing myself.

So basically, where I am financially, I'm trying to figure out, I think I know the answer, is I've got about $310,000 saved, oh, about $240,000 on my house.

I have about $450,000 in IRA.

And I was debating on should I try to play catch up a little bit before this potential change happens as far as my income,

or should I just pay the house off and be done with that?

Pay the house off and move on.

Pay the house off by nightfall.

I wouldn't have that money in the bank and have a mortgage.

You borrowed on your home to have money in the bank,

right?

Net net.

Yeah, net net.

So, what are you talking about?

You're going to make less income?

Yeah.

Why, like, right now, between my wife and I, I'm sorry.

Why?

Just potential work downturn and work right right now.

What field are you in?

I mean,

advertising.

Okay.

So, I mean, and the other thing is, I'm also looking at as I may want to just change my life as well.

In other words, not keep pursuing that, but try to do something that has a little bit more impact and gives back a little bit more.

So I'd be maybe talking about just a life change in general versus pursuing that.

Okay.

Well, you would be a lot more free to do that if you didn't have Ausch payment.

I mean, that's kind of what I was thinking.

You read A Halftime by Buford?

I'm sorry?

Have you read a book called Halftime by Bob Buford?

No, I have not.

You had to pick it up and read it.

You're describing it.

The second part of your life?

Yeah, it's the

first half, back half, particularly with males.

They spend the first half of our life in acquisition, the second half searching for significance.

That's sort of where I'm at.

I've done a lot of things to help a lot of people in the advertising world pursue what they wanted to do.

And now I'm sort of like,

I don't feel like I've given back as much as I'd like to give back and actually make an impact, you know what I mean, on things in a positive way.

Yeah, I agree.

I think that's cool.

I think it's good.

And you need to pursue those issues and take them to ground, either whether you do it inside your career or with a separate career.

Either one's fine with me.

Yeah, pick that book up.

You'll like it.

It's called Halftime by Bob Buford.

It's a really, it's an old book, but it's a great book.

Dave, we got a lot of calls on this show where life happens.

One day someone's healthy, they're working, providing for their family, and then a curveball hits.

You know, we hear it all the time.

A car accident, a cancer diagnosis, a heart attack, and suddenly everything changes.

Yeah, and that's why you've always said that having term life insurance from Xander is essential because it protects your family if the worst happens.

Yeah, that's right.

You need 10 to 12 times your income in coverage.

No gimmicks, no whole life junk, just straightforward term life protection.

But there's another piece that people often overlook, and that's long-term disability insurance.

Yeah, it's important to understand the difference between them.

Life insurance steps in when you die.

Disability insurance steps in while you're alive but can't work.

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Michelle is in Florida.

Hi, Michelle.

How are you?

I'm doing all right.

How are you all?

Better than we deserve.

What's up?

So I'm calling for your advice today.

I lost my husband about six months ago.

I'm sorry.

Thank you.

How long were you married?

Almost 30 years.

Wow.

Okay.

So

he was just like a couple years.

We could have retired, but he wanted to work for a couple more years.

And we have two homes.

They're both paid for.

One is in Florida and one is in Utah.

And our plan initially was to go back and forth between a home.

But now that he's passed, I'm just calling kind of like what would they do

financially?

I'm just wondering if you think it would be better if I sold one of the homes or both the homes or

diversify and invest that money, or in the long run, what would be best financially for me?

Well, I mean,

why would you keep

both of them?

Well, I was thinking that

mostly for investment, like one I would live in, and then the other

branch or something.

I'm not sure yet.

I kind of vacillate.

I would like to go out to Utah, I think, but my job is here in Florida.

My friends are here in Florida.

But I would like to live in Utah.

I do, but they're grown.

The last one launched this year.

Where are they?

Three of them are in California and one is in Georgia.

Okay.

Do you have grandkids?

No.

Okay.

Not yet.

Okay.

But the potential would be California, it sounds like.

Mainly.

Okay.

Yeah.

Yeah.

All right.

So

you're how old?

I'm 55.

Okay.

And your life is currently centered in Florida?

It It is.

So what's the draw to Utah again?

I just like it out west.

Oh.

I like the mountains.

Oh, okay.

Okay.

I like the mountains.

And they're both paid for.

Did he have life insurance, Michelle?

He did.

I mean, honestly, he left me in a really, really good situation.

I have choices.

So

I have over a million in like Roth IRA and 401k, and I have about $600,000 just sitting in a high-yield savings account right now that I'm trying to figure out what to do with.

I would only want to own a home where I'm going to do life

unless I was going to actively use something as a second home.

And I don't,

I like the mountains.

It's not I actively use Utah as a second home.

Is this like Park City?

It's south of, no, it's south of Salt Lake.

Is it in the mountains or is it just in the suburbs?

It's in the Wasatch.

It's in the suburbs.

It's in the Wasatch Valley area.

Yeah, I know the valley.

It's a beautiful area.

Okay.

Yeah, another way to ask this sometimes is I reverse engineer it in my own head.

Would I do it if I didn't have a house in Utah today

and I'm a six-month widowed

and I've got my life centered in Florida, I like Utah and I like the mountains.

Would I go buy a house there or would I just go up there and stay some?

I don't hear a house in this.

Okay.

I hear visits.

Yes, it is visits right now because we were both still working.

Yeah, and you're still working.

I mean, you're not shutting your life down in Florida.

No, well, I guess you could.

You probably have enough money to retire.

But you're probably not going to go to Utah where you don't have any connections and sit around all day.

No.

that's weird

not wise that would be lonely yeah i guess i was wondering because my house is worth so much more here in in florida and i thought maybe that wasn't wise either no i think you're fine what's it worth what's the one in florida worth

about 1.5 or 1.6

it's not you know okay it's still it's still not and it's paid for it's paid for it is

yeah i i i i don't think you're going to get the incremental joy and use out of the Utah house

with him in heaven that you were going to have before.

But I do think you still love the mountains and you'll probably go up there and visit some and do some vacationing there.

But you're probably not going to, and you don't want to rent it.

That would be a horrible idea.

Oh, okay.

Yeah, renting something halfway across the country is really, you would never say

you never say, I'm sitting in Florida and I'm going to go buy a rental house in Utah.

That wouldn't be logical.

You would want to buy a rental house in the area where you are if you want to own real estate.

But

I mean, there's no rush.

As you said, you've been left in a wonderful condition.

And if you want to take some time and pray about it, it's only six months.

You can take some more time if you want.

I would not rent it.

I would only keep it if you feel like you're going to get enough use of it to justify owning it and maintaining it and paying the insurance and the taxes, which is probably going to be $100,000 plus a year.

Utilities, maintenance,

taxes, property taxes,

and so forth, and making sure everything's taken care of just for it to sit there, to be there when you want to go visit.

And I really think you could go to the montage at Deer Valley and stay for a long time for $100,000.

Right, that makes sense.

That's why I called you.

Yeah, and I but

I also, I'm fine with 30 years of marriage and your life just got changed.

And if you take a minute and cry and think about it, I'm okay with that too.

Okay.

But please don't rent it.

Please don't rent it.

You'll hurt your own feelings if you rent it.

Because your dream is going to have renters living in it.

Your old dream that's dead now.

And it's going to have renters.

You're not going to like that emotionally.

Don't do that.

Don't do that to yourself.

Sell the house before you rent it.

But

I think you're going to sell it and you're going to enjoy the money in other ways doing some other stuff.

Yeah.

Put it towards

the travel end of it versus owning it.

Yeah.

Yeah.

You can just, you can move about the country, as the commercial says.

Yeah.

Yeah.

That's, wow.

I'm sorry, Michelle, though, that's hard.

It changes everything.

Well, and it's probably a level of letting go of kind of what you said of what

it was.

Yeah, of what it's supposed to be.

So there's like a little bit of that grief.

It wasn't supposed to be this way.

We were supposed to finish up working and get to go to Utah.

It'll be a sad selling for sure.

Yeah.

and it's not even

from like a touristy standpoint.

You know what I mean?

Like you wouldn't even want a VRBO.

Like not even like long-term or short-term renters.

No.

You cringe.

Yeah.

Wow.

VRBO.

Yeah.

No, that's

Verbo.

I think I know.

But

we're talking about a serious amount of maintenance now.

You're now running a hotel.

That's different than renters.

That's another step up of, oh,

yeah.

That's, oh, man.

Now you're buying sheets.

Yeah, this is, oh, bro.

no, no, no, no, no, no, no, no, no, no.

All right, Dean is in Pittsburgh.

Hey, Dean, what's up?

Hey, Dave.

How are you doing?

Better than I deserve.

How can we help?

So I got myself in kind of a bad situation here.

I had an ex-fiancé, and I co-signed a car refinance.

When we were going to get married, she had over a 25% APR on her car.

She was drowning in the amount of interest she was paying, so I co-signed.

It got it down to a 7%

five-year loan, and suddenly she stopped paying for it.

Shocking.

She isn't.

Yeah.

She's not

being cooperative with me or the bank.

So wait a minute.

You don't have any ownership on the car, right?

None at all.

None at all, sir.

Okay.

All right.

How much is owed on this car that she's going to get repoed on you?

About $7,000.

And it's a 2013 TSO.

It's probably not worth more than $1,000, and I think they'd be very lucky to get $500.

Okay.

All right.

I got really bad news, dude.

The amount of money is not worth suing her over.

You're going to lose some money here after they repo it, and you're going to get your credit tagged after they repo it.

And you're going to end up writing the bank a check for $3,000 or $4,000 to get your name out of this mess before it's over.

You could start on that now if you wanted to, offering them three or four thousand to release you and let them go after her.

But good luck with all that.

When I do something stupid and it costs me money, man, I call it stupid tax.

So when you write this check in the four column, write stupid tax.

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Guys, if you died tomorrow, how would your family keep the lights on?

How would they pay the mortgage?

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If anyone in your life depends on your income, you need life insurance.

But how do you choose from all the options that are out there?

Well, it's actually pretty simple.

Life insurance is one job, replace your income, and term life insurance is the only kind that does only that.

The others, like whole life or permanent life, try to add in investing and they dumb down the insurance part and they raise the cost really high.

You only need life insurance while someone depends on you financially.

So if you're like most people, you need a policy worth 10 to 12 times your income for a term of 15 to 20 years.

And it should be a level-term policy, meaning the premium stays the same.

For more info and resources, use our free term life insurance guide.

Go to ramseysolutions.com slash term lifeguide or click the link in the description and we'll help you out.

Josh is in Pennsylvania.

Hey, Josh, how are you?

Good.

How are you guys?

Better than I deserve.

What's up?

So I'm calling in.

We had $90,000 of debt.

We have paid it down.

We only have $28,000 left.

And we have about $20,000 in crypto that I've had for years that has just kind of sat there like everybody else has.

I'm just wondering, should I liquidate that to just get through baby step two here and just finalize everything?

Yes.

Simple answer.

Yeah.

Anything that you you had money in that was not retirement, we would tell you to liquidate it and clear your debt.

Okay.

And focus very intensely on your debt because when your debt is cleared up, you then have control of your most powerful wealth-building tool, which is not investments.

It's actually your income.

And when your income is all going out in debt payments, you've limited your ability to build wealth.

Correct.

I mean, look, followed you guys religiously for a while.

Well, not too religiously.

You've got $20,000 in crypto, so you weren't real religious about it.

But

the I mean, semi.

I mean, you went to church on Easter, but that was it.

So anyway, the

anyway, the the thing is, yeah, if you had the money in Apple stock, if you had the money in

mutual funds, if you had the money in a money market account, if you had the money in a shoebox under your bed, we would tell you the exact same thing to liquidate it and put and pay off your debt as fast as possible.

It just gives us a little bit more joy when it's something as stupid as crypto to tell you to do it.

So yeah, but yeah, definitely go do that for sure.

When is a world that Dave Ramsey would ever buy crypto?

I don't gamble much.

I'm

if it ever became a proven investment for you?

Well, it's not going to be a proven investment because it's a commodity

and commodities are never a proven investment.

That's a problem.

Commodities like gold or oil, I don't buy barrels of oil either.

Sure.

Yeah, exactly.

And I don't buy blockchain.

And so I don't buy crypto.

So it's a currency.

I don't buy the N, and I don't buy the Deutsche Mark.

You can invest in the Deutschmark or the N.

They're a proven currency.

You could look at the track record and see

how that is done versus the USD, right?

Or the Euro.

I mean, you could

say it's a currency.

It's crypto currency.

Yeah.

And so a digital currency.

So you could, you know, but I don't invest in currency, so crypto is no exception.

It's just the least

appealing because it has the least track record of all of them today.

Someday, though, it could have a long track record and it could be very much more legitimate than it is now.

Right now, it's just all the cool kids doing stupid stuff.

And it's just maddening because people are using up their wealth-building power that they could have actually become wealthy and they get screwed over trying to be cool.

And because it's very faddish,

it's as dumb as beanie babies.

Or,

you know, really.

I mean, people were buying beanie babies.

I've had people call me on this show in the old days.

Your wife.

My wife.

For us.

No, no, no.

She bought beanie babies like crazy, but she never once said it was your college fund.

Oh, true, yeah.

I had people put their kids' college fund in beanie babies.

The Princess Diana Bear.

We had a special.

Yeah, can you tell me one that is sold?

I got one.

The dog carries it around, but I don't yet know one that is sold.

I know.

They're supposedly sold for $10,000, but I've never seen one.

They're for sale on eBay, but no one's ever bought one.

So anyway it's hilarious I mean you know what we had you were you were a baby and there was a thing that went around people decided they were going to instead of investing in cattle and pigs they were going to buy emus

because emu meat was somewhat like ostrich meat and we had emu we had friends that bought farms and bought emus

I mean, this is the same, it's the same category for me

as crypto.

I mean, it's just the same.

It's just a fad and beanie babies.

And so it's just because it's just something everybody's into and all the cool kids are talking about it and it's dumber than crap.

And it's just, you know, people are just doing it en masse.

And so

because they're losing their butts, they really are.

And so.

Well, the amount of, what's wild to me is the amount of scams

within it and the amount of things people have lost.

I mean, so much money people have lost in it.

Yeah, I mean, the other day we took a call.

Jade and I caught a catfish.

I mean, Jade caught the catfish.

The guy was catfishing this girl from Russia.

She had never met him, and her boyfriend

in Russia wanted her to cash out her 401k and put it into crypto with him.

And she'd never met him physically.

It was a complete, you know, romance scam over the internet, but they're using crypto to do it.

So, oh, my God.

I mean, that stuff's everywhere.

We're getting that stuff in here by the tidal waves into our offices by email.

Help us with this.

Help us.

We're not the FBI.

We can't help you with this.

It's just, you know, try not doing stupid stuff.

That'll help.

It's just, oh, my gosh.

Wow.

It was so sad, too.

Like, it's the first time maybe she ever realized that she didn't have a real boyfriend was when Jade told her.

It was awful.

Man.

It was just devastating.

That's why we all need friends.

Yeah, right.

People need people.

John is in Louis.

Hey, John, what's up?

Hey, how's it going, guys?

Better than we deserve.

How can we help?

It's good.

It's good.

Hey,

got a blessing brought on us.

My parents are gifting us their modular home and about three acres of land on their property.

And

I guess really, I have a few questions, but my first one is, should we use the money that we received from selling our current home to remodel and upgrade the place that we're receiving?

Or should I pay off some debt with that money?

Okay, so many questions.

How much debt do you have?

Once my house is sold, my current home, I would have about 60,000, 60,000 to 65,000 in vehicles.

That is it.

Okay.

So,

and but I mean, you're getting money from your current home, right?

Yes, yes.

I owe 140, we should sell around 190 to 210, somewhere's in there.

And you have other debt that you would use that money for, or you're asking whether to pay the cars off with that?

Yeah, should I pay the cars off with it or should I fix up the home because you should pay the cars off.

You should pay the cars off or you should sell them.

What do you make?

What's your household income?

Together, we bring home $77,000.

Okay, you don't need $65,000 worth of cars, Her, hon.

You're going to be broke your whole life.

Right.

You got too much tied up.

You got too much tied up in cars.

Okay.

Yeah, we do have a little plan with the no-house payment, obviously.

We plan to pay both vehicles off in two years.

Doesn't matter.

You still got $65,000.

you're going to turn into $10,000,

and you don't make enough money to do that.

You've got too much of your life invested in things going down in value rapidly, whether it has debt or not.

Yeah, John, we would say anything with motors and wheels, it should be half your annual income.

So you guys should have closer to like $30,000, $35,000.

Max,

your cars are killing you.

Yeah.

You owe almost as much on your cars as you do your house.

What?

Yes, about half.

Yes, half.

I know.

It's devastating.

Okay, that's the first part.

Second part, modular house.

Modular house.

Help me with that.

Is this a trail?

The difference between a modular home, I got a definition pulled up.

Modular home and manufactured homes.

The modular homes are factory-built homes that are essentially the same as traditional homes once assembled.

So pretty much they're made to build a home.

If I walk up to it,

I can't that it wasn't stick-built.

Uh, no,

okay, so there's wall sections put together, but they and they came on a truck, but and that's modular, that's the proper definition.

But I can't tell that this house was, it doesn't remind me of a trailer, it reminds me of a house.

Yes, it reminds you of a shotgun-style house.

Okay, then you can fix that one up, that's fine.

But if you can tell if it looks like a trailer, it's a trailer.

Natasha is in California.

Hi, Natasha.

How are you?

Oh, I'm doing great, Dave.

How are you?

Better than I deserve.

What's up?

Yes, my husband and I have a little bit of debt, but we also have savings.

And so I was wondering if it'd be a good idea to take from our savings to pay down our debt.

How much savings?

How much debt?

So total savings is $75,450 in just a regular savings account, $30,000 in a separate IRA or simple IRA.

Oh, so part of this is retirement money, okay?

Yes.

All right.

So 35 in, say it again.

So 45 in savings.

Okay.

And how much debt?

And then

$65,000 total.

On what?

One is a business vehicle and one is business credit card and a consumer credit card from our personal.

Okay.

They're all consumer, by the way, because the business was not loaned any money.

It doesn't have any money.

You signed them personally.

Yes.

You qualified them as business.

No one else did.

Okay.

Just to help you.

The law doesn't see it that way, in other words.

The bank doesn't see it that way.

They didn't loan that business any money.

It doesn't have any money.

So, um, yes.

So, is that your husband's work truck?

Yes.

What's he do for a living?

Um, we own a film production company and an event production, so it hauls all our equipment.

Gotcha.

Okay.

How's the business doing?

Is it making money?

Well, yes, yes, we make money.

Good, good.

Congratulations.

Thank you.

All right.

Well, what we teach folks,

in the business, you should be holding back some of your profits in the business account for retained earnings, which is a savings inside the business to cover the ebb and flow of business and cash flow.

Okay.

Okay.

So you ought to be keeping some cash over there to cover different bills that come in before the customers pay their bills, okay?

Payables versus receivables, cash flow.

And probably even for some growth, if you wanted to buy some equipment or things like that, you'd have a little cash over there.

So start setting aside a percentage of your profits in the business to keep there in the business.

Then what comes home we work with to run the household, and that would include paying off all of our debts.

Hmm.

How much pro what kind of income?

What's your household income off of this business?

What's the taxable income?

The total taxable income

is $184,000.

The profit?

For both of us?

No.

That's not profit.

Currently, you're going to pay taxes.

Okay, so yeah, so then that would be our profit.

My husband also has

a 9 to 5.

He also earns a salary.

Oh, I see.

Okay.

All right.

Yeah, I want to clear these debts,

whether they're labeled business or whether they're not, as fast as possible.

So, yeah.

So, anyway, on the personal level, what we teach folks is what we call the baby steps.

And the first baby steps have only $1,000 saved.

Everything above that, that's not retirement, we would throw at the debt.

So the answer to your question is, yeah, we would take most of this $40,000 and throw it at the debt.

But in your situation, I probably need to pull some of that $40,000 and set it in the business account to make sure we've got enough to cover the slush I'm talking about.

Yeah, is there any savings in the business right now?

Do you have any money set aside?

Not savings.

It just sits in the active account.

No, but I mean, how much is in there?

Ooh, good question.

About, we roll over maybe about $3,000 to $4,000 a month.

Okay.

Some months are good.

Some are, you know, it just.

Yeah, you need to keep a little in there so that it doesn't drain back out of the house, okay?

And then past that, we're going to pay off the debts, smallest to largest.

And I'm going to

pay the $40,000 all of it but $1,000 at these debts it sounds like that's going to clear up everything but the truck and a big bunch of the truck

right yes we owe 39 on the truck 39,000 okay and

so you've got 16,000 in other debt

yes okay yeah cut up the business credit card quit using a business credit card make the business cover itself a debit card is all you need there make it cover itself.

It

has to cash flow its own deal.

It has to create money, not drain money.

And so when you sneak off money over onto the side on the credit card, it makes you feel like you're doing better in the business than you actually are.

And so you've got to get rid of that problem from a business management or acumen standpoint.

But

if we pay that credit card off and cut it up, we pay off 16 out of the 40, and then we start throwing chunks and chunks and chunks at this car.

You could be done with this car by Christmas and be 100% debt-free and then rebuild your savings.

Your emergency fund, a fully funded emergency fund in your personal is three to six months of expenses, which in your all's case is probably $30,000 or $40,000 again.

I want you to get back up to that $40,000 number by this time next year.

But you could do that.

You could be debt-free and be back to your $40,000 number by this time next year if you concentrate on it and tighten up your budget really tight.

Yeah, and the fact that you guys have other jobs.

I mean, he has another full-time job too.

On top of that.

It's a total of $184,000 household income.

Of everything.

Yeah.

That's what she said.

So it's good.

Yeah.

You guys can do that.

That's reachable there.

Megan is in Delaware.

Hi, Megan.

How are you?

Hi, I'm well.

How are you?

Better than I deserve.

What's up?

I'm calling regarding two investment condos that my husband and I own.

We've owned them for about 20 years.

We have a fiduciary advisor who's advising us to sell them and buy

one or two multifamilies in a different state where we could possibly or hopefully get more rent

compared to what we're getting now.

And my question to you is, should we do that or should we sell the apartments, just take the equity and get hit, get the tax hit, but then just have the equity and not have any more investment properties anymore?

Yeah.

Multifamily is very intense to manage because it's multifamily.

And

being in another state is a nightmare as far as I'm concerned.

I own several hundred million dollars worth of real estate, and I don't own any multifamily in another state.

Oh,

yeah, I think that's part of our problem, too, is we're overwhelmed.

We have kids, and we both work full-time, and we're overwhelmed thinking about it.

I think this fiduciary advisor is telling you what he wishes he could do, not what you should do.

Yeah,

she owned a lot of multifamilies herself.

That's kind of how we found her.

And

you found her because you were looking to do multifamily?

No, we found her because

it was hard to find an investment or an advisor who would help us with our real estate because we have so much equity and so much of our wealth is in real estate and our 401ks.

Yeah, I wanted somebody who specialized in it.

Yeah.

Okay.

Well, I mean, you know.

That's fair.

Yeah.

Yeah.

That's a fair assessment.

And, but she's going to take you.

I mean, you know,

when you're a hammer, everything's a nail, right?

Well, and if you're tired right now, Megan, then that's that's that's triple, quadruple tired.

Yeah,

you're not getting rid of the tired.

We better back on.

I wanted to ask her.

Sure, sure, sure, sure.

Megan, how if you sold if you sold both of those, how much would you guys net out if you sold your condos and didn't buy a multifamily?

So they're worth $1.6 million together, and we own one of them outright, and we have $120,000 left on the mortgage with the other one.

Okay.

And what's in your 401k?

My husband and I together have $4.5 million.

Way to go.

Well done.

Good job.

Well done.

Well done.

Thank you.

Proud of you.

Yeah.

If you don't want to own real estate anymore, then because of the hassle of it, then you don't want to own multifamily in another state.

Okay.

If you do want to own real estate, it's okay.

I'm just worried down the line because I hear you and so many wealthy people who have a little bit of both.

And I'm afraid if I sell it, then I won't have any more real estate.

Is that okay?

That's a good question.

It's okay if you don't want real estate.

I mean, I know people that hate the idea of owning real estate because it is a real estate gives you a much greater rate of return than the stock market will, but it's also a much greater hassle factor.

It is, yeah.

You don't have a tree fall on the neighbor's yard when you're on a mutual fund.

Yeah, and if you guys are tired, Megan, I would, I mean, just, you could sell them and then spend a couple of years just investing.

And then if you guys want to get back into real estate, you can.

Go into a type of real estate that's much less intensive.

Like you could roll this into a 1031 exchange and go buy some warehouses on Triple Net.

And

they don't take up any mental calories versus multifamilies at the other end of the spectrum on mental calories.

Hey guys, George Camel here.

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Welcome back to the Ramsey Show in the Fair Winds Credit Union Studio.

Rachel Cruz, Ramsey personality, number one best-selling author.

My daughter is my co-host today.

Sarah is with us in Detroit.

Hi, Sarah.

How are you?

I'm great.

How are you?

Better than I deserve.

What's up?

I am calling.

I am recently divorced and the mom of two teenagers.

And I'm trying to figure out my best path forward with my retirement money.

I was never the one in the marriage who focused on this.

And so in listening to your show, I'm really all over the map with my baby steps.

But the one thing I do have, I was able to keep my 401k

with the divorce.

Good.

I have

$933,000.

Wow.

Good for you.

Not bad for somebody that didn't know what was going on.

You got a million bucks, girl.

I know, I know.

I'm 47.

I am a social, I'm a child welfare worker.

And with my job with the state, I'm actually able to convert that 401k to a Roth IRA.

And I hear that you say on your show that Roth is better than 401k.

So I'm trying to determine if that

is how much would I be paying like tax implications.

Is this smart to do at my age?

Are you still working?

I am still working.

I can retire in about five years.

I don't anticipate retiring in five years given my income.

I would change your current contributions to be Roth only,

but that's different than the 933.

Anything of the 933 that we move to traditional is going to be taxed

now.

Now, I'd like for you to do that over time, but in context with a bunch of other things going on, not just go, hey, let's write a $250,000 check in taxes and move $800,000 over instead of $950,000, okay?

Or $700,000 instead of $950,000, okay?

Because that's what it's going to do to you, and I wouldn't do that.

It's going to cost you $250,000 in taxes to move this right now, and I wouldn't do that.

Oh, wow.

Yeah.

Okay.

So, but I do want you to systematically move it over a number of years in context with everything else you're doing that we've not gotten to yet.

Okay.

So you've done a great job.

Congratulations.

You're a millionaire.

And from this point forward, you're going to make contributions in the Roth.

So call HR,

change your 401k from this point forward to be Roth contributions, okay?

Roth 401k.

Roth 401k.

Okay, she's asking about a Roth IRA.

You have a Roth 401k.

Is this Roth IRA now?

No, it's not.

I have the ability to switch it over to a Roth IRA.

No, yeah, you can switch it to a Roth 401k.

You can't switch it to a Roth IRA unless you quit.

Okay.

Gotcha.

Okay.

You can't move a 401k while you're currently employed.

You could.

But you could roll it to the Roth 401K

and do the same exact thing.

That's what I was talking about.

Do you have a Roth IRA, Sarah, or just a traditional IRA?

It's a traditional 401k.

I just have the traditional 401k.

Well, she should open a Roth IRA as well.

Yeah, that wouldn't be a bad thing.

Are you debt-free now?

So I only have, I'm working on it.

I just have final lawyer's fees that I have to pay.

But I should hopefully,

in the next two months, I should hopefully be done with that.

Good for you.

But then I do have to save up for my

three to six months.

And it's crushing me to not continue putting money in my 401k or opening up the Roth.

That's okay.

Listen, you've been through hell and you need an emergency fund.

You're going to feel better when you got 20 or 30 grand laying around, and then you go back to your 401k.

You're okay.

You're not going to retire with dog food, kid.

You got it.

You did it.

You're a millionaire.

Thank you.

Okay, you're okay.

Thank you.

The only question now is just how we can maximize it.

Not are we on,

you're not going to be homeless.

I mean, you're good.

So we're in good shape.

So, what I will tell you is jump on ramseysolutions.com and click on Smart Vestor Pro and find someone in your area that's the people that we recommend recommend in that world that will sit and spend some long-form time with you and catch you up.

Because what you are is a smart, intelligent person that does not have this particular information.

Correct.

And so you've got a little bit of learning to do, but it's not difficult learning.

And the Smart Vestor Pros, we will not send people to investment people unless they have the heart of a teacher.

Because I want them to teach you so you're making the decision with the information they give you, not my guy told me to.

Okay.

I want you to be confident and competent going forward because that creates a sustainable situation.

But what it's going to look like, Sarah, is pausing all that retirement right now, not doing anything with it, pausing it, getting that cash, say, for your emergency fund.

And then what it'll look like in four years, probably, is that you're going to have a Roth IRA as one account that you're going to be funding.

You're going to have a 401k traditionally

and then a Roth.

And so you'll, and then slowly moving some of those things.

And then I would move some of that traditional to Roth each year without tripping your tax bracket.

That's right.

That's right.

And that's what they're going to help you do.

And so over a 10-year period of time, you're going to move it all to Roth.

But instead of just writing a singular check up front, boom, and taking the hit, I wouldn't do that.

I'd move it gradually and let someone help you do the math on that and show you why you're doing it that way.

Rachel's exactly right.

But yeah, you'll get the lawyer's fees and the emergency fund cleaned up, and then you can start your 401k back, but start it back as a Roth, and you'll be doing a Roth as an individual on the side.

And then the last step will be to gradually start moving some of this 933 into Roth inside your 401k, unless you leave.

And if you leave, you can move it inside of an IRA.

Either one will be fine.

So very good.

Very good.

Wow, she's done great.

It's great, Sarah.

We have talked to several multimillionaires today.

An unusual number.

A lot of people.

For one particular day.

Yep.

4 million, 8 million,

3 million, 1 million with her.

Pretty cool.

It's great.

Pretty cool.

Folks are doing better out there than a lot of people think folks are doing out there.

It turns out the stuff that we're talking about around here works.

Some people are doing it without us talking about it because they never heard of us.

Some people are doing it because they followed exactly what we told them to do, and they become baby steps millionaires.

But either one works.

I mean, we're just happy.

We're happy for you when you succeed.

And

we're going to love you enough to tell you the truth, whatever the situation is,

and

help you get things aligned so that you can succeed in all of these things.

And the interesting thing is that we keep coming back to on this show, and we have from day one, personal finance is 80% behavior.

It's only 20% head knowledge.

The mathematical knowledge to become extremely wealthy, you learn by the sixth grade

in most schools.

Okay?

It's compound interest is multiplication.

That's all it is.

It's not, if you know how to do multiplication, you're ready to go.

And then you can add and subtract into a budget and tell if you're spending more than you make.

So it's not about that.

It's about controlling the person in your mirror, becoming a person of character, developing only quality relationships and exiting toxic ones.

or redeeming toxic ones,

whatever, so that they're no longer affecting the whole process because this whole thing works together.

Your spiritual walk, your relational walk, your behavior, the way you take care of your body, the way you treat each other and your family, all of these things enter into whether or not you actually can become financially successful.

Hey, what's up?

Dr.

John Deloney here.

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Today's question comes from Jill in Michigan.

I recently got engaged and we're trying to figure out how we should be splitting the wedding expenses.

I understand that you always recommend that married couples combine finances, but what do you do in the stage where you're moving from a boyfriend to a girlfriend to engage and planning a wedding when most of the costs will come out of our pockets and not from our parents?

Yeah, it's a great question, Jill.

I mean, I can tell you what Winston and I did.

We just opened up a separate checking account completely and put our wedding money in that.

The wedding checking account.

Yeah, we called it the wedding checking account and then used debit card, wrote checks and stuff out of that account.

So, but from the splitting expenses, I think you got, I mean, however much you both have to spend on the wedding, that's going to be the budget.

And it may be coming more from him or from you.

I don't know.

Whatever you guys decide the, the total is going to be of what you guys can afford.

Yeah, the amount percentage-wise of who, who comes from who, that doesn't bother me.

So if it's a

$20,000 wedding and it's 10, and 10, that's great.

If it's 5, 15, that's great.

I mean, I don't care.

But yeah, I would put it in one account and then you guys just use that account as the wedding account.

And then once I ended up just migrating all of our money to that account, eventually and closed out our other two, and that became our

joint checking at that point.

Post-wedding.

Post-wedding, yeah.

Yeah.

So, yeah.

I think the main issue is you sit down and say, okay, with my budget and my debts and my savings, here's what I can contribute to the wedding.

And with your budget, your debts and your savings, what can you contribute?

And we both come to a number, and it doesn't have to be the same number, I agree with Rachel, but it does need to be laid out ahead of time.

So, you say, okay, I can put in five and I can put in 15, we've got our 20.

Okay,

and then you've got, and we both have a clearly aligned goal of, and here's when I'm going to be able to do that, when I sell this car or when I do that,

and that's how we're going to be able to fund that.

And then that'll help you come up with your wedding budget.

And then I'll go a step further beyond the question and tell you:

we had,

in classic Ramsey style, three

wonderful, fun

parties that were weddings that were honoring to God, and we had a blast at all three of them.

All three kids.

They were absolute fun celebrations.

We liked to party.

And

that was the positive.

And the other positive was

that all three of them were

in huge compliment to all three Ramsey Gen 2s.

They laid out a game plan, they put a number on it, and then they broke it down line by line what we're going to spend on the wedding, and they stuck to it, by and large.

And so no one had a little

four-year-old on the serial aisle meltdown

bridezilla fit, and no mother-in-laws had a bridezilla fit like some of these things you see on these reality stuff and all that.

This was just like, okay, here's a project, and it's going to cost this.

The dress is going to be this.

The reception is going to be the big number usually.

If you're going to throw a party, it is.

And, you know, here's the videographer, and here's what we pay the preacher, and here's what the venue costs.

And you're running a project like you're building a house.

Here's what the carpet costs.

Here's what the lights cost.

And that's the budget.

And we stick to that then.

We don't go, oh, you know, we can do without the lobster flown flown in from Madagascar or whatever, right?

I will say, because it's a story you wrote in Smart Money, Smart Kids.

I did go over a little bit with the chairs at the reception.

Do you remember that?

I do remember that.

And I was like, hey, I just come on.

I had to have the gold chairs.

No, no, no, no, no, no, no.

It was just the, yes, when everything shook out, there was a small deficit.

But it wasn't, it was not.

No, it was not significant.

And it really was.

But in rachel fashion, I spent every last

penny of the three kids.

This one here is the one that went over, Yeah.

And so, but it was just

enough that it made a really good joke.

And so, and we make fun of her for the next 25 years.

So that's it.

But it's good family legend stuff.

But anyway, the point being, you lay out a budget and you say, this is the number, and that means we're going to spend X on dress, Y on reception,

and we can't do the open bar or we can or whatever we're doing.

Yeah, right?

Yeah, yeah.

And you look at the cost, and you can't just say, oh, none of this matters because of romance.

Yes, it does.

You're going to screw up the romance with the money.

And it's honestly, and it's good learning.

I mean, I know people, depending on when you're getting married.

You always have to make choices.

Yes, yes.

And I remember we had to do stuff like in the actual church, the pews, you know, the flowers on the side and all of it.

We had to nix those and do berries instead.

We were getting married on Christmas because our flower budget was over.

So it was like, okay, we got to cut flowers somewhere.

Where are we going to cut it?

You know, so it is.

You are figuring it out, but it's a great test run as a couple.

Now, the guy usually doesn't care.

I feel like it's usually the girl that probably has more opinions and emotions around it all.

There might be some mothers or mothers in the world.

But it's good.

Well, yeah, that's you.

Thank God, not for me.

Anyway,

it's good.

You learned some boundaries there, too.

Yes.

But do not enter this.

And this couple here isn't, because the way she's asking this, I can tell she's not guilty.

But do not enter this.

Like,

I have unlimited

ability to spend just because I have a right to.

This entitlement thing on weddings is out of control.

And,

you know, and it's partly because we have 16th birthdays now that are out of control.

And then that extrapolates into a wedding that's out of control.

And so,

and I don't care what you spend.

It's the out-of-control part I don't like.

Okay.

I mean, a friend of mine, they spent $125,000 on the wedding the other day.

And that doesn't bother me a bit.

They got billions of dollars, and that's not a big deal.

But

this supposed grown woman and the supposed grown man that she's marrying cannot be told.

No one can tell them no.

Like they're little spoiled brats or something.

And that drives me bananas.

But if you're paying for your own, you've got to tell yourself no, like Jill's doing.

So Jill's not guilty of that for sure.

But guys, just be careful with that.

It can get out of control really, really quick.

Frank's in Alaska.

Hey, Frank, what's up?

Not much.

How are you?

Better than I deserve.

How can I help?

Great, great.

So I am looking at retiring in about a year and a half or leaving my job at least.

My wife's going to keep working.

We have a house mortgage at $300,000.

Our house is currently worth probably about $650,000.

I have two vacant lots right next door to me that are completely paid off.

And I'm looking at possibly

building a duplex on one of these lots and living in one side.

as a way to become mortgage-free within my retirement.

I don't want to go into retirement and carry carry a mortgage.

So, you sell your house?

Well, that's a question.

My mortgage for my house right now is like $1,300 a month, and I know I could rent it out for like $3,000 a month.

And I'm thinking about just holding on to the house and using that as a supplement to income to pay off or to pay off the mortgage on the duplex.

I thought you were going to be debt-free.

All right.

How did you not end up debt-free?

I thought you told me you were doing this to be debt-free.

Well,

I'm making to be mortgage free

you're not mortgage free yeah you're going to mortgage on the house

and the duplex yeah i

no he's clearing the duplex how are you clearing the duplex

well clearing the duplex well i have two hundred thousand dollars to pay down on the duplex in cash and then um eventually selling the house to use that to pay down on the on the duplex

okay so no i would not do your plan If you want to do something to become debt-free, do it, but don't have do it and eventually do it.

You need to pull the trigger on the whole thing at once when you get ready to do it.

No, I would not do this.

I don't buy rental properties, investment properties with debt, period.

It adds to risk.

It doesn't reduce risk.

So if you want to sell

the vacant one of the vacant lots and sell your home and take the equity from your home and $200,000 and build a duplex and move in half of that debt-free.

We can talk about that one.

The downside then is

and your tenant lives next door to you.

The upside is your tenant lives next door to you.

Yeah, just knock, knock, knock.

Hello.

Hi, this is leaking.

Hello.

The light bulb's out.

Happy retirement.

Something's dripping over here.

Yeah.

Doesn't sound fun to me, but some people can do it.

We've all done dumb things with money.

I've done them with zeros on the end.

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

You got to have a plan.

You got to be intentional and you need to get a budget.

You have to tell your money where to go so you're not wondering where it went.

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Alexander is in California.

Hey Alexander, how are you?

Good and you?

Better than I deserve.

What's up?

I'm in a predicament right now, and I need your advice.

Okay.

My mother passed away early March, and she has a life insurance policy for about $300,000, and it's split between me and my brother.

My mom wrote out the policy when we were minors in case she died of her disease that she passed away not that long ago.

And the money is being held by my aunt and my grandma.

I'm sorry.

No, no, wait a minute.

Stop.

That's not possible.

Okay.

Your mother bought a life insurance policy and it had a beneficiary.

Well, I'm not sure how that stuff works, but.

Well, I'm telling you, that's how it works.

Okay.

And the beneficiary is who the check should have been written to.

Now, did she make your grandmother the beneficiary, or did she make you the beneficiary?

The paperwork says the money's supposed to go to me and my brother.

What paperwork?

My stepfather gave me the paperwork of what the insurance policy was.

Okay.

Are you How old are you?

I just turned 18

February 27th.

When did your mother pass away?

March 2nd.

After you turned 18?

Yeah, I believe it was two days after I turned 18 when my mother passed away.

I'm so sorry.

It's all right.

And your brother is how old?

My brother just turned 24 a few days ago.

Okay.

So if you were named the beneficiaries, the check should not have been sent by the life insurance company to anyone but you.

I'm confused how it got sent to your grandmother.

I think it's because my stepdad said that

I think it was written to my

aunt and my grandma, but it states on the paper that the money is supposed to be split between the children, which is me and my grandmother.

No, honey, that's not how a life insurance policy works.

There's no paper that does that on life insurance.

You haven't seen the paperwork, have you?

I have the paperwork.

But you've not looked at it and understood it.

Okay.

All right.

So I don't know what has happened based on the story you're telling me because you're getting told by

family legend that paperwork says something, but I don't think it says what you think it says.

And here's why.

Okay.

A life insurance policy has a beneficiary on it.

The beneficiary gets sent the check, period.

If the life insurance company sends the check to someone else, they're going to lose all the money because the person that is the beneficiary is going to sue the life insurance company for all the money, and the life insurance companies just simply don't do that.

They will not write the check to anyone that's not the beneficiary.

Okay?

So I think, I'm guessing, because you don't know and I can't tell, but I'm guessing that this policy said that the life insurance was to go to your grandmother and a will or a a verbal agreement with your mother said it was supposed to go to you once it went to your grandmother, thinking that you were going to be a minor at the time.

Yeah, I think that's the way my stepdad explained it.

Yeah, but I think the reason their grandmother has the money is she was actually the beneficiary.

Okay, and unless you can produce a piece of paper like a will or something else in writing,

not family legend, but in actual writing, that your grandmother owes you that money because that was your mother's written will

and desire.

Does she have a will, Alexander?

Do you know?

I have no idea, to be honest.

So when you talk to your grandmother about this, what does she say?

Well, I talked to my aunt about it because it was written off to both of them.

So they both got their own checks, which split the money.

And what did they say?

Well, my aunt told me about it, and my stepdad told me about it around the same time.

And every time I bring it up to my aunt, like the story always changed.

Like the amount of money changes or like the way she explains that the money will be spent changes.

And I mean, I'm not so close.

I mean, closer tells me.

Hey, you're breaking up, Alexander.

We can't hear you.

You're breaking up, hon.

Are you back?

Wherever you walked, walk back.

Oh, there you go.

Yeah, you're there.

You're there.

Thank you.

Thank you.

All right.

My bad.

Every time I do talk to my aunt, it's like something changes about it.

Or like she has a new role of what the money will be spent on or something like that.

For you or for herself?

For me and my brother.

So she says, what?

You have to spend it on college or you have to spend it for a down payment or like what does she say?

Well, she'll bring up college or she'll bring up like me moving out to the bay area with her and going to college out there and i pay her rent but if i ever ask her for money for like something maybe i seek interest in or like to put towards my future she's always iffy about it and saying that it's not what my mother would have wanted

okay you do not have a legal problem you have a relationship problem

This cannot be solved by a court of law because you don't have any standing.

Unless there's a will somewhere.

And if there's not a will and you don't get your hands on a will that dictates, but a will very seldom dictates what happens to life insurance policies.

It only dictates what happens to an estate.

So you can have a will, and it does not supersede what the life insurance policy said.

So the life insurance policy,

I.

I'm afraid that you are going to have to develop a relationship with your aunt that is not adversarial and that she needs to become convinced this is for your own good.

She thinks she's supposed to manage this money, that your mom wanted her sister to take care of you.

That's what she thinks.

And she's got some weird definitions of what take care of you means, and they're different than your definition.

But you're 18 and you've just lost your mom, and that's part of the deal.

But

I'm not a lawyer, Alexander.

You could go spend some money with a lawyer if you want.

I think you're wasting it.

Because I don't think you're I think you're going to

persuade your aunt to use the money that is in some way that is good for you.

How much is it?

How much does your aunt have and how much does your grandmother have?

$300,000, $150,000 each.

Is that right?

Yes,

okay.

Okay.

And so and your grandmother has some as well?

Uh yeah, my grandmother has her check put in a separate bank account from hers.

And what does she tell you?

You haven't talked to her?

No, I haven't talked to her yet about it.

It's mainly my aunt trying to be in control of it all.

That's why.

Okay.

Well,

I haven't heard anything that your aunt was using it for herself.

I've heard that you are not in agreement as to what's good for you.

She wants to use it for one thing that's good for you.

You want to use it for a different thing that's good for you.

And you want control of it.

And I don't think you're going to get control of it.

Your mother didn't leave you in control of it.

She left your aunt in control of it.

That's what it sounds like.

And

I don't think there's any piece of paper anywhere floating around that's going to give you control.

Not in the story you told me.

I'll be shocked if you find it.

If you find it, then I would take that piece of paper, whatever it is, the will or anything else you can find, and sit down with your aunt in person and say, this piece of paper says that I need this money.

And if you don't write me a check, I'm going to have an attorney ask you to write me a check.

And then you would seek legal counsel.

But I don't think you're going to find that piece of paper, Alexander.

I don't think it exists.

I think this was a handshake between your mother and her sister

and her mom to take care of her boys.

And the boys just don't agree with what take care of is defined as.

That's what it sounds like.

You hearing me?

So if I were you and your brother, A, I would look for this paperwork.

and not be adversarial about it until you find the paperwork.

And if you don't find the paperwork, or if you do, buy an airline ticket or get in a car and drive and sit down in person with your aunt and start trying to come to some alignment on what she thinks is good for you and what you think is good for you.

Because I don't think the story is changing as much as you think it's changing.

I think that you've gone through a lot of tragedy and hurt and heartache, and you want to do what you want to do, and she's telling you no.

That's what it sounds like.

Our scripture of the day, 2 Timothy 2, 15, do your best to present yourself to God as one approved, a worker who does not need to be ashamed and who correctly handles the word of truth.

Theodore Roosevelt said, far and away the best prize that life has to offer is the chance to work hard at work worth doing.

Amen.

Hey, the Ramsey Gold Planner is out and for sale.

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John Deloney to help you start each month on track with your money, your faith, and your relationships, and then follow through on your goals.

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You can get yours for $49.97 at ramseysolutions.com slash store or click the link in the show notes.

Jake is in Boise, Idaho.

Hi, Jake.

How are you?

Well, staying out of trouble, so can't complain too much.

Thanks for having me on.

My pleasure.

How can we help?

So, issue or problem that came up is we had a murder happen right next door at home.

Oh, my God.

My wife is a stay-at-home mom with two under two at home, my two little ladies.

And so, obviously, like she was at home and everything went down and all that fun stuff with all the cops showing up.

But so, she doesn't feel safe there anymore.

It wasn't like a gang violence thing.

It was just a

break with a random crazy guy.

Yes, I I would say, I guess you could call it random.

It's like a crazy guy decided to go after some family members.

I'll put it that way.

I'm sorry.

Say that again?

Yeah.

A crazy guy.

A crazy guy

decided to try and

succeed in killing one of his daughters and then tried to kill

one of his other kids.

Wait a minute.

The murder was domestic violence gone crazy.

He knew the people he was killing, and they had nothing to do with your family.

Correct.

So this is not a crime spree in the the neighborhood.

This is crazy people lived next door.

Yes, sir.

Okay.

So why would your wife be afraid?

Well, she was at home through.

No, no, but do you have crazy people in your family that are going to come attack you?

Because that's what happened.

At least not that I know of.

Well, that's what happened.

Not that I know of.

It could be.

I feel the same way, Jake.

I feel the same way.

Pretty sure.

Next to one of them.

Oh, brother.

No, seriously, seriously,

it would be logical to be afraid if this was a random act of crime in the neighborhood, but this was associated with the family and the people in the

a family member did this to another family member.

Am I correct?

Yes, that's correct.

So there was no danger presented to your house except for stray bullets.

Yep, exactly.

Okay, so now that he's gone,

there's no danger other than all the ickiness of this.

Yes, exactly.

That's how my very logical brain, that's not very emotional brain, I'll put it that way.

Works.

No, that's just

emotional and it's logical, but emotions need to

be run by logic, and we need to accept both.

It's valid to say a traumatic thing happened next door.

It was traumatic to me and my wife and my little girls.

The cop cars were everywhere and people died over there.

But that's traumatic.

And dealing with that trauma is a valid thing and that's a sweet thing for you to do and you and your wife to work on together that's different than we're in danger

yes okay and and they're they're very separate things yeah okay all right i'm back with you now i had to catch up because i didn't know the story enough all right i'm sorry y'all been through this how old are your baby how old are your babies under two uh one just turned through yesterday actually or today and then another one the other one is five months old oh so the five month old has no idea, and the two-year-old might have seen a cop car.

So really, it's your wife

was traumatized by it.

Yes, that is 100% correct.

Because I don't think the two-year-old grasps probably what's going on.

Oh, yeah.

The kids are just fine.

They thought it was a fun thing.

And what she's saying, Jason.

So it's your wife.

So because of all this, she's saying she wants to move.

Yes, exactly.

She just doesn't feel safe going on walks in the neighborhood anymore, doesn't want the little ones playing out in the backyard as much.

and just but she is feeling like she needs to move, and I want to be able to provide that for her.

Let me stop you.

Dr.

John Deloney would say that she's not going to feel safe anywhere.

Because the lack of safety is not due to the actual presence of crime, it's due to the trauma.

And the trauma is inside of her, and it's going to go wherever you move.

Okay.

This happened like a couple weeks ago.

I've been talking to my wife quite a bit.

She still feels how she feels.

Do you guys have any advice in navigating?

Yeah, I think you guys need to see a therapist.

She's been through hell.

You need to have somebody help her with her trauma.

Yeah, I mean,

I'm not faulting that she has these feelings.

I would feel the same way.

Yeah.

It's creepy.

Oh, it's weird.

It's creepy.

Super weird, yeah.

It's super weird.

But it's not, it's also the cause of...

Yeah, if there was a break-in of, you know,

if there were people, there were people breaking in Rachel's neighborhood.

There was guys going in and knocking doors in and stuff in her neighborhood.

and they caught them.

So everybody feels safer now in her neighborhood, okay?

But that was not associated with a single family thing.

If the next-door neighbor's 16-year-old stole his mother's diamond brooch and sold it to buy drugs, that doesn't make you scared.

Unless he's going to come in your house to steal your diamond brooch, right?

And so there's no logical reason to be afraid when you're walking, except that you've been traumatized.

And that means if you move across town, you're going to be afraid when you're walking still.

Does that make sense?

Yes, it makes.

So I don't care if you move, but I don't want you to think moving is actually going to fix it.

It's going to solve her fear.

It's not going to solve it.

Okay.

So

I would challenge you.

I think I'm okay with you moving.

I might move,

but I'm not going to move because I don't feel safe.

Okay.

Because that tells me that I haven't dealt with my trauma yet.

So I would sit down with a therapist.

I really would.

Because I think your wife's really been traumatized.

It's fair.

Well, there was a murder in the neighborhood next to us, and it was terrible, but it was a family-oriented thing.

We would be traumatized.

Yeah, it's

so scary.

But also, my kids will still ride their bikes in that neighborhood because

it wasn't to your point.

It's not a drive-by shooting.

Dangerous people around you.

Right, right.

It's not what's going on.

But your wife has now internalized it is what I'm saying.

And that's okay.

I understand.

It's a wound.

Trauma is a wound.

It's a valid thing for her to be scared and to have gone through this.

But to extrapolate that to, if I live on the other side of town, I won't be afraid when this had nothing to do with the house.

Then

that means you got something else to work on.

So I would see it.

If it was me, we would sit down together and see it through.

Do six months of that.

And then if it's for some reason it's still not good, then maybe try the move.

I don't know.

I might move anyway.

Just ickiness.

ickiness I can move off of icky the memory the memory is

ickiness is weird because it'll always be the murder house as long as you live there I mean it's weird like um

so yeah I bought a house one time when I was buying and selling real estate that a guy had been killed in and it was like it had a stigma the neighborhood but the people that bought it had no idea and it wasn't I mean I didn't have any idea when I bought it sure I didn't care I was buying a foreclosure right right and so uh but it was but it's still there's an ickiness I mean life a life was ended there it's weird

It's just strange.

So you're you're the ickiness is a reason to move, but not

if you if you're actually using the I don't feel safe, then that tells me she needs some other stuff.

She needs some other help with this.

And that's okay.

It's not it doesn't mean she's a bad person.

It doesn't mean she's,

you know, it just means she went through some trauma.

And but don't take that with you to the other side of town and then go, well, I can never go outside the rest of my life and walk because one time, 42 years ago, there was was a murder next door and I never dealt with my trauma.

That's how stuff develops.

And so you don't want to live there.

And I'm channeling my inner Dr.

John Deloney.

I know I was going to say, you said internalize.

You were using some.

Using some John Deloney words.

Yeah, I know.

I was like, man, trauma goes with you.

Well, I've been hanging out with him.

I've been learning from him.

He's a smart dude.

It's good.

So there we go.

It's real, though.

So real.

It's so sad.

I'm sorry y'all been through that, Jay.

I know.

And I'm just glad you're going to be able to do that.

And what you don't want to do is make a stupid financial decision decision based on the heightened emotion either.

So just let some stuff settle.

Yes.

Be calm.

Go do some work.

And then if you guys need to make a wise decision to move, do that.

And ickiness is an okay decision.

But that's nothing wrong with that.

That puts this hour of the Ramsey Show in the books.

We'll be back with you before you know it.

In the meantime, remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.