Stop Making Excuses and Start Making Progress

13:40Jade Warshaw:Very little. So they might get$1 ,400 each every month. That basically covers their rent and utilities. Are you the only sibling? uh the only sibling capable of taking care of anything yeah but i don't think you are you're in bankruptcy and that's why i am where i'm at and and that's what i'm saying so we've got a we got to break this chain it's it's a little bit of everything that's just snowballed at once um my dad was working and then he was diabetic and it turned into um he had an infection and turned into amputation that's terrible unable to work for about a year and a half where Where is he living?

14:21Jade Warshaw:Is he living in a home? Is he living in an apartment? How is he living? Him and my mom rent a house. Okay. I mean, this is really tough, but there's part of this that it's very hard for you to get in a true position of being able to help if you don't put up a boundary and say, I got like, I'm drowning here. I'm in bankruptcy. I'm literally the boat tossed me off and I'm fighting for my life in the ocean. And if I keep trying to rescue you guys, we're all going to drown. Right. And so at some point it might be tough, but it's like, I need you guys to fend for yourselves or the other siblings or something so that I can just get myself back in the boat here.

15:08Jade Warshaw:And then I promise once I get every, like, I will come back for you. Like, that's kind of what you need to do because you're in bankruptcy you don't have the money and if this is what's caused this then 100 you've got to go guys i cannot do all of this and and and there should be no shame in that it is very hard it's hard to handle one household let alone your parents household right and that's it is hard between everything i've picked up probably six or seven hundred dollars um in bills that i don't necessarily that aren't necessarily mine how much do you bring in every week it fluctuates so i do asphalt where i'm at a um it kind of depends on weather but generally between 800 to 1200 dollars every week okay after tax after tax so you're bringing home about let's call it around 60k or so uh yeah actually last year according to my income it was actually about 70 because i do have a secondary job good since the asphalt is seasonal but yeah okay it allows me to swap back and forth

16:17George Kamel:every year so if you're hustling you could bring in five to six k a month and what's your rent uh twelve hundred and fifty okay that's reasonable and so where's all the rest of the money going outside of the attorney fees and your chapter 13 payment?

16:39Jade Warshaw:Two parents, essentially. So the attorney payment is$350 every month. Cell phone bill is roughly $150. I pick up my mom's bill. That's another$150. You pick up her cell phone bill? Why are

16:53George Kamel:your cell phone bill so high?

16:56Jade Warshaw:Why don't you get her like a boost mobile phone? Why don't you get her off of what she has and get her like a Boost Mobile and pay like 30 bucks a month for that instead of 150. So and then it turns into another debt payment of the cell phone because it's through Verizon and not paid off.

17:15George Kamel:Yeah we don't need to be having financed cell phones when we can't even put food on the table. So we can get some dumb phones.

17:23Jade Warshaw:Yeah can we trade that phone in, get whatever cash we can, pay it off, and then just get you a dumb phone like George said. I can attempt that, yeah. Yeah. These are all the things I want you looking very closely at with a magnifying glass going, what can I do? So you pay the mom's cell phone. Tell us the other bills you're paying for them. Let's see if we can help you knock them out or get them very, very low. I do pay the car insurance for everybody. That's about$400 every month. Your dad's not driving right now, right? No, but he does have the vehicle. It's financed, and he's able to pay that payment.

18:00Jade Warshaw:Right, but let's stop for a second.

18:02George Kamel:Think about what you just said. We're paying a payment with insurance on a car that he's not even driving.

18:07Jade Warshaw:So let's, for the time being, because my guess is he's probably not going to drive for a while, let's get rid of that vehicle. Can we sell it? Can we get out of that, which will get rid of that insurance as well on that vehicle? It's too far negative to get rid of. I've looked into that for him.

18:25George Kamel:What's the underwater amount compared to what you could get private party and the loan?

18:30Jade Warshaw:It's worth about$6 ,000 or$7 ,000, and he still owes$23 ,000 or$24 ,000.

18:36George Kamel:So there was negative equity rolled over?

18:39Jade Warshaw:It wasn't negative equity rolled over. It was just the way the loan fell. Yeah, a bad loan. What about mom's car? What about mom's car? It is paid for cash, but it's for a only vehicle. Okay, but what if she drove dad's car? What if we sold mom's paid-for-cash car? She took dad's car. Dad is not going back and forth to work, so he's just not going to have a car for a while. They can't afford two vehicles, certainly not on payments. They can't afford to live. They certainly cannot afford two cars. So let's get rid of mom's car. What can you get for that?

19:12George Kamel:Maybe$5 ,000.

19:15Jade Warshaw:these are the decisions if you're going to be in bankruptcy and helping them with their life and their money these are the these are the types of decisions you're going to have to be able to make and say i can't do this if we're going to rescue ourselves we've got to make some deep cuts i'm making deep cuts you've got to make deep cuts if you're not willing to make the deep cuts i can't help and so that's what this looks like but um the strong can only help the weak and right

19:42George Kamel:now you're operating from a place of weakness. And I don't want you to see you calling back two years from now saying, I'm back in bankruptcy again because mom and dad are anchors keeping me down. Everyone needs to figure this out for themselves. You're all adults. And right now you need to clear the decks and get yourself some financial foundation.

20:14George Kamel:This show is sponsored by BetterHelp. A lot of you are just trying to keep it together all the time. You show up to work. You pay the bills mostly on time. You smile at all the right times.

20:25Jade Warshaw:But no one sees you when you're exhausted. No one sees you snap at your spouse or sit awake at 2 a.m. running through everything you wish you'd done and said differently during the day.

20:35George Kamel:Just because you're functioning doesn't mean you're okay. Talking to someone else is a great way to process what's happening in your life. and get to the root of what you're experiencing. That's where BetterHelp comes in. BetterHelp matches you with one of their 30 ,000 licensed therapists, someone you can be real with and finally put down some of the weight you've been carrying. They can help you get perspective and see other sides of your situations and help you move forward with a plan for getting well.

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21:42George Kamel:Ramsey is taking over an entire cruise ship. March 14th through the 21st, 2027. The Live Like No One Else cruise is back for the second time. All right. This time we're going to the Western Caribbean. Seven nights, Bahamas, Jamaica, Grand Cayman, Cozumel. And this is an entire cruise filled with Ramsey fans and us Ramsey personalities with new wealth building teachings from Dave, the world's largest debt-free scream, live tapings of your favorite Ramsey shows, and so much more. And this is for a very specific person out there, not for everyone. Very exclusive to those of you who have paid off all of your debt except the house, probably the house included.

22:18George Kamel:We got a lot of Baby Step 7ers on the cruise. Fun to meet them. But this is really to celebrate the milestone that you may have just glazed over. Because you pay off the mortgage and then there's more bills to be paid the next day. You never really get a chance to market. And so we made this cruise specifically so that we felt like we had a moment together.

22:35Jade Warshaw:I love that.

22:36George Kamel:And it was a lot of fun last year. so all inclusive pricing starts at about 2100 bucks per passenger that's cabin food entertainment taxes tips all included that's not bad not a bad deal for seven nights so uh you know we have a lot of people singles coming on this one we're doing an event just for them should be fun are we i'm trying to news for me i want to host it i want to be the ryan sechrist of the ramsey you hosting the singles event i think i have just for my own entertainment okay i need something to do for it So join us. It's going to be a good time. Click the link in the show notes or go to RamseySolutions.com slash events to book your cabin.

23:12George Kamel:Lee is in Phoenix up next. What's going on, Lee? Hey, how's it going, man? Good. How can we help?

23:19Jade Warshaw:Hey, so I live in Phoenix, Arizona, a suburb of Phoenix. It's Gilbert. And it's debating if I should rent or buy. It seems like the house prices are pretty inflated here and the rent's cheaper even with 20 % down. So I just kind of want an eager insight of what route I should take. Well, I mean, I would say real estate's inflated just about everywhere. It's just expensive in the housing market in general. But rent is not much better. Most people are paying around 25 % to 30 % every month for their rent, too. And the problem with rent is that's going to keep going up. So my question is, where are you in the baby steps?

23:56Jade Warshaw:And are you in a position that you could buy and you're just choosing not to? yeah i mean i have a possibility of you know baby supplies i pretty much so i called you all about seven years ago i was a whole bunch of car debt credit card debt did all the baby steps at this stage you know i have no debt and have a pretty good savings account and invest a lot of money each month so financially i'm pretty good there it's just uh the biggest thing with rent like if you buy a house for 800 000 20 down it's like five grand a month versus you can do the same property for about three grand a month on rent.

24:31Jade Warshaw:Well, let's talk about that a little bit. So tell us, tell us how much money you have saved. I mean, so I have 401ks, I have about 400 ,000. And then like my own personal stocks, like crypto is about 350. I have about a hundred grand cash. Okay. So you've got money and I love that for you, but nothing says you have to start with an$800 ,000 house. Is it just you? No, it's me. I have a family. I have three kids. And still I say, nothing says you have to start at$800 ,000. Yeah. I mean,$500 ,000,$600 ,000 in this area for sure. And it's more the same house at$800 ,000 you can rent for$3 ,000 a month.

25:15Jade Warshaw:You can, but you're not getting anything from it. And we're like, don't get me wrong. I think there's a season where it's cool to rent. And it's really great to rent when you're not ready to buy. And you're just trying to stack up that down payment or stack up that emergency fund or whatever step that you're on. But when you are able to buy, it's such a huge part of wealth building because every month that payment is going towards building your equity. It's not just going down a black hole that you'll never see it again. And with rent, that is the case. That's why we say renting for a short time until you can buy really is where you want to be.

25:49Jade Warshaw:How long have you been renting?

25:52George Kamel:Two years. I owned a house previously. And then what's your income? What's your after-tax monthly income? After-tax, probably close to$20 ,000,$25 ,000. Okay. So you can afford a healthy mortgage. I mean, you could afford$5 ,000 mortgage, no problem. Yeah.

26:09Jade Warshaw:I'm in mortgage sales, so it goes up and down, of course. So that's why I'm very conservative when I try to buy stuff, just in case, you know, mortgage. Sure.

26:17George Kamel:So you could have like a peaks and valleys fund to set aside when there's a really good month. Let's set some aside in savings to cover the down months. But what are your actual bare bones expenses that you need to cover the household for the month? All in? $10 ,000 a month. Okay. It'd be very comfortable. So you got plenty of margin. So let's say you put$400 ,000 down on a$600 ,000 house. that's about$2 ,200 on a 15-year fixed. Yeah. And you're in the mortgage world, so you know these numbers way better than I do. So what's wrong with having a$2 ,200 mortgage?

26:50Jade Warshaw:Well, then the key is, okay, now I'm taking out my investments that have been doing pretty well. And that's like, do I rent?

26:57George Kamel:Well, the problem is your investments had zero goal. You were just investing into the abyss. I only invest when I have a particular goal. So retirement is one investing goal.

27:07Jade Warshaw:And you have that.

27:07George Kamel:Down payment is another goal. So let's just, if you earmark this as down payment fund, do you feel a whole lot better selling this off?

27:15Jade Warshaw:Yeah, for sure.

27:17George Kamel:That's what I would do. I'd get rid of the single stocks and crypto and go, I'd rather be a homeowner than watching the crypto and stock markets shift. And you can build back up.

27:26Jade Warshaw:It's not even getting rid of it. It's shifting the investment. You're shifting it from being in stocks, which is actually more volatile, and you're shifting it to investing in your personal mortgage, your personal residence. and that's something that's going up in value too. You're gaining equity in that. So it's not like you're cashing out all investing, if that makes sense. You're just shifting it and you're making money in a different way for your family. Yeah, I understand that. Yeah, that's what I was thinking too. Just like, I like seeing the money grow with the investment. So it's like a game and I'm playing.

27:58Jade Warshaw:Well, nothing's going to stop you from doing that. I mean, with a mortgage of 2 ,200 a month, if you still wanted to play with a small portion of your money and keep doing stocks, nothing would stop you from doing that, right?

28:10George Kamel:But personally, I'd be maxing out all of my tax-advantaged retirement accounts first. Then if there's money left over outside of that, if I haven't hit 15 % of my household income, then you can move on to non-retirement investing. Cool. But I think look at the big picture. Look at the quality of life you want for your family. And I think you'll find that being a homeowner and having this house is going to be well worth the trade-off of selling off some of your portfolio to make it happen. Absolutely.

28:36Jade Warshaw:And I would just say, and I'm not saying this in a negative way, but the way the housing market is, if you have the cash, which you do lead to go out like that, you are on the winning side right now. There's so many people who are like, I cannot get in this market. It's impossible to save this down payment. How is anyone doing this? And you've got the money like capitalize and get yourself the win while you can. All right, cool. Yeah, I appreciate it, guys. And I called you guys about seven years ago. It helped me out tremendously. That's awesome. I appreciate it.

29:08George Kamel:Man, from being in debt, trying to claw out to having hundreds of thousands invested, no debt. That's pretty impressive.

29:16Jade Warshaw:Way to go. Way to go. Way to go.

29:17George Kamel:I'm excited. And Jade, there's a lot of people in Lee's shoes. They don't have the hundreds of thousands. They'd like that part. But they're wondering, is it a waste of money to rent? And that word just, it hurts my soul when, because what they usually say that is when they're desperate to get into a home at all costs. they say well I don't want to waste money on rent it's throwing money away yes and it's not you're buying yourself patience until you have the financial footing to step into home ownership with some confidence yeah instead of stress you know well then the argument shifts because then

29:45Jade Warshaw:you have a guy like Lee who's like I don't want to buy a house it's too expensive to buy a house it's cheaper to rent so what that tells us is whatever boat that you're in if you don't like the boat you're in it's just easier to find right the reasons wrong with it versus like looking at the facts of the situation. And so I think you're exactly right. Sam and I rented for 10 years. It's a long time to rent. And it does. Sometimes you do feel like, oh gosh, this money is just going away. It's not building. It's not getting me anything, but it is. It's giving you shelter every night. It's giving you a place to lay your head.

30:17Jade Warshaw:It's giving you stability. And it's also giving you the ability to save a down payment. And that's really, really great.

30:21George Kamel:That's right. And the way I got to those numbers for Lee, by the way, is using our mortgage calculator. And And it makes it super simple to punch in the home value, the down payment amount, the type of mortgage, the interest rate, property tax. And it'll give you the exact number. So I always like to go down to brass taxes and go, all right, we're looking for 25 % of our after-tax monthly income. No more than that going toward a mortgage. Once you can do that, regardless of the home price, the interest rate, you get the green light to go get that house.

30:47Jade Warshaw:What did you plug in for Lee?

30:49George Kamel:I plugged in$600 ,000 home value with a down payment of$400 ,000 on a 15-year fixed. and I lowered the property taxes, got rid of HOA for this example, and it was about$2 ,200. I love it. So that's all it takes. So go check it out. We'll drop a link in the description to that mortgage calculator if you guys want to crunch the numbers for yourselves. You might be hopeful. You could be a homeowner sooner than you know it.

31:30Jade Warshaw:If you're waiting for rates to drop before you buy a home, here's what nobody tells you. When rates fall, every buyer who's been sitting on the sidelines makes their move at the same time you do. That means more competition, higher prices, bidding wars, all that. That's why I tell people to talk to Churchill Mortgage before they do anything else. Churchill gives you a strategy so you're not at the mercy of the market. They can show you what you can afford, not just what the bank will approve. And with their Certified Homebuyer program, your financing is completely secured before you shop, which means when rates drop and everyone rushes in, you're already ahead of the crowd.

32:08Jade Warshaw:You're not scrambling for pre-approval while the house goes to someone else. My husband and I bought both of our homes with Churchill, and having a real strategy, not just a rate we were waiting for, made us ready when it really mattered. So start your search with Churchill. Click the link in the description or go to churchillmortgage.com slash Ramsey offer for an exclusive Ramsey audience offer. Churchillmortgage.com slash Ramsey offer.

32:48George Kamel:If you're new to The Ramsey Show, you'll hear us talk about the baby steps. This is the methodology, the framework that we use to answer every single money question on the show. So if you want to learn more about those seven baby steps, we'll drop a link in the description so that it's a little easier to follow along. Christine is in Rochester up next. Christine, welcome to The Ramsey Show.

33:08Jade Warshaw:Hi, thank you for inviting me on. My question is, my husband and I, he's getting ready to retire in February. We went, per the advice of some friends, to talk to a financial advisor. I have a traditional 401k, and the financial advisor wanted me to let him take that 401k and put it into a Roth IRA. But I know there's tax implications, and we were just a little concerned because he basically wanted to take all of our investments and somehow make us like a payout each month. and we just felt a little strange about it. And I listened to you guys, so I told my husband I would try to get on your show.

33:52Jade Warshaw:Are you still working? I am still working. I'm working part-time. I had some back surgery last year. I used to work full-time but couldn't do it anymore. But my husband is still working full-time, so I'm part-time. He's full-time. And you're still contributing to that specific 401K, or is it an old one? I am still contributing to it it's been there for about 30 years oh what's in it um it's just about 250 ,000 when I when I first started doing it I didn't think I you know you're young you don't think about retirement and I was only putting 75 cents a week in there and uh so now I'm putting more though in the past 10 years they're putting a lot more in what baby stuff are you guys in?

34:39Jade Warshaw:Do you know? Well, we don't have any car payments. We don't have any credit cards. We just have our mortgage. And my husband recently had an inheritance from his dad. So that's another reason why we went to an advisor because it's a sizable amount and we didn't want to just do something. We wanted to continue to grow. That's why we went to see the advisor.

35:08George Kamel:Okay. How did you find this advisor?

35:11Jade Warshaw:Through some friends. They're in Pennsylvania and we're in New York. And the advisor's in Pennsylvania.

35:18George Kamel:I'm curious, when they say a monthly payout, it scares me and it's giving annuity, which is an insurance contract where you have a guaranteed payment. Is that what they're talking about?

35:30Jade Warshaw:He didn't mention annuity, but that's what we were worried about. and he kind of took all of our different things that we have because my husband has a TSP through the government. That's his job, and then I have a traditional 401K, and he kind of just wanted to take everything.

35:50George Kamel:Well, the thing to know is that he can't manage your 401K, and so therefore I think what they're trying to do is basically convert it into manageable assets. But you can't just take your traditional 401K while you're still working there and just move it over to a Roth IRA.

36:06Jade Warshaw:You can or you can't. You can't.

36:08George Kamel:You'd have to leave the employer.

36:09Jade Warshaw:That's why I asked you if you were still working. Yeah, and that's why we were kind of, like, confused, because we just didn't feel like that was a good thing to do. Well, I got to tell you. Like, I can't do it. It sounds like you are having some reservations about this cat, and I am too.

36:28George Kamel:And it's not even in the same state that you're in.

36:32Jade Warshaw:Yeah, yeah, and that's another reason. why we were sort of like, but he did well for our friends really liked him. So they wanted us to talk to him. But then we were like, this is all our money in the whole world. I think there's a couple of things that's going on. Number one, he's asking you to do something that you can't do. That's a red flag for me. Number two, he's wanting to do something that sounds suspiciously like an annuity, which is something that we would never suggest for you. and he's wanting to do that with all of your money. And I just feel like that is a major—I mean, how many times have you even sat down with this guy, and he's already suggesting such a major act?

37:17Jade Warshaw:We had two Zoom calls with him. Yeah, it doesn't sit right with me. Does it sit right with you? No, no, that's why I said I'm going to contact them because it just felt a little queasy. Then that's your number one indicator, Christine. Just walk away. That you need to just walk away. And if it worked out for your friends, that's fabulous. You're not missing out on anything just because something worked for somebody else. If you don't have a good feeling about it, that's good enough for me. Okay. Yeah, we did go to a more conservative type of firm that's in our area that is only a half hour drive for us.

37:56Jade Warshaw:And that person did not mention anything like that. He mentioned like once we retire, we could turn it into like a regular IRA, but not a Roth. He didn't even mention Roth. I mean, if you had a traditional IRA that you were interested in converting to Roth, I think that's totally fine. I would just wait until you're in baby step seven once the house is paid off. And if you wanted to convert funds like that, you could. And they would help you do that in a way that makes sense tax wise. But I don't hear any of that coming from this guy.

38:29George Kamel:Sounds like they're just promising this monthly payout to get you excited to work with them. But my spidey senses would be tingling.

38:35Jade Warshaw:You know, he could turn this$1 million into like$2 million in a couple years, and it would be$3 million.

38:41George Kamel:No, I don't trust anybody who's trying to guarantee me to double my money in a certain amount of time.

38:45Jade Warshaw:Yeah, and that was how we felt, too. So thank you. You're kind of confirming what our thoughts were. That's really good.

38:52George Kamel:And I would reach out to a SmartVestor pro at ramsysolutions.com slash SmartVestor. and getting that second opinion about your situation. And they'll explain to you exactly how they get paid. And most advisors who are quality these days, you're going to see something like a 1 % AUM fee, assets under management. So they get paid based on the portfolio size. And so if they grow it from 1 million to 10 million, well, they 10X their paycheck too, as they 10X your net worth. So that's what you're looking for versus someone who's trying to guarantee you a monthly payout or sell you insurance products, which I'm seeing a lot these days.

39:27George Kamel:There's a lot of insurance agents posing as wealth strategists or tax-free wealth strategists. And what they're really doing is just peddling very expensive permanent life insurance and annuities. And those are the ones you get the invite in the mail for a free dinner at the local steakhouse.

39:44Jade Warshaw:Is that how they do it?

39:45George Kamel:What's upsetting is I want the free dinner. And in the fine print it says must be 50 years or older. I'm like, then why are you mailing me? You guys know how old I am. You have all the demographics in the world. Don't waste your stamps on me.

39:57Jade Warshaw:I can tell you I've never seen one of these, but I believe it's real.

39:59George Kamel:They're very real. I'll take the steak.

40:02Jade Warshaw:Where's the steak dinner? Is it like at? Yeah, your local, you know, Sparys, Perry's, you name it.

40:07George Kamel:Oh, really? Yeah. That's so funny. That's a good time. But that's a good reminder when you're working with anyone who's touching your investments, you need to stay in the driver's seat. Yes. You need to be asking the questions. You need to be very comfortable and in control. And if you can't explain what's happening with your investments, then you have not done enough homework. Don't just let them do it and say, well, I got a guy. He's handling it for me. You need to know exactly what's being charged to you, how much it's costing you, what kind of funds you're in. They need to understand what your goals and vision are.

40:39George Kamel:And if you're not in alignment, it's okay to say, this isn't working for me.

40:43Jade Warshaw:That's right. And if you feel like they're trying to kind of talk over you or what I would say insult your intellect. A little condescending. Yeah, a little condescending. This is something, trust me, I know what I'm talking about. Like, don't worry about it. It's complicated. Yeah.

40:57George Kamel:I don't want to bore you.

40:57Jade Warshaw:Ooh, I don't like that. I do not like that, George.

41:00George Kamel:Oh, man. Ooh, it gives me the heebies and the jeebies, the willies, the nillies, all of it. But we do have a great article on questions to ask your financial advisor. So we'll drop a link to that in the description of this show as well, because I think it's well worth a scan to go.

41:15Jade Warshaw:Yeah, you're interviewing them. Yeah. They don't have the job until you hire them, by the way. So just remember that.

41:20George Kamel:So you ask them questions like, what services do you provide your clients? What's your investment philosophy? How will we communicate? And you might find, hey, they're going to reach out to you once a year. And if you're like, no, I need a little more touch point than that, or I prefer text and email and Zoom versus in person, make sure you find one that aligns with how you want to be communicated to. And then how do you get paid? Is it assets under management? Is it an hourly fee? Is it a flat fee, like a project fee to come up with this whole plan? Is it commissions based on products you sell?

41:49George Kamel:and then how are you going to measure and evaluate my investment performance? That's another thing you got to look into.

41:54Jade Warshaw:I like that. And I think it probably wouldn't hurt if you brush up on some of your lingo so that you understand the conversation and you're following it well and you feel like you feel confident having the discussion. A lot of times if you feel like, gosh, I don't really understand this, you do start to just go with the flow of whatever they're saying. But if you feel like you can stand on your own two feet, that helps too.

42:16George Kamel:Absolutely. Again, the link is RamseySolutions.com slash smartvestor if you want to get connected to an investment professional who actually, you know, wants to help you complete your vision and goals instead of just sell you a bunch of products you don't need.

42:38George Kamel:Hey, George Camel here. Listen, if you're behind on debt payments and drowning in debt, I already know what you're thinking. I can't afford a lawyer to help. And honestly, that's exactly what creditors are counting on. But here's what most people don't know. Guardian Litigation Group doesn't work like a traditional law firm. There's no massive retainer. There's no hourly billing that costs more than the debt itself. Guardian is a law firm built specifically for people in default, behind on payments or staring down bankruptcy. And their model is designed so people in that situation can actually access real legal protection.

43:09George Kamel:From day one, you're assigned an attorney. If a creditor sues you, you have someone who can actually represent you, not a call center that isn't built to defend you when things escalate. The best path out of debt is still doing it the right way. Budgeting, working the plan, changing the behavior. But if you've already hit a wall and you need real help, Guardian delivers. Their attorneys have settled over$600 million in debt for more than 55 ,000 people. So go check it out for yourself, guardianlit.com slash Ramsey. That's guardianlit.com slash Ramsey. Attorney advertising. Results may vary and no specific outcome is guaranteed.

43:52George Kamel:Welcome back to The Ramsey Show and the Fairwinds Credit Union Studio. I'm George Camel, joined by Jade Warshaw, taking your calls at 888-825-5225. Emily is in Jacksonville, Florida. Up next, what's going on, Emily?

44:09Jade Warshaw:Hi, George and Jade. How are y 'all doing?

44:11George Kamel:Doing well. How can we help?

44:13Jade Warshaw:So, quick question. I just feel like I'm a little bit behind. I listen to y 'all show a lot, and I see a lot of people my age, about 32, that are all over the spectrum. But I just wanted an unbiased opinion from you guys about if you feel like I'm on the right track as far as finances and if my monthly allocations of my funds are appropriate.

44:35George Kamel:Oh, monthly. You're talking my language now. All right. So how old are you? You said you're 32?

44:42Jade Warshaw:Yes.

44:42George Kamel:Okay. And you're worried you're behind compared to everyone is a pretty big group.

44:49Jade Warshaw:Everybody else.

44:50George Kamel:Every 32-year-old on the planet?

44:53Jade Warshaw:Maybe certain ones. But just in general, like, I got a late start, maybe. Is it just you, Emily, or are you single? Do you have a family? Just me. Okay. So other single 32-year-old females out there you're feeling behind? i feel like maybe i am but i could just be overthinking it i don't know we'll tell you the truth tell us what you got let's put the cards on the table where are you at financially okay yeah so i'm uh have a seph ira as i'm self-employed i have a roth ira and an old 401k and those total with a brokerage account about um 105 000 okay um i have an emergency fund of 30 thousand. My home, I have about 125 ,000 of equity.

45:41Jade Warshaw:I still owe like 215 ,000. Um, I'm self-employed and my business account right now has about 50 ,000 in it. Um, that just kind of, I haven't touched. I don't really, I like to leave it there, I guess. Um, how much do you bring home from yours? How much do you bring home from your self-employed business every month? So I'm just a W2 through, my business my salary is 105 ,000 so I bring home about 30 3200 twice a month okay and are you investing it sounds like you have a fully funded emergency fund that's baby step three are you investing 15 of your 105 or are you doing a little bit more since you have the employer side what are you investing every month I am doing 25 into my step IRA I was doing 15 but then my CPA was like you should do 25 to keep as much of the money as possible.

46:34Jade Warshaw:So I bump it up to 25 % every month. 25 % of? 2 ,100. Say again? Of the 105, 25 % of the 105 ,000 salary. So about 2 ,100 per month. Well, let me stop there and just say, first off, I think you're doing fabulous. I think that you're walking the plan that we teach. You've paid off your consumer debt. You've built up three to six months of expenses, you're actively investing more than 15%. We might find a reason to back that down here in a minute. But that alone lets me know that you're winning at life. Oh, that's good to hear. Yeah, because you've got, this is all foundational. And a lot of times people will try to build wealth without doing the foundational stuff right.

47:19Jade Warshaw:And it's just, it's more headache. But you're doing the foundation stuff right. You've protected your debt freedom with an emergency fund. You're building wealth the correct way. I mean, the next question I would have for you is, do you have the right insurances? Have you double checked that your car insurance is good and your health insurance and all that stuff? I have health insurance as a self-employed. It went up a little bit compared to when I was with a regular employee, but it's like$420 a month. I have life insurance, even though I'm single, I got a policy now just because I don't know what's going to happen in the future.

47:53Jade Warshaw:And it was really cheap to get one. And it was a million dollars, about 10 times my hundred thousand income. And then I have disability insurance as well. I actually just got a new quote through Xander. And see, that's huge. That is huge because a lot of people leave that kind of stuff out. And it's a huge part of protecting the wealth that you do build. So I'm going to go with foundationally, you're right on track. And let's just plug those numbers in. I don't know if you've ever played with an investment calculator, Emily, but we have a really great one at RamseySolutions.com and I have it plugged in and I just put in your current investments.

48:27Jade Warshaw:It's 105 ,000 that you have. You said you're putting 2 ,100 a month and you're 32. Let's let it grow for the next 30 years until age 62 at 11 % rate of return. And I've got you at$8.6 million by age 62, which means you're gonna be a millionaire a lot sooner than that, right?

48:48George Kamel:And that's if you never get a raise, you always keep at that level. And once you have a paid for house, you're going to ratchet up your investing, most likely, knowing you. So the good news is, as soon as you said, am I behind at 32? I went, she's got plenty of money and I feel it. Because most people that are even asking that question, it's sort of like the natural state you're in when you're doing everything right is, am I doing enough?

49:11Jade Warshaw:Yeah, that's pretty much it.

49:12George Kamel:The average for under 35 for their retirement accounts is$49 ,000. The median is$18 ,000. So you are so far ahead of America, let alone debt-free with an emergency fund, with retained earnings in your business account. You are thriving by all measures. So I would tell you to enjoy your life a little bit.

49:32Jade Warshaw:Yeah.

49:32George Kamel:Are you enjoying spending and giving on top of the investing?

49:36Jade Warshaw:I think so. I still do my things I like to do, like my bougie massage and my nails and stuff. Good. And I use the EveryDollar app, so I know exactly how much everything costs every month.

49:49George Kamel:You've got the Treat Yourself line item in there.

49:51Jade Warshaw:I would make one tweak to this, Emily, that I hear. And I mean, this is so small, but it's just I'm being nitpicky because I feel like I can with you. I might back the 25 % down to 15%, and I take that 10%, and I throw it towards the mortgage extra.

50:06George Kamel:That's an extra$10 ,000 a year if you do nothing else with extra mortgage payments. So that would be a great goal to say, hey, listen, while I'm single, no one else is dragging me down. What if I knocked out the mortgage over the next five years?

50:19Jade Warshaw:Wow, that's a cool goal.

50:21George Kamel:You know, before your 40th birthday, you're going to be completely debt free.

50:25Jade Warshaw:Yeah, I put about$500 extra a month towards the mortgage, too, and then the$500 in the brokerage account. So y 'all made me feel a lot better. Good. I appreciate it.

50:33George Kamel:You're going to be fine. Whether you have$9 million in retirement or$8 million, it's going to be okay. Okay, so the question is, what does the rest of your life look like on the in-between? That's the harder part to figure out. Because you're really good with numbers, I can tell. Even if you invested 15 % at a 10 % rate of return, you'd still end up with$5 million.

50:55Jade Warshaw:Wow.

50:56George Kamel:So rest assured, Emily's going to be okay if she continues these habits. So now it's more like, what are the next goals? Before I retire, what do I want to accomplish? And that might mean we're paying off the house. We want to go on this vacation. We want to upgrade the car. And who knows? I don't know your future. I don't know if you want to, you know, get married one day, have a family. But all of that's going to affect your situation. But the better financial foundation you have stepping into that, the easier and more comfortable life's going to be.

51:25Jade Warshaw:Awesome. I appreciate you guys. Y 'all are my favorite. Thank you. Gold star. I love it.

51:29George Kamel:This is like Emily's the poster child. Yes. Like how do we clone Emily's all around the world?

51:33Jade Warshaw:But you made such a good point, George. The people who are plugged in enough to what's going on with their money to be asking those questions are not the ones that we need to worry about. It's the ones who are just bopping through life. And it's like you're living paycheck to paycheck. The pain is there and you're just ignoring it. You're not asking the right questions. You don't want to poke the bear. You're just like, maybe this will all be OK.

51:58George Kamel:If she was 52 and asking, I feel like I'm behind. It might be a realistic answer. Yes, you are behind and it's going to be OK. But in Emily's case, I mean, it's mythology at this point. She's going to build incredible wealth because of the foundation she set for herself early on. And be careful who you compare yourself to, because right now we've learned they're invisible people who may or may not be doing better than us. So just run your own race and focus on your own goals, Emily. You're doing great.

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54:32George Kamel:Dennis is in Clarksville, Tennessee, up next. Dennis, welcome to the show. Hello, thank you. How are you all today? Doing great. How can Jayden and I help?

54:41Jade Warshaw:Yes, I have a question in reference to setting up a will. My wife and I have been married for about seven years, but we have older kids from previous relationships. And I'm just trying to figure out, okay, so both of us would die at the same time, how to set up an executor to take care of the property, because overall the property is worth anywhere from$800 to$1 million, and I've been making double payments on it, and I think I owe about$250 left on it, and it's going to be paid off in about four years. So I'm just trying to figure out which direction do I go into if we both die, if I die, how can I set it up to have stuff written into the will in order for people to be taken care of.

55:24George Kamel:So what are you wanting to happen? Let's say you have in the will, here's who's getting what. Let's say, how many older kids do you guys have between the two of you?

55:33Jade Warshaw:Three total. I have two. She has one.

55:35George Kamel:Okay. Have you guys talked about who would get what as far as these things?

55:39Jade Warshaw:No, we have not. Okay. No, because I know that if I die, the property is probably too large for her to take care of. And I know I've talked to her before in the past about trying to set up a will, and I keep putting it off, putting it off. And I just got to do something because I would hate for both of us to go. And then the government kind of reached their hands into the pot. Is the property the only major asset or do you think that there'll be a lot of cash or IRAs or anything else a part of this? I have about one hundred thousand in my savings account because I'm kind of semi retired right now.

56:14Jade Warshaw:My wife still works and I'm just kind of I have a life insurance policy that both all three of them are on it. My wife has the bigger share. What's that worth? That's$250 ,000. Okay.

56:29George Kamel:That would pay off the mortgage, essentially. Yes, sir. Okay.

56:33Jade Warshaw:Okay. And did I hear you say$100 ,000? Yes. Yeah. I kind of retired. How are you partially retired off of$100 ,000 in retirement? I'm a pretty good saver. I've been saying I'm retired military. Okay. So I get a pension there. But everything I got is paid for. So I have a lot of assets. I got about 50 acres on the homestead. So overall, like I say, the property is probably worth about a million dollars. And I just want to make sure I know I've seen it in the past where people die and people get greedy. I just want to make sure that when I go that people that they're taking care of. Are you trying to make stipulations that the property has to stay intact or are you fine with them selling it in three and taking three equal shares?

57:19Jade Warshaw:What are your wishes? Well, I don't want to. I'm not cutting out my wife in any way because I know she'll probably end up, whenever she does sell the property, she would end up moving away. I just want to make sure that my kids are taken care of because I just don't want them not to be taken care of later on down the road just in case something would happen. You said they're older kids. How old are they? They are. My son is 33 and my daughter's 26.

57:51George Kamel:So they don't need to be taken care of in the financial sense.

57:55Jade Warshaw:They don't, but I would prefer them to be taken care of. I'm not a millionaire. I'm rich in other ways, but I want to make sure that the money that I put into this, that they get a little bit out of it. So let me just walk through this a little bit, because I'm trying to understand if this is something that you're doing together with your wife or you're doing separate. Because let's say you pass first, the land automatically goes to her. You don't want her to then say now she's she gets to decide what happens with the land. You want that specified in the trust ahead of time. Just a little bit.

58:29Jade Warshaw:Yes. I'm not telling her what she can and can't do with it. I would just like to have something. OK, when you go to sell it, if you sell it for X amount of dollars, I would like for my son and my daughter to get X amount of dollars. So I think if I were in your, especially given the value of this, I think I would sit down with an estate, you know, an estate planning attorney and say, here's what I'm thinking. I'd sit down with your wife, too. Here's what we want. We want to make sure that if I die, the land passes to her. And then when she dies, I just want to make sure X amount of portion is cut out for each of each of our kids.

59:03Jade Warshaw:And then from there on, if she wants to do something else with it, like and you guys sit down and decide what you want, because I mean, And I'm not saying that you have to have this figured out today, but I don't think today you're even clear on what you want. But I do think that I would do this in a trust, and I think that I would do this with an attorney. I wouldn't try to do this online on a will by myself.

59:24George Kamel:Okay. And you can get started with a simple will just to have something right now. And we have a great partner with Mama Bear Legal Forms where you can do that. But eventually you may want to look into a more complex trust because the will will explain who's getting what. But if you want ongoing management of something like a property, you're going to need to set up a trust. And there is something called a Qualified Terminable Interest Property Trust. It goes by the nickname Q-Tip Trust. Have you heard of that? No, sir. So that is specifically great for blended families, like the one you're describing, so that it lets the surviving spouse use the property and income for life, but it locks in who gets the property after that spouse dies.

1:00:05Okay.

1:00:06George Kamel:So that you might want some kind of stair-stepped approach like that. And that's where the trust comes in handy. And we always say trusts are not for everyone. Most people are totally fine with a will. But if you have very specific things you're trying to solve for, you might want to look into a trust. And to Jade's point, that's where an estate planning attorney comes into play. So I'd find a good local estate attorney to walk you through this and help you figure out which one makes sense for you and what the cost is going to be.

1:00:30Jade Warshaw:And a big part of that too, once you do that, Make sure you're sitting down with the kids and explaining what's in it, what your wishes are. So there's really no surprises when that time comes.

1:00:39George Kamel:Don't let it be someone else's job to tell people what's going to happen after you're gone. Gosh. That's cruel.

1:00:45Jade Warshaw:Yeah.

1:00:45George Kamel:That's cowardice. So just tell everyone who's involved in the will, here's what's going to go down, and here's what happens when. That's how you love your family well. All right, Melissa is in Chicago up next. Melissa, welcome to the show.

1:00:57Jade Warshaw:Hi there. Hi, George. Hi, Jade. Thanks for taking my call. You bet.

1:01:01George Kamel:What's going on?

1:01:02Jade Warshaw:So I am new to Ramsey and the baby steps and I think I'm doing pretty well overall, but I currently rent and I actually don't really even want to own a home, at least not for the foreseeable future. Why? But I guess I'm like, well, I can explain and I want to know how that'll affect my wealth building ability. But I have owned in the past. I'm divorced. I have two little kids. I have owned in the past. I live in the Chicago area. So housing is so expensive. And I don't like the upkeep. Talk about like losing peace of mind. Like I had trouble sleeping at night because I was worried about the next thing that was going to go out.

1:01:51Jade Warshaw:I can understand that. So I sold my house, my townhouse a couple of years ago, moved to a rental. And I've been sitting on this cash that I got from the sale of my home. And I feel like I should have that earmarked for a future home purchase. but I just feel like I have bigger goals around like my own retirement and my kids, you know, college savings and just being able to like live a comfortable life. Where is the money now? Is it in a high yield? Yeah, it's sitting in a high yield savings account. How much is it? I have about$102 ,000 in the savings account now.

1:02:32George Kamel:Awesome. Okay, what's your income? them?

1:02:36Jade Warshaw:I make$183 ,000 a year. So after taxes monthly, it's about$11 ,700. You know, I love the goals that you have, and I agree with you wholeheartedly. I think you should have the goal of having a nice retirement, a nice, peaceful, comfortable retirement. I love the goal of making sure there's money for the kids' college. I definitely think that you should have that. But I don't think that you should take your home equity money to accomplish that. I think those are goals that we accomplish month by month with our cash flow, certain percentages of our cash flow. So for instance, of the$11 ,000 that you're bringing home, you're marking a certain percentage, you can decide how much you want to put aside to 529s every month.

1:03:21Jade Warshaw:you can decide that I'm going to start investing 15 % of my income into my 401k. Right. And I think doing that. And then if you want to continue to set aside money and increase that hundred and 2000 that you have in the HYSA. Yes, I'd keep adding to that money. And if this season is not a season that you want the upkeep in the drama, I'm not mad at that. But let's put a time frame on it and let's set a really clear goal and say, when I have, you know, 400 ,000 in this HYSA, that's when I'm pulling the trigger and I'm making the next move up. And let's just put parameters around this so we're not just renting forever and ever.

1:03:59Jade Warshaw:Amen.

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1:05:31George Kamel:Charlie is in Chicago up next. Charlie, what's going on?

1:05:36Jade Warshaw:Hi. That's kind of a complicated question. I am 34 years old. My wife is 30 years old. I had my house paid off since I was 28 before I met my wife and we just had our first baby and her mom and dad want us to move closer towards them but I don't feel they flooding uh like selling the house or moving with the like you know because moving 30 miles closer to Chicago is quite a bit more expensive than where I live. So it's only a 30-mile move? Yeah, we're within an hour of her parents, and her parents want us to be within half an hour, and I think it's a little safe. Why don't they move? Why wouldn't they move 30 miles closer to you?

1:06:36Jade Warshaw:She's one of five, so it kind of puts them in a central location of everybody. you how does this affect your jobs it would so i have like a little excavating business and my yard is within a mile from where i live so i've explained to my wife because i have to go

1:06:54George Kamel:back to the yard every night pretty much and it's nice because it's nice and close to my house but i explained to her i said if we move that adds an hour or an hour and a half onto my day every day

1:07:06Jade Warshaw:going back to the yard where it's otherwise I'd have to relocate. Yeah, I'm not doing that. And what is the property increase? You know, what's your house worth today versus what you would feel like you would need to spend to get what you want 30 miles closer to them? My house is probably worth like$400 right now, but the house I would need would probably be close to$700 because I would need at least a little bit of land so I could park on, you know a large truck and trailer and some equipment on it you know and so just to recap the drive to the parents house now is an hour an hour and 10 minutes is that what i heard correct and this is a problem because because i i don't know i kind of like a buffer sometimes it's nice to have a well i agree with you but i don't know i just my question is am i in the right to dig my heels in and say no.

1:08:05Jade Warshaw:Do you have the$300 ,000 extra to make this move and keep it debt-free, which is it sounds like where you want to stay. You have a paid-for home. That's nice. Do you have the money to do this, and it's just a work thing, or is it a work and money thing? It would be a work and money thing. I only have like$150 ,000 liquid cash, and I'm not wanting to spend any of that towards another house.

1:08:34George Kamel:What does your wife think? Maybe another option. Is she desperate to make this move?

1:08:40Jade Warshaw:Not necessarily. If she spends a long weekend with them and I'm not there, she comes back and she reinstigates the conversation. It's been going on for about a year. And I'm like, you know, there goes long stretches where she's totally fine. where she's a stay-at-home mother now. So we've got that locked down and she can be a stay-at-home mother. But I think with this move, she would have to go back to work. And then that entails childcare. And I'm scared of childcare costs. So let's just... To me, it doesn't make any sense. Let's just pretend for a second. Let's pretend that you're like, all right, we take the 400.

1:09:19Jade Warshaw:Let's say you decide, hey, we're going to make this move. And we want to take the 150 and put it with the 400. And so in the meantime, we're going to save up our three to six months just to make sure we're not touching emergency funds to do this. And we're going to go in and we're going to put$550 ,000 down on a$700 ,000 house. And then we're going to have$150 ,000 mortgage. Let's just pretend you did that. She would have to go back to work because of the mortgage? Or is there another reason you feel like she would have to go back to work? Because that doesn't feel. I guess it would be, it's part of my resentment that all that money that I worked towards that house was mine.

1:10:03Jade Warshaw:And the reason she wants to move is part late. She feels that the house isn't hers because she hasn't contributed. Okay, now we're getting somewhere.

1:10:12George Kamel:This is a layer beneath. So is her house on the deed? Is her name on the deed? No. Or no. And why is that?

1:10:22Jade Warshaw:Because I had it prior before we were married and it was paid off before we were married. But you can easily add her to that. That's just paperwork. Correct. But I guess I'm in a field where divorce rates are high in the construction field. Okay, so we're getting somewhere on this. There's some issues here. Because you can go two routes of this. If you said, hey, she doesn't feel like the house is hers. I lived here before she did. I picked this house. She just feels like I would love to move somewhere that feels ours. That's one side of this argument. But then the other part of it is like, dude, you're married to this woman.

1:11:01Jade Warshaw:You're clinging on to something you did as a single man and you're no longer single. So add her either. Let's add her to this deed because you're married to her. And let's show that you're like all in 100 percent. or you guys need to have some deeper talks, I think, with a counselor because I think I'd be feeling the same way if I were in her shoes. Like he's not letting me fully in on this. He's already thinking about what happens if we divorce, but you didn't have her sign a prenup, did you? No, but I don't think that's the question. That's not my, I think my question is, is it proper for the parents to be getting muddling in my business?

1:11:43Jade Warshaw:No, it's not. It's not. But in digging through, we found other. You're right. The initial question was, do I need to move closer to the in-laws? No, you don't. You truly don't. But in uncovering that, I think we're seeing the deeper issue of the reason she wants to move is she wants something that's both of you all's. And what you have right now, she's feeling iced out because you won't let her in on the deed. And she's thinking maybe if we have a new house that we have together, we'll both be on it. oh, and by the way, my parents want us to move closer. That's another reason that I can push him to move.

1:12:17Jade Warshaw:So she's using what your in-laws want to do as leverage for her to get what she really wants from you, which is a place that we live that we can call our own that I'm on to.

1:12:32Jade Warshaw:See what I'm saying? Yeah, she's not like a money person. I know. You don't have to be a money person. Check it out, Charlie. You don't have to be a money person to want 100 percent buy in with your spouse on the things that you're building together and a part of together.

1:12:55George Kamel:She feels like I should feel so blessed to live in Charlie's kingdom he made for himself. And instead, she wants to feel like the queen of the castle, too. And I think that she has every right to do that. So I think what we need to do is just separate out all of these issues. Yes, the in-laws are meddling in your business. Yes, this destroys your commute. Yes, this messes up your finances because you're adding a mortgage to the picture. It's okay to use those facts on paper. I just don't want you to sort of hide the stuff that's going on underneath just by using those as excuses.

1:13:26Jade Warshaw:And you don't even have to move closer to the in-laws. What if you guys, if you like the neighborhood you're in and if that works better for your business, what if you said, honey, I talked to these good people on the Ramsey show. I think I understand. Would it be a good, can we compromise here? Can we stay in this area? which means we're staying in this price point, which means we don't have to take on a mortgage, but can we get something that you and I select together? We're both on it, and it doesn't cause us to go into debt any further. I think that, Charlie, that would be a very fair compromise.

1:13:56George Kamel:Imagine you guys upgrade to a$500 ,000 house in cash, and she gets a vote this time. That might solve this all, to where she's not itching to move, and the parents are just giving her a reason to bring this all up.

1:14:10Jade Warshaw:Right. That's probably why when she goes on the long trip, she comes back and she's like, I can use this as leverage.

1:14:18George Kamel:Yeah, I think you're right on that one. But it's okay if you just say, I don't like my in-laws. That's a fine reason to not move closer to them. I know you're not going to say that on air and I put you on mute so you didn't have to, but I imagine as soon as we did, he was like, yep, that's...

1:14:31Jade Warshaw:I vote for the buffer, George, every time.

1:14:33George Kamel:Yeah, it's okay. It's a weekend trip. Instead of a, hey, we were just in the neighborhood decided to pop by. Now it's you got a plan for the trip.

1:14:39Jade Warshaw:Now it's Everybody Loves Raymond. And I'm like, an hour is a perfect it's perfect. You can go over there. You have a good time. It's enough time nobody needs to stay over. You can go home.

1:14:48George Kamel:It's not enough to tire you out on the drive. Yes. It's a good happy medium. Good luck, Charlie.

1:14:53Jade Warshaw:Look to the buffer.

1:15:19Jade Warshaw:Hey, it's Rachel Cruz. I don't know about y 'all, but I can build something up in my head until it feels way harder than it really is. I'll convince myself it's going to take forever, be super complicated, or cost a fortune. Then I finally sit down to do it, and I wonder why I waited so long. Making a will might be one of those things for you. That's why I love Mama Bear legal forms. They've taken something that can feel overwhelming and made it so simple. Their online wills are designed by attorneys and tailored for your state. And while you're on the Mama Bear website, it'll walk you through the whole process step-by-step so you feel confident that you're doing it right and that your loved ones will be taken care of.

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1:16:36George Kamel:One of the most helpful things you guys can do if you're enjoying the show is leave us some feedback. Drop a comment, hit subscribe, share the episode with someone who could use it. You guys are the best marketing engine we have to spread the word about the show and the hope that we're trying to bring people. So thank you for doing that. Victoria is in Denver up next. Victoria, welcome to the show.

1:16:56Jade Warshaw:Hi, Jade. Hi, George. Thanks for having me.

1:16:59George Kamel:Absolutely.

1:17:00Jade Warshaw:So my question is essentially my husband and I recently switched away from credit cards and just to our debit card out of our checking account. And we're just wondering if that really will save us a lot or if we'll still have kind of the swiping carelessly habit, unless if we go to full cash. So that's my question.

1:17:20George Kamel:Oh, so you're on debit now. You're like, should we take it a step further and go full cash?

1:17:25Jade Warshaw:Yes, which sounds very cumbersome. So you might have to get me on board.

1:17:29George Kamel:Sure. Well, there's only a couple of places that works in today's society. You're not going to walk down to your utility company and give them a lot of cash. So a lot of things are going to be on auto pay. And so the things that you can use cash for is likely groceries, maybe gas, if you want to walk into the station.

1:17:45Jade Warshaw:And it does make a big difference on groceries. I will say that, Victoria. Okay, interesting. It's not a necessity. It was a few weeks ago, and so far I haven't really noticed any changes, so I think it's more just, hey, is this doing anything, or should I be getting my 3 % cash back?

1:18:04George Kamel:Are you itching to go back to credit cards?

1:18:07Jade Warshaw:I wouldn't say my husband is. I probably have a slight more itch than him. There are only debit cards with cash back. I think I haven't seen a spending benefit yet. I think I'm still spending similarly to how we have been, and we have pretty good spending habits. I'll say we maybe spend a little more on food than in our budget, but for the most part, not too bad.

1:18:27George Kamel:So where are you guys at financially? What are your sort of goals right now? What Baby Step are you on?

1:18:32Jade Warshaw:Yeah, we're doing really well. We're 29 years old each, and on, I think, Baby Step 5 slash 6. So we have twins that are almost a year old.

1:18:42George Kamel:Awesome.

1:18:43Jade Warshaw:And so saving for their college fund and then paying off our mortgage, but we have no other debt.

1:18:49George Kamel:Great. And you're on track to do that, funding college, putting extra on the mortgage. You guys are hitting those goals, and you still have room to save for a car upgrade, a vacation, maintenance, all the other things.

1:18:59Jade Warshaw:Yes, yeah. We're doing really pretty well thanks to a lot of the advice from the show. So thank you, guys. That's awesome. I mean, I think that you guys, you sound like you're really, like, conscientious people and that you're just intentional about what you're doing. It sounds like you have really good control over your spending. So I wouldn't expect to see like this market improvement from you going to a credit card to a debit card, you two specifically. My guess is it would probably show up in like specialty purchases. Like if you were buying concert tickets or going on a trip, it might cause you to spend a little bit more on flights.

1:19:35Jade Warshaw:It might cause you to upgrade the hotel room. Like that's generally where people tend to spend. The discretionary spending. Yes. That's when the percentage of what you spend generally would go up higher. I've even saw studies that say fast food for whatever reason when people go and buy fast food they spend more on a credit card than they would on a debit you'll upgrade that meal on a credit yes um and so I my guess Victoria is that you guys are just responsible people if you're looking for the three percent cash back look into some of the debit cards that offer it if it really is that big of a deal but I specifically wouldn't divert back just for the thirty dollars okay yeah I think we We've been trying to become people that we admire and we admire people who use debit cards.

1:20:20Jade Warshaw:So I think we'll stick with it. But I was definitely curious. It's interesting to hear, though, about maybe cash could be more beneficial at the grocery store or things like that. So I might look into that. I mean, it is for a couple of reasons. I mean, when you go to the grocery store with one hundred and fifty bucks, when it's gone, it's gone. No other plastic. It's like, hey, you got to put the eggplant back. I don't have the dollar fifty. Like, I don't have the extra money. You just got to put it back. So I do think that in that way. I wish that's what people were like,

1:20:49George Kamel:dang it, I shouldn't get the eggplant today. It's usually snacks.

1:20:52Jade Warshaw:Eggplant is in season and it's expensive if you get organic. That's all I'm saying.

1:20:55George Kamel:It's the Bogo Oreos for me, Victoria. There you go. So yeah, I would just try to, the areas where you feel like you could do better or that you know are tempting for you, I would just try to put boundaries up for those. And that might mean deleting the app off your phone or deleting the payment information for the debit card from that app. And then for the in-person spending, Some people go, I'm not going into Costco. It's too dangerous. I'm going to do Instacart. See, I like to go into Costco. But Jade is like, I'll do Instacart because I'm not tempted by all the things in Costco. So you know you better than anyone.

1:21:26George Kamel:That's right. And so you and your husband can then set up a game plan for how are we going to protect the margin that we've worked so hard to create. And that's where a debit card really is a protective barrier more than it is this magic wand that's going to cut your spending in half.

1:21:39Jade Warshaw:The biggest thing is making sure we're budgeting our money every single month and we're sticking to the money that we budget. That is the crux of everything we teach is making sure you're doing all of that together.

1:21:50George Kamel:That's right. All right. Good question. Nate is in Toledo, Ohio. Up next, Nate, welcome to the show.

1:21:57Jade Warshaw:Hey, thanks for taking my call. Sure. My question today, my wife and I bought a house in January and we put about$60 ,000 into the house so far and moved in just two weeks ago. My question is, because of the amount of money that we put down at the beginning, not being 20%, we're paying PMI currently, and I'm just looking towards the future and thinking about refinancing. Is there any guidelines or instructions that you guys would have for our situation looking at refinancing our home? How far away are you from getting rid of the private mortgage insurance? How much more do you need to pay? We put$10 ,000 down.

1:22:47Jade Warshaw:So as far as our mortgage is concerned, we still probably have that$30 ,000 left to go. Okay. I thought I heard you say you put$60 ,000 down.

1:22:56George Kamel:Was that of work, like renovations?

1:22:59Jade Warshaw:Yes. That's the amount of value that we put into the house and just investing in materials and that to do.

1:23:07George Kamel:So you knew it was kind of a fixer-upper. So you put$10 ,000 down, you had$60 ,000 set aside in cash to cash flow the repairs and renovations needed? Yep. Okay.

1:23:17Jade Warshaw:What was your interest rate? Our interest rate is a six and a quarter, I believe. Yeah. So, I mean, it's not going to make sense to refinance for you until rates go down to a point that you go, man, that's going to make a significant difference for us. whether it's a whole point that'd be what i'd be looking for but i think that my bigger play right now instead of waiting for interest rates to go down because i don't see that happening uh i would be thinking okay how how can we pay this mortgage down and get this pmi off our backs quicker we got 30 000 until this monkey's off our back let's just get to work and in the meantime it's great because

1:23:59George Kamel:we're just paying down our mortgage too and the other thing to do is get an you can get an appraisal because you put those 60K of renovations in, that might be able to get you out of this PMI because your house might appraise for 60 grand more, meaning your loan to value ratio just changed. Gotcha. So that's one thing to do. That's something I could talk to the bank with. Exactly. And see if your lender can just drop the PMI versus having to refinance to get there. And I assume you're on a 30-year? Okay, yes. Okay. So it may not be worth refinancing for a while until we see some significant rate changes.

1:24:31George Kamel:I wouldn't just jump to a 15 to do it. So what you do is look at your closing costs on a refi. It might, let's say it's$5 ,000. Well, now you got to look at when am I actually going to save that much or more? What is that break even point? And that's a pretty easy calculation to figure out to go, all right, it's going to take us seven years to break even. This refi is not worth it. But if it's going to take 18 months, 24 months to break even, all right, that's going to be worth it. Let's do that. We know we're going to be in this home for the next five to 10 years. So that's the simplest way to look at the math on it, but you're not going to magically just get PMI removed until you hit that 80 % or less loan-to-value below that threshold.

1:25:11Okay.

1:25:12George Kamel:All right. Thank you. Absolutely. Great question. That is a good question. And that's an interesting conundrum. Because they put all this money into the house, it likely improved the value. Now, did it increase the value of the home by$60 ,000 just because they put$60 ,000 in? Highly depends on what they did.

1:25:28Jade Warshaw:Well, it goes back to the teaching we used to have on buying a house, which I guess is still a teaching to put 20 % down. And the main reason was to avoid the private mortgage insurance. But in today's market, I mean, gosh, most people are putting down well more than that just so that they can have the payment be less than 25 % of their take home after tax. And so the fact that they were able to only put 10 % down and - 10K down and still get in there. Yeah, that's telling me.

1:25:54George Kamel:I don't know all the numbers, but it sounds like they're doing all right. Yeah. So way to go, Nate. I wouldn't stress too much about the refi, but you can always contact our friends at Churchill Mortgage and they can at least run the numbers for you, show you the math, and then you can make the decision.

1:26:32George Kamel:Welcome back to The Ramsey Show in the Fairwinds Credit Union studio. I'm George Camel here with Jade Warshaw taking your calls at 888-825-5225. Ashley joins us now in Minneapolis. What's going on, Ashley?

1:26:47Jade Warshaw:Hi, thanks for having me.

1:26:49George Kamel:Absolutely.

1:26:51Jade Warshaw:So my husband and I, in our late 30s, have two young kids. We're on baby step seven and are talking about spending$200 ,000 to put in an in-ground pool.

1:27:04George Kamel:Woo! In Minneapolis. Yeah. All right. How much use is that going to get out of the year, you think? Is that like a six-month situation?

1:27:14Jade Warshaw:Yeah. Yeah, about five to six months. Well, it'll have a heater and everything, so it extends it a little bit.

1:27:21George Kamel:Nice. Do you guys have the cash?

1:27:23Jade Warshaw:Yeah, that's cool. Yes.

1:27:25George Kamel:Okay. And is this just earmarked for pool? Like this doesn't derail any other savings or financial goals? No. Wow. What's the home worth?

1:27:35Jade Warshaw:About$850 to$9. Love that. So tell us, do you have pause and why do you have pause? Well, we're normally very frugal and it's a lot of money. I'm a little bit more all in, but my husband is hesitant. because it's a large purchase. Is it because of resale value or just, man, this is just a lot of money? I've never spent this much money on a thing before. It's a lot of money to spend on something that isn't necessarily an investment. It doesn't increase in value. Have you looked at, I'm guessing this is all the bells and whistles. Have you played it out in your minds? Like, how would we feel if we did the$150 ,000 version of this?

1:28:24Jade Warshaw:Would we feel like we were shortchanging ourselves or would we feel like it's not worth it? Have you played out those different scenarios in your mind? Yes. I mean, we're not going, you know, high end above and beyond by any means, but we're, you know, if we're going to spend the money, we want what we want. There you go.

1:28:42George Kamel:So you have the vision already of exactly what you want this to be. and he's on board, but he's just sort of getting his breath taken away by the bill. Yes, yep. What's the most expensive thing you guys have ever purchased outside of your home?

1:29:01Jade Warshaw:Cars, like, yeah.

1:29:02George Kamel:What's the nicest car you guys have paid for in cash?

1:29:08Jade Warshaw:Roughly$45 ,000 to$50 ,000.

1:29:10George Kamel:Nice. Did that take your breath away the first time? Where you were like, whew,$50 ,000 gone.

1:29:17Jade Warshaw:um yeah but it's also something you need whereas a pool you don't need you didn't need a car i mean

1:29:25George Kamel:it's utility at some point but you got it because you guys are like we've worked hard we have the cash let's enjoy it and so you saved up for this it's not like you had 200 000 laying around and

1:29:35Jade Warshaw:you're like ah maybe we could just put a pool in you saved up it's not like you're spending your

1:29:40George Kamel:college savings on a pool you guys said we have a goal to buy a pool and now we have the money but now we're getting a little bit cold feet.

1:29:49Jade Warshaw:Yeah.

1:29:50George Kamel:Yeah. I mean, that's normal. I want to tell you, it's wise to, before you write a$200 ,000 check, to have a little bit of a gut check to go, should we be doing this? But to me, and I'm like your husband, I'm the guy who's like, is there a cheaper version? Do we have to do this now? I mean, the kids can't even swim yet. What are we doing? And so these are the same conversations I've had in my own house. But here's the deal. you have to realize that not everything has to be an investment. Your husband likely has hobbies and things he enjoys that are not an investment. They are truly a waste of money, and it's a fun waste of time, essentially.

1:30:26Yeah.

1:30:27George Kamel:And so picturing the kids out there swimming, having the best time, the summers they're going to spend there for the next, I don't know, you said you have young kids. How old are they? Four and seven. Perfect. That's such a great age. So now you're talking, they have like 10 to 12 years before they don't even want to hang out with you guys anymore. And so now we're going, this is a worthy investment to create some amazing memories. We're not going to look back 20 years from now and go, we shouldn't have got that pool, derailed our entire life. No retirement now. And so you guys have, you've eaten your vegetables and I think you deserve some dessert at this point.

1:31:01George Kamel:So it's a green light for me. I think you guys should spend the money on the pool.

1:31:06Jade Warshaw:Well, thank you. I like that.

1:31:09George Kamel:You've already toiled with it long enough. I think the longer this sits in your brains, the worse it's going to get.

1:31:14Jade Warshaw:I think if you let this sit too long, I think you'll start to talk yourself out of it. And that would be a shame. Okay.

1:31:21George Kamel:What would he want to do? Let's say he had 200 grand. What does he want to do with the money?

1:31:28Jade Warshaw:Save it and invest it. Okay. For what?

1:31:31George Kamel:And then what?

1:31:33Jade Warshaw:Well, so we don't have to work the rest of our life.

1:31:37George Kamel:There we go. So now we actually have a math problem is can we retire when he wants to retire even if we do the pool? You might find that the answer is yes, we can. Now, is it going to be six months later because we built the pool? I wouldn't put this pool as an obstacle to early retirement if that's what he's trying to do. Okay. I would set that as a separate goal and say, hey, we can invest on the side here for your early retirement goal, and here's the date based on our math. Okay. And then make peace with that decision. And you can have a pool in the meantime. All right. I just want to separate it out because I'm the same way.

1:32:15George Kamel:I'm like, you know what? If a compound growth and a good growth stock mutual fund, 200 grand could turn into 5 million by the time we were - Absolutely.

1:32:20Jade Warshaw:You should run the opportunity costs. I agree with George. But I also think there's, you know, when you do this plan, there's a tightrope walk that you have to do because you do. You want to live your life in the moment. And when you've worked as hard as you guys, it's like that can be an ever-moving goalpost. Just, oh, well, now instead of using the$200 ,000 that we said was going to go for a pool, now all of a sudden another long-term goal pops up. And then another long-term goal. And before you know it, it's like, gosh, we just kept pushing it and pushing it. And now we're retired and we get to enjoy the retirement.

1:32:51Jade Warshaw:But we never did any of the fun stuff when we were working. So just something to caution against.

1:32:59George Kamel:Have you guys crunched the numbers for his retirement goals?

1:33:03Jade Warshaw:yeah he's more of the numbers person than i am but um yes it would put him back about six months

1:33:10George Kamel:i believe okay in the grand scheme of life would he rather go down as a legend as an awesome dad for building that sweet pool that his kids got to enjoy or would he rather retire six months earlier

1:33:24Jade Warshaw:be a legend i think the pool is a better idea yes yes i feel better then i don't have to worry

1:33:30George Kamel:Listen, my kids can't complain about trauma at that point. I'm like, listen, I gave you everything. We took you to Disney. We built a pool.

1:33:36Jade Warshaw:They're in counseling because they spent too many pool days.

1:33:40George Kamel:Yeah, we got sunburned that one time. We got sunburned. We got to put on the sunscreen. Yeah. But it's a good reminder to all of those people in Baby Step 7. There's a lot of those listening right now who are in the same space, which is we've worked so hard. Now I feel bad spending a large amount of money. But let me remind you the other part, live and give like no one else. Yeah. So live like no one else so later you can live and give like no one else. So sometimes giving helps you unlock some of the spending. Yes. Because you feel almost selfish to spend$200 ,000 on yourself for a thing that's not going to, quote, produce income or increase your home value by$200 ,000.

1:34:16George Kamel:And I have to remind myself every day, not everything has to be an investment. That's such a good thing. You can just enjoy it. Sometimes you're investing into the memory dividends.

1:34:26Jade Warshaw:Absolutely. I feel like that plays a huge part in how we enjoy life and probably longevity, too. Yeah.

1:34:33George Kamel:And a good book for him. This is not a Ramsey book. I don't agree with everything in the book, but it's called Die With Zero. And for a lot of people, this has helped them unlock the purpose of money and helping them use it now while they're alive, while they have young kids versus in letting their kids inherit$5 million when their kids are 70. Does them no good at that point. Let's enjoy life now.

1:35:20Jade Warshaw:Hey guys, Rachel Cruz here. and I'm so excited to tell you that the brand new 2027 Ramsey Goal Planner is available now. Guys, this is the only planner with exclusive monthly content from John Deloney, Jade Warshaw, and me to help you set clear goals and actually stick to them all year. But here's the thing, these sell out every single year. So don't wait. Order your new 2027 Ramsey Goal Planner for$49.97 at RamseySolutions.com slash store. That's ramsysolutions.com slash store.

1:36:06George Kamel:Today's question of the day is brought to you by Y-Refi. When private student loan payments start getting away from you, it can feel like you're paying for decisions you made years ago. Y-Refi helps borrowers explore low fixed rate refinancing options and payments designed around your current situation. Visit YReFi.com slash Ramsey. May not be available in all states.

1:36:25Jade Warshaw:All right. Today's question comes from Gabriel in Arizona. He says, my, Gabriel or Gabrielle? Gabriel. I guess. Good question. I'm going to go with, it's a guy.

1:36:35George Kamel:All right. I didn't know there was a big, oh, Gabrielle would be a girl. I feel like there'd be an L-E at the end. You know what I mean? True that.

1:36:40Jade Warshaw:True that. Okay. Let's go with Gabriel. My financial planner wants me to continue investing, but after watching Dave and speaking to my dad, I think I should hold off investing more until I pay off my debt. The only debt I have is$30 ,000 in student loans that are 0 % interest until payments resume in October. I have$10 ,000 in cash in my bank account and I earn$110 ,000 annually. Should I stop investing temporarily? Well, Gabriel, I love this question because it shows that you're interested in your future. Anybody who's like, I want to start investing. I love that you're thinking about your future.

1:37:18Jade Warshaw:That's a very smart thing to be thinking about. But I do think that there's kind of a good, better, best way to approach investing. And the best way to approach it is with the best foundation. And what I found, Gabriel, is that it's best to clear the debt out first, which is what you're wanting to do. You're eliminating that risk. In this case, there is 0 % now, but you're right. Interest is going to resume in October. And so at that point, gosh, you're paying for that debt even more. And so let's take the full force of our income temporarily and let's knock out this$30 ,000 of debt. You'll be done super fast and then you can save up three to six months of expenses.

1:37:54Jade Warshaw:The three to six months there, it's just kind of like an insurance fund against not only your debt freedom, but it's also an insurance fund against your future invested money. Because without an insurance fund, without an emergency fund there, you're basically saying, hey, if something happens, the only money I can go to is my invested money. and you don't want to touch that. So let's make sure we have an emergency fund built up, ready for you. And then after that's done, yeah, let's start investing 15 % of your gross every single month into your 401k or a Roth IRA.

1:38:27George Kamel:Amen. Trying to do both at once is going to slow you down on both sides. So imagine you take nine out of the 10k you have in cash, throw it at the debt, and now you've got 21k left. You throw four or 5k at that, you're done in four or five months. So fast. That's pretty incredible. And then you build your emergency fund four to five months later, and eight to 10 months from now, you are investing 15 % with no one stopping you. But of course, your financial planner is a little bit incentivized to get you to keep investing. That's true. So that's another part to remember. They're not looking at your holistic financial picture.

1:38:59George Kamel:They need to be listening for what your goals are. And if you tell them, hey, my A1 is paying off debt right now, they should respect that and say, I'll be here when you pay off your debt. I'll be cheering you on. That's it. All right, let's go to Rowan in Roanoke, Virginia. What are the odds? What's going on, Rowan? Hey, how are you, Jordan Jade? Doing great.

1:39:19Jade Warshaw:How can we help? All right, so my question is, I'm a broke college student. I'm at school for aviation. I have my pilot's license, so that's what I'm doing. But I have to get to the airport, not this semester, next semester, multiple times a week. I had a car at the beginning of the year, and it was a junker, I would say. It was about$3 ,000, and it died. I need a new one to get to the airport. I have no other way to get there. It's too far to ride a bike. I need a vehicle of some sort. But I have a$10 ,000 personal loan because I had to take out a personal loan to get the pilot's license in the first place.

1:39:55Jade Warshaw:And it wasn't enough, so I had to put$2 ,000 on credit cards. So I have about$12 ,000 in debt.

1:40:01George Kamel:So far, everything's had to. Who's forcing you against your will, Rowan? Blink twice if you're okay. Yeah.

1:40:07Jade Warshaw:No one's forcing me, but in order to get my bachelor's degree in aviation at the school I'm at, I had to get my pilot's license. So let me guess, let me guess, you have to finance a car to get to the airport now? No, I don't. That's my question. Do I save up and I get another, let's say,$3 ,000,$4 ,000 car by about January, which is when I need it? Or do I finance a car or do I get a motorcycle or something, which I might not be able to ride because Virginia snows? I don't know about the motorcycle, but I definitely love the idea of, yeah, let's save up and pay cash for whatever you can get in cash by January.

1:40:46George Kamel:And that becomes your budget. And now you're going to be searching high and low. You're going to be making sure you're looking at vehicle history reports and get an inspection before you buy it so you know you're not getting a lemon and let that get you from A to B for maybe a year or two.

1:41:01Jade Warshaw:Yeah. And let me just call out. I like that you're attempting to change your mentality of saying, I don't have to do debt. I have options here and I'm going to choose the option that gets me where I want to be without adding risk and debt to my life. Yeah. So would you recommend that I get that vehicle, that$3 ,000 car for January or around January when I need it? Or should I figure something else out and pay off that personal loan first? because I could probably get that paid off by January, but I wouldn't have any money for a car. What would the figure something else out mean? And just had a small down payment.

1:41:38George Kamel:What are your transportation options if it wasn't you having your own car?

1:41:45Jade Warshaw:An hour bike ride, probably. I don't know about that on the highway. That feels like a recipe for disaster. Yeah. Yeah, let's not do that. Let's not do that. Let's take first things first.

1:41:56George Kamel:Hold off on the personal loan. Let's get you some transportation that's reliable. then we can focus on the personal loan. How much money are you making right now? Right now, not very much.

1:42:09Jade Warshaw:I'd say I'd make about$400 a week.

1:42:12George Kamel:Okay. And are you able to up that, or is that the most you can do while going to school?

1:42:16Jade Warshaw:That's about the most I can do with my workload at the university.

1:42:20George Kamel:Okay. That's about$1 ,600 a month, and you're saying by January you could have$3 ,000 or so saved up.

1:42:27Jade Warshaw:And a good chunk of that paid off onto the personal loan. where I could just go for a nicer car. I might be inclined, if you can get a$5 ,000 car over$3 ,000, look at what's out there and let that be the guide on what you spend. Because if you can get something that's going to last you a little longer, because how long are you going to be in aviation school? About three more years. Yeah, we want something that's going to get you through because you don't have the ability to make a ton of money, it sounds like right now. So let's make sure you get something that'll get you through the next three years and that you feel confident with.

1:43:02Jade Warshaw:And if that causes you to delay paying off the personal loan by a couple of months, I think it's worth it for you to have a reliable vehicle.

1:43:10George Kamel:So realistically, just make minimum payments on the personal loan while stacking up cash as quickly as possible for that car. And then once you have the car, now we can turn and start knocking out the personal loan.

1:43:21Jade Warshaw:Okay, so your preference is to spend a little bit more on the car to ensure that it'll last me the time I need it versus saving a little more and putting it towards the personal loan and getting that paid off so I avoid interest? I think so. I think if you're looking at cars and you're looking at one and you're like, I see one for$3 ,000. I just like this looks like, but you see one for$5 ,000. You're like, I feel good about that one. Get the$5 ,000 one. You know, it's not going to derail your life or debt payoff by more than, what, a month or two? And I think that's worth it for what you need transportation-wise for the next three years.

1:43:59Okay.

1:44:00George Kamel:But the goal is debt is off the table forever. So let's just go, okay, how do we get creative and not call back and say, well, I had to. I think you're starting to change that language, which is awesome. if you can get this at this age you're going to be unbelievably wealthy and avoid debt the rest of your life yeah absolutely so this is great and jade fun fact i once broke down in roanoke in my cousin's sob hatchback that i was driving across the country do they still make those i don't think so and i can see why after breaking down in roanoke of all places that's pretty good but yeah it's a great reminder and and i wrote down had to in quotes because that's always that's

1:44:38Jade Warshaw:so funny.

1:44:39George Kamel:Well, it tells me this. If you can break out of that mindset of saying I had to, because what that says is life happened. I had no control. No personal responsibility. I had to be reactive instead of proactive. I could not have avoided this. If you can change that to, I made the decision to. Huge. Change that. I made the decision to go into debt. Now we're holding up a mirror and we can say, you know what? I want to be a different guy who says, I made the decision to save up and pay cash for that car and only upgrade when I have the cash later. Drive like no one else so later you can drive like no one else.

1:45:10Jade Warshaw:Yeah. I love that because then when you take personal responsibility, you take it for the negative stuff, but then when you turn around and start making the right decisions, you get to take responsibility for that too and that feels really great.

1:45:19George Kamel:I made the decision to invest 15 % of my income for the last 30 years. That's pretty cool too.

1:45:58Jade Warshaw:Listen, guys, I've heard just about every excuse for why folks think they can't get ahead with money. So let's go ahead and settle this right now. You get the final say on what happens with your money. That's why you have to start telling your money where to go so you can stop wondering where it went. So if you're going to start winning with money, you have to get on a budget. And the easiest way to get started and stick to it is with the EveryDollarBudget app. It'll help you make a plan for every single dollar coming in and every single dollar going out. every single month. And guess what? It's free.

1:46:35Jade Warshaw:So no excuses. Download every dollar in the App Store or Google Play today.

1:46:56George Kamel:everyone needs insurance but it can be hard trying to find pros who aren't just looking to make a buck and agents who actually know their stuff well ramsey trusted insurance pros are vetted and coached to make sure they're market experts who have your best interests at heart so go to ramsaysolutions.com slash coverage to find the type of insurance you're looking for and connect with a Ramsey-trusted agent. Tina is in St. Louis up next. Tina, how can we help?

1:47:21Jade Warshaw:Hey, thanks for taking my call, guys. Sure. Well, Tina, my husband just passed away about five months ago suddenly. Oh, sorry. How old was he? Thanks so much. He was 60 years old. Wow. What happened? So he was self-employed. Well, he had, we think he had a blood clot. He had had surgery on his heart the year before, was doing great. And then he's self-employed, a tax accountant, had his own tax business, and he wasn't answering my text. And I found him, passed away at the office. So sorry, Tina. Oh, thank you so much. He was self-employed. Sadly, for some reason, he had no will. And he had a lot of kind of hidden credit card debt.

1:48:08Jade Warshaw:But my goal is I want to be crazy and attack and pay off all that debt. So I paid off all the credit card debt. I'm about to pay off our house.

1:48:20George Kamel:Was it in your name?

1:48:22Jade Warshaw:Well, it was in the business name.

1:48:24George Kamel:Okay.

1:48:25Jade Warshaw:Because likely they would have written that off.

1:48:27George Kamel:You sent them a death certificate.

1:48:29Jade Warshaw:Yeah, they would have probably. Probably, but I was kind of on the LLC as co-owner. You thought they'd come after you? Yeah, I needed to get that done. Now, we did shut down the business. Since he was the brains of the business, made the decision. You shut it down or you sold it? No, we shut it down. And I work a full-time job and two part-time jobs. So I'm okay financially paying for my current bills. And I'm good there. But what my question is for you, I have an integrity question for you. So one thing that was not under my name is Brian's office. And he also has a loan. Now, the office is very old.

1:49:15Jade Warshaw:It's worth about$80 ,000. But we found out it's got some significant things that need to be done, plumbing, that sort of thing. And he owes$30 ,000. Both are solely under his name. Now, while I'm crazy about wanting to pay off all the debt and get debt free, I also want to be God honoring. And I don't want to do something that I feel like is dishonest. Like what? Like what I'm thinking of, because while I'm not in St. Louis, I'm in a little town south of it. Okay. There's a lot of commercial real estate up for sale for a long period. I'm thinking about just giving the office back to the bank and stepping away.

1:49:58Jade Warshaw:Why? Why can't you sell it for whatever it's worth? If it needs plumbing, the person who buys it will know that it needs plumbing work, right? Right. You're not trying to not disclose what's wrong with the property. You're not trying to hide it. True. No, yeah, and it would probably have to be kind of a short sale. I haven't gone into probate yet because I've only got about$2 ,800 left, and that would be something I'd have to give solely to the lawyer. So I was thinking, I'm worried that I would have to keep continuing to keep this building going at$800 a month, which I just don't have. And doing probate, you know, I couldn't get the proceeds for six months.

1:50:40Jade Warshaw:So those were kind of my things. But I just wanted to go, I wanted to get your guys' advice. I'm probably going to go ahead and get it into probate and have to stake out a little money to do that in advance. But I just wanted to say, is it God honoring to or, you know, honest to give it back to the bank if need be? I thought that you said that the office was worth$80 ,000 and that he owes$30 ,000. He does. He does. I just don't know. It will sell. There's so much commercial property in our little town. Well, let's check and see. Let's get with a SmartVestor Pro and let's find somebody who specializes in commercial real estate.

1:51:17Jade Warshaw:and let's see what's the value of it.

1:51:19George Kamel:You mean like a real estate, a Ramsey trusted agent?

1:51:22Jade Warshaw:Yeah, what did I say?

1:51:22George Kamel:Real estate agent? Yes. You said smart investor, which we on the financial advising side. I'm sorry. I went to the wrong thing. Thank you, George. But I was going to say, I think you need a team of pros in your corner. I would be contacting a local probate attorney, get a real estate pro, even a financial advisor, like a smart investor pro, to help you through all this. Right now you're doing a lot on your own, and there's a lot of big numbers here, and you don't want to make mistakes where you could have looked back and said, gosh, why did I do that? I was just grieving and in a hurry, and I just wanted it off my plate.

1:51:50George Kamel:Instead, just you can rest and breathe easy. Can you make the$800 office payment for the next couple of months?

1:51:57Jade Warshaw:For a couple more months, yep, I can do that.

1:52:00George Kamel:And then what's the long-term play? Let's say you've sold this thing for at least what you owe on it, and it was out of your hands at that point. Would that be a win?

1:52:08Jade Warshaw:Oh, that would be a definite win. Just kind of putting up fires. I think my house that is actually we're closing on tomorrow, or selling it, there's been a lot of hidden debt. I've had to put$30 ,000 into it, and that took out anything that I had in the savings. So I think maybe I'm just a little bit traumatized by that. That's why I'm panicking about the office. I don't think you need to panic just yet. Let's see an appraisal, what it's worth, because if you said it's worth$80 ,000 and it's really worth$30 ,000, well, then you're just breaking even.

1:52:40George Kamel:So there's no reason to surrender it at this point. And either way, it's not dishonest. It's just a bad move. I think I was just flailing. Yeah. Yeah. So right now you're not in too much of a pinch. You're able to work. That's fantastic. Do you have some savings right now?

1:52:56Jade Warshaw:Only about$2 ,800.

1:52:58George Kamel:Okay. And how much debt is left, if any, tied to your name?

1:53:04Jade Warshaw:Basically none. Once his house sells tomorrow, I'm out from underneath it all.

1:53:08George Kamel:What are you going to do with the profits of the house?

1:53:11Jade Warshaw:Oh, there's no profit. Sadly, in December, we refinanced, and a few years ago, we had taken out a HELOC, stupidly, and I realized it hasn't even been touched. So I'm actually having to pay almost$10 ,000 to get out from underneath the house.

1:53:29George Kamel:So you're underwater on the situation. Okay.

1:53:31Jade Warshaw:Underwater, but I had to buy a new HVAC and a roof. And was there any life insurance at all, Tina? Yeah, there was enough. It's got enough to do the funeral and having to put like$30 ,000 into a new roof and a new HVAC for the house. Everything kind of just the last of it. You know, I've got cashier's checks for the closing cost of my, that's it. So that just kind of leaves the$2 ,800 kind of left. But, you know, that's enough. And I make about$3 ,100 between the three jobs take home. And I got an apartment, you know, it's perfect for me. You know, and I'll have an additional$1 ,000 a month.

1:54:12George Kamel:Okay. And then what's your retirement plan? Do you have a nest egg?

1:54:16Jade Warshaw:No nest egg at all. We had, again, being self-employed, we took out probably about four years ago our 401k. I'm just basically right in the, I'm in the ashes, just rebuilding. I'm 56, so I've got several years of working and I've got a great day job and good little side job. So I feel comfortable, but I think after I get through all this office stuff, I think I'll be able to start putting back the 15 % that I'll need. Good.

1:54:46George Kamel:Yeah, that's the goal. If you can start doing that for the next, let's say, you know, 14 years, you might have to work longer than you wanted to, but then at least we can retire with some dignity. Plus, if we get anything from Social Security, I don't know how much you'll get from that. Do you know if there's any survivor benefits from your husband?

1:55:03Jade Warshaw:Well, that was the thing. He was going to start doing that in like two months before he died. So because he wasn't actually receiving the Social Security benefits, I won't be able to even see that for another like four years. That's OK. That's OK. So. Well, it sounds like you're hopeful. And I'm prepared to work till 70.

1:55:23George Kamel:You're comfortable. You're doing OK. And so I would just take a breath and go slow and reach out to some pros and don't try to do this all on your own. Number one, even if you weren't grieving the passing of your husband, it's good to have pros in your corner. But especially someone who can see your situation very clearly, map it all out, help you understand what they're doing and why they're recommending what they're recommending. That's the most important part versus you, like you said, just flailing, making almost impulsive decisions just because you're scared or stressed.

1:55:53Jade Warshaw:Yeah, and I have to say, I might go back and look at that business. If he had a book of business, there might have been some value there. and I might just double check that and see if there is anything worth selling to another accountant in the area that needs the business.

1:56:07George Kamel:Yeah, creating a lump sum to throw into that nest egg. That can't hurt. Good luck, Tina.

1:56:29Thank you.

1:56:46George Kamel:Whether you're a small business owner or an individual, doing your taxes is not fun. It's like an algebra test where if you get anything wrong, the IRS can make you pay with actual money. But if you work with a Ramsey Trusted Tax Pro, you don't have to be a tax whiz because they are. They know taxes like the back of their hand, which makes filing super easy. So work with a Ramsey Trusted Tax Pro and get back to doing what you love, which probably isn't taxes. Visit ramsaysolutions.com slash taxpro and fill out the referral form to get connected to a Ramsey-trusted tax pro today.

1:57:26George Kamel:Our scripture of the day, Psalm 40, verse 2. He lifted me out of the slimy pit, out of the mud and mire. He set my feet on a rock and gave me a firm place to stand. Samuel L. Jackson said Take a stand for what's right Raise a ruckus and make a change You may not always be popular But you'll be part of something larger and bigger and greater than yourself

1:57:50Jade Warshaw:I'm not arguing with Mr.

1:57:52George Kamel:Jackson Who am I to argue? He had me at you may not always be popular I said amen Amen Dylan in Saginaw, Michigan is up next What's going on, Dylan? Hi, how's it going?

1:58:05Jade Warshaw:What's going on? Oh, well, I kind of got myself into a situation with a vehicle about a year ago. After the fact, no, that was a terrible idea. And I'm underwater with it, and I'm trying to just get out of debt in general, and I feel like it's a very big bill in terms of everything I have going on, and I don't really know what to do about it.

1:58:28George Kamel:Man, okay, what's left on the loan? Left on the loan is$13 ,000. And have you looked up the private party value you could get for it?

1:58:38Jade Warshaw:about probably five to seven, I would assume in this area, closer to the five.

1:58:43George Kamel:Wow. What happened? Why is it so underwater?

1:58:46Jade Warshaw:Well, I have a business and I just, I put a crazy amount of miles on it within this, actually within the first six months of me having it, I put about 60 ,000 on it.

1:58:57George Kamel:Goodness gracious.

1:58:58Jade Warshaw:Okay. The intent was to pay into it and pay it down, but at the time that was not a very aha moment thought out process.

1:59:10George Kamel:So why not just pay off the$13K loan at this point and just hang on to the car? Yeah.

1:59:16Jade Warshaw:Well, we don't have the funding to be able to do that. We're kind of – we recently have been listening and recently been trying to get out of debt, generally speaking. And that just seems to be a very large bill in the way and with how many miles are on it. What's the payment? And it does need work. Payment isn't really that bad. It's$352. Insurance is about$290. So tell us what you're working with every month and why specifically this$113 ,000 debt is the issue. What's your monthly income? Monthly income is$2 ,800. Okay. And then, well, gosh, how much is rent or mortgage? A mortgage is$865. Okay, so we know the issue beyond the debt is the income, right?

2:00:05Jade Warshaw:Correct, yes. So tell us what you do for work. Is it your wife too? Yes, but we have a newborn and we just think it's the smarter decision to save from having to have somebody watch the boys because she has a boy as well. than it would be for her to stay and go about that direction. It depends on what she can make in the market, honestly.

2:00:30George Kamel:So if daycare is two grand and she can go out there and bring home three grand, well, now you have a thousand dollar margin to knock out the debt. But you're saying you don't think she can make enough to make daycare worth it?

2:00:43Jade Warshaw:No, not necessarily that, but also I work a scheduled job and then I also have a business on the side as well.

2:00:51George Kamel:And all of that is bringing in$2 ,800 a month?

2:00:55Jade Warshaw:No, I have not necessarily included what I make in the business as also money going to personal things. What do you make in the business? It kind of varies. Last year was my first run of the year or run of the time of really getting going on it, and it was about$45 ,000.

2:01:14George Kamel:Okay. Where did that money go?

2:01:17Jade Warshaw:Not in the right places.

2:01:20George Kamel:you told us you can't find money to pay off 13 000 and you just found triple that in your side

2:01:26Jade Warshaw:business uh-huh do you play are you on track to make that again this year i haven't really done it much this year um it's been very more so my mind has been a lot of how do i get out of all of the situations right by working and you have this doing it the thing you're avoiding is the

2:01:44George Kamel:solution.

2:01:45Jade Warshaw:You have a side hustle that or a side job or side business that you're like, hey, I can make 45 a year on this. I proved it last year when I did it. And then you guys decide, you know, we're going to start getting out of debt and you stop working the side business. There's got to be more to the story than that, because that doesn't make sense. Now, how should I, I guess, proportionally put a portion of profit to those things rather than putting it back into? Well, let's decide how much do you absolutely need to pour. We didn't talk about what type of businesses, but what do you absolutely need to pour back into the business to keep it going?

2:02:21Jade Warshaw:And then how much of it can you honestly say this is profit? I don't need to reinvest any of this. And whatever that amount is, and that's the amount that you're going to take out, pay yourself and let's start paying off this debt.

2:02:35Jade Warshaw:what that i'm going to give you some credit here because i think that's easy for you to figure out something is causing you to not be moving forward right now and i don't think it's that what is it it is that i don't know the fine line between trying to compute family time and work time together. Okay, there we go. So we've got an infant at home. Your wife also has a son, and you're like, she's depending on me. She needs me here, but I feel like I need to go out and work. I don't know what to do. Correct. And we've talked about it, and she's fine to work. She's okay with doing that. And we're both on the same page of we believe it would be more efficient.

2:03:22Jade Warshaw:Is she struggling? Is she struggling mentally where she's like, I need help? Like I'm crying out for help? Or is this just taking care of a baby is a lot. I just could use a little help. Which one is it? It's that. It's more of it's just a lot because also her other boys, too. So it's a very busy, very busy house. So I'm going to say something that sounds really harsh, but I'm saying it on the side of I'm your buddy and I'm your friend and I'm rooting for both of you and I want you out of this mess. OK, ready? All right. You have to work and you have to work full hours. And she sounds capable.

2:04:00Jade Warshaw:It doesn't feel like she's in a, you know, a rut or she's not having postpartum depression. It sounds like she's OK. It's just a hard season of life. And I think you guys both have to embrace this is the season of life that's tough. We're going to be, you know, working our fingers to the bone. We're going to be burning the candle at both ends. She's going to be up at night with the baby. I'm going to be up at 6 a.m. going to work. I'm going to do my normal job plus the$45 ,000 side job because we make we only have$2 ,000 a month after we pay our rent. And that's not enough to pay even for our car.

2:04:34Jade Warshaw:That's only$13 ,000.

2:04:36George Kamel:Are there other debts as well?

2:04:38Jade Warshaw:There are other debts. I went through and wrote everything out to get a good visual. All in all, with the$13 ,000 is a total of$19 ,500.

2:04:48George Kamel:Okay.

2:04:49Jade Warshaw:Not including the house. So$6 ,000 more.

2:04:51George Kamel:Yeah. So that's still reasonable. You could knock that out. If you just said, hey, for one year, my one goal is to knock out the debt and then sock away money and savings. One year from now, you'd be completely debt-free with$20 ,000 in the bank. Okay. Now, side hustles don't have to happen. No. And you can increase your full-time income. That would be my next suggestion because your side hustle is almost outpacing your full-time job income.

2:05:15Jade Warshaw:Exactly, which is why I wouldn't stop doing it. What kind of work is it? Honestly, the easiest way to describe it is just odd jobs. I partner with some property management companies, help do maintenance things along those lines. So you're like a handyman. Bouncing between, correct, bouncing between several different places all the time. What's your full-time job? I've got full-time as a cabinet maker.

2:05:38George Kamel:Okay. So you're just a very handy guy.

2:05:40Jade Warshaw:Fine carpentry.

2:05:42George Kamel:Yeah. What does the ladder look like in the cabinet world? I mean, can you level up and work on more luxury stuff? How do we get from$2 ,800 to$4 ,800?

2:05:52Jade Warshaw:It's really hard to say because it is a small business. There's a very small group of us, and it's just kind of one of those things where it's an art thing. So it's not really like – it's a skilled trade. So that's what I'm saying. You should be making more.

2:06:10George Kamel:If there's a supply-demand issue, there's only a couple of you, and it's art. I mean not a lot of people can do this. I would be charging more. I don't know if it's an hourly rate that you charge builders or how it works, but I would look into that, maybe even a handyman business on the side, and you could charge$50 to$90 an hour doing that. And I know that because I've paid these people$50 to$90 an hour to do all kinds of handyman work, and that can just be in your neighborhood. you barely have to leave the house for that

2:06:35Jade Warshaw:I think everything that you need Dylan is right in front of you I think this season of life kind of got you stunned and you were paralyzed for a minute it's like you got the new baby you're realizing there's debt you just needed us to kind of like on the TV shows where they smack you across the face and then you snap out of it

2:06:52George Kamel:he come to he snapped out of it now I love it well we're rooting for you man we believe you can do this let's just get to work and knock it out let's not belabor the process That puts this hour of The Ramsey Show in the books. Remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of Peace, Christ Jesus.