Is It Too Late For Me To Invest For My Future?

Summary

The Ramsey Show Highlights

Episode: Is It Too Late For Me To Invest For My Future?
Release Date: May 15, 2025
Host/Author: Ramsey Network

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Introduction

In this episode of The Ramsey Show Highlights, host Dave Ramsey addresses a listener's concerns about investing for the future, homeownership, and retirement planning. The episode features Andrea, a 60-year-old listener facing financial decisions amidst changing circumstances, with additional insights from John Deloney.

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Andrea's Financial Situation

Andrea's Background: Andrea, a 60-year-old employed individual, shares her current financial landscape. She brings home approximately $2,864 monthly and resides with her son and his family. Her only fixed expenses include car insurance, gas, and other incidentals. Andrea holds $69,000 in a 401(k) and has recently begun using the Every Dollar budgeting app after just three to four weeks of listening to The Ramsey Show.

Key Points:

• Income and Expenses: Andrea has minimal outgoing bills, allowing her to save a substantial portion of her income. After car insurance and gas, she estimates having about $2,154 left each month.
• Savings: She has saved $45,000 in a savings account with no existing debt.
• Relocation Plans: Andrea relocated from Ohio to Arizona before the pandemic but is now considering moving back to Ohio due to increased living costs in Arizona.

Notable Quote:

“I have $69,000 in a 401(k) and I'll tell you a little bit... Obviously, everything has gotten so inflated.”
— Andrea [00:13]

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Dave Ramsey’s Financial Guidance

Emergency Fund and Savings Strategy: Dave acknowledges Andrea's solid emergency fund and encourages her to focus on increasing her income to enhance her savings rate. He emphasizes the importance of investing over mere saving to outpace inflation.

Investment Advice:

• Investing vs. Saving: Ramsey points out that saving alone cannot build wealth, especially with current inflation rates. He advocates for investing in the stock market to achieve higher returns.

  Notable Quote:

  “If you invested the stock market last year, Andrea, Andrea in 2024 returned 24%... mutual funds within that retirement grow at a steady pace, probably 10 to 12% over the next 10 years.”
  — Dave Ramsey [03:35]

• Retirement Investing: Ramsey advises investing 15% of income into retirement. He reviews Andrea’s current investment rate of 1%, suggesting an increase to meet long-term goals.

Homeownership and Retirement Planning: Dave stresses the necessity of creating a sizable nest egg and maintaining a solid savings rate to achieve homeownership and retirement objectives. He cautions that without increasing income or investment rates, Andrea may need to extend her working years to reach her financial goals.

Notable Quote:

“You can't save your way to wealth. We have to invest this money because right now you're not even beating the rate of inflation.”
— Dave Ramsey [03:25]

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John Deloney’s Insights

Relocation and Family Considerations: John Deloney explores Andrea's desire to move back to Ohio, probing the emotional and practical implications of moving away from her current family setup. He suggests considering caretaker roles with siblings as a way to potentially save more and receive support in return.

Career Advancement: John encourages Andrea to leverage her medical coding certification to seek higher-paying roles, even if it means starting in an entry-level position to climb the career ladder.

Notable Quotes:

“You get to do whatever you want. Going all the way back to Ohio, that's a long way... it's easier for me to get here right now.”
— Andrea [04:24]

“Or yeah, you take the last two bedrooms in one of your brothers or sister's house when you're caretaking and you're helping out.”
— John Deloney [07:20]

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Actionable Strategies and Conclusion

Increasing Income: Both Dave and John emphasize the importance of enhancing Andrea's income to create more savings potential. Dave suggests that Andrea could potentially work into her 70s to achieve her financial dreams if she continues her current trajectory.

Investing for the Future: Dave recalculates Andrea's retirement prospects, projecting that by consistently investing $1,000 monthly, she could accumulate over half a million in her retirement fund by age 72.

Homeownership: Dave advises Andrea to save diligently for a down payment to transition from renting to owning a home, thereby avoiding prolonged market rent payments.

Final Thoughts: The episode concludes with a reiteration of the importance of proactive financial planning, investment, and strategic career moves to secure a stable and prosperous future.

Notable Quote:

“You know, you got $69 grand in that retirement account. You keep investing, let's say $1,000 bucks a month. If you can do that to 72, you'll have over half a million in that nest egg.”
— Dave Ramsey [07:03]

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Key Takeaways

1. Prioritize Investing: Merely saving without investing does not outpace inflation or build substantial wealth.
2. Increase Income Streams: Enhancing income through career advancement or additional certifications can significantly impact financial goals.
3. Strategic Relocation: Moving closer to family for support can be beneficial, but it's essential to weigh the financial and emotional aspects.
4. Long-term Planning: Consistent investing and saving can lead to a secure retirement, even if it requires extending the working years.

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For more advice and insights, listeners are encouraged to visit Y Refi for refinancing options and to continue following The Ramsey Show Highlights for daily financial guidance.

Transcript

[Dave Ramsey]

Brought to you by Y Refi Refinance your defaulted private student loans [e-mail] Ramsey.

[Andrea]

Hi and thank you for taking my call.

[Dave Ramsey]

Absolutely.

[Andrea]

My name is Andrea and I am 60 years old and I am employed. I make about. I bring home about 24 $2864 a month. I live with my son and his family. The only outgoing bills I have is my car insurance and I pay for gas and any other incidentals. I want to know is it possible for me to continue or to own a home and still save for my retirement? I have 69,000 in a 401k and I'll tell you a little bit. I was in Ohio and I relocated to Arizona before the pandemic. And since I've been here, everything has gotten so inflated. So my decision now is to go back to Ohio. But while I'm here in this kind of situation to save and not have to pay any bills, I have some time before I get go back to Ohio. So ask me anything.

[Dave Ramsey]

All right. So you told me your stated goal was I want to be able to own a home and retire one day.

[Andrea]

Yes.

[Dave Ramsey]

Okay. That's going to take a sizable nest egg and a pretty solid savings rate. So how much are you able to save right now? You're saying you get. You got almost no bills. So out of that 2864, how much is left over?

[Andrea]

It'll be two 2154, like $2154 with. Minus the car insurance and the gas. But I plan on getting a job in my. Where I look at to work from home, which that will save on the gas. And I do have like 45,000 saved up.

[Dave Ramsey]

Okay. That's in a savings account. And no debt whatsoever.

[Andrea]

No, not if I have that. I just pay it off every month if I use a credit card. But I did get the Every Dollar app. I recently did that. I'm still working with that. And I've just only been listening to you guys for like three weeks. Three or four weeks.

[Dave Ramsey]

Awesome. Welcome to the party. Well, we. We have a pretty controversial stance around here, and that is debt robs you from your future, even if it's temporary, even if I'm paying it off tomorrow. And so John and I do not own a single credit card. We just use our debit cards. We use our own money. And what you're facing here, Andrea, is an income problem. We've got to get your income up because that's going to create more margin for you to save for that home. And so you've, you're in what we would call baby steps four, five and six. If you're debt free with an emergency fund, which you just told me you have 45,000 liquid.

[Andrea]

Yes.

[Dave Ramsey]

Great. And so we'll call that your emergency fund plus some down payment fund because you don't need 45,000, I imagine, to cover your expenses for three to six months.

[Andrea]

No.

[Dave Ramsey]

Okay, so your, your A1 goal, if it is buying a home, is to put money away for a down payment. But before we do that, we should be investing 15% of our income into retirement. So how much are you investing right now?

[Andrea]

So right now I'm not investing that much. I think I'm at 1% and I can probably put that up to where I should be.

[Dave Ramsey]

Why is it at 1%?

[Andrea]

Because my. In my mind is thinking before I listen to you guys, I was going to get more in my check to save more, but that hasn't worked out as low as I want wanted it to.

[Dave Ramsey]

Well, you can't save your way to wealth. We have to invest this money because right now you're not even beating the rate of inflation. If that money's just sitting in a checking account.

[Andrea]

Yes.

[Dave Ramsey]

If you invested the stock market, the U.S. stock market last year, Andrea, Andrea in 2024 returned 24%. So you put $100,000 in that account. Now it has $124,000. Do you see the difference? Invested in the stock market. And we're not saying a single stock you're going to do. Mutual funds within that retirement grow at a steady pace, probably 10 to 12% over the next 10 years. And that will at least help give you some cushion. I don't know that we're going to have a dream retirement at this stage of the game. We might have to do what John Deloney says and choose our reality and grieve what could have been and create a new picture of what's next.

[John Deloney]

Why don't you want to live with your son?

[Andrea]

I just, I don't. I just don't. I don't. I don't want to. I think I just, I'm still want. I just don't want to be honest.

[John Deloney]

You get to do whatever you want. Going all the way back to Ohio, that's a long way. It feels like an intentional move away from family.

[Andrea]

Well, it'll be away from the. Yes, it'll be away from this family. But then my sisters and brothers are all back east and they're all getting older and they're all like sickly Okay. I guess I wanted to be closer to them. Not that I don't want to be closer here, but it's easier for me to get here right now. It's not easy for me to get there.

[John Deloney]

Gotcha.

[Andrea]

And be there as a help.

[John Deloney]

Is there a possibility you could move in with one of your brothers and sisters in a garage apartment or something? I, I, I'm just trying to like reimagine buying a house right now versus if you're going to be in a caretaker role, moving in with somebody.

[Andrea]

I could. That is a possibility. I'm not going to lie. It's not. It's a possibility.

[John Deloney]

I know it might not be ideal, but man, I love the idea of you saving some money over the next five or 10 or 15 years until somebody can help you. Right. Because you'll need that. You'll need somebody to love and care on you also.

[Andrea]

Yeah.

[John Deloney]

If you move to Ohio, is your job going to go with you?

[Andrea]

Yes. If I get the job from home, my job comes with me.

[John Deloney]

Okay, great.

[Dave Ramsey]

What does that job pay?

[Andrea]

About 40,000 a year.

[Dave Ramsey]

Okay. What, what job is, what kind of role?

[Andrea]

I work in the medical records department.

[Dave Ramsey]

What would it look like to make 60 or 70,000 at your age with your experience in that field? What does the latter look like?

[Andrea]

I'm not understanding the question. I'm sorry.

[Dave Ramsey]

Like, what would your supervisor be doing in the medical records field? Is there another job out there where you could not just settle for what job you could get, but go, how do I grow in this field so that I can actually put more away for retirement and save up for that house?

[Andrea]

I do have a certification for medical coding, but it's been just difficult to get a job because I don't have any experience in that particular job.

[Dave Ramsey]

What an entry medical coder make 40,000?

[Andrea]

They could make, they could start off at 40,000. Yeah.

[Dave Ramsey]

So that's what I would be doing. If the trajectory is higher with your certification, even if it's not the exact role you want, I would just try to get on a ladders. And the truth is, Andre, you might be working into your 70s to make this dream happen.

[Andrea]

Yeah.

[Dave Ramsey]

Are you okay with that?

[Andrea]

Okay, I am.

[Dave Ramsey]

I just crunched the numbers for you. You know, you got 69 grand in that retirement account. You keep investing, let's say 1,000 bucks a month. If you can do that to 72, you'll have over half a million in that nest egg. And on the way, get yourself, you know, a reasonable mortgage. And that way you're not stuck paying whatever market rent is for the next 12 years.

[John Deloney]

Or yeah, you take the last two bedrooms in one of your brothers or sister's house when you're caretaking and you're helping out. And maybe you let that dream go of I have to buy my own three or four bedroom house, but we have a great place to live and you get to care and serve like you like to.

[Dave Ramsey]

Thanks for the call, Andrea. Why refi refinances delinquent private student loans for struggling borrowers? Learn more at yrea f y Com Ramsay.