Podcast Summary: The Ramsey Show Highlights

Episode: My Girlfriend And I Are Building A $700,000 House (We Only Make $70k)
Date: December 3, 2025
Host(s): Ramsey Network Financial Advisors
Caller: Joseph
Theme: Financial Reality Check for Young Couples Planning a Major Home Purchase

Episode Overview

In this concise yet impactful episode, Joseph, a 21-year-old caller, seeks guidance about building a $700,000 home with his girlfriend—soon to be fiancée—while their combined income is approximately $70,000. The Ramsey advisors tackle the realities of relationships, money, and ambition, offering candid advice about timing, risk, and prudent financial planning for young couples.

Key Discussion Points & Insights

1. Relationship Status and Financial Ties

• Red Flag on Joint Commitments:
  • Advisors immediately question the wisdom of entering a major financial obligation without being married or even officially engaged.
    • Quote [00:20] Financial Advisor:
      “Numbers aside, you're in way over your heads. There's not even a ring on the finger. And you're going to sign up for a mortgage and put your names on a deed together?”

2. Alternative Path Suggested

• Smart Sequence Recommendation:
  • Advisors propose: get engaged, get married, rent and save, then buy or build when ready.
    • Quote [00:59] Financial Advisor:
      “Let me lay out a different path. ... Why not get engaged, get married, rent together, save up on your own and then purchase a house or build when you're financially ready?”
• Caller’s Rationale for Rushing:
  • Joseph and partner want to avoid “throwing money away” on rent and hope to start a family soon.

3. Financial Snapshot

• Savings & Parental Matching:

  • Joseph and girlfriend have ~$60k in savings, aim to put $100–$130k down; her wealthy parents are willing to match their down payment—$260k total.
    • Still, this leaves a large mortgage.

• Income Clarification and Mortgage Reality Check:

  • Confusion about monthly vs. annual income leads to a sharp reality check:
    • Quote [03:21] Financial Advisor (mishearing income):
      “A month?”
    • Turns out they make about $70k/year, with commission and business income potentially bringing it closer to $10,000/month (uncertain, fluctuating).

• Advisor Crunches the Numbers:

  • Even with best-case incomes, the mortgage (approx. $4,500–$5,000/month) would consume about half their take-home pay.
    • Quote [04:02] Financial Advisor:
      “So we're already setting ourselves up where half of our take home pay goes toward the mortgage.”

4. Being “House Poor” and Risks of Banking on Future Income

• Financial Experts Warn About Overextension:
  • Joseph admits the mortgage would be a stretch but expects incomes to rise and business/commission earnings to double.
  • Advisors caution that relying on everything going perfectly is a major risk.
    • Quote [04:47] Financial Expert:
      “You're setting yourself up in a situation where everything must go as planned for this to work out. ... even if everything is perfect, you're still house poor for several years.”

5. Advising Patience and Strategic Upgrades

• Pump the Brakes:
  • Advisors urge Joseph to slow down, prioritize order and timing, and purchase a home that fits today’s realities, not tomorrow’s ambitions.
    • Quote [05:27] Financial Expert:
      “I truly would love for you to slow down a little bit ... Let's just do it in the right order and at the right time.”
• Wait for Stronger Financial Foundation:
  • Emphasize saving, income growth, and an emergency fund before leaping.
    • Quote [06:20] Financial Expert:
      “It's both [increasing income and saving]. ... As you do that you're saving up more too.”

6. Debunking the Myth of “Too Late” for Success

• Perspective on Age and Success:
  • Joseph, at 21, feels pressure to accelerate, but advisors stress there’s no rush.
    • Quote [06:55] Financial Advisor:
      “Who told you it's too late? Who told you you have to rush into this or else…?”

7. Flexible, Realistic Approach to Home Ownership

• Start Smaller, Upgrade Later:

  • Advisors suggest purchasing a more modest home (e.g., $400,000 three-bedroom), paying it down quickly, and upgrading as life evolves.
    • Quote [07:37] Financial Advisor:
      “I would go with what you guys can afford and if you can get a $400,000 three bedroom, I would do that and have a small mortgage that you can knock out quickly and you can upgrade over time.”

• Life Changes—Don’t Prematurely Build for “Someday”:

  • Caution against overbuying for a future that may involve change (kids, one income, job switches, etc.).

Notable Quotes & Moments

• [00:20] Financial Advisor:
  “Numbers aside, you're in way over your heads. There's not even a ring on the finger...”

• [05:27] Financial Expert:
  “Let's just do it in the right order and at the right time.”

• [04:47] Financial Expert:
  “You're setting yourself up in a situation where everything must go as planned for this to work out... even if everything is perfect, you're still setting that up [to be house poor].”

• [06:55] Financial Advisor:
  “Who told you you have to rush into this or else and you got to do this by this time and we're going to make this much?”

• [07:37] Financial Advisor:
  “...I would go with what you guys can afford and if you can get a $400,000 three bedroom, I would do that and have a small mortgage that you can knock out quickly and you can upgrade over time.”

Important Timestamps

• 00:06 – Joseph introduces their home-building plan.
• 00:20 – Immediate concern about lack of engagement/marriage.
• 00:59 – Advisors suggest “rent, save, then buy/build.”
• 02:11 – Caller shares savings and family gift plan.
• 03:21 – Income confusion clarified; financial reality check.
• 04:02–04:47 – Advisors caution about being "house poor."
• 06:14 – Joseph asks: income vs. emergency fund; advice is both.
• 06:55 – Advisors push back on “rush” mentality.
• 07:37 – Recommendation to buy a home you can afford and upgrade later.

Episode Takeaways

• Do things in the right order: Engagement/marriage first, then shared financial commitments.
• Don’t overextend based on hoped-for income; buy based on today’s numbers.
• Focus on saving, income growth, and emergency funds before jumping into a major mortgage.
• There’s no need to rush—take time, start smaller, and upgrade as your life and finances improve.
• Planning for a perfect future leaves you exposed if anything goes awry; build flexibility into your plans.

This episode delivers a clear, tough-love perspective: dream big, but take practical, prudent steps—especially with relationships and major financial commitments.