Discipline Today Can Rewrite Your Financial Future

Summary

The Ramsey Show

Episode: "Discipline Today Can Rewrite Your Financial Future"

Date: February 17, 2026
Hosts: Jade Warshaw & Rachel Cruze (Ramsey Network)

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Overview

In this engaging and wide-ranging episode, Jade Warshaw and Rachel Cruze answer listeners’ toughest financial questions, bringing empathy, practical wisdom, and trademark Ramsey straight talk to bear on everything from crushing debt and complicated family dynamics to investing anxieties and windfall management. True to the episode’s title, the recurring message is the transformative power of financial discipline — how today’s sacrifices and smart choices can completely alter your family’s financial future, regardless of past mistakes.

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Key Discussion Points and Insights

1. Dealing With Old Debt and Debt Collectors

• Caller: Lisa from Cincinnati, OH ([00:37])
  • Situation: Served papers on a 2017 SoFi loan (originally $50K, now owned by LVNV), struggling with the stress and shame of old debt, seeking guidance on court vs. settlement options.
  • Advice:
    • Rachel explains how debt is resold and the "scary" factor is often exaggerated—collectors are just people in high-turnover jobs ([03:19]).
    • Suggests considering a settlement, especially as the debt is years old ([07:04]).
    • Jade recommends aggressive action—sell a car if necessary to raise settlement funds, get it done quickly for peace of mind ([07:59]).
  • Notable Quote:
    • "I would sell one of these cars and be done with this today ... I'd give myself 30 days to make this happen. ... The way you cried when you came on the line, this has been going on for too long enough. Like far, far too long."
      — Jade Warshaw ([07:59])

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2. Family and Financial Control After Loss and Betrayal

• Caller: Marie from Phoenix, AZ ([10:19])
  • Situation: Lost money and assets in a scam ten years ago; daughter now controls her finances through a joint account and is reluctant to relinquish control.
  • Advice:
    • Rachel and Jade empathize, advise open communication about trust rebuilding and setting up a roadmap for independent access.
    • Recommend clear milestones, possibly gradual access with oversight, and possibly legal counsel if trust cannot be rebuilt.
  • Notable Quote:
    • "There's such a fine line of loving someone ... and then controlling them ... At some point, after 10 years, if there haven't been other mistakes or other patterns, you should be moving forward."
      — Rachel Cruze ([17:21])

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3. Financial Disagreements in Marriage — Whole Life Insurance & Debt

• Caller: Sydney from Omaha, NE ([21:17])
  • Situation: Troubled by husband's attachment to a low-value whole life policy from childhood; couple has term life coverage and $180K in debt (mostly law school loans); not on the same financial page.
  • Advice:
    • Strong guidance to cash out the whole life policy ("such a bad product"), boost emergency fund, then attack debt.
    • Rachel identifies the bigger issue: marriage is not on the same financial page. Calls for a serious sit-down to align goals—otherwise, progress will be difficult.
  • Notable Quotes:
    • "This is how bad of an investment whole life is... after 32 years, $17,000. If you put $17,000 into the market right now ... in 30 years ... you would have $1.1 million. That's how crappy of an investment ... horrible!"
      — Rachel Cruze ([23:15])
    • "You guys have way of a bigger issue happening of being on the same page financially than a whole life insurance policy."
      — Rachel Cruze ([28:44])

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4. Down Payment Disagreement – Investing vs. Security

• Caller: Caleb from Indianapolis, IN ([32:45])
  • Situation: Debt-free couple (young, 26/22), $90K in mutual funds, wants to buy a $150K house; disagreement about how much to put down (wife prefers keeping cash buffer).
  • Advice:
    • Both hosts ultimately side with Caleb: bigger down payment means lower mortgage, increased security, and flexibility for future life choices.
    • Acknowledge value of buffer, suggest possibly meeting in the middle, but emphasize long-term wealth-building from aggressively lowering housing costs.
  • Notable Quote:
    • "Once you have a home, it becomes the number one thing you want to protect if you ever hit hard times … That feels way more secure ... than having some money floating."
      — Jade Warshaw ([34:48])

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5. Investing Anxiety — Afraid of the Market

• Caller: Katie from Billings, MT ([37:56])
  • Situation: $500K in bank, only $200K in CDs; afraid to invest, feeling overwhelmed by market risks.
  • Advice:
    • Rachel explains the massive opportunity cost of leaving money in CDs vs. investing in the stock market ($36M vs. $1M after 36 years, given average returns) ([39:46]).
    • Urges Katie to meet with a SmartVestor Pro, learn basics, and gain confidence to move money into diversified investments.
  • Notable Quotes:
    • "So you're leaving $35 million on the table, Katie."
      — Rachel Cruze ([40:39])

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6. Strategic Real Estate — Family Legacy vs. Financial Optimization

• Caller: Jeff from Atlantic City, NJ ([43:36])
  • Situation: Bought 3 homes for young daughters to possibly live next door as adults, but area is changing and it may not be desirable.
  • Advice:
    • Rachel and Jade advise selling the homes, using freed-up equity to pay off personal mortgage and invest remainder for generational wealth/flexibility ([47:55]).
    • Strong recommendation to draft a will due to family complexity and value of assets.
  • Notable Quote:
    • "So for that reason, I think you'd probably get a better bang for your buck and have more freedom with the type of investment that you were talking about."
      — Jade Warshaw ([48:01])
    • "If you hate your family, don't do a will."
      — Rachel Cruze (citing George Kamel) ([49:42])

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7. Medical Uncertainty & Emergency Fund Priorities

• Caller: Chris from Montana ([54:03])
  • Situation: Single dad, recently divorced, two daughters with serious genetic condition requiring frequent long trips for monitoring; worries about how much savings to keep vs. paying off $30K in debt.
  • Advice:
    • Maintain a separate “girls’ fund” dedicated to recurring medical travel costs, keep it topped up even if that delays debt payoff.
    • Encourage maximizing income during lulls, especially leveraging weeks without custody.
  • Notable Quote:
    • "I would have that $800 continuously in an account ... even if that means pausing the debt snowball for a bit."
      — Rachel Cruze ([57:10])

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8. Managing a Windfall: Inheritance, Generosity, and Boundaries

• Caller: Katie from Columbus, OH ([66:30])
  • Situation: Received a $2.6M lawsuit settlement; asks about paying off mortgage/debt, investing, spending, and whether/how to gift family members without creating expectations.
  • Advice:
    • Pay off all debt (mortgage and student loans), invest wisely, enjoy some, and practice generosity.
    • For family giving, establish clear boundaries, make gifts practical (e.g., buy a car, pay a bill directly) and avoid creating dependency by not disclosing the full windfall.
  • Notable Quote:
    • "There are three things you can do with money...give it, save it, and spend it. I would do all three at some capacity."
      — Rachel Cruze ([69:50])
    • "If you can not just give cash, pay the bill, pay for the car. That kind of thing is helpful."
      — Rachel Cruze ([73:28])

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9. Wedding vs. Debt: Eloping or Waiting?

• Letter from Daniel, California ([76:09])
  • Situation: Deep in debt, recently engaged, asks if they should elope and have wedding later, or wait and pay it off first.
  • Advice:
    • Rachel: Go ahead and get married, even if it’s small. Don’t delay your lives for years for a party ([77:14]).
    • Jade: If a quick, affordable party is possible, maybe cash-flow it together for a middle ground, but don’t postpone marriage for debt ([77:46]).

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10. Parent-Teen Car Loan Decision

• Caller: Richard from Bowling Green, KY ([79:31])
  • Situation: Bought daughter a car at 16 with intent she’d work/pay for it; she stopped working and is ungrateful; loan is in parents’ names.
  • Advice:
    • Jade: Sell the car, apologize for the mistake, possibly buy her a cheaper car in cash; do not enable entitlement or set her up with more debt.
    • Rachel: Reset boundaries and use this as a teachable moment; do not transfer loan to her ([82:01]).
  • Notable Quotes:
    • "If you, to me, there's something so big when a parent apologizes and it's like, I made a mistake and here's what I did...that sticks with a kid for a very, very long time."
      — Jade Warshaw ([84:15])

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11. Other Noteworthy Moments

• Sneak Peeks and Products: Throughout, the hosts plug tools such as EveryDollar budgeting app, Ask Ramsey (an AI tool), and Zander Insurance, emphasizing the Ramsey approach: debt-free living, intentional spending, and planning for the unexpected.
• Notable Quotes:
  • "There's only one way to move the needle on your finances this year—You’ve got to have a plan."
    — Dave Ramsey ([94:31])
  • "If you don't like the road you're walking, start paving another one." — (Dolly Parton, quoted in closing, [117:22])

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Memorable Quotes & Timestamps

• "I would sell one of these cars and be done with this today."
  — Jade Warshaw ([07:59])
• "There's such a fine line of loving someone ... and then controlling them."
  — Rachel Cruze ([17:21])
• "This is how bad of an investment whole life is ... you'd have $1.1 million in the market vs. $17,000 in the policy."
  — Rachel Cruze ([23:15])
• "You guys have way of a bigger issue happening of being on the same page financially than a whole life insurance policy."
  — Rachel Cruze ([28:44])
• "You're leaving $35 million on the table, Katie."
  — Rachel Cruze ([40:39])
• "For that reason, I think you'd probably get a better bang for your buck and have more freedom with the type of investment you were talking about."
  — Jade Warshaw ([48:01])
• "I would have that $800 continuously in an account … even if that means pausing the debt snowball."
  — Rachel Cruze ([57:10])
• "If you can not just give cash, pay the bill, pay for the car. That kind of thing is helpful."
  — Rachel Cruze ([73:28])
• "If you ... don't like the road you're walking, start paving another one." — Dolly Parton ([117:22])

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Timestamps for Major Segments

• Dealing with Debt Collectors: 00:37–09:00
• Family Control After Scams: 10:19–19:39
• Life Insurance & Marital Debt: 21:17–31:01
• Down Payment Debate: 32:45–37:35
• Investment Anxieties: 37:56–43:36
• Real Estate for Kids: 43:36–52:25
• Windfall Management: 66:30–75:42
• Wedding vs. Debt Dilemma: 76:09–79:19
• Parent-Child Car Loan: 79:31–85:10
• Final Inspirational Words: 117:04–127:00

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Tone & Style

Jade and Rachel balance empathy (“I would do anything for my kids … they’re number one.” — Rachel Cruze, [57:10]), humor, and directness—never sugarcoating but always encouraging. The tone is practical, warm, and candid, with moments of real vulnerability both from callers and the hosts. The ultimate message: past mistakes don’t determine your future; discipline and intentionality today can change your family’s story forever.

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Conclusion

This episode is packed with practical advice, heartfelt moments, and powerful reminders: No matter your past, intentional discipline with money can completely rewrite your future. Whether you’re facing debt, navigating family complexities, or suddenly learning to manage a windfall, small decisions made in faith keep you moving toward financial peace.

Transcript

[Dave Ramsey]

Brought to you by the EveryDollar app. Start budgeting for free today.

[Jade Warshaw]

Normal is broke and common sense is weird. So we're here to help you transform your life. From the Ramsey Network and the Fair Ones Credit Union studio, this is the Ramsey Show. I'm Jade Warshaw. Next to me, Rachel Cruz. Taking calls about your life and your money for the next couple hours. So if you want to, you can get involved by calling 888-25-5225 in the go to the phone lines where we have Lisa, who's in Cincinnati, Ohio. Hey, Lisa.

[Caller]

Hi.

Thank you all so much for taking my question. So we have been served papers on an old debt that we now are having to either go to court and fight it or settle. And so we don't have the money for a lawyer. So we've been using chat AI to kind of guide us through. And so far it's worked like, you know, we've. We've been able to prolong it a little bit. So. But now, you know, I need guidance. I need real guidance on. On what to do and where to go.

[Rachel Cruze]

How long ago was this?

[Jade Warshaw]

Take a deep breath.

[Caller]

I'm so sorry.

[Jade Warshaw]

That's okay.

[Caller]

I'm sorry. I'm just nervous, and then it's just very emotional.

[Rachel Cruze]

Yeah. Stressful. Stress.

[Caller]

Stress, yeah. Okay, so the debts from 2017, or we took the loan out in 2017, and then. Okay, like around 2019, it's a SoFi loan. They gave us 50 grand. It was great. We reconsolidated debt. It didn't. And so around 2019, I had a baby. And then right around the corner of 2020, all of a sudden I was home and had to quit my job. And so it was just my husband and we. We. We were kind of like, we missed a couple of payments and. But we would catch up. And then right around the corner of 2020, like, they just sold it off like it didn't matter. And so we've been fighting it ever since. They served US papers December 16th, I think, hoping, like, we only had 20 days to respond. And I think they were hoping that with the holidays, we wouldn't be able to find a lawyer and we wouldn't know what to do. We just wouldn't respond. But we did. We got it together. We put it in chat. Chat gave us some information. We sent it. They sent us back discovery, most of it redacted. And so our next, like, we were going to send another request for more discovery, but instead we just sent them a pro se if they would settle. And save what company?

[Rachel Cruze]

What company owns the debt right now? Do you know the name of it?

[Caller]

Yeah. Lvnv.

[Jade Warshaw]

And what's the lv?

[Rachel Cruze]

Envy.

[Caller]

Yeah.

[Rachel Cruze]

Okay. So, Lisa, I need you to just understand who you're dealing with, because I do think that always helps the stress level. Okay. When bad debts, whether it's loans, credit cards, are sold, they sell them to a company. The company. The company, you know, repackages them with other loans, sells it to another company, and it's been probably passed around. Okay. So you're dealing with someone who's sitting in a cubicle, who's been on the job for probably three weeks and will probably end up leaving in two months because the turnover rate with collectors is constant. It's constant. Okay. So it feels scary and it's a big number. Right. So we're gonna have to address it. But I do want to take some of the stress off of who it is. It's someone who honestly has probably the worst job on the planet, who is calling and serving people old debt. And again, the intimidation factor is so big, but the reality of it's not, Lisa. So we have to deal with it. So I'm not minimizing the situation, but I do want you to just realize the person you're talking to or who even wrote the letter to serve, it's probably not even going to be there in 60 days. It's going to go on to someone else, and then the company, envy or whatever, the.

[Jade Warshaw]

Helen. Lnvnv.

[Rachel Cruze]

It's okay. Okay. There you go. Yeah.

[Jade Warshaw]

Yeah. You know what, Lisa? I used to. Back in the day when the credit card companies used to call me and debt collectors used to call me, I used to just imagine that they probably had more debt than I did, otherwise they wouldn't be working there. And it made me feel a lot better. Like, it just. It made the whole thing a lot less intimidating. Yeah. Have you offered. So you have no money right now. Have you offered to do any sort of payment plan?

[Caller]

So in the past, like, the past couple of years, we did a payment plan for, like, they'll do one for like, 12 months, and then after that amount of time, they'll hit you back up and they want the whole amount.

[Jade Warshaw]

Sure. So explain to us what's going on with your money now that over the course since 2017 and even 2020 on where we haven't been able to kind of stack together any money to make any sort of deal on this or keep the payment plans going. Tell us what's going on now.

[Caller]

So now we're doing better. Like, our income is getting up there in 2020. It just wasn't.

[Jade Warshaw]

What is it today? What's your income today?

[Caller]

204.

[Jade Warshaw]

Okay. And is this the only debt that you have, or do you have other debts? Okay, tell us really quickly about the other debts so we can understand how this fits in.

[Caller]

So we have 58,000 of, like, other debt and cars.

[Jade Warshaw]

Tell me the two. Tell me the cars. What do they each total?

[Caller]

One is 11 and one is 15. And then the other debt is. I think there's two loans, like, small loans and then credit cards. So. And we've been paying it down. Like, it was much worse that. So there is light at the end of this tunnel. Like, 58,000 sounds really, really bad. And it is. And then we have a mortgage, and our mortgage is 175,000, but our house is worth, like, 450.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

Okay, so I just. With the numbers you're telling me, I don't see a world where you're not setting up a payment plan and in the meantime stacking up a bunch of cash to settle. To settle. I think. I think a lot of your trauma and shame about this lives in the past because it sounds like you have the ability to start getting this cleaned up unless you tell me a reason that you don't see that hope.

[Caller]

No, I do. Yeah.

[Jade Warshaw]

I just.

[Caller]

I mean, do you think that we should settle?

[Rachel Cruze]

Yes. Yeah. You just have to have the amount of money to settle. And depending on how. I mean, how long it's been and how long. You know, considering this was a. You stopped really paying in 20. 20. It's been six years, so they're probably not expecting to really get paid, Lisa. I mean, at the end of the day, they're probably. Yeah, they probably assume you guys are broke.

[Jade Warshaw]

So if you could 50 and. And settle this.

[Rachel Cruze]

Yes, that's what I was gonna say. If you could get maybe 15, 000. And that means you guys are gonna have to limit your life. Like, you guys are gonna have to be working extra. You're gonna limit lifestyle. You're gonna do whatever you can, and you're gonna get $15,000 as soon as possible. And if you can hold them off till then and then see if they will settle. If you can somewhat get maybe back on a payment plan and then have an amount of money and say, this is what we have.

[Jade Warshaw]

What are your cars worth? The one that's 15,000, if you were to sell it, what could you get for it?

[Caller]

Maybe 20 or 22.

[Jade Warshaw]

You know what I do? I'd sell one of these cars and be done with this today. Hypothetically, I'd sell one of these cars. If you can get 20 for it and you only owe 15, go get a $5,000 car. You get a 15 to settle. Huh? Is it paid off or. I'm sorry. Yeah, I would do that. I would clear that out, get more money per month, then I can add that up and then I can settle this debt very quickly. That's what I would do. It's going to be a major sacrifice. But the way you cried when you came on the line, this has been going on for too long enough. Like far, far too long. And I would be going to great extents to make this better in the next. I'd give myself 30 days to make this happen. And if that means selling cars and driving junkers, then that's what I'm going to do. Foreign.

[Caller]

This show is sponsored by BetterHelp. If you feel like you're the one holding everyone else together while you're slowly falling apart, I want you to hear me for a second. If you feel stuck or anxious or overwhelmed, yet you find yourself always saying.

[Jade Warshaw]

I have to take care of everybody.

[Caller]

Else and I'll get to me later.

[Rachel Cruze]

That will work for a while, but.

[Caller]

Until it doesn't, talking with a licensed therapist gives you a place to slow down, be honest and sort through what challenges in your life are actually yours to carry and what challenges are not yours to carry.

[Rachel Cruze]

BetterHelp is an online therapy platform that.

[Caller]

Matches you with a licensed therapist based on your goals and preferences. You can message your therapist and schedule sessions through the platform. And if the first therapist you're assigned isn't the right fit, you can switch at any time for no additional cost. You're not weak for wanting help. Therapy has changed my life and it can change yours. You're wise for choosing to talk to someone. Visit betterhelp.com Ramsey to get 10% off your first month. That's BetterHelp. H-E-L-P.com Ramsey.

[Jade Warshaw]

All right, let's go back to the phone lines where we have Marie, who's in Phoenix, Arizona. Hi, Marie.

[Caller]

Hello.

[Jade Warshaw]

What's up? Hi.

[Caller]

I have a little bit of an issue that I need a solution to.

[Jade Warshaw]

Okay.

[Caller]

I was scammed about 10 years ago. Lost all my money, my house, my car, my jewelry.

[Jade Warshaw]

Holy smokes.

[Rachel Cruze]

Oh, my gosh, Maria.

[Caller]

Yeah, it was considerable. And that's why I'm still working at 71. But when I came clean to my daughter, we decided On a plan. And we opened a joint checking account. And she has taken all my money, my pay, my Social Security every month and gives me an allowance for food, gas, medication, et cetera. When the rent is due, she transfers that money. Any kind of car repairs, insurance, she does an extra transfer. We had managed to save almost $200,000 during that time, which is remarkable.

[Rachel Cruze]

Oh, my gosh.

[Jade Warshaw]

How much of that's yours and how much is hers?

[Caller]

It's all mine, but it's all in her name. I don't have access to it.

[Jade Warshaw]

Okay.

[Caller]

Yeah, she doesn't send it. She sends me screenshot. It's all still there.

[Rachel Cruze]

Good for you, Marie. Well done.

[Caller]

But I want this arrangement to stop. I've asked for several times, and she's just not inclined to do so. She still doesn't trust me. Understandable. But, you know, I would like to have my money available to me when I want it.

[Rachel Cruze]

Okay.

[Caller]

And.

I don't know. One time I contacted an agency for elder abuse in that. In my area, and they told me just to take her name off the account. Well, I didn't do that. I opened another account and had my money go there. She found out, she came. She was not very happy. Make me close the account and transfer it back to the joint account.

[Jade Warshaw]

What is her. When that happens? What is she telling you? Because there is a reason that this arrangement was made. What is it that she's afraid that you're gonna do?

[Caller]

She's afraid that I'm gonna get, you know, pulled back into that. That scenario. And she does not want me to be penniless again. And I can understand it.

[Jade Warshaw]

The scenario where you were scammed.

[Caller]

Yes.

[Rachel Cruze]

Are there things, Marie, that you want to do with your money right now that she's saying no to?

[Caller]

Well, I.

[Jade Warshaw]

My.

[Caller]

My. My rent. My lease had ended last March, and I wanted to buy a condo or townhouse, and she wasn't on board with that. She said the only where that would happen if the. If the property was going to be put in her name, which I didn't have a problem with that. But it ended up. I had to move to another place, and I have the lease now with an apartment, so.

[Rachel Cruze]

Okay.

[Caller]

Am I out of line to ask to be able to use my money, or should I just suck it up and continue with our arrangement?

[Jade Warshaw]

You're not out of line to ask to use your money. I. There's another side to this that I want to know more about. Is she keeping you from. And here I'm just going based on what you Said it sounds like something was so drastic that she was brought in to help you. And she's probably looking at this. And I'm not saying that she's right. I'm just trying to get both sides. She might be looking at this going, you know, the best predictor of the future is the past, unless something has changed. Right. So she might be looking at this going, I don't see why I would expect anything different if I let her have access over to this money again. So you might have to explain to her, here's why this is different, here's why this is not like it was before. Because you said, she's afraid I'll fall back into my own old way that got me scammed again. So if you know that, my thought would be, I need to help her understand why this is not like that anymore. And if you feel like. If you genuinely feel like maybe you've changed or it's different, then have that conversation. And then if not, then I'd be talking with. I might have to bring a lawyer into it and say, hey, this person is not yet.

[Rachel Cruze]

There's such a fine linery of loving, you know, someone in your family by helping them financially like this and then controlling them. And so I, I don't know from her sake, if she was on the other line and we talked to her after, you know what I mean, the story she would give us. Because my hope would be that it's out of love and care for you, Marie, that she says, did you. Were you good, Were you good with money? Besides the scam that happened 10 years ago when you got, when you were raising her, how was money?

[Caller]

I. I was born and raised in Germany. My husband was from this area. He's passed and we've always lived frugally.

[Rachel Cruze]

Okay, so really, was it just this one scam that caused all of this?

[Caller]

Yeah, but it was. It was massive. It was like $600,000.

[Jade Warshaw]

How did it happen?

[Caller]

Well, I met this guy on Facebook. He pretended to be someone he was not, and it took almost three years.

[Rachel Cruze]

And that it happens more than.

[Caller]

Yeah, it's very rampant and it's very sad.

[Rachel Cruze]

Yeah. I'm so sorry.

[Caller]

I know she did that to help me, to protect me. And.

[Rachel Cruze]

And that was 10 years ago. Marie2016ish.

[Caller]

Yes, it happened. It started in 2015.

[Rachel Cruze]

So what I would do to probably keep the relationship good with your. With your daughter, and again, I'm going to assume good in this call, that she is doing this out of love and protection for you is I would sit down with her and I would have a road to say, hey, this is what I desire. At the end of this road, I want full access to my money. I want to be able to purchase a condo because rent keeps going up and up and up. And I want to be able to have a place to live that's modest, that I own and whatever that looks like for you, Marie, what the end of it looks like. And then. And then I would bring her in and just say, hey, what steps need to be taken for you to rebuild trust? Because it sounds like you guys have just been functioning in this and she may. She may have decided already. I'm just going to do this till forever. For the rest of my mom's life.

[Jade Warshaw]

I made that assumption.

[Rachel Cruze]

Yeah. So. So we want to break that for you and to. And some milestones. Have a couple of milestones. And in the next 12 months, what are things that you can be doing that would give her the confidence? Because that feels reasonable to me. And again, I'm assuming, Marie, this isn't. I'm saying all this putting you in a good light, that you're being responsible, but you're not off to the side.

[Caller]

You know what I mean?

[Rachel Cruze]

So I don't.

[Caller]

I don't even have access to banking. She sends me screenshots and I keep a little book here.

[Jade Warshaw]

Yeah.

[Rachel Cruze]

So there's a point after 10 years, if there hasn't been other mistakes or other patterns, you should be moving forward.

[Jade Warshaw]

Yes.

[Rachel Cruze]

And for her sake, too, that she's. She doesn't have to babysit you or, you know, roles reverse that. She's your mom. Right. For a season. I think that's really good. But over time, you probably do want this deal to dissolve. But I would again, try to do it with her. And like, what's the roadmap to get there? And. And then I hate to say, but if she's. But if she's unwilling to do any of that, I would be curious. Then her motivation at the end.

[Jade Warshaw]

That's my question. And I'd want to make sure that everything's above board.

[Rachel Cruze]

Yes. On both sides. So then how do we rebuild the trust? That's what I would ask Question.

[Jade Warshaw]

How do we build the trust? And how do you do it in a way that can still preserve the relationship? Because if it really is, there's, like I said, there's probably more to the story on her end, more to the story on your. And Marie, but there probably is reason for both of you to feel the way that you feel.

[Rachel Cruze]

Yes.

[Jade Warshaw]

And so I like your idea of making that roadmap because I think in the end that's gonna be. And if the eight months or 12 months happens, then you gotta start pushing, pushing more.

[Rachel Cruze]

And maybe there's a transition even for the adult daughter to say, hey, the next step would be that she does have access to her money, but your name's still on the account. So you can, for six months, see it, see what's go. She can actually log into her own account. Right. I feel like that's, that's fair.

[Jade Warshaw]

That's very fair.

[Rachel Cruze]

So, like, what are small steps that we can take to create more independence on Marie's side versus just having this hard black and white wall of like.

[Jade Warshaw]

Either you do it or I do it. Yeah, yeah, yeah.

[Rachel Cruze]

It could be at both ends for a season too, you know.

[Jade Warshaw]

Yeah.

[Rachel Cruze]

But yeah, that's, that's hard. And I, and I feel like Marie too, to your daughter's credit. Like, we get the calls. We get your daughter calling in and saying, my mom has been scammed 600,000.

[Jade Warshaw]

Yes.

[Rachel Cruze]

What do I do? How do I step in? Because she feels gullible, she feels really vulnerable. I feel could fall into one of these again. And we probably would give her that advice. Sit down with your mom. Say, mom, I want to be able to help you.

[Jade Warshaw]

Yes.

[Rachel Cruze]

Let me. You know what I mean?

[Jade Warshaw]

So, and probably what the daughter is thinking is, oh my gosh, if something like this happens again, I'll have to take care of you. And I don't have the money to do that. So all of this is really being done out of just of a abundance of caution for the future is what it sounds like.

[Rachel Cruze]

Yes, that's what I would hope.

[Jade Warshaw]

Going to assume the best here. Assume everything's on the up and up. Sorry that's happening, but thanks so much for the call.

[Dave Ramsey]

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[Jade Warshaw]

See boostmobile.comramsey for details. All right, we have Sydney, who's in Omaha, Nebraska. Hey Sydney, you're on the line.

[Caller]

Hey, guys. So my question today, and I know you've taken this call a million times, but how do I persuade. That's not really the right word, but how do I inform my husband that we no longer need the whole life insurance policy that his parents took out for him as a child?

[Rachel Cruze]

Okay, you don't need it because you think you should do term life or you don't need it because you guys are self insured. Just somewhere you are financially.

[Caller]

We each have term life policies on one another.

[Rachel Cruze]

Oh, okay.

[Caller]

Yeah, we're good to go.

[Rachel Cruze]

What's his reason for keeping the whole life?

[Caller]

So we actually talked about that recently. It just gives him like a peace of mind. He will be 32 in April and the death benefit on this thing is like 17,000.

[Jade Warshaw]

Is he into it?

[Caller]

No, just like growing or just sitting. I don't really know.

[Rachel Cruze]

And it's been growing since he was a kid. And there's only $17,000 in it.

[Caller]

Yes.

[Jade Warshaw]

If it's not costing you anything, what does it matter if it's just sitting there growing?

[Caller]

Yeah. You know, that's a fabulous question, one that I have asked myself. I do know when he was a kid, his dad is in pharmaceuticals and there was a flow times where he would be out of work and things, and they were on Medicaid. And so I think it's just like that extra layer of security. Whereas I'm like, we could take the cash value, which isn't a ton.

[Rachel Cruze]

It's like three or four thousand dollars here's.

[Caller]

And yeah. Use that for what? Well, so I mean, ultimately paying off debt. It's. I'm trying to win the war here rather than the battle.

[Jade Warshaw]

But you do have debt to pay off?

[Caller]

We do, yes.

[Jade Warshaw]

Okay, that's. That's more what I was getting at. Is it just like a. Why do we need this? We don't need to get rid of it, or could you really use the cash?

[Rachel Cruze]

Well, here's what's frustrating, Sydney. This is how bad of an investment whole life is. Okay, so let's just pretend that they opened it up when he was a baby. He's 32 now. Okay, 32 years. It's grown to $17,000. If you put $17,000 into the market right now, in 30 years, instead of it just becoming another 70,000, you would have $1.1 million. So that's how crappy of an invest. Like it's not even an investment. Like it's not. It's horrible. Horrible. So my motivation would be like, let's Actually put our money in something that's working, that will actually work for us and not grow at a snail's pace. And if something really were to happen to him, they're going to keep a lot of it. You know what I mean? You don't even get the full death benefit always. So it is. Oh, it's such a bad. It's such a bad product. So from just the common sense perspective, I'd be like, wouldn't you want to move 17,000 over to a legitimate investment? Like, absolutely. You know, not that you can, because you're gonna have to surrender the policy. So you won't get that. But for me, I'm like, I just want to have things in my life financially that make sense, like this make. This doesn't even make sense sense. So not only could you use the cash to start paying off debt, but also, let's be smart with where we're putting our money and keeping, quote unquote, $17,000 in a whole life policy that's not growing, basically, is not wise.

[Jade Warshaw]

Well, what's the. What's the debt you're trying to pay off?

[Caller]

Yeah, so a little bit of everything. So like I said, I'm trying to win the war rather than the battle. So my husband, he would sleep better at night if we had a month's worth of expenses saved at all times.

[Jade Warshaw]

Is it because your irregular income?

[Caller]

No, no, it's just like, what if the furnace goes out kind of a thing. And so this getting rid of this whole life policy would allow us to basically shore up the savings account and then immediately go towards paying extra towards debt.

[Rachel Cruze]

How much y' all have in savings right now?

[Caller]

In savings? We've got 4400.

[Jade Warshaw]

Okay, so go ahead.

[Rachel Cruze]

Well, I was gonna ask what's a month's worth of expenses?

[Jade Warshaw]

Six.

[Rachel Cruze]

Okay.

[Jade Warshaw]

So you, in your mind, you're thinking, okay, if I cause him to get rid of this policy, which he doesn't. Which he doesn't want to get rid of, but if I take that money and give him what he wants, which is a month's worth of expenses, that's better than nothing at all. That's you winning the war. Okay, well, winning the war would be.

[Caller]

Him getting on track with the baby.

[Jade Warshaw]

Right, right, right, right.

[Caller]

And I can get free.

[Jade Warshaw]

I understand, I understand. Okay. And then after you did that, and after that, he's like, now we can go buck wild and pay off this debt. Is that what he's agreed to?

[Caller]

More or less. Yeah.

[Jade Warshaw]

What's the less?

[Caller]

Just like we're not obviously following the baby steps to a T, you know, that would be only having $1,000 in our savings.

[Jade Warshaw]

But is there another, is there another part that he's already said, I'm not, or was that really. Because if you're telling me this is the only thing he asked of me, Jade, he just. This will make him feel better. And then everything else, we're off to the races. I probably wouldn't argue much. I'd be like, hey, do it. And then maybe over time policy, because.

[Rachel Cruze]

It makes you feel good, but we're gonna, we're gonna start moving.

[Jade Warshaw]

Yeah. And if you told me that, I'd be like, great. But if you tell me, hey, actually it's probably gonna be this was just one of many battles and I'm just trying to get over this hump, then I'd say we have more conversations to have. I love that you're trying to make progress. I'd probably go ahead and do. I'd probably make that deal. I'd be like, yes, if we, if we cancel this whole life policy and you want the one month there, I'm not going to fight that battle today. As long as we can go hard on this debt going forward. That might be just the peace offering you need to make in order to get this thing going.

[Rachel Cruze]

Yeah. How much debt do you guys have, Sydney, to pay off?

[Caller]

About 180. The bulk of that. My husband went to law school, so we've got about 110 there. We've got about 15 on a car, and then just shy of 14 on private loans that he took to take the bar. And then my student loans are 37.

[Rachel Cruze]

Okay, well, how long ago, Sydney, did you start listening to the show and wanting to work a new financial plan? The baby steps.

[Caller]

Yeah. Last May, I had heard of Dave in the personal finance classic. Took in high school. And then a good friend of mine, her husband followed the baby steps, which is mind boggling because they are Catholic missionaries. And I'm like, how did you, you know, do all of this? And essentially they just, it was the.

[Rachel Cruze]

Baby steps that helped it.

[Jade Warshaw]

Yeah.

[Caller]

Yeah.

[Rachel Cruze]

Okay. How old are you guys?

[Caller]

I am. How old am I? I am, I'll be 30 this year. My husband will be 32.

[Rachel Cruze]

So. Okay, great.

[Jade Warshaw]

Can, can I ask another quick question? I'm just trying to get a sense of him. If you said to him tomorrow, hey, let's pretend you did the thing with the whole life policy and put the month aside. And then you said to him, hey, I've really been looking at Our car. I think that because I. I looked and found that if we sell it, we can make $5,000 and not have the payment anymore. And then we can take that $5,000 and buy a junker car. Right. Another aspect of the baby steps. If you told him that, what would he say?

[Caller]

So we've had that conversation before and he's like, absolutely not.

[Rachel Cruze]

So, Sydney, I hate to say it, and we don't have a lot of time, so I just feel like I gotta, like, say it to you. I think you guys have way of a bigger issue happening of being on the same page financially than a whole life insurance policy. And I wish that was just it, but as we start peeling back on this, you guys aren't on the same page. And it's. I don't wanna say it's impossible. It's just.

[Jade Warshaw]

It'll take a long time.

[Rachel Cruze]

It's really hard for you to be the one, Sydney, that pulls him through this process and that to make progress. And so you guys need to sit down tonight and you need to tell him, Sydney, how you're feeling and what's going on inside of you. Cause it's not just a whole life policy that would feel good if he just cashed that out. That's great. You have $180,000 in debt. Like, that's terrifying. Is that scary?

[Caller]

Oh, yeah.

[Rachel Cruze]

Yes. Okay, so talk about that, Sydney. Talk about what you're feeling. The sleep that you're not able to get because you're stressed. You're scared if something happens to you. Do you guys have kids?

[Caller]

We do. We have. She's almost two.

[Rachel Cruze]

Okay. Yes. And so I'm like, the weight of this whole issue of just your entire financial picture is weighing on you. And you're trying, which I applaud you, to make a little progress here and there, but it's not gonna do much, Sydney. It really won't unless you guys sit down together and say, hey, we are in a marriage. And we've committed our lives to be a team together. And we're going to tackle every area of life together in law issues, parenting issues, and our money issues. And we're going to be a team. The money is the problem. The debt out there is the problem. You're not the problem. Looking at him and Sydney, you're not the problem. How do we tackle this together? And you're really not going to make a ton of progress, Sydney, until that happens. And I would push and fight for that, for you to be heard. And in what you're wanting because it does not sound like he's going to do much in this process.

[Jade Warshaw]

Well, Dave, you know, on the show all the time we get calls about cars, used cars. What's one thing you want folks to know?

[Dave Ramsey]

Well, really a couple things. Number one is always buy used. Unless you got a million dollars, we don't buy new cars. And if you're gonna buy used, number two, you want it to last. And that means regular proper maintenance.

[Jade Warshaw]

Yeah, that's a big deal. I know when Sam and I moved from South Florida up to Tennessee, that's the first thing you're looking for. You need somebody who can take care of your car. So when we found Christian Brothers Automotive, it was a no brainer and they've been absolutely great.

[Dave Ramsey]

We're excited to recognize Christian Brothers as the official auto repair partner of the Ramsey Show. Christian Brothers keeps things simple, honest and transparent. Every repair is backed by their nationwide nice difference warranty. Three years or 36,000 miles, whichever helps you more.

[Jade Warshaw]

Listen, Dave, I'm first to admit I'm not into cars like you are. But the thing about Christian Brothers is I feel just as confident going in there. They're not trying to upsell me. I feel 100% confident that I'm going to get the service that I need.

[Dave Ramsey]

Hey, if you want your car to last and stay on track with the baby Steps Trust Christian brothers, go to cbac.comramsey to find your local shop schedule service and get an exclusive Ramsey discount. 10% off your visit up to $250.

[Jade Warshaw]

Yeah, that's cbac.comramsc store for detail. Well, tax season is upon us to get free checklists and guides that'll help you file. Be sure to go to ramseysolutions.com taxes all right, Caleb from Indianapolis, Indiana is on the line. Hey, Caleb.

[Caller]

Hi there. Me and my wife are on baby step four debt free and are looking at buying a house and we're having a disagreement about how much we should have as a down payment.

[Rachel Cruze]

Oh, well, congratulations for getting so far. Well done on paying off debt and get ready to buy a house. That's exciting.

[Jade Warshaw]

What are you looking to spend?

[Caller]

So we have about 90 grand sitting in a mutual fund and a good starter house in the area is around 150 grand. What she wants to do is spend 50 grand? No, she wants to leave 50 grand in the mutual fund and probably would have 30 grand as a down payment and 10 grand for closing cost. I want to use the full amount so we can have an 80 grand down payment. Okay, we do it her way, we're following your guys's rule. The payments would be around 25% of our combined income on a fixed 15 year fixed. What's the reason? The reason I'm wanting to do the full AB grant is so that in the future we at least have the opportunity to live off a single income. And I feel like that would make it easier for a baby step six.

[Jade Warshaw]

Okay, I see what you're saying. So you're wanting to put 80, she's wanting to put a total of 50. Did I understand that?

[Caller]

That she wants to leave 50 and so be 30 grand as a down payment, 10 grand for closing cost and fees and all that.

[Jade Warshaw]

So me looking at this right quickly your way, the payment's around 972. Her way, it's around 1400.

[Caller]

I. I believe so, yeah.

[Jade Warshaw]

Okay. And your thought is we can go to a one income household later on if we so choose.

[Caller]

Or at least I have the opportunity of that. We don't have any kids yet, but we're wanting to start trying within the next couple of years.

[Rachel Cruze]

Caleb, what is she wanting to do with the 50 grand in the mutual fund? She wants to leave it. What is that for?

[Caller]

For her, she just wants to leave it. She views the mutual fund as more of an investment. It feels like it would grow more there than it would in the house. She's very frugal and a large purchase is just uncomfortable for her.

[Rachel Cruze]

There's like an extra safety net for her in a way. In a way to have that. To have that available.

[Jade Warshaw]

Okay, I actually, I'm with you, Caleb. I think that, that I would rather do that. I think there's more. Once you have a home, it becomes the number one thing that you want to protect if you ever hit hard times. And so I kind of like the idea of saying, hey, if we do this, our mortgage will be so low that even if only one of us were working, it would be okay. And that feels way more secure in my mind than having some money floating. Yeah, money just floating.

[Rachel Cruze]

How much do you guys make a year, Caleb?

[Caller]

Combined around 80 grand. I just got a promotion.

[Rachel Cruze]

Okay, great.

[Jade Warshaw]

Right.

[Rachel Cruze]

How old are y'?

[Caller]

All? I'm 26 and she's 22.

[Rachel Cruze]

Oh, wow.

[Jade Warshaw]

You guys are youngins.

[Rachel Cruze]

Y' all are so young. Okay. I. I always hate giving like a gray answer because I know people want like a black and white like J. Yeah. Jade said she would do your way, Caleb. I would probably say I would lean your way too. Caleb, like if someone. We just got this question on money and marriage. They were gifted a big inheritance, and they're like, should we just throw it all at the house, or should we use some for investing? We're like, yeah, just attack the house. Cause you have all the time in the world to invest.

[Jade Warshaw]

Yes.

[Rachel Cruze]

You know, every single year, you guys can open up a Roth. You can fund your Roth while you're working, and you will be fine at retirement. So my caveats are. You sound very buttoned up, Caleb. You sound like you love running your Excel sheet and your numbers. And sometimes when we're so in the numbers and so in a formula, we forget about life. And I'm just curious if she sees, like, we're gonna have to replace a car soon. Like, we're gonna have to do a couple of big purchases, and having the cash available to help us do those things smoothly would be wise.

[Jade Warshaw]

Right.

[Rachel Cruze]

Like, I don't know if that's the case, but if that's something that's in her head, that's good to know. Either way, either option, you guys are gonna be fine. Caleb. I mean, I really do believe that. I think that you guys, you could follow the. Yep. The 5%, 20% down and be fine. You could throw way more at close to 50% of it and be fine. But at the end of the day, I would probably choose Team Caleb just because I like having a lower payment. And you guys just have so much time on your side to save and invest and that.

[Jade Warshaw]

And it does free up for, you know, 450amonth, save up 500 bucks way more quickly, so that if there was something like a vehicle or all of those things, that it would be nice to have a chunk of cash for. You could do it.

[Rachel Cruze]

Yeah, that's right.

[Jade Warshaw]

Fairly quickly.

[Rachel Cruze]

That's right. Yep. Or maybe I'll meet in the middle, too. Caleb, you know, leave, I don't know, 25 in or something. I don't know. Leave a little bit in just for her to have a little bit of that security if she wants. So, yeah, y' all can meet in the middle and be great, but either side, I think you. You'll be fine. I mean, you guys are so young, and you're so on target that I'm like, I think you guys, you're gonna be fine.

[Jade Warshaw]

So final ruling. There's no wrong answer, but if we. If we were forced to decide, we'd go the lower. The lower payment, therefore, higher down payment. Yep.

[Rachel Cruze]

Yep. That's it.

[Jade Warshaw]

All right. I love it. Thanks for the final.

[Rachel Cruze]

Final answer.

[Jade Warshaw]

Final answer. All right. We've Got Katie, who's in Billings, Montana. Hey, Katie, how are you? Hi.

[Caller]

I'm good. How are you?

[Jade Warshaw]

Excellent. How can we help today?

[Rachel Cruze]

Great.

[Caller]

So I am so confused when it comes to the world of investing. My husband and I were not in debt, thankfully, and we have been able to save up about $500,000 in the bank.

[Jade Warshaw]

Wow.

[Rachel Cruze]

Well done.

[Caller]

I contribute $500 monthly into a Roth. My husband does not have one. And the investing, I guess you could say that we do, is just in CDs in the bank at 3.75% and we have about 200,000 in that.

But.

[Rachel Cruze]

Okay.

[Caller]

Other than that, that's it. Because it feels safer to me and I. Is that foolish?

[Jade Warshaw]

Well, let me make sure I understood this right. I thought you said you had 500,000 in the bank, but then you said 200,000 in CDs. So some of it's just sitting freely and some of it's in the CDs. Or is that in addition to.

[Caller]

Some of it's just in savings accounts.

[Jade Warshaw]

Got it. Okay. Wow. Why are you guys averse to investing? What happened that made you feel squeamish?

[Caller]

I guess nothing happened. It just. It's foreign to us.

[Rachel Cruze]

Yeah. And what you don't know can be scary.

[Caller]

And when it. Exactly. And when it comes to retirement, like I said, I do put $500 a month from my paycheck into a Roth account for myself, but you don't see that money until I'm close to 60 years old. And I sure a CD seems a little bit safer because it's a six month, 12 month return.

[Rachel Cruze]

Yeah. Katie, how old are you guys?

[Caller]

I'm 31 and my husband's 37.

[Rachel Cruze]

Okay. So just to do a little calculation for you. Oh, my gosh. Are you ready for this? This is going to probably make you.

[Caller]

So I'm ready for it.

[Rachel Cruze]

Okay. So I just put really quickly in if I. If you just dropped $500,000 in the market. Right this. And. And an average. I put 12% rate of return. Some people get mad at that. I'm going to just do it for fun because it was way more than that the past couple of years. There's some down years, but. But the past couple years have been fantastic. So I'm gonna put 12% average. It's actually been more than that, but I'm gonna just leave that. And if you did that right now at 31, by the time you're 67, if you just said just let this money grow, you would have $36 million.

[Caller]

Wow.

[Rachel Cruze]

So if you kept it in now, if you kept it in the CD, which is averaging 1.7% interest right now, I'm gonna bump it up to 2 because I'm feeling gracious to the CDs you have. You'd have 1 million. You'd have 1 million.

[Caller]

Sure.

[Rachel Cruze]

So. So you're leaving $35 million on the table, Katie.

[Caller]

So, yeah.

[Rachel Cruze]

What we have to realize is we need to understand this intimidating part of money which is investing. And I get that there's a lot of people use diversification index funds, S&P 500. You know, you're like, what is. What is all like.

[Jade Warshaw]

Yeah.

[Rachel Cruze]

What does this all mean? So I would. Because you guys have done so well. I mean, it's crazy.

[Jade Warshaw]

It's. Yeah.

[Rachel Cruze]

Crazy that you've saved this much. I mean, this is. It's amazing. You guys are incredible. At 31 years old, I would sit down with a SmartVestor Pro in your area.

[Caller]

Okay.

[Rachel Cruze]

When we get off the phone, Christian will pick up and he can kind of direct you on the website, where to go. But you. But I would meet. Katie, meet with two or three SmartVestor Pros in your area. Okay. And I want you to. To get, number one, a feeling from them because these are the. And these have all been vetted. So these are great people. But you're going to naturally connect and feel more comfortable probably with one or two over another.

[Jade Warshaw]

Right.

[Rachel Cruze]

And that's really important, this process, because anyone that's going to help you kind of push the buttons and investing, you want to feel really, really good about. And I would ask every question that you can think of. Don't feel like, oh, my gosh, I feel stupid asking this. I should know none of that and actually start to get the basics and learn. What does this mean? What does it look like if I invest in an index fund or a mutual fund? What types of funds are out there? I mean, there's so much you could be doing with this money to make you money. That's. It may kind of feel risky, but at the same time, compared to what you would make on the other end.

[Jade Warshaw]

Absolutely.

[Rachel Cruze]

I think it's worth the risk. That's not really even there. The ups and downs are real, but the overall picture is pretty bright. So that's what I would do. Katie, if you're looking for a more budget friendly way to save on medical costs and stay true to your values, Christian Healthcare Ministries is a great option to think about. CHM is not health insurance. It's a health cost sharing ministry. A Biblical, community based way for Christians to share each other's medical bills. That means no enrollment deadlines and you can choose any doctor or hospital you want. That kind of freedom is big, especially if you're self employed between jobs or you just need something that fits your budget better. CHM has been around for decades faithfully serving the Christian community. And many members save hundreds of dollars a month compared to traditional health insurance. And that margin gives you breathing room when you're working the baby steps and trying to steward your money well. And right now, CHM is offering new members a 50% credit towards their first month of membership. Get [e-mail] budget and use promo code RAMSEY. That's chministries.org budget and promo code Ramsey.

[Jade Warshaw]

Welcome welcome back to the Ramsey show in the Fair Winds Credit Union studio. It's still me, Jade Warshaw with Rachel Cruz going straight to the phone lines where we got Jeff in Atlantic City, New Jersey. Hi, Jeff.

[Caller]

Hey, Rachel. Jade, how are you? An honor to be on the show.

[Jade Warshaw]

Awesome. We're glad to have you.

[Caller]

I discovered the Ramsey about the Ramsey show about six months ago and I've been following a lot of the principals and just have a question. Got a question for you.

[Rachel Cruze]

Okay.

[Caller]

So I'm 37 next month. My wife is 31. And we have been putting away money, investing in retirement, investing in future growth for ourselves to live comfortably later on. And we in our community, the children live next to the parents, relatively close next to the parents. And we have voice three residential single family residential homes for our children to be able to live next to us. We got three girls. Yeah, we bought three homes for our three. We want our girls to live next to us. So we bought the three residential homes so they can live relatively walking distance to us.

[Jade Warshaw]

Okay. How old are the girls?

[Caller]

So the girls are 8, 6 and 4.

[Jade Warshaw]

Wow. You got started early with the purchases. I mean.

[Caller]

Yeah, yeah, yeah, we definitely wanted to start early. And we got great interest rates. We bought it when the COVID rates were around and the twos and then the threes. So right now we got tenants there that covered the COVID the rent until, you know, it's time to give it to them when we feel the time is right. And my question goes like this. My wife and I have had some hard discussions about these homes and we've came to the conclusion that most likely the kids will not want to live because the area is changing and most likely the kids will not live next to us.

[Jade Warshaw]

Sure, yeah.

[Caller]

So what happens is we find ourselves in an interesting position right now. We have tenants that cover the mortgage, and we have a little bit of extra every month, like $2,200 extra from the three homes every month. And we've been doubting ourselves that this is the right path going forward because we are thinking to cash out these three homes, sell them, cash out $1.65 million from, you know, basically what the down payments we put in.

[Rachel Cruze]

Yeah, what you get out of equity.

[Caller]

Out of the three, the equity is 1.65. Take this 1.65, minus the taxes we would have to pay on that average is about. Let's say we'll be end up with like 13 or something like that.

[Rachel Cruze]

Yeah.

[Caller]

And put the 13 into an S and P mirrored fund where, let's say 20 years down the line.

[Jade Warshaw]

I love this.

[Caller]

That grows to a huge number.

[Jade Warshaw]

Yes.

[Caller]

And then if they want to live in XYZ area, okay, here's a million dollars. Go buy the house.

[Jade Warshaw]

Genius. A genius move.

[Dave Ramsey]

No.

[Caller]

So my question is, is that the right move, or should you just let the house keep on being paid off by tenants?

[Rachel Cruze]

What, do you guys own your. Do you guys own your house, Jeff, you and your wife, or do you still have a mortgage on it?

[Caller]

No, we actually have a 2% rate. Yeah, we. We are. We own our house. Straight up. We actually have, like 1.3 equity in our own home.

[Jade Warshaw]

Okay. And you don't owe anything on it?

[Caller]

No, we do. It's worth about.

[Jade Warshaw]

What do you owe on it currently today?

[Caller]

368.

[Jade Warshaw]

368. But it's worth 1.3.

[Caller]

No, no, it's worth about 1.8.

[Jade Warshaw]

Holy smokes.

[Caller]

Maybe 19 even. Yeah.

[Jade Warshaw]

You know what I would do if you're offloading the three houses for the. The kids, I'd take a little of that money. If you said the whole thing, you'll walk away with 1.3. I'd probably take some of that. And I'd pay off your house in full. And then I'd invest the other million. And you will.

[Rachel Cruze]

And then invest your mortgage payment back into this fund for the girls.

[Caller]

Even though now I've been listening to Ramsey, I know you guys say you pay off that mortgage no matter what. So my question is, I got a 2% rate.

[Rachel Cruze]

Yeah.

[Caller]

With 15 years exactly to go, even though it's 2%. Pay that off.

[Jade Warshaw]

Yes. Because you're the guy who would take the full mortgage payment that you were paying. And you'll invest it in that. You'll invest it. I can tell that you would do it.

[Rachel Cruze]

So you'd rather make 12% than 2%, you know?

[Caller]

Right, right. I hear that.

[Rachel Cruze]

I hear that. Yeah. And Jeff, too.

[Caller]

But my question is, would you sell the three home? That's my question.

[Jade Warshaw]

I would. You.

[Caller]

You would?

[Jade Warshaw]

I would. Only because the reason that you said you purchased them.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

Was for your kids to live in them so that they could be close to you. That was the number one reason. And that's the only reason I heard, by the way. And so much life. And when you told me their ages 4, 6, and 8, so much can happen in that time. Number one, like you said, the neighborhood can go down. Number two, there are three different women who will have three different lives that could go in any direction.

[Rachel Cruze]

I would never want this for you, Jeff, because I know how much you love him. But she may. She may meet a. Meet a. Meet a mic and then move in with her husband. You know what I mean?

[Jade Warshaw]

Somewhere. Yeah. Or you get a different job and you want to move. Like, there's so much life that can happen over the course of the next 18 years or so. And so for that reason, I think you'd probably get a better bang for your buck and have more freedom with the type of investment that you were talking about. And when you told us the spreads on the rent, it wasn't all that great.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

Either. Right away.

[Caller]

Like, no, we don't end up making money at the end of the year because here in H vac breaks and break even totally. Your principal is going down.

[Rachel Cruze]

Yes.

[Jade Warshaw]

Okay.

[Caller]

So I have clarity on that. I have one more question. I'm sorry, I'll make it quick.

[Jade Warshaw]

No, go ahead.

[Caller]

What is the right. So again, I'm 37 next month. My wife is 31. 32 to next month. So what is the right age to write a will today? Really?

[Jade Warshaw]

Yeah, today. Because you've got. Especially because you've got minor kids. And there is a big part of the will that's going to decide what would happen to those kids if, God forbid, something happened to you and your wife. If you don't make a will today, the courts will decide that. And that is that for that reason alone. There's many other reasons, but for that reason alone, I would be. It's a mess sitting with a lawyer today.

[Rachel Cruze]

It's a mess.

[Jade Warshaw]

Mess.

[Rachel Cruze]

Yeah. Jeff, one of the Ramsey Personas that host the show, George Camel, he has my favorite line. He's like, if you hate your family, don't do a will.

[Jade Warshaw]

Because.

[Rachel Cruze]

Because it's so. It. It creates what would be a Horrible situation. Your whole family trying to untangle, you know, your whole life. And. And from the. From the financial sense and try to figure out what. What is happening financially, what's happening with the girls. I mean, it just. It can create something. So much stress. But when it's all laid out in a will, if you go to Mama Bear legal forms, Jeff, you could. You can do a state specific will with them. Your estate might be a little bit more complicated once you guys get into it, because you own multiple properties and different things, so you may actually want to sit down with an estate attorney just to draft one up. But I. Yes, I would do a will today. And. And I just want to applaud you, Jeff. This is such a success story, like what you and your wife have done, because we talk about changing your family tree, and that's in the way you view money, the way you handle money, the role that money plays. And when you're deeply in debt and you're living paycheck to paycheck and life is so stressful with money, that's the environment your kids grow up in. But you guys, Jeff, have made such great decisions. Your girls not only are in an environment that's peaceful when it comes to money, but you're also going to literally live out changing their family tree. Like if you bought your girls a home, that is, and they never had a mortgage, and then they invested that mortgage payment for the rest of their life and then their kids. That's generational wealth working for the good. Do you know what I mean?

[Caller]

Right. I just want to add one comment that, first of all, I wish I would have found the Ramsey. The Ramsey show earlier. Only found it six months ago. But I will say that I grew up in such tremendous poverty that. And I'm the oldest of the family, oldest of eight. I come from a family of eight. I was the oldest of eight living in Trinity. I can't even tell you what kind of poverty I grew up in. So when I became an adult, there was such a drive to really, really, really. And when I discovered the Ramsay show, I'm like, oh, my gosh, there's a match made in heaven. They talk my language.

[Jade Warshaw]

I love that.

[Rachel Cruze]

I love that. You guys are amazing.

[Jade Warshaw]

So proud of you and your kids. They're going to be so much better for it. I can tell you're going to raise them to be able to actually be great stewards of this money and do exactly what you've done, which is continue that legacy for the family. SA.

[Dave Ramsey]

This is Dave Ramsey. We all want to know that the money we give to charity is doing something that matters, that it's making a real change, giving someone lasting hope. And here's one way to make sure of that. Give to preborn. They're the real deal. Proven transparent and changing lives every day. I trust preborn, and you can too. They're on the front lines of the battle for life, partnering with clinics to offer free ultrasounds to mothers in crisis. Because when a mom sees her baby, that screen, something changes. It's not just a decision anymore. It's a person. And 80% of the time, when a mom sees that ultrasound, she chooses life. Your $28 gift provides one of those ultrasounds, just 28 bucks, to be the reason someone chooses life. And at every clinic, the gospel is shared, giving moms the chance to choose life and find real hope in Christ. $28. One ultrasound, one heartbeat, one mom who realizes she's not alone. That's the kind of life changing impact your giving makes through preborn. Go now to Preborn.com Ramsey or call 855-601-2229. That's Preborn.com.

[Jade Warshaw]

All right, let's head back to the phone lines where we have Chris, who's in Montana, Big Sky. What's going on, Chris?

[Caller]

Hey, thanks for taking my call.

[Jade Warshaw]

You bet.

[Caller]

So I make about 4,500amonth gross, conservatively. Monthly bills, including my car, around 3200. And after recent divorce, I live with my parents, paying 400amonth while I kind of stabilize my financial life. In that time, I've lost over 180 pounds, had a major skin removal surgery, and I'm kind of getting back to a point where I'm feeling disciplined and focused. But my biggest concern is my daughters. So both of them have a genetic condition that's called Dicer 1 syndrome. My youngest is clean so far, but my oldest has cysts in her lungs, kidneys, and brain.

Oh, wow.

[Rachel Cruze]

I'm so sorry.

[Caller]

And we're having to monitor that very closely. So I'm trying to find the balance where in the event of a very possible medical issue, I have a comfortable savings buffer beyond that base $1,000 emergency fund and where the balance is between. How much should I have there just in case? Because we regularly go from Missoula to Seattle children's hospitals for the girls, which is about eight hours each way.

[Jade Warshaw]

How often do you foresee going to do they have them removed every once in a while. Is that how it works or what's that gonna look like? For you long term medically.

[Caller]

So right now it's just monitoring and making sure that they don't grow any more than they have. She's got one in her left kidney that has grown at a concerning rate. So they've got medical boards meeting on what's the best decision, because, I mean, you can operate with just one kidney, but if we take one out and the other one's already got an issue.

[Rachel Cruze]

Yeah. How much, Chris, on average, do you think you guys are spending a month on this? Or is it. Or is it. Or is it every, like four to five months something comes up? Or every eight months? What's the calendar?

[Caller]

It's about four times a year that we have to make this trip. And each trip is around probably $6 to $800.

[Rachel Cruze]

Okay.

[Jade Warshaw]

Okay. So it doesn't. You don't hit your deductible. It's just straight out of. Everything comes straight out of pocket.

[Caller]

So they are. So that's all travel expense. And hotels, they're under Montana Medicaid, so.

[Jade Warshaw]

Okay.

[Caller]

They're taken care of by the state.

[Jade Warshaw]

Okay.

[Caller]

So what otherwise would be.

[Rachel Cruze]

Yeah, so what I probably would do because. How much debt do you have.

[Caller]

Including the car total? Sub. 30,000.

[Rachel Cruze]

30,000. Okay. And you're. I'm sorry, you're divorced?

[Caller]

I am, yeah.

[Jade Warshaw]

Okay.

[Rachel Cruze]

Is your wife that. That six to $800, is that split between you guys or is that what you're paying? And then she's paying the same amount too. What does that look like?

[Caller]

I generally fund it. I'm in a better financial position. And then she'll help with a hotel every other night kind of thing.

[Rachel Cruze]

Okay, I gotcha. Okay. So what I would probably do, because, I mean, Jade and I are both moms, and I'm like, I would do anything for my kids. They're number one. Paying off debt's amazing. And we want you to be able to do that. But taking care of our kids and making sure that.

[Jade Warshaw]

Yes.

[Rachel Cruze]

So what I would probably do is have a different account that would be kind of like my. The girls account, if you will. And I would make sure I have $800 in it. And then when you use it for a trip, my. I would pause the debt snowball, refill that, and then go back to the debt snowball. But I would have that 800 continuously in an account, even if that means pausing the debt snowball for a bit. Bit and throwing money at that to replenish that account. But that's the one I would keep consistent. And then if something changes, Chris if you guys get a different diagnosis or you see she's gonna have to have surgery and there's gonna be more expenses, either on the travel side or anything medical. That's when we would pause the baby. That's when we'd pause baby step two and. And build back up a bigger emergency fund. That's probably what I would do just because it seems consistent, but yeah.

[Jade Warshaw]

Tell me about the. The state paying for it. Is there. Is there an income that if you hit a certain income, the state will no longer pay?

[Caller]

Yeah, I'm sure there is. And they go through their mom with that side of things.

[Jade Warshaw]

I was going to say, is that on your side? Okay. So your income can go up as much as you want and it won't affect their care.

[Rachel Cruze]

Yeah.

[Caller]

But they still get consistent medical care with Montana.

[Jade Warshaw]

Okay, good. So on your end, I would then be doing secondary to what Rachel said. I'd be everything I can to blow my income up as far as I can. How long is this deal going to be going with your parents? The $400 a month.

[Caller]

They're very flexible, though. I have it as long as I need it to get up on my feet.

[Jade Warshaw]

Okay. And you're lying, like, what's your thought in your mind on that?

[Caller]

I would really like to be out of there in two, three years at the absolute most.

[Jade Warshaw]

Okay. Okay. And you guys just split custody of the girls, is it. How does that work? Every 50.

[Caller]

50? Yeah. So Sunday to Sunday, I have a week at a time, and then they go back to mom.

[Jade Warshaw]

Okay. So I'd be looking for a side hustle or something that when that week that they're not with you that you can just go crazy on, because I think for you, having that fund for medical and then getting this debt paid off, that is going to relieve so much stress. Like, there's enough stress with the diagnosis of this that getting the financial side in order as quickly as possible. Festival is going to do a lot for your soul, you know?

[Caller]

Yeah, absolutely.

[Jade Warshaw]

Yeah. Yeah, that's what I would do. That's what I would do.

[Rachel Cruze]

Yeah. I'm sorry, Chris. You guys are going through that. It's horrible. So heartbreaking.

[Jade Warshaw]

Very tough. But you've got a plan now, and that can give you a lot. A lot of peace and who you're.

[Rachel Cruze]

Going to be even in the next two years. Chris, what you've done so far from a health perspective is unbelievable. Losing 180 pounds, like, you are amazing. It's amazing. So keep. Keep on the track because you. You're you're creating a whole new life for yourself, Chris. We're proud of you.

[Jade Warshaw]

So good. All right, thanks for the call. We've got Jackson next in Boise, Idaho. Hi, Jackson, thank you for the call.

[Caller]

Hey, good to be on here. Kind of didn't expect to be on here, but this is awesome.

[Jade Warshaw]

Well, we're glad you're here. How can we help today?

[Caller]

Yeah, it's really cool. Yeah, so I. I'm getting out of the military. I'm 100% disabled, permanent in total, and so I get the VA healthcare for free. However, you know, I do want to have a family at some point and I've heard a lot about like HSAs. And my kind of question is, should I kind of open up another account or open up, get other insurance for the sake of an hsa, or should I wait until kind of that, that bridge comes fray?

[Jade Warshaw]

You don't have the family yet. You're not married or with kids yet. Yeah, I mean, just. Are you just saying for the, for the possible ability to invest in the hsa? Is that what you're talking about when you said you've heard of them?

[Caller]

Yeah, I heard a lot of like the tax advantages and stuff. And so I kind of figured it'd be good thing investment wise, but also like the health insurance thing, I mean, kind of.

[Jade Warshaw]

Well, right now you're fully covered by va, right?

[Caller]

Yes.

[Jade Warshaw]

So you don't need the coverage and your family is not here yet for them to need the coverage. And so then when you think about it from an investor investment point of view, it really is on down the line from other ways to invest. I would rather you invest money in a Roth IRA if you could, or something like that before I'd go to an hsa. It's kind of just like once you have it, it's very nice to have, but it's not something you have to seek out and go get for that purpose. So for that reason, I would say you're just fine as you are.

[Rachel Cruze]

Yeah. As is. Yeah, yeah. It is a great option, like Jade said, if you're using it above healthcare for an investment. But that's after you've maxed out out whether it's 401ks, you know, Roth IRAs, I mean, all of it. It's just another investment vehicle. But at this point in life, I think you. Yeah, I probably wouldn't, I probably wouldn't hassle with it because you have great health care with the va.

[Caller]

Okay, well, that, that makes sense. Pay answers the question. I appreciate you guys helping awesome.

[Jade Warshaw]

Thank you so much for the call. It's a good question. Yeah, HSAs, you know, know, they're, they're really great. Like you said, they've got that triple tax advantage. And a lot of people, if, you know, you don't need to access the money for health. Yeah. Go ahead and invest it. Usually you can invest it. There's usually a minimum of like a thousand dollars that kind of has to stay liquid. And then you can invest the rest and over time it'll just convert into a normal like ira. You don't even have to use it.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

For medical expenses, which is. It is, it is nice to have that. But, but if an HSA is not the right. A high deductible plan is not right for you, I would not get the plan simply to have access to an hsa.

[Rachel Cruze]

That's right. Absolutely. Because saving and your emergency fund and stuff can cover some medical things that are out of pocket, where the HSA may step in and do that if you are using it for medical purposes. So there's ways around it for sure. It's great if you have it. It's just kind of another tool to invest in. But definitely not necessary. And probably wouldn't move mountains for it.

[Jade Warshaw]

No, I definitely wouldn't move mountains for it. Thank you so much for the call. This is the Ramsey Show.

[Caller]

Dave, we got a lot of calls on this show where life happens. One day someone's healthy, they're working, providing.

[Dave Ramsey]

For their family, and then a curveball hit. You know, we hear it all the time. A car accident, a cancer diagnosis, a heart attack, and suddenly everything changes.

[Caller]

Yeah. And that's why you've always said that.

[Dave Ramsey]

Having term life insurance from Zander is.

[Caller]

Essential because it protects your family if the worst happens.

[Dave Ramsey]

Yeah, that's right. You need 10 to 12 times your income in coverage. No gimmicks, no whole life junk, just straightforward term life protection. But there's another piece that people often overlook, and that's long term disability insurance. Yeah.

[Caller]

It's important to understand the difference between them. Life insurance steps in when you die. Disability insurance steps in while you're alive, but can't work.

[Rachel Cruze]

So it replaces a large part of your income so the bills still get.

[Jade Warshaw]

Paid while you get back on your feet.

[Dave Ramsey]

Now, if your employer gives you free disability insurance, great, take it. If it's discounted there at a better price, take it. But if not, Zander can help you find the right plan, whether you're single or married. It's not optional. If you're going to Be out of work for a while, then you need to make sure the money's still showing up.

[Caller]

And that's why Zander is our go to. They make it super simple to get the right coverage at the best price. No pressure, no upselling.

[Dave Ramsey]

I've trusted Jeff Zander and Zander insurance for over 25 years, and so is my family.

[Caller]

Don't wait. It's fast, it's easy, and it could make all the difference. Go to zander.com or call 800-356-4428 to.

[Dave Ramsey]

Protect yourself, protect your income, protect your family.

[Jade Warshaw]

The truth is, we wish that we could get to every call and every question here on the Ramsey show, so. But we can't. I mean, there's a limited amount of time. We have segments and we go to commercial break. So if it ever seems like we cut you off, it's because we got to make that clock. But if you do have a question and you want an answer for your situation, you can always head over to our website and use Ask Ramsey. Ask Ramsey is our free AI tool that's built and trained on proven Ramsey principles. And you'll get an answer that really is the Ramsey way, so you don't have to worry about it. You know, if you go to, I don't know, like, OpenAI, you could get a lot of things mixed in there. But if you go to Ask Ramsey, it will be Ramsey advice the way we would give it on the show. So ask your question [e-mail] or just click the link in the description if you're listening on podcast or YouTube. Love that. All right, next is Katie in Columbus, Ohio. Hi, Katie. How can we help today?

[Caller]

Hi, my name is Katie. Yeah, I just wanted to see. I recently got a $2.6 million settlement, and I just wanted to figure out what I should kind of do with the money.

[Rachel Cruze]

Oh, wow.

[Caller]

I have a mortgage, and I'm trying to figure out whether or not I should pay that off or not.

[Rachel Cruze]

Yeah. What was it from the settlement?

[Caller]

It's a lawsuit.

[Jade Warshaw]

Is it like. But you're okay? There's nothing. Is there anything we should know about you going forward, or you're all good?

[Caller]

I'm all good.

[Jade Warshaw]

Okay.

[Rachel Cruze]

So no ongoing medical issues or anything out of it?

[Caller]

No, not yet.

[Rachel Cruze]

Okay. Okay. How much is your mortgage?

[Caller]

My mortgage is 190,000. That's how much we have on the principal, and I'm at 2.75%.

[Rachel Cruze]

Okay.

[Jade Warshaw]

Is. Is it just you, or do you have a family?

[Caller]

I have a husband. I don't have any children.

[Jade Warshaw]

Okay.

[Caller]

And my husband is a student right now and he's working on becoming an air traffic controller.

[Jade Warshaw]

Oh, how old are you guys?

[Caller]

I am currently 30 and my husband is 31.

[Rachel Cruze]

Okay. And do you guys have any other consumer debt?

[Caller]

Let me see. We have 105 from student loans for me. I'm a nurse.

[Rachel Cruze]

Okay.

[Caller]

And then my husband, he's gonna be about 150 total.

[Rachel Cruze]

Okay, great. And then. But no car payments, credit cards, anything?

[Jade Warshaw]

Anything.

[Caller]

Cars is 25k for me. And then my husband is. He only has 6k left on his.

[Rachel Cruze]

Okay. Credit cards.

[Caller]

No credit cards.

[Rachel Cruze]

Okay.

[Jade Warshaw]

So my biggest question would be, before we get to the 2.6 million, let's pretend that 2.6 million, whatever happened, caused that to come your way. Never happened. Were you already on the track to say, you know what? What? This debt is kind of crushing us. We need to, we need to do something about it. Had you already kind of been looking at that or kind of tell us how you arrived at calling. Calling the show? Was it just the 2.6 million?

[Caller]

Yeah. So, I mean, basically it's the 2.6. But in all reality, my husband, once he graduates from school, our plan was to immediately start attacking that as much as we possibly could.

[Jade Warshaw]

Okay.

[Caller]

I have been working 60 hours a week currently and I make about 120k annually right now.

[Rachel Cruze]

Okay. Okay.

[Jade Warshaw]

So as long. I just wanted to. Before we started saying you need to take this money and pay off the debt, I wanted to make sure, like, philosophically, we aligned on the idea that debt is.

[Rachel Cruze]

No moving forward if it gets paid off, that we're not going back into the habit of taking out debt for stuff we want.

[Caller]

Oh, absolutely not. No.

[Rachel Cruze]

Perfect. Perfect. Yeah. Because sometimes you can come in with a lawsuit like this or inheritance tents and just in one sweeping motion, be completely debt free. Even your mortgage, which is amazing. That's where we're going to guide you to. But it comes back. But if that behavior. Yes. Hasn't been changed or the belief system hasn't been changed, you'll be right back into debt. You know, and how quickly, I mean, 2.6 million is amazing, but yes. We just want to make sure that you can. Yeah. Sustain a lifestyle that still makes sense.

[Jade Warshaw]

So.

[Rachel Cruze]

Yeah. So, yeah, Katie, I mean, what I would do is, yeah, it looks like you guys will have close to $200,000 in debts, not including the mortgage. If you include the mortgage, that's around 400,000 after all the student loans and everything. So I would pay everything off that would leave you 2.2 million. And yeah, there's really three things that you can do with money and I would do all three at some capacity. You can give it it, you can save it and you can spend it. So I would look to see, you know, what are things that you and your husband really care about. I don't know if you are someone of, you know, that practices a certain faith or if there's things in the community that you guys, I mean as a nurse, I'm sure you see a lot like, so I don't, I don't know what that looks like for you, but yeah, any level.

[Caller]

Yeah, we go to church every Sunday.

[Rachel Cruze]

Okay. Yeah. So any level of generosity is going to be, I think an important part of this picture. Just because the practice of that I think is just, it's an amazing thing and it changes who you guys are. So I would be giving, I do.

[Caller]

Have a question about that actually.

[Rachel Cruze]

Yeah.

[Caller]

And it's just because like, and I don't mean to break you off, but basically like with the other financial advisors we talked to like three different. But we're still trying to figure out who to kind of go with.

[Rachel Cruze]

Yep.

[Caller]

But everyone has, seems to have a different opinion on gifting money to family because they don't want it to turn into a transactional relationship and they don't want it to change the relationship dynamic. What is your opinion on that? Because my husband and I are both, you know, we both want a gift but we want to make it so that it's not like a reoccurring thing or an expectation with family, you know?

[Rachel Cruze]

Yes, that's, I think it's great advice because you can easily. Yes. Get into that where it becomes a habit that Katie is suddenly so rich and we can just go to her when we need things. So is there something that you guys have pinpointed with your families? Like maybe paying your parents house off or like is there a thing that you're thinking about or you just. Okay, what is that? What are you guys thinking about?

[Caller]

So my in laws, my parents are unfortunately not around, but my in laws, we were thinking about gifting them with a car. Their car is on its last, it's last leg and they, they need a new one and they're so I was thinking about that and then also getting, you know, giving my, giving my brother some, some money too. He's got some health issues going on as well.

[Rachel Cruze]

Yes. So yeah, I, I, I would be okay with that. With some like very communicated boundaries around it. I think just the idea of it just happening, I probably be a little bit more intentional with it.

[Caller]

Okay.

[Rachel Cruze]

So I probably would sit down with his parents and just say, hey, you know, we've been put in a position that we're able to do some giving and we would love to help replace your car. And here is. I. I almost would. This maybe sound too controlling. I almost would go ahead and just buy it and 100. I was gonna say, instead of giving them cash and a very like modest car.

[Jade Warshaw]

Yes.

[Rachel Cruze]

But you know, but a good car, right? Like go spend some money on it.

[Jade Warshaw]

Do your family members know about the 2.6 million? Do they know this happened and that you got a large sum of money?

[Caller]

Not at all. And I don't plan on sharing her.

[Jade Warshaw]

I think that's great. That's what I was gonna say.

[Rachel Cruze]

So I think you guys can kind of of like sneakily come in and help them in that way. And then your brother, if he has outstanding medical bills and you guys want to pay some or all or whatever you decide. Then again, if you can not just give cash, pay the bill, pay the bill, pay for the pay and get the actual car, you know, that kind of thing I think is helpful and. But I think that's the way to. I. Yeah, that doesn't like freak me out.

[Jade Warshaw]

I think it doesn't freak. I think, you know, the person like, you know, the type of character that someone has where they maybe have the propensity to take advantage. They have the ability to, you know, you give them an inch and they take a mile. And if, you know, these aren't that sort of. This is not that sort of person, then I would do that in two seconds. Yep. And I think it's a great blessing.

[Rachel Cruze]

Yep.

[Jade Warshaw]

Really good.

[Rachel Cruze]

Yeah. And.

[Caller]

And then you very much.

[Rachel Cruze]

Yes. And then investing some to Katie and spend some, you know, if you guys need some upgrades on some things or you want to take a great trip. Yeah. Leave some room for that because you don't need to be working 60 hours a week anymore. You know, I wouldn't change your work. I would still be contributing and still be going to work. I think that's just good in general for a person.

[Jade Warshaw]

Yeah. You don't want it to take away your sense of purpose.

[Rachel Cruze]

Yes, that's right.

[Jade Warshaw]

You know.

[Rachel Cruze]

Yep.

[Jade Warshaw]

So I could see spending a reasonable amount, like you said, on things that increase your day to day quality of life.

[Rachel Cruze]

It's Spotify premium. If you haven't already, get some of the enjoyment of life. I think that's great. Set up some of your lifestyle a little bit. Yeah. And just be really intentional, be aware and then. And then again be sitting down with an investment professional that you guys feel good about and invest a good bit of this money because this will take you guys on all the way. Yes. Into retirement and completely change your life. So I hope that helps. Katie.

[Jade Warshaw]

Our question of the day is brought to you by Yrefi defaulted private student loans. Don't go away by ignoring them, but you can face them with a plan. Plan why? Refi helps you refinance into low fixed rate payments built around what you can afford so they so that you can take control and get back on the baby steps. So go to y refi.com Ramsey that's the letter y r e f y.com Ramsey may not be available in all states.

[Rachel Cruze]

Today's question comes from Daniel in California. He said I'm 28 years old and have a hundred thousand dollars in student loans, car loans, credit cards and a 401k like loan. My girlfriend and I have lived together for three years and recently got engaged. Would it be better for us to elope and then save for a formal wedding once my debt is paid off or should I pay off my debt while she saves for the wedding? She has no debt. I am currently working both full time and part time to knock out what I owe. Oh man. This always hurts my heart. I was on the show with Ken because Ken is like like not anti wedding but he's like just don't worry, it's fine. It's one day. It's one day. I love a great wedding. Like so it always hurts my heart when I'm like just go elope. But I would Daniel, after three years I go go tie the knot and then you guys can save up and and pay for a great wedding. So I would go down to the courthouse, make it what it is and. And then you guys save up for a fun party and I think so. So I would go get married but again it kind of hurts my heart a little bit. Cause I love a good wedding.

[Jade Warshaw]

I do too. She's gonna be the one that feels this.

[Rachel Cruze]

Yes. Probably, you know, but got 100. That's gonna take a while even if you're working a part time job. And you know what I mean? I'm like that's gonna be another two and a half years possibly depending on what he makes. So I wouldn't wait that long to get married. I would go ahead and get married.

[Jade Warshaw]

Married. I wouldn't. Unless her idea. Okay, I could talk about this a little bit more.

[Rachel Cruze]

Okay, go.

[Jade Warshaw]

If her idea of a formal wedding can be done for a lot less than what I'm thinking in my head. Like, you guys. Yeah. What are you thinking?

[Rachel Cruze]

10, 15?

[Jade Warshaw]

Yeah, I was. Yeah, I was thinking 15, 20. But if you can. If you can cash flow it both of you. And maybe it's like she, you know, with her job, can contribute half and you contribute half. I might. I might could be okay for that.

[Rachel Cruze]

And you could do it in like six months or something.

[Jade Warshaw]

Yeah. Just because I just feel like she's gonna be like, wait a second.

[Rachel Cruze]

I know she's gotta be bought in.

[Jade Warshaw]

So you're telling me that I can't have my wedding because of your debt? I agree. Like sitting in this chair, I know it's right. But if Sam Warshaw came to me back in the day and was like, first off, I have $100,000 in debt. And for that reason, we're just gonna. Oh, we're envelope. It's like.

[Rachel Cruze]

Take off the ring. She'd say, nope.

[Jade Warshaw]

I don't know if I would.

[Rachel Cruze]

That's a good point though. If you can cash. But I wouldn't wait. I wouldn't wait longer than. Than five to six months, though. I would do it quick.

[Jade Warshaw]

Agree. I would do this quick because you can't have a really nice party. It doesn't have to be in secret, I guess is what I'm saying.

[Rachel Cruze]

Right, right.

[Jade Warshaw]

You can have a really nice party and then save up and do another really nice party later on.

[Rachel Cruze]

Yes. So if you can save for it quick again, four to five months.

[Jade Warshaw]

Yeah.

[Rachel Cruze]

Then you can. Yeah. Do the wedding. But if you guys are just like, it's not a big deal to either one of you. You. Then I would. Yeah. Then I would elope. And then you guys can. Yep. Put your incomes together, pay off that debt faster, and then. Oh, man, that's hard.

[Jade Warshaw]

It is hard. But. Yeah, you heard. You heard our ideas. Yes.

[Rachel Cruze]

We gave you two options.

[Jade Warshaw]

That's good. All right, we've got Richard, who's in Bowling Green, Kentucky, on the line right up the road. What's going on, Richard?

[Caller]

Oh, doing good. Thanks for taking my call.

[Jade Warshaw]

Yeah, you bet. How can we help today?

[Caller]

Okay. I found you guys about a year and a half ago. And just a year ago, I was. I'm lucky enough, our guests are thankful enough. I found me a really good job. I make 140 a year. And we. We kind of made a boo boo. We bought my 16 year old at the time a car, and she's like, I'm gonna work, I'm gonna pay for it, blah, blah, blah, blah. Well, she, after about six months, decided she wasn't gonna work. Now the car is. And mine and the wife's name, because she was 16 and can't take the loan.

[Jade Warshaw]

Sure. How much?

[Caller]

And, well, at the time, it was 23, and now it's down to 14. We have paid it down to 14,000.

[Jade Warshaw]

Okay.

[Caller]

My question is, should I sell it or should I keep it and just finish paying it off? Because I'm in my debt snowball right now, and it's like the bill I'm working on right now, it's three more. That's above that. And then, then I'll be putting all towards that car.

[Jade Warshaw]

How much are you and your wife's vehicles worth, what you spend on those?

[Caller]

Well, I spent. I spent 20 on mine, and it's paid off. And I spent like 28 on hers and it's paid off.

[Rachel Cruze]

Okay. And how old is your daughter now?

[Caller]

Well, she just turned 18 two months ago.

[Rachel Cruze]

Okay.

[Jade Warshaw]

I mean, you're, you're in the parameter, like for your income, 140. We'd say no more than half of your annual income in vehicles. So you're, you're right there. 20, 28 and 23, you're right at the cusp, a little bit over. But since the others are paid off, I'm not going to be too much of a tyrant about it. You could keep it and pay it down. She's 18 now.

[Caller]

Yeah, she just turned 18.

[Rachel Cruze]

And have you guys talked to her about taking over the loan?

[Caller]

Tried to, but it's like talking to a brick wall.

[Jade Warshaw]

Oh, I'm not liking what I'm hearing about this. I have a hard sound.

[Rachel Cruze]

Very ungrateful.

[Caller]

Yeah, right.

Yeah, it's. Yeah, she. She's got this attitude that she's entitled to it, and I'm like, oh, then.

[Jade Warshaw]

Sell it in two seconds.

[Rachel Cruze]

Right, well. And you put your daughter in debt, Richard. I don't like that either. So out of the principal. Yeah. If you guys were baby step seven, you had tons of money. I would say, if you wanted just to pay for it and then say, there, it's yours. Whatever. I don't like the idea of you setting her up with debt. So I think you sit her down and start say, sweetie, I'm so sorry we messed up.

[Caller]

We.

[Rachel Cruze]

You said we had a boo boo. Right. You said the beginning of the call.

[Jade Warshaw]

Right.

[Rachel Cruze]

Not only is the deal that we had made disintegrated, which I don't blame her entire. She's 16. Like the frontal part of her like brain isn't even formed yet. So you're putting a lot of responsibility on a 16 year old which was not very smart.

[Jade Warshaw]

How much is the car now?

[Caller]

It's right at 450amonth.

[Jade Warshaw]

That's a lot.

[Rachel Cruze]

How much could you sell it for? If you sold it, what would you get for it?

[Caller]

Oh, I don't have no idea to be honest with you. I mean 100%, I wouldn't know. Like I said it's.

[Rachel Cruze]

Yeah. So I would look it up. Yeah. I mean in a perfect world it's not upside down. In a perfect world you'd get 18 and you could buy her a four thousand dollar car and just call it like a. Hey, we did this. But yeah, but I would say the two things. Number one, the deal that we made was a bad deal for you and the deal we made now goes against the value system on which I think that you should live financially. And because of that in good faith, I can't keep you held to a loan because I don't think that that's the right way to live with your money. And so it's in our name and we're gonna sell it. But she is 18 so I don't even wanna give her the choice to take it on.

[Jade Warshaw]

No, I would not transfer this over. It's. Rachel makes a very good point. On the one hand, you guys were in the wrong for bestowing this life of debt in front of her.

[Caller]

We can see that now. I'm going to see that now.

[Jade Warshaw]

And then she also, it sounds like, I don't know, just deriving from what you've said. She's kind of hard headed and as is not really doing what you guys are hoping for in this moment. So I would not want to reward that behavior. I like what Rachel said about kind of going and saying hey, you know what? We said this, that was our mistake, our best. However, you also haven't shown that you really want a vehicle. And because of how you're acting, it's very hard for us to even fund one the correct way, which is in cash for you at this stage. So I would kind of play both sides of that field.

[Rachel Cruze]

She's gonna be mad, mad, mad Richard big. So listen, that's the thing about when you set up a boundary, you put up the boundary and then regardless of what that person, how they react, what they say, that's on them at that point. But we, you probably know from, from data points that it's, it's not going to be great. But I really do believe in the.

[Jade Warshaw]

Long run for her, it's going to be better.

[Rachel Cruze]

It's going to be better.

[Jade Warshaw]

It's going to be better. And she is going to remember the lesson. If you. To me, there's something so big when a parent apologizes and it's like, I made a mistake and here's what I did. I never should have done that. That sticks with a kid for a very, very long time. So she's going to remember the fact that, that my parents went into debt and they looked at it and realized it was the wrong thing. And I almost, I almost would be willing to take back my former thing about not getting her a car. Cause what I wouldn't want to happen is that that lesson getting lost in the part where she no longer has a car.

[Caller]

Do you know what I mean?

[Jade Warshaw]

Yeah, yeah, yeah. So there's part of me that I'm like, maybe I would give her the $5,000 car. Yeah, I probably would. Yep. And then she remembers the bigger.

[Rachel Cruze]

And if she's real pissed, she can go get a car loan on her own and make her own decisions at that point.

[Jade Warshaw]

Yeah. Yeah, that's true. That's a good one. Thank you for the call.

[Rachel Cruze]

Sorry, Richard. I hope it goes well. We'll be praying for you. All right.

[Jade Warshaw]

Welcome back to the Ramsey Show. We're here in the Fair Ones credit union studio taking calls about your life and money. I'm still with Rachel Cruz. I'm still Jane Warshaw.

[Rachel Cruze]

We're doing it.

[Jade Warshaw]

We're still, still doing it. All right, going back to Dominic, who's in Springfield, Massachusetts, I'm guessing on the line. What's up, Dominic?

[Caller]

Hello, Jada, how are you?

[Jade Warshaw]

I'm good. How can we help? Did I get it right? It's Ma. Massachusetts.

[Caller]

Yeah.

[Jade Warshaw]

Okay.

[Caller]

Yeah. So I gotta, I just have a quick question for you guys. Not too long. So I have a lot of money investing, so like I'm a rookie when it comes to investing. I just started. I hired an investor back in September and I'm watching my investments go along the way and it doesn't look like my investments are doing as great as I wish I could. And the other thing is too, like, I think I want to like cash out my investments and because like a couple years down the road I'm trying to buy a house and move out of my parents house and I just don't know if I'm. Should I cash out the investments or just kind of hope for the best.

[Jade Warshaw]

And are they retirement? Is it like ira, Roth IRA type stuff? What's the vehicle?

[Caller]

Well, no, so a lot of my. So yeah, no, I do have a 401k but I wouldn't use it that for the house. It would. So I have a lot of my money in the s and P500.

[Jade Warshaw]

Okay.

[Caller]

I have $97,000 in what's called River Bridge. And then I have another $135,000 in like another little fund that they have. It's, it's like, it's, it's called a structured note.

[Jade Warshaw]

Okay. And they're just tax is just a taxable brokerage account.

[Caller]

Yeah. One of them is like kind of like a brokerage account and then the other one is I guess like a. I'm not really so sure how to put it. The River Bridge is what. It's a Nvidia and then Google it's an investment in.

[Jade Warshaw]

Okay. So they're single stocks.

[Caller]

So it's like. Yeah, yeah. So it's like not just, it's not a single stock. It's like a lot of them. Yeah.

[Rachel Cruze]

How many together? How many single stocks are in that fund?

[Caller]

I think it's about like, like 10. I'm not entirely so sure to be honest.

[Rachel Cruze]

Okay. Okay.

[Jade Warshaw]

So part of me, what I don't like about what I'm hearing is you're not sure about what you're invested in, which is always a red flag for me because you should understand it enough to be able to explain it back in a way that is clear. So part of me, and I think you understand facets of it obviously, but there's obviously facets that maybe you're not sure of. So, so that's thing number one that I'm thinking about. Thing number two I'm thinking about is the fact that you said ultimately you're trying to buy a house and I'm wondering what your timeline is for that because that, that does play into whether or not I would keep this or what I would do with this money going forward. So what's your timeline for the house?

[Caller]

Like within like the next like couple years. I'm really interested in moving out of my parents house and I was thinking whether I should rent or buy and I am looking more towards the buying because I feel like I can afford it. I do have a good chunk of change, but.

[Rachel Cruze]

Yeah.

[Caller]

Yeah.

[Rachel Cruze]

How much are you making a year?

[Caller]

I'm my full time position. I make like 75k a year.

[Rachel Cruze]

How did you save up all this money? I mean it's like almost 235,000.

[Caller]

Yeah, no, I'm, I'm a really frugal person. I don't really spend my money. And before too I started working full time. I had a like back in high school I was working little part time job. You know, I was pretty much always saved money, never really spent.

[Rachel Cruze]

Good for you.

[Jade Warshaw]

Well if you're thinking about there's two parts to this. So first off I based off of what you've said, the way this money is invested, it's not invested the way we would tell you to do it here, the Ramsey way. It sounds like your, your 135 is probably mostly in bonds or something like that with the structured note that you have and then the other is in index funds which is fine, fine. We would teach you if you are going to invest your money to do it in mutual funds against across four different types. And it doesn't sound like you have it invested that way. So I would think about rolling that money into the proper investments versus cashing it out per se. Now if you were ready to buy a house immediately I would say you could go ahead and pull it out. But if you really are thinking hey this is two to three years down the line, what I'd be doing is I'd be meeting with a smartvestor pro and saying hey, hey, I have this money invested the way the reason that your return is not very great is it sounds like you have a lot of bonds with that 135 invested. That's why it's probably going very slowly. And I would say I don't like the way this money's invested. I don't believe it's invested the money the Ramsey way and that it's getting me the best rate of return. And then I would have them roll it over into better funds. And then yeah, I just let it sit and grow for the next however many years until you're ready. And just understand that when money is invested for five years or, or less, you may or may not. You know what I mean? That five year point is kind of when we see like there is a locked in. You've, your money has grown, there's a higher rate that it will have grown by five years versus if it's less than five years, there's more fluctuation within that. So just know that.

[Rachel Cruze]

And even like the Riverbridge account, like I, I would almost feel more okay with that if you said there were 50 individual stocks in there. But the 10 feels real, really limited.

[Caller]

A lot of risk to be honest.

With you, River Bridge, I think it is a lot more. Okay, so I hired, so I don't do this by myself. I hired a professional. He's really good. I, I like him a lot and he, he answers all my questions when I ask him and.

[Jade Warshaw]

But your returns aren't, your returns aren't what you said they should be. That's a red flag for me.

[Caller]

Yeah, I, Yeah. I don't know if it's really necessarily his fault. Just I guess it's just the stock market. Just what I'm.

[Jade Warshaw]

Well, it depends on what you're invested in. That's the whole point. So if you're invested the way we say, like your bonds are going to move slower than anything else, that's kind of like what you transfer to when you're almost ready to retire. So you could, you could stand to be more aggressive in your approach. That's just me high level looking at it. Based on what you said, looking at.

[Rachel Cruze]

Some funds that are, you know, aggressive growth type mutual funds, you probably would see more return. But also, you know, it is the long game. So I wouldn't. But I would make sure that. Yeah. From a investment strategy perspective, like what you're saying, Jade, there's a right way to play that long game.

[Jade Warshaw]

I agree. I mean, don't get me wrong, if you love this guy and you think that you just need to spend more time with him to understand, great. I'm not going to tell you to divert.

[Caller]

But yeah, it might even be that just not really giving it a fair chance because like I used to just do like CDs which is like guaranteed. But then once you go to the stock market, you're like, whoa, you know what I mean? Totally.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

That's a good job.

[Caller]

That's not really.

[Rachel Cruze]

Yeah, yeah, well. And I think, you know, over the next two to three years, Dominic, I would use majority of this to put as much down on a house as possible and then have that and then, and then re. Re. Energize the, the investment machine, if you will. So I think you're. Yeah, I mean I would look into it, but two to three years isn't going to make or break you because you're probably going to use this for the house. But I would just from a knowledge perspective, like what Jade said saying is sit down and really get a good grasp on what all this is and check out our investment, you know, philosophy on the four types of mutual funds and again, we're even. Okay with an index fund that's just over you know, the broad scope. If you just want to put your money in that too. But, but the diversification piece is really, is really big. So that's what I would ask him about that, that other fund. But I'd get out of, I'd get out of the bond market personally.

[Jade Warshaw]

Yeah, I would too. It sounds like I was just kind of looking at it a little bit and it just sounds like it's way more predictable. There's an income facet of it. There's a lot of protection against the downside of the market. So it sounds like this is just very, very conservative for you.

[Rachel Cruze]

And at your age, you probably don't need it.

[Jade Warshaw]

You don't need to be. Yeah, you got time, buddy. So get out there, test the waters.

[Rachel Cruze]

Well done, Dominic, though. Keep the, keep the, the, yeah. The habits in place though. The fact that you've saved that much is so impressive. We just want it to go as far as possible for you.

[Jade Warshaw]

Yes, absolutely. Thank you so much for the call.

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[Jade Warshaw]

All right, we've got Susan on, on the line. She's in Seattle, Washington. Hi, Susan, thanks for joining us. How can we help today?

[Caller]

Hey, thanks for taking my call. So I'm kind of at a loss. The man I married, we've known each other four and a half years and we got married four months before he passed away.

[Rachel Cruze]

Oh, my gosh, Susan.

[Caller]

Anyway, I've always had a soft landing.

In my life and there's always been somebody who's the first time. And again, it's a little bit of a soft landing. He left a little life insurance. I've sold a lot of assets that I have and it's helped. I am self employed, but I found myself and I went through a grief support group thing and one of the things they talked about was grief spending. I'm like, oh, that's not me. Sure enough, enough. It was about four weeks ago I realized, oh my gosh, I'm. I'm a grief spender. I mean, I was just going over my numbers. He passed in August and since September, over my budget, I have spent $33,800. Now, some of that was on tires to the car and, you know, oil change and stuff, but the majority of that has just been on memberships, house cleaners, gardener, handyman and dog stuff. And just stuff I don't need or didn't need to buy. And every time, and I just empathize with myself. When I would click that little buy button on Amazon, it was, oh my gosh.

[Jade Warshaw]

Are you using the insurance money for this or is this something you're going into debt to?

[Caller]

No, unfortunately, no, I'm not going into debt. So I currently right now in savings, I'm down to 20,000. In three months ago, there was 57,000 in there. Okay. Some of that I've been using to live on. I need two grand a month to live on in my house. My business requires two grand and it's standing on its own. So I'm not worried about that. But I do need my business to kick it up a notch so that it can support my business and me. But that's going to take time because when he got sick, I did back off. Clientele, et cetera.

[Jade Warshaw]

The 2000amonth you live on, what's that cover? Do you live someplace where there's no mortgage or telephone us more about.

[Caller]

It's a rent and that's utilities. Rent is 1450 and it's gas, lights, trash, water and Internet.

[Rachel Cruze]

Okay. And that's going to be gone in 10 months?

[Caller]

Well, yeah, if I keep going in the way I'm going. Yeah, yeah. I am getting more inheritance next week. There, there's another Herringtons truck coming.

[Jade Warshaw]

How much?

[Caller]

That'll boost that 20 up to 50,000. So it'll be 30,000. And then there is another probably 25,000 in assets that I need to sell.

[Jade Warshaw]

Okay.

[Caller]

That I haven't gotten to yet. I'm working on it.

[Rachel Cruze]

It's just.

[Caller]

There's just an awful lot to navigate.

[Rachel Cruze]

Yeah.

[Caller]

And then, and then there's another pension of his that I haven't applied for yet, and that's about 18,000. So when all said and done, if I spend no more out of the savings in about a month. There should be 95,000 in that account.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

So are you, do you feel like the, the counseling is helping with the grief spending now that you've kind of pinpointed it? Because sometimes part of the problem is like realizing, oh gosh, that's me. Then you identified and you can kind of start to work through it.

[Caller]

Yeah, I finished the grief counseling back in December and I didn't realize my problem until about three weeks ago.

[Jade Warshaw]

Okay.

[Caller]

Now back in September, a friend was booking a cruise. I said, sure, I'll book that cruise with you for February. So two weeks ago I went on a one week CRU. It was 500 bucks. I say it was only 500 bucks. Yeah, that's not bad for a nice, you know, balcony stateroom. But I didn't calculate the $100 parking fee and the $400 I had to board my dogs.

[Jade Warshaw]

Yeah.

[Caller]

Plus I spent another probably five or six hundred dollars on luggage and clothes. None of that was in my purview back in September when I booked.

[Rachel Cruze]

Sure, sure.

[Jade Warshaw]

Yeah, there's an expense plan for it.

[Rachel Cruze]

They don't. Yeah, they sneak up, up. Susan, go ahead. Well, I was going to say first I give yourself some grace because I do think when you're in a season, especially of grief, our bodies, we're looking for a way to cope.

[Jade Warshaw]

Right.

[Rachel Cruze]

And if we're not aware about or not intentional about it, it can go, we can start medicating sideways. Right. Whether it's drinking, gambling, shopping, whatever we're doing to have a level of stability we search out for. So I don't want to fault you for that because I think that's a common.

[Jade Warshaw]

It's a very normal.

[Rachel Cruze]

Yes. So now I think the fact that you've realized it now we can put some things in place to help with it to actually create some friction between you and buying things. So I would do, you know, from a low level, I would delete Amazon Prime. I would not have my card saved on any website to make it an easy purchase. I would take off Apple, pay off of your phone, like put some actual logistical friction between you and, and spending any money. Okay. That's like one thing you can do. Another thing that when you're coming off of, and I wouldn't say that you're necessarily are addicted to spending, but a lot of people, especially in 12 step, they say to redirect where you would normally go and spend or normally go and get a drink instead do something helpful. Right. When you feel the need to spend, go for a walk when you feel the need to spend. Have that friend that you call and you tell her, I'm going to call you every time I'm tempted. Right. It's this redirection of your actions that actually can be very helpful because you almost train your, train yourself to have a new set of habits. So yeah, that, that those are a couple of just things I would probably, I would start today. And then of course the budget and kind of the working with still, you know, yourself, I think is still big.

[Jade Warshaw]

Yeah. I think in this call I would tend to err on the side that what Rachel said is probably the, the bigger and the biggest part of this because until, until you can get that piece in alignment, anything else that we teach you is not going to hold. Right. Because you need to have that self control that's built in. But once you do have that. Yeah. There's the practical side of making sure you are in a budget like every dollar. And we'll make sure that you get that before we hang up this call.

[Caller]

But I have it and I have created the budget it to pay my bills.

[Rachel Cruze]

Good, good.

[Jade Warshaw]

And then.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

The discipline of learning how to be really detailed when new things pop up is something that is a muscle. I think that builds over time to just think through every aspect of what you might spend money on. But my biggest question besides these lump sums of money that's coming is what's your month to month? How are you, how much money do you earn coming in month to month?

[Caller]

Right now I'm earning in my business about two grand. Just enough to cover the expenses of my business business. So I've been living off of whatever he. Right as whatever he has.

[Jade Warshaw]

So it's not whatever. It's not actually profit. It's having to be right. Reinvested right back into the business to keep it going. So I, I would say that I'm concerned about that and that would be along with what Rachel said, creating the friction. My, my number two piece of homework for you would be figuring out what earning an income looks like for you. How long have you had this process business?

[Caller]

Five years. And it was doing really well.

[Jade Warshaw]

What caused it to decline?

[Caller]

My husband's sickness and me stopping. Stepping back.

[Jade Warshaw]

Okay. Okay.

[Rachel Cruze]

Do you have a timeline, Susan? A realistic timeline? And when you think it's going to start actually creating a profit, is it going to be like another year? Is it going to be three months?

[Caller]

It's, it's actually starting to build back up again.

[Rachel Cruze]

What kind of business?

[Caller]

I'm A transformational trauma coach.

[Jade Warshaw]

Okay.

[Caller]

And I'm pretty elite in the area I live.

[Rachel Cruze]

Okay.

[Caller]

So I'm pretty well known and it is lucrative.

[Rachel Cruze]

I mean, so it's good in the clientele bag.

[Caller]

But like 24 and I had my husband's income as well in 2024. We were doing close to a hundred thousand that year and we live in a small town. So.

[Rachel Cruze]

How much were you making out of that?

[Caller]

About 52.

[Rachel Cruze]

Okay. So if you could get back clientel wise to that 52, that would, you could sustain on that.

[Jade Warshaw]

And I, I like that for you. In the meantime, honestly, I'd pick up a side hustle because when you have too much time to sit at home. I know when I'm at home, Rachel, and my eyes just look at the walls, I go, oh, it'd be nice to get something new for that wall. Oh, I need a new bed spread. Oh, like when I'm not doing enough with my time, I tend to spend more money. And I think a lot of us are like that. Cuz you're bored and you're looking for release, you add grief on top of that. And I think it's just a recipe for overspending, which is what you've seen.

[Rachel Cruze]

And you need an income right now too.

[Jade Warshaw]

So it's going to kill two birds with one stone to get out there, get a side hustle until this business is producing and do what Rachel said, put some friction in place.

[Dave Ramsey]

It's that time again, folks. Tax season is here. I know some of you would rather bury your head in the sand until April 15th than face your taxes. But here's a better idea. If your tax situation is complicated, get in touch with a Ramsey trusted tax pro today. That way they can take the stress off your shoulders once those tax forms come in and teach you how to keep your tax bill as low as possible. But don't wait. Ramsey trusted pros can book up fast. Go to ramseysolutions.com taxpro to find one who serves your area with excellence. That's ramseysolutions.com/taxpro.

[Jade Warshaw]

One of our favorite things is when people share their stories of how they're winning. And we just got this amazing review of our Every Dollar app. She says, I love this app. It makes it super easy. Easy to budget. With my husband, we have implemented this practice since our wedding day and we've had zero money fights because there is full transparency and we're on the same page. Love that. That's amazing. Hey, you can do it too. You can take control of your money and you can change your family tree. You can live like no one else. Go download our Every dollar budget app for free in the App Store or Google Play. Alrighty then. Stephen is in Hartford, Connecticut. Hey Stephen, how can we help help today?

[Caller]

Hi, I'm do, I was doing the baby steps and I'm finally at that pay off the mortgage step. Yeah, I thought you guys last year through a guy at work, I've been messing up and I've been putting money towards my escrow. Is there a really good way to attack the mortgage? Because I love to be paid off in about five years. Yeah, sooner.

[Jade Warshaw]

I mean the best way is to pay extra payments. So you pay your normal payment that's due, that satisfies the interest and then then after that's free and clear, then you can go back and put extra payments and put them directly onto the principal. And that truly is the best way to do it over time.

[Caller]

Okay, so when you do the, when you say pay on the principal for the mortgage payment, are you talking about like the lump sum I pay every month or is it actually like a certain mortgage payment?

[Jade Warshaw]

So your mortgage payment, the payment that you pay every month, it's probably comprised of a couple elements. Elements. There is the actual loan balance, what you owe for the home and then you probably have some insurance that's built in there, some taxes that are built in there. Right. Hoa hoa. Sometimes that's built in. So your payment is going to all those different places when you pay your monthly payment, interest, all of that. So after you've paid that monthly payment, you've satisfied the interest, you've satisfied the taxes, anything else that's built built in. Now any extra money that you apply, it's going to go directly to the loan balance which we would call the principal. So it's going to go straight to that. And that way it's like a pure, it's pure money go. So if you pay 500, it's going to lower your balance by 5, you know it's going to lower it by that much because it's already, it's on top of your normal payment. And a lot of times that's what.

[Caller]

I thought I was doing, but it was actually just sitting in my escrow and then I got a check for the remainder.

[Jade Warshaw]

So what I would do is you can either call it in and tell them, I know on mine you could go in and you can actually decipher if it's going to be a normal payment or if it's going to Be a principal only payment. It actually has the option. If yours doesn't have that, then I would call in and do it that way. And if you're doing it, you kind of have to make sure for the month, you've already satisfied the payment for the month, or else it'll go towards your monthly. It'll go towards your normal monthly monthly payment. Does that make sense?

[Caller]

No, I have no problem with that. I usually pay a little early, and then what I have at the end of the month is what I try to put on extra.

[Jade Warshaw]

Yeah.

[Caller]

So after everything was done, like, all my bills are set and paid, it's. I throw whatever I have left over just right in there. I kind of have, like a free account type of thing.

[Jade Warshaw]

Yeah.

[Caller]

After everything goes through the budget, is there a good strategy on how to pay it? Like, try to do, like, two, three extra mortgage payments and try to kick it down? Or is it just throw anything and any extra that you have at it.

[Jade Warshaw]

As much as you can within, you know, what. What makes reason reasonable sense for you. So we always teach that, you know, when you do the first three baby steps, you're very intense. Everything is as fast as possible. You sacrifice everything, you know, in order to do this quickly. But then when you move into baby steps 4, 5, and 6, you're moving into a season of intentionality, which is, I don't have to be like, you know, balls to the wall, but I do want to be thoughtful about, am I intentionally putting extra towards this? And that really is up to you. If you're in a season that you want to go really fast, that's fine. Or you. You know what I find, Rachel, is that there are seasons where you're very, you know, gung ho about it, and then there's seasons where you're like, you know what? I'm going to renovate that bathroom. And so maybe you pull back a little bit, but you're still putting something extra. And so it kind of es and flows. But the point is that you're always doing something and that you have a plan for what that looks like. It's not just kind of a haphazard thing, but it is an intentional day behavior.

[Rachel Cruze]

And I'm sure you've run numbers, Stephen. Right. I mean, people do, like, Excel forms or a mortgage calculator, and you can watch that as that principal goes down.

[Caller]

Just learned about that from Dave.

[Rachel Cruze]

Okay, good. Yes.

[Caller]

Like I said, I'm new to this.

[Rachel Cruze]

Yeah.

[Caller]

My mortgage calculator thingy. So I'm hoping to be like, I Said I just refinanced for a 15 year.

[Rachel Cruze]

Oh, good for you.

[Caller]

Yeah, I was, I had horrible credit and everything like that when I first did this, so my interest rate was high.

[Jade Warshaw]

Okay.

[Caller]

So good with doing everything. I was so scared because paying off everything, obviously my credit score dropped, so they had to do the underwriting thing you guys talked about, but they did it.

[Rachel Cruze]

That's awesome.

[Caller]

Yeah.

[Rachel Cruze]

Well, 15 year.

[Caller]

And I just really want to pay it off.

[Jade Warshaw]

Yes.

[Rachel Cruze]

Well, for a lot of people, when you start to see those numbers and what's crazy is even I don't remember the math, but we did this at a live event recently. It was like four extra mortgage payments a year.

[Jade Warshaw]

Year.

[Rachel Cruze]

And how quickly that takes off what, what it does on the principal and how much, I mean, how much interest you save. Tens of thousands, if not even hundreds of thousands of dollars of interest. Like it is, it is wild what even just a little bit will do.

[Jade Warshaw]

Do you know what I mean?

[Rachel Cruze]

That's what's so encouraging about it is when you start plugging in your numbers, you're like, oh my gosh. Like this goes a really long way. And a lot of people that are doing the baby steps, they pay their houses off in seven to 10 years. So yeah, you may be faster than that, Stephen, or you may be right around that. But I think when you at least have the mindset that you want to pay off your house, it happens faster than just settling and saying, I'll have a mortgage for 30 years or 15 years.

[Jade Warshaw]

Yeah. So if you do what Rachel said, on a 30 year mortgage, just doing four extra principal payments, you could reduce it by 17 to 20 years.

[Rachel Cruze]

Yes.

[Jade Warshaw]

Just by doing four extra principal payments.

[Rachel Cruze]

Does it say 15?

[Jade Warshaw]

Uhhuh. On a 15 year, it could shrink it to around 10 to 11 years. Years. Okay, so that is major.

[Rachel Cruze]

Let's just years.

[Jade Warshaw]

Yeah.

[Rachel Cruze]

Just a few extra mortgage payments. So if you did that six times a year. Right. Like it starts to just shrink so quickly. That's what's wild about it.

[Jade Warshaw]

Yeah, it's really, really crazy. Yeah. If you, you know, spent the average right now, which is around 400,000 on a mortgage, the normal terms. Yeah. On a 30 year, you would save potentially $200,000 in interest simply by doing that.

[Rachel Cruze]

Yeah, yeah.

[Jade Warshaw]

So if you've not, not ever played around with these numbers, you can get yourself like, you can go down a rabbit hole of just like, oh, like.

[Rachel Cruze]

Really realizing and that's money back in your pocket. Hundreds of thousand dollars. That's not going to interest. That's You. It's for you.

[Jade Warshaw]

Yes.

[Rachel Cruze]

You save that. It's amazing.

[Jade Warshaw]

And can we just say that for a minute? Sometimes when you're playing, when you're talking about numbers like this and they feel like they're out in the future, it can feel like it doesn't matter, but it does. These are real dollars that you are paying. Real dollars. $200,000 from your money. And so just really take some time and think about that. It can feel almost like it's not us.

[Rachel Cruze]

Real.

[Jade Warshaw]

Yes, but it is. It is real money. All right. Very, very good. Let's go to Holly in Sacramento, California. Holly, you're up. How can we help today?

[Caller]

Hi there. Thanks for taking my call. I have a two part question. The first one, I'm a single teacher mom. I make 114,000 a year. I life insurance through work at 300,000. And I'm just wondering if I need extra term life insurance on top of that.

[Rachel Cruze]

Yes, I would we say 10 to 12 times your annual income. So I would put more like a million. Have a million dollar policy.

[Jade Warshaw]

Yeah.

[Caller]

Okay.

[Rachel Cruze]

Yes. And hopefully you can get it. Hopefully, you know, and you can supplement it if you want to keep the work one. I'd be okay with that. If you got a 700,000 term life. And it shouldn't be. Be too expensive if you're, you know, healthy and all the things, so. Yeah, but that's what I would. I would have that to supplement.

[Jade Warshaw]

Yeah. And you can get that through Xander. You can hop on and they'll get you set up. It's really easy now. I mean, they'll even come to your house and everything like that.

[Rachel Cruze]

Yeah, it's great.

[Caller]

Okay. And my other question is, I recently paid off my car and one other large debt.

[Rachel Cruze]

Oh, congratulations.

[Caller]

Thank you. I'm working on paying off my HELOC loan and it's at 20,000. Right. Right now I'm paying $1,000 a month. And I'm just curious, so, you know, what should my next steps be in order to continue to support my child? I have more than a thousand in my emergency fund. I'm nervous about putting it down to a thousand.

[Rachel Cruze]

Yeah. How much is in your emergency fund?

[Caller]

I have 6,000 right now.

[Rachel Cruze]

Okay. And you're paying an extra thousand.

[Jade Warshaw]

So.

[Rachel Cruze]

So on track, you know, year and a half or so, you'll have that HELOC paid off.

[Caller]

Yeah.

[Rachel Cruze]

Yes. Yeah. I mean, I would say if there's. I mean, that's a great. I mean, to be a single mom working.

[Jade Warshaw]

Yeah. There's a different level of stress there.

[Rachel Cruze]

Yeah, you're doing. I think you're doing great, Holly. If there's anything extra that you can put towards it at any capacity, obviously the faster the better. But you're killing a girl. I mean, yeah, I think you're doing.

[Caller]

Doing great.

[Jade Warshaw]

Yeah. I think you're going to feel the motivation on your own to find ways to get more and more income going towards that and it's going to be knocked out before you know it.

[Dave Ramsey]

Hey, guys, Dave Ramsey here. Every day on this show, we help people work through real money problems and figure out what to do next. Now, you can get that same kind of help anytime with Ask Ramsey. Ask your money question question and get answers built on Ramsey principles we use on the show. Whether you're making a decision or just want something explained, ask Ramsey is here to help. It's fast, simple and free to use. Go to ramseysolutions.com and try Ask Ramsey today. That's ramseysolutions.com.

[Jade Warshaw]

All right. Our Ramsey show. Scripture and quote of the day, Proverbs 3, verses 5 through 6. Trust in the Lord with all your heart and lean not to your own understanding. In all your ways, acknowledge him and he shall direct your paths. Dolly Parton said, if you don't like the road you're walking, start paving another one.

[Rachel Cruze]

Oh, pretty good.

[Jade Warshaw]

Pretty good.

[Rachel Cruze]

Classic.

[Jade Warshaw]

Man, I feel like I'm walking on air. After James gave us that really nice encouragement. James, I don't know how to act. And then we got Dolly Parton and Proverbs.

[Rachel Cruze]

Just we're going to end the show.

[Jade Warshaw]

Well, I know I wanted him to come on. He didn't. All right. Curtis is in Richmond, Virginia. What's up, Curtis?

[Caller]

Hi. How are you ladies doing this afternoon?

[Jade Warshaw]

Excellent. How can we help?

[Caller]

Well, let me start by 2025 was a really bad year for me.

[Jade Warshaw]

I'm sorry.

[Caller]

In May, I lost my wife. December, I lost my dad. I had been his caregiver for a few years when I.

[Rachel Cruze]

When I need.

[Caller]

To become his caregiver. I left my job because I was getting a stipend to take help take care of him. Plus, my wife had a very good job and it was her idea for me to bring him into the house, help take care of him, do what needed to be done because that's what I felt like I was led to do.

[Rachel Cruze]

Sure.

[Caller]

Fast forward to now. The savings that I had between my wife's passing and now my dad's has been eaten up by going back and forth to the hospital.

[Jade Warshaw]

Yeah.

[Caller]

The funeral expenses, trying to Catch up on bills, and I found myself to be about $13,000 in debt, and that's after paying down almost 70,000.

[Dave Ramsey]

Wow.

[Jade Warshaw]

And.

[Caller]

Okay, I have no job now, and I'm trying to find one, but I have found it very difficult.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

What's your field like? What's your expertise, Curtis?

[Caller]

Well, I was military to begin with, and prior to that I was in sales.

[Jade Warshaw]

Okay.

[Rachel Cruze]

And how long were you out of the workforce taking care of your dad? How many years?

[Caller]

Eight years.

[Rachel Cruze]

Oh, okay. Wow.

[Jade Warshaw]

Okay. Yeah, that.

[Rachel Cruze]

And how old are you?

[Caller]

49.

[Rachel Cruze]

49. Okay.

[Jade Warshaw]

Okay. So there's no. Just to get a better picture, there's no savings anywhere to speak of. Do you have anything that was put away while you were in the military? Anything like that?

[Caller]

No, I've blown through all of it.

[Rachel Cruze]

Okay.

[Caller]

See, dad. Dad ended up with dementia with Alzheimer's.

[Rachel Cruze]

Okay.

[Jade Warshaw]

I'm sorry. Sorry.

[Caller]

And Trish? It was unexpected. She passed with massive heart attack.

[Rachel Cruze]

Oh, my gosh, Curtis. Oh, I'm so sorry.

[Jade Warshaw]

It's really tough.

[Rachel Cruze]

Yeah.

[Caller]

I'm trying to stay positive. I'm trying to put it in God's hands because that's what need to do.

[Rachel Cruze]

It's also grieving the life that you thought you were going to have for the next 30 years. You know, I mean, it's. Life looks completely different. And as Dr. John DeLoney always says, it's almost like you close not even a chapter of a book, but a whole book, and you almost have to open up a whole new one and start rewriting your story. And, you know, the hard thing is, you know, you're 40, and so it's hard because you.

[Jade Warshaw]

You.

[Rachel Cruze]

You have a long life ahead of you. And it's also a positive thing because I think you can make some incredible changes and start. You know, it's a new life that you have to look at. Right. It's not even rebuilding the life that you had. It is. It's. It's looking ahead and saying, there's going to be a new Curtis, and what do I have to do now for myself to not only sustain, but what's good for me? And finding some positive small wins in the midst of this grief is not only gonna help you financially, Curtis, but I also think in who you are and kind of going back to. Yeah. Finding a new purpose and how to contribute to the world. And that's a hard thing to do. I do know at the end of the call, though, we will give you Ken Coleman's book, Find the Work youk're Wired to Do. Because there's still a whole second chapter, Curtis, of your life to be written, you know?

[Jade Warshaw]

Yeah, I agree. This is kind of like a renaissance, like a rebirth for you. And in many ways, that can be scary and daunting, but in other ways, it can be really interesting and can be exciting after enough time passes. And you can see it as an opportunity to start something fresh and new. And I actually think that that might end up being the case career wise. So I'd be sitting some time, spending some time thinking about if I could do anything. And I know when Ken coaches people, he kind of starts with that, if I could do anything, what would it be? And then kind of just run that down. And that would kind of be. If I were in your shoes, I think that that would be a journal prompt for me every day, is if I could do anything I wanted to do today with my career, with my talents, what would it be? And I would just spend time thinking about that. Because I think sometimes in life we don't give ourselves. There's always something. Something going on, and we do what we have to do, we do what we need to do. But very rarely do we always do the things that we want to do. So I think that that would be a really good exercise for you, and I think it's just going to take time.

[Rachel Cruze]

Yeah, absolutely. Yeah. But anything that you can do today to start bringing in an income, and it, of course, won't be your dream job, but I think getting up, having a routine, having a schedule, having something that you're doing, doing, I think does start to, you know, re. Energize you. And there's a level of dignity that's there and getting a paycheck and actually start seeing progress in some part of life. And this would be the more financial side part, but. But it can be powerful when you start actually getting up and doing something. Cause it could be so easy just to. Not because you've been through so much.

[Jade Warshaw]

And don't hesitate to call us. Call us back if you feel like you're getting that traction. And then you're saying, okay, I. I'm making this money now what do I do with it? The good news is 13,000 in debt. You know, once you start having any income come in, you're going to realize, oh, I can knock that out.

[Rachel Cruze]

That's right. That's right.

[Jade Warshaw]

Fairly, fairly quickly. And I have no, no doubt that you're going to do that. I just think the fog needs to clear a little bit more for you to get your bearings in this. Thank you for the call. All right, let's go straight to Nicole in Louisville, Kentucky. Nicole, we're right up against Kentucky the Clock. How can we help today?

[Caller]

Thank you so much for taking my call. I am in my early 40s and my husband is in his early 50s. We've both grown up and lived our entire lives in the same location, and we're really interested in starting a new adventure.

[Jade Warshaw]

Wow.

[Caller]

We have found a place that we want to move to, but we want to rent there first before we sell our current home. We are debt free except for that mortgage. We do have some older kids who are currently renting, and since we have family nearby who could also support them, we want to know if renting our house to them would be wise.

[Rachel Cruze]

Probably not. Because you guys will probably sell it in a year. Right. If you're wanting to keep it just for a short term till you find a house that you guys want to buy in the new location. Right.

[Caller]

Is the new location is as much of a fit as we hope it is? Yes.

[Jade Warshaw]

Okay.

[Rachel Cruze]

But if it's not, you'll come back home and want to live in the house that you're in, is what you're saying?

[Caller]

Yes.

[Rachel Cruze]

Okay.

[Caller]

It's hard to give up the interest rate that we have until we know we have to.

[Jade Warshaw]

Oh, okay. Interesting. What type. I mean, what would you do for work? Do Are your jobs, you know, our.

[Caller]

Jobs are remote, so we can.

[Rachel Cruze]

Yes.

[Caller]

We can do the exact same things we're doing now there.

[Rachel Cruze]

Okay. Would you guys be able to support the rents of the new place? And then for some reason, if something goes haywire with family, are you. I mean, does that put you in a financial bind?

[Caller]

I don't think so. We've tried to use the 25% of our income to say, like, what could we afford in rent, plus covering the mortgage if we had to. But of course, you know, anybody helping.

Cover the mortgage while we're gone would help.

[Rachel Cruze]

I normally am not a fan of that. But if, since. Since it's still a question mark of if you're going to stay in the new location location, I would be okay with you keeping it and doing a one year. Very clearly communicated. A one year rent agreement. Two people, you know.

[Jade Warshaw]

Yes.

[Rachel Cruze]

Which means that I can go haywire. That's why I want a lot of margin with you financially because I don't want this to ruin any kind of relationship and it get weird. But. But yep. If you have that one year and then you guys, if you want to stay in the new location, that house. You need to sell it, Nicole. I don't care what the interest rate is. You need to sell it and move your life to the new. Or if the new location didn't work out, then you move back home. But I would just do it for one calendar year, and that's it.

[Jade Warshaw]

Yeah, I like that idea. And it's good that you have the kids, because they seem like they'd be just the right person to rent the house. Thank you for the call. All right, guys. Thanks for hanging out with us. Remember, there's ultimately only one way to financial peace, and that's to walk daily with the Prince of peace, Christ Jesus Sa.