Make Money Choices Today That You Won’t Regret Tomorrow

Summary

Summary of "Make Money Choices Today That You Won’t Regret Tomorrow" - The Ramsey Show (February 6, 2025)

In this insightful episode of The Ramsey Show titled "Make Money Choices Today That You Won’t Regret Tomorrow," host Ken Coleman and financial expert Jade Warshaw engage with listeners facing a range of financial dilemmas. From job searching post-divorce to managing significant financial windfalls, estate planning, parenting financial disagreements, skepticism towards multi-level marketing, and car ownership for young families, the episode offers practical advice grounded in the Ramsey philosophy of financial discipline and strategic planning.

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1. Job Searching and Networking Strategies

Caller: Christie from Atlanta, Georgia

Issue:
Christie, recently divorced and struggling to secure full-time employment despite a master's degree and a strong resume, discusses her challenges with Ken and Jade. With her house, car, and a rental property paid off, she is uncertain about managing her cash reserves given the unpredictability of her future income.

Advice Provided:
Ken emphasizes the importance of networking over traditional online applications:

“You are essentially playing the job lottery when you go through what is now heavy AI format...” [02:04]

“The way to get hired is through relationships.” [05:44]

Jade supports this by advising Christie to maintain her financial stability while actively seeking job opportunities through personal connections:

“I would probably sit it in a high yield savings account and continue to save for it.” [07:10]

Notable Quote:
Ken Coleman underscores the value of personal connections in job hunting:

“Now, if you don't know anybody at Company XYZ, you got to ask, do I know somebody who knows somebody?” [05:44]

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2. Navigating a Large Windfall and Real Estate Decisions

Caller: Kevin from Charlotte, North Carolina

Issue:
Kevin and his wife anticipate receiving around $1 million after taxes due to his wife's career advancement. They are torn between buying a new, more expensive home in a desirable neighborhood and retaining their current rental property.

Advice Provided:
Jade advises prioritizing debt repayment and avoiding overextending financially:

“I would not do that. I would not go into debt to pick up another rental property.” [08:03]

Ken echoes the need for financial prudence, suggesting selling the existing rental to fund the new purchase without additional debt:

“…use the money to pay off existing debts and invest wisely in the new home.” [16:23]

Notable Quote:
Ken Coleman cautions against over-leverage in real estate investments:

“That is a whopping $12,000 a year. You're burning cash.” [16:42]

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3. Managing Financial Disagreements in Parenting

Caller: Erin from Augusta, Georgia

Issue:
Erin and her husband have conflicting views on spending for their 11-year-old daughter. Erin advocates for investing in educational activities like summer camps, while her husband prefers minimal spending, relying solely on child support.

Advice Provided:
Jade and Ken recommend open communication and aligning budget priorities:

“We need to ask why he’s tight with money and address underlying issues.” [26:23]

“It’s not just about you or me. It’s about us.” [49:00]

They also suggest seeking professional help, such as a marriage therapist, to navigate these disagreements effectively.

Notable Quote:
Jade Warshaw highlights the importance of setting logical budget boundaries:

“The spirit that we make our boundaries out of is our budget and what's a logical use of money for a child.” [23:48]

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4. Skepticism Towards Multi-Level Marketing Opportunities

Caller: Olivia from Mississippi

Issue:
Olivia was approached by a friend to join a multi-level marketing (MLM) scheme involving energy drinks, marketed as a legitimate side hustle to eliminate debt. She seeks advice on the viability and risks of such opportunities.

Advice Provided:
Both Ken and Jade express strong skepticism towards MLMs, emphasizing their reliance on recruitment over actual product sales:

“I would just steer clear of it altogether.” [32:14]

“All of those models are based on recruiting people.” [34:35]

Notable Quote:
Jade Warshaw shares her personal experience to illustrate the pitfalls of MLMs:

“When he showed up at lunch, he was selling energy drinks. I couldn't sell one.” [33:24]

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5. Estate Planning for Future Generations

Caller: Ray from Dallas, Texas

Issue:
Ray, in his late 70s, has amassed an estate of over $30 million and seeks advice on structuring his inheritance to benefit his daughter and grandchildren without overwhelming them financially.

Advice Provided:
Jade and Ken discuss the balance between generosity and fostering financial independence. They suggest incorporating conditions to ensure responsible management:

“Is this like the house that you had your children in? [...] It might not be a crutch in life.” [70:10]

“Consider structuring gifts with specific conditions.” [72:04]

Notable Quote:
Ken Coleman reflects on the potential impact of large, unrestricted gifts:

“How would it change their perspective if they knew they were going to be making a quarter million dollars every year whether they do anything at all.” [70:10]

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6. Car Ownership for Young Families

Caller: Owen from Nashville

Issue:
Owen and his wife, expecting a child, are debating whether to repair an existing car or purchase a new mid-size SUV within a $25,000-$26,000 budget without straining their savings.

Advice Provided:
Jade recommends setting a strict budget and prioritizing essential features over brand or mileage:

“Set your budget first because I want that to be the driving factor.” [82:07]

Ken emphasizes the importance of budgeting and making informed decisions based on financial capacity:

“Creating and sticking to that budget is essential.” [80:11]

Notable Quote:
Ken Coleman shares a personal example to reassure listeners about finding reliable vehicles within a budget:

“My son bought a Ford Explorer for $13,000 with 98,000 miles and it's in phenomenal shape.” [81:14]

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7. Payoff Strategies and Emergency Funds

Caller: Mo from San Antonio, Texas

Issue:
Mo is navigating between baby steps in financial planning, dealing with a $50,000 HELOC loan, and preparing for a new child. Balancing debt repayment with building an adequate emergency fund is a primary concern.

Advice Provided:
Jade advises adhering to the baby steps framework, focusing on debt repayment while preparing for upcoming expenses:

“Once the baby arrives and emergency expenses stabilize, resume accelerated baby step progression.” [75:11]

Ken reinforces the importance of not skipping financial foundations:

“Skipping saving steps puts you back where you started.” [77:32]

Notable Quote:
Jade Warshaw outlines the approach for Mo's situation:

“Stack up as much money as you can, knowing that there's a baby coming.” [75:21]

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8. Avoiding Unnecessary Debt and Building Savings

Throughout the episode, Ken and Jade consistently emphasize the importance of budgeting, prioritizing debt repayment, building emergency funds, and making strategic financial decisions to ensure long-term stability and avoid future regrets.

Notable Quotes:

• Ken Coleman highlights the importance of intentional budgeting:

  “Get on a budget. Seriously, how are you supposed to save money if you don't know how much you're spending in the first place?” [51:43]

• Jade Warshaw underscores the necessity of aligning financial decisions with priorities:

  “We don’t just stop because we feel like we’re going to stop it.” [27:54]

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Key Takeaways

1. Networking Over Online Applications: Personal connections significantly enhance job search success compared to solely relying on online submissions.

2. Prudent Financial Planning: Avoid overextending financially, especially when faced with windfalls. Prioritize debt repayment and strategic investments.

3. Clear Communication in Relationships: Financial disagreements, especially in parenting, require open dialogue and professional guidance to align priorities.

4. Skepticism of MLMs: Multi-level marketing schemes often prioritize recruitment over genuine product sales, posing high financial risks.

5. Responsible Estate Planning: Structuring inheritances with conditions can foster financial independence and prevent beneficiaries from becoming reliant on large sums.

6. Budget-Conscious Car Ownership: Setting strict budgets and prioritizing essential features ensures affordable and reliable vehicle purchases without straining finances.

7. Structured Debt Repayment: Following a step-by-step financial plan, especially when anticipating life changes like new children, ensures balanced and sustainable financial health.

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Conclusion

This episode of The Ramsey Show offers a comprehensive exploration of various financial challenges individuals face and provides actionable advice grounded in sound financial principles. Ken Coleman and Jade Warshaw guide callers towards making informed money choices today that set them up for a financially secure tomorrow, embodying the show's core belief that anyone can build wealth and take control of their life regardless of past financial mistakes.

Transcript

[Ken Coleman]

This is the Ramsey show where you come America to get coaching to win in your life, win in your money, win in your profession and win in your relationships. 888-255-2225 is the phone number to jump in alongside the Inc. The fabulous and go on almost Happy birthday gal. Tomorrow she will be the birthday gal. Jade Warshaw, I'm Ken Coleman. Just happy to sit next to her. That's how it goes folks. Just, that's it. I'm easy. She's happy to be easy.

[Jade Warshaw]

Like Sunday morning.

[Ken Coleman]

I enjoy being with you friend. We always have a good time. So Jade will coach you up on what to do with your money. I'm going to coach you up on how to make more money. How about that? Pretty simple. Let's go to the atl, Atlanta, Georgia, Christie's there. Christy, how can we help?

[Caller]

Yes, I got a divorce a few years ago. Not really by choice, but I have cannot seem to find a job. I, before I stayed at home with my kids. I had a great job. I have a master's degree and now that I'm trying to look for a job full time, nobody will really hire me. And I, I'm currently doing like the small business that I was doing when I was married so it's more of a part time income. But I got, my house is paid off, my car is paid off, I have a rental house that's paid off. So I've got that and I've got some cash but I'm not really sure what to do with it because I don't know what my salary is going to be in the future.

[Ken Coleman]

Okay, well let's get, we'll get to the cash. I want Jade to weigh in on that and help you out. But let's just talk about this, this reality that you're facing. You're saying I can't get hired. Are you not getting interviews or are you getting interviews and you're not winning the interview? What's going on?

[Caller]

Well, I started with looking in the healthcare business section that I was in and because it had been over 20 years, I just could not get any kind of interviews. I've had all kinds of people look at my resume and say it's really good. Um, I mean, vice presidents, all types of people I've had look at it. Um, so then I tried to, you know, change it up and do more marketing stuff, which is kind of what I've been doing, I guess part time. Um, and I just can't seem to find anything.

[Ken Coleman]

Well, no, again, here I'm Looking for specifics. When you say you can't get interviews, and that's across the board.

[Caller]

Had a few interviews.

[Ken Coleman]

Okay.

[Caller]

Um, but not very many. Like, I'm just not getting any calls for interviews. So I'm not sure.

[Ken Coleman]

What's your process? What is your. Your process for getting these interviews? What are you doing?

[Caller]

I'm going online and filling out. I have different resumes tailored to different types of jobs, and then I'm sending them in. And I've been looking locally, but also, I can't really move right now. I still have one in high school, so I'm kind of a little bit. I don't live in.

[Ken Coleman]

Okay, so based on. Okay, so based on what you did in the past in the healthcare industry, what did you do, by the way?

[Caller]

Oh, I was in finance.

[Ken Coleman]

Okay. So on the number side. Okay, so based on that, that skill set is still there. You largely. It's not like you forgot how to crunch numbers and be detailed and all the things. And be analytical. All the things that it takes to win. So you've had a few interviews, but based on all of that, that's what people are telling you in the healthcare space, that your. Your resume is up to speed and ready to go?

[Caller]

Yeah, I mean, I. I have had a few people in healthcare, but mostly it's just been other fields. Anyone that I knew look at it, I would let them look at it, but everybody said they thought it was a great interview resume.

[Ken Coleman]

All right, two things. One, I'm gonna. I wanna make sure. Christian, let's get her my Ken Coleman resume templates. They're very, very different, and they're designed to actually call attention to what I teach in my bestselling book, the Proximity Principle. So you've gotten a few interviews, but you have tried to get far more. So your percentage right now is. Based on what I'm hearing, it's pretty low. So how do we increase the percentage of actual interviews? The way we do that is through relationships. It's not going online. And I'm not criticizing you. I'm encouraging you. You are essentially playing the job lottery when you go through what is now heavy AI format, when you go onto a website to give you an idea, there are tens and tens and tens of thousands of people that apply at Ramsey Solutions every year. They're coming through our website. But I'm gonna tell you how you get hired here is how you get hired everywhere else. You make a connection. That's right. And so I'm gonna give you my book, the Proximity Principle. To encourage you, okay? But more importantly than reading the book, what's really important is that you begin to say, okay, as I'm moving forward today, as I'm talking to Ken and Jay today, going forward, when I see a job that I'm interested in, I'm not going to fill out the online resume submission thing. What I'm going to do is, is I'm going to look at that job at Company XYZ and I'm going to go, okay, do I know anybody that works at Company xyz? If the answer is yes, we reach out to them and say, hey, do you know somebody over in this department? Because this is where I'm looking. Okay? And we walk through that and the goal here is, is to get them to personally walk into Jade's office and go, Jade, I know you're hiring for this position.

[Jade Warshaw]

Right.

[Ken Coleman]

I want to, I want to tell you about my friend Christy. I've known Christy for this long. This is her story, her background. I've got a physical copy of her resume in this nice little manila file folder. If anybody uses those anymore or they put the resume in front of Jade and say, jade, I'm not going to bug you. I'm not going to harass you, I'm not going to bend your arm. But I think you should seriously consider my friend Christie. Now, this is not a guarantee that Jade, who's helping me role play in this situation, is going to go done. She's hired. Thank you, Ken. I've been waiting for you to walk in and tell me who I should hire. That's not going to happen. But Christy, you get how that does move you out of the pile. Yes, yes, the digital pile. Okay? Now if you don't know anybody at Company xyz, you got to ask, do I know somebody who knows somebody? And now we're playing this old game of 7 degrees from Kevin Bacon. But I'm telling you, as old fashioned and as simple as that sounds, that is the way to get noticed. And it's going to take some time and you're going to have to keep turning over rocks, turning over rocks, turning over rocks. And eventually you're going to get into the right situation where the door opens for you. Now, I want to transition to Jade here because she's got some money she doesn't know what to do with. And I wanted you to help her out with that while she's in this season of part time pay.

[Jade Warshaw]

All right, well, let's talk about the money because when you what you first said Sounded pretty good. Paid off, house paid off, car paid off, rental. What else is going on?

[Caller]

I mean, I have some extra money. Like when we sold the marital house, I wanted to do something with it. So I bought a rental, have a great tenant, pays on time, like it's going great. The problem is I don't have enough to buy another full house. So I'd have to get of course mortgage and the rates, you know, are not good. And I don't want, if I do that, I don't want it to be too close to what I'd have to pay, you know, with insurance and taxes and such.

[Jade Warshaw]

The other houses for you, I'm just.

[Caller]

For you, another rental. My house is paid off.

[Jade Warshaw]

Why are you in a rush to where you're like, I'd have to get a mortgage and I'd have to. Why do you feel rushed to do that?

[Caller]

Because I won't be getting any help from my ex husband soon. Like I'm, you know, I'm kind of getting near there and I don't make a lot with my job or my.

[Ken Coleman]

So you're, you're thinking this is going.

[Jade Warshaw]

To be good income, like instant income?

[Caller]

Yes, I'm looking for income. Really.

[Jade Warshaw]

Okay, well, it's not going to be too, too much because you're going to have a mortgage on the house. I would not do that. I would not go into debt to pick up another rental property. I think you could probably go make more doing something else with less risk or no risk attached to it, just in the form of a job. If I were you, the money that you have left, I would probably sit it in a high yield savings account and continue to save for it. If the horizon is more than five years, I suppose you could throw it in an index fund and let it grow a little bit faster. But other than that, nothing's on fire here. Yeah, I mean, Ken gave you got to be patient. Can give you what you need to get the job you need.

[Ken Coleman]

And I, and I would by the way, be getting solid hourly work if that's what you got to do to make up the difference here. But hang on the line. Christian, let's get her a copy of the proximity principle. Let me tell you something. The right people will get you in the right place.

[Dave Ramsey]

Statistics show that half of Americans don't have enough life insurance or they don't have any at all. I don't understand this, John. Why don't people want to take care of their family? They think they're not going to die or something?

[Ken Coleman]

Well, I Used to be one of those guys. I didn't even think about it. And one of my buddies said, hey, the only reason to not have life insurance is if you hate your wife and kids. And I immediately went and got term life insurance.

[Dave Ramsey]

That's a gut punch.

[Ken Coleman]

For decades, Dave, I've sat across people who've lost a spouse, they've lost somebody important to them.

[Dave Ramsey]

Me, too.

[Ken Coleman]

They don't know what to do next.

[Dave Ramsey]

You're going to have a crisis here. You know, you got two options. While you're sitting and talking to a young widow, she's concerned about how she's going to invest all this money properly and not mess this up, or she's concerned how she's going to eat tomorrow.

[Ken Coleman]

That's exactly.

[Dave Ramsey]

These are the two options. It's saying I love you to your family. Term life insurance, Jeff Zander and the team at Zander Insurance makes it easy and affordable. I've used them personally for 25 years. They're the only people I trust. Go to Zander.com or call 800-356-4282.

[Ken Coleman]

Welcome back to the Ramsey show alongside Jade Warshaw. I'm Ken Coleman. We're so excited that you're with us. Well, it's that time of year. I can't believe how fast the calendar is coming at me. And before you know it, you're gonna have to pay those taxes. And you need to make sure that you've got a pro who knows how to navigate maybe some of the complexities or just making sure that you are not paying too much. All of those things that are associated with taxes. You just don't want to try to do it yourself unless you really know what you're doing. That's why we want you to think about a tax Pro. Go to ramseysolutions.com taxpro to find CPAs and enrolled agents who have been vetted by our Ramsey team. And I was just emailing back and forth with my local tax pro and I always tell him, I said, I gave you some love today on the show because I sleep better, because I know he's taking care of business.

[Jade Warshaw]

I know that's right.

[Ken Coleman]

You know what I mean? I do not want to get on the wrong side of the irs.

[Jade Warshaw]

I know. That's right. That's right. Take care of that business, Ramsey. I don't want to do it. I hate taxes, Ken.

[Ken Coleman]

So do I. I'm not going to get distracted. Sometimes I hear the word taxes and I go into a rant. We're going to go To Kevin and.

[Jade Warshaw]

Okay.

[Ken Coleman]

Kevin is in Charlotte, North Carolina. Kevin, how can we help today?

[Caller]

Hi, guys. Thanks for taking my call. This fall, my wife and I will be coming into a significant amount of money. It'll be like probably a million after taxes.

[Jade Warshaw]

Wow.

[Ken Coleman]

What's going on?

[Caller]

And, and so I want to be smart about it. My, my wife and I kind of disagree about this. So she, she wants to move. There's an area of our city that she really wants to move into. It's incredibly expensive.

[Ken Coleman]

I know where you're talking about or if you're in Charlotte. I know.

[Caller]

Yeah, yeah. So. So our neighborhood doesn't have very many kids and our oldest has no one his age. So that's, that's a big portion of why. Why we want to move about. We owe about 182 on our.

[Ken Coleman]

Kevin, Kevin, Kevin, Kevin. You're going so fast. We got a couple questions for you.

[Caller]

I'm sorry.

[Ken Coleman]

No, no, you're doing great. How old is your child?

[Caller]

My oldest is 11.

[Ken Coleman]

Okay, so you got 11 year old. And then how are. What is. What is creating this windfall? What's the. What's the 1 million coming from my wife.

[Caller]

She's a rock star. And so she, she's selling or she's. She's moving a book of business to a different institution. That's one of her. That's one of her incentives.

[Ken Coleman]

Okay. Okay. So this is. So this is considered income. This is not an inheritance. That's why I asked that. I was.

[Jade Warshaw]

Yes, that's a big deal. So tell me more about the numbers you want to move. You gave me the reasons why. I don't know how good those reasons are, but I digress. Tell me the numbers so we can see this makes sense.

[Caller]

Okay. So we owe about 182 on our. On our house. We bought it for 100 or we bought it for 265.

[Jade Warshaw]

What's it worth?

[Caller]

It's now. It's now probably worth about 700 on the low end.

[Jade Warshaw]

Okay.

[Caller]

It does need a renovation. We've. We bought it when we had nothing. It was kind of an up and coming neighborhood and it has just exploded. So our mortgage right now is about 1700. I could rent it as is probably for about 2700.

[Jade Warshaw]

I wouldn't do that. Keep rolling.

[Caller]

Okay.

So.

And basically that's. That's kind of what I want. What I want to know is I kind of want to keep the house because I think it would be. It'd be a great rental. I also just love the house. I love the neighborhood.

[Jade Warshaw]

If it was paid off, I wouldn't necessarily disagree with that. If you were also paying for your next house in cash.

[Caller]

Yeah. So, so then that's. So the next house. The houses in this neighborhood go for like 1.5.

Okay.

So, um, so, you know, we could rent it. We could sell it. If. If we rent it, we could. We would need to do some renovations like kitchen, bathroom. Our current house. But. And so.

[Jade Warshaw]

Well, I don't think you can have your.

[Caller]

Should we take the million and put it all towards the other home? Should we take 100 or two and put it towards renovations for this property and 1,500 on the other home?

[Jade Warshaw]

Yeah, I don't think you can have your cake and eat it too, on this. I think that there's a really clear path forward, which would be if the. You've got. You're going to have 1 million, the house you own is worth about 500, a little less once, like, fees and everything are accounted for. And the house you want is 1.5. That's the money right there. So without looking at the other factors, because I have to ask you more questions, but let's just say, hey, I want a house that's 1.5 million. Selling your current house gets you the 1.5 million to pay cash for it. I wouldn't do a situation where I do a little bit on this house, rent it while it still has a mortgage, and then put a little on the next house and have a mortgage there. I feel like there's a way for you to do this really clean and come out on top. The only way. The only other way would be to take the 182 and pay that off and then buy a less expensive second house. And then you could do the. The two things at one time. Does that make sense?

[Caller]

Yeah, from a math perspective, it makes sense.

[Jade Warshaw]

Yeah.

[Ken Coleman]

But let me tell you why I don't think it makes sense. I agree with Jake.

[Jade Warshaw]

Wait a minute. What's the other perspective, other than math? We're talking about money. That's right.

[Caller]

I know, I know.

[Ken Coleman]

Well, his wife, he wants to stay. So Kevin wants to stay where he is.

[Caller]

The wife.

[Ken Coleman]

The wife wants the. The nice upgrade of the neighborhood.

[Jade Warshaw]

That's true. Listen, that's true.

[Ken Coleman]

That's true. I know. So let me, let me throw this out.

[Jade Warshaw]

Okay.

[Ken Coleman]

Okay. As to why I like Jade's idea and I want to give you real numbers, Kevin. Okay, but.

[Jade Warshaw]

But before you do, we have to ask a couple of key questions to even see, does my idea Work, because we don't know. Do you guys have debt? Do you have. Tell us about your debt. Tell us about your income. Tell us more.

[Caller]

Okay, so I do have a car. So we have about 20,000 left on a car. I'm gonna. I'll pay that tomorrow. I'll pay it off tomorrow. Okay, so that's done. After I pay the 20,000 left on my car, our emergency fund will be down to about 27,000. It should be about 115, um, for six months. For six months? Yeah.

[Jade Warshaw]

Dang. Okay.

[Caller]

Yeah.

[Ken Coleman]

They're crushing it.

[Jade Warshaw]

Love it. What's the income?

[Caller]

Our. Our income is currently about 350.

[Jade Warshaw]

Let's go. Okay, good.

[Ken Coleman]

So here's the deal, all right? I've heard everything I need to hear, Jade.

[Jade Warshaw]

Yeah, me too.

[Ken Coleman]

Kevin, you don't need to be a landlord. And I just don't think it makes any sense. Here's why. Okay? You only are talking about right now. If you use. You owe 1700amonth. You're paying for it on mortgage. You said it was about 2700 that you would get in rent. That's a thousand bucks a month. That is a.

[Caller]

On the low end. On the low end.

[Ken Coleman]

Kevin, don't fight me on this one. Don't fight me on this one. That's a whopping $12,000 a year. Let's up it a little bit. You're going to make $15,000 a year gross on renting this house. Yes or no? Gross.

[Caller]

Sure.

[Ken Coleman]

All right. Yeah. Now I know you're talking about putting money in it to renovate it, just to rent it. It's just burning cash. I would sell it. Pay off the debt that you have left and take, like Jade said, take the rest of it and put it to the down payment with the million dollars and buy a sweet house in a sweet neighborhood, cash. Because you're not making much money even if you pay it off. Jade gave you a second scenario. You pay off the 182. Now you're in it. You're still only clearing about 25 to 30 grand a year. And I'm being generous because that's gross. That's not including reno costs.

[Caller]

Maintenance.

[Ken Coleman]

Maintenance. Dude, it is not all it's cracked up to be.

[Jade Warshaw]

Okay? We talked earlier about money and the math part of it, and you are right. There is more to money than math. It might not weigh as heavily, but is this like the house that you had your children in? Is this. The house like this clearly has some sentimental value. It feels like it's more about that than the real estate there is certain.

[Caller]

There's certainly sentimental value. I mean, if I'm paying seventeen hundred dollars, right. If I'm paying seventeen dollars a month for, for this house, you know, and just also looking at trends of, you know, kids moving back in with their parents and everything, like, I could, I could, I could probably in, in 10 or 15 years, I could probably, you know, afford for my son to live here temporarily, you know, to get his life set up whenever he graduates from college or my, or my other two kids, you know, and it could just be sort of the house that we have that lets the kids roll through. I also think it's a great investment like this, this area that we're in now is just exploding and has become very popular. And so I feel like if we were to sell right now, we'd be leaving money on the table because then, then wait, just going up in value. So, so, so much.

[Jade Warshaw]

Why then tell me this. I. Now I'm sensing something else. It's like, we've got this million dollars. It's going to be burning a hole in our pocket. We've got to do something with it. What would, what would it look like to just say, hey, let's, let's sit on this for a minute? Because in any other scenario, whenever somebody comes into a large amount of money like that, we tell them to wait, like chill out for a minute. Get used to the.

[Ken Coleman]

I'll tell you what it is. And his wife wants it. That's the challenge.

[Jade Warshaw]

And I know, I think you're moving too fast.

[Caller]

She, she, she wants to move into this. I mean, our, our life is in this other neighborhood. All of our friends are in the other neighborhood. All our kids.

[Jade Warshaw]

Friends are in. But you don't feel right about it. If you don't feel right about it, don't do it.

[Ken Coleman]

He doesn't feel right. This is a therapy session. I mean it. Yeah, they're both, they are both on different ends of the spectrum. And boy, oh boy, I've been married long enough to know how that turns out. This is the Ramsey show.

[Dave Ramsey]

Listen, people, what you call organized chaos is still chaos this year. Build some room in your budget to get your life really organized. One tool that I recommend is a knockbox. As in next of kin. Knockbox is a complete system that helps you organize important documents, accounts, IDs, tax returns, insurance policies, estate plans, and other personal history in one secure place. The 15 categories in your knockbox cover everything from health history and investments to your ancestry and even collectibles. So Cut the clutter with a knockbox. Start getting organized today and receive an exclusive [e-mail] Ramsey that's n o k box.com Ramsey.

[Ken Coleman]

The Ramsey show continues. I'm Ken Coleman. Jade Warshaw with you as well. 88882. Let's go to Erin in Augusta, Georgia. Erin, how can we help?

[Caller]

Yes, so my husband and I have been married for about four, five years this year. And my daughter is 11. And we have a difference of opinion on what we should spend on her. We get along great, we communicate great. But when it comes to this, we cannot agree. And I would just like some unbiased opinion. It's everything from she needs something from school to school, summer camps. I feel like she should be able to go to summer camp and not sit in front of a tablet all summer when he thinks those are a little ridiculous because they are so expensive and that we should not really spend anything extra outside of what our child support is to spend anything on her. What do you mean?

[Ken Coleman]

Hold on, hold on a second. What do you mean child support?

[Caller]

So I get child support from her dad every month, obviously.

[Ken Coleman]

Okay, gotcha.

[Caller]

But that's the only money that I should use. For how much school relate? 300amonth.

[Ken Coleman]

And so your husband is going outside of medical and groceries and just keeping this child alive. Anything outside of the basics has to come out of the 300amonth from your ex.

[Caller]

Yes, sir.

[Jade Warshaw]

Interesting. How. What's your combined incomes?

[Caller]

150,000.

[Jade Warshaw]

Okay.

[Ken Coleman]

How often does this happen? Yeah, like is this a weekly or monthly or is this just in some of the bigger things like you described, like summer camp?

[Caller]

No, it's everything.

[Jade Warshaw]

Why do you need to scrutinizing it so much?

[Caller]

Because she, she, she is a brat. She's 11. She has a little bit of an attitude.

[Jade Warshaw]

They don't get along. Do they get along?

[Caller]

No, not at all.

[Jade Warshaw]

Got you.

[Caller]

And her biological dad buys her everything she asks for every single time.

[Jade Warshaw]

Okay, so she's over there?

[Caller]

Yes.

[Jade Warshaw]

Is she spoiled or does she just get what she needs?

[Caller]

No, she's spoiled when it comes to her dad.

[Jade Warshaw]

Okay. So. Okay, there's a lot going on here. I kind of wish Dr. John was here. There's a lot going on here because on the one hand it's like as a parent, I don't say to my son, you're acting, you're acting a type of way right now. And so because of that, I'm not gonna, I, I'm not gonna make sure you have the things you need for school. Or I'm not gonna put you in summer camp. Like, that's not my. That feels retaliatory. And so I don't feel like that's. That's the spirit that we should be making our boundaries out of that. The spirit that we make our boundaries out of is our budget and what's a logical use of money for a child. Right. That's the spirit that we use to do that.

[Caller]

Right.

[Ken Coleman]

I'm curious, how old was she when you guys got married?

[Caller]

Six.

[Ken Coleman]

Was he this way from day one?

[Caller]

Yes.

[Ken Coleman]

Okay. That's what I'm digging very much.

[Caller]

I don't want to spend money on anything, so.

[Ken Coleman]

Okay. And so what I was. Here's. Let me tell you why I asked that question. I'm trying to figure out if this is because she's a brat and he resents her because she's also not his biological daughter. These are all reasonable things that a human being could be struggling with. And I say that, by the way, Aaron, not from judgment, but sense of understanding. Yeah, but the fact that you said he was this way day one tells me this is more his scarcity mindset about money. Rachel Cruz wrote a book, know Yourself, Know youw Money, a few years ago, and it was a genius book, in my opinion. And I think he's got. From his childhood, his. So I would say there's two E's. It's our experience and our environment. So his environment growing up shapes his view of money, and then his experience with money up to this point shapes his view of money. So since he was that way day one, sure, he could have still had some resentment, but. But it would have been very small. Just in her position as not his biological daughter. I think it's more that he's a scarcity mindset guy with money. He's scared to death. It's hoard. Hoard. The resource is not a hoarder.

[Jade Warshaw]

But. But does he do that in other areas? Is my question. Is he. Is he a tight wad in the other categories, or is it just as it relates to your daughter?

[Caller]

Both. He is a tight wad, but he will spend things. If, like, if I wanted something, sure, I could have it, but he grew up. If he wanted something, he had to work for it. So that's exactly what.

[Ken Coleman]

Okay, so I think he also resents your ex and how he spends so lavishly on her.

[Caller]

And so I do, too.

[Ken Coleman]

You do too. So you know what he's doing? He's correcting. He's course correcting whether he realizes it or not right. All right, so.

[Caller]

But I, at the same time, feel like I should be able to buy things for her and not feel any kind of way about it.

[Ken Coleman]

I'm not saying.

[Caller]

Going overboard.

[Jade Warshaw]

Huh. So it's you guys deciding on what's a normal amount and what's considered overboard.

[Ken Coleman]

Yeah. This is a. I think this is a therapy session because I think you need a. Here's what I believe. I really believe that you two need to get with a marriage therapist. And it's a safe place. What's great is you guys are not in crisis. You told us you guys get along on everything else, so this should not be too painful. But it might be difficult to get to a middle ground. And I think you need a. I mean, appreciate you calling us. We're not marriage therapists, but I think getting a objective, licensed marriage therapist who can get you two in the room together and we find middle ground on this because I hearing what I hear, Jade.

[Jade Warshaw]

Yeah.

[Ken Coleman]

I'm in the middle. I think he's probably way too tight.

[Jade Warshaw]

Yes.

[Ken Coleman]

But I think you also need to come his way. Not in giving into his demands, but understanding maybe where he's coming from. I think this is solved with a lot of understanding.

[Jade Warshaw]

And the daughter needs to understand because she's. She feels it and probably doesn't know what that is. Right. She feels. She feels going over to Dad's house, and it's like, I get what I want, then she feels going over to your house, and it's like, do these people hate me with nothing?

[Caller]

Right. Right. I've told him. I don't tell him every time she asks for something, because I do say no a lot, but all he hears is when I'm in agreeance. And she's like, all she does is ask for stuff. And I'm like, well, she's 11.

[Jade Warshaw]

Yeah. Yeah. I mean, they're gonna ask and you can say no. But I. I mean, the example you gave about going to summer camp, you know, it depends on what summer camp. It depends on how much. I mean, there's a lot of. Well, that's ways that can go.

[Ken Coleman]

So, Jade, that's where the budget comes in.

[Jade Warshaw]

Yeah. That's why I said this has to be guided by the budget. Right. It's not just a free for all on any side. We don't just stop it because we just feel like we're going to stop it. But we also don't spend whatever we want. So it's you guys looking at your budget and going, okay, like, what's a reasonable Amount to spend here.

[Caller]

Well, and I've asked him that. I'm like, give me a number. And he's like, 500. I'm like, that spends one camp. So you got three months. I get one camp, and she's gonna sit in front of her phone the other day.

[Jade Warshaw]

Well, now, now, now, that part. Let's. Let's go to the next extreme. Because. Just because she doesn't go to camp doesn't mean she has to sit in front of where I come from. We went outside and we had to play on our own. And we played basketball.

[Ken Coleman]

Don't get me started. We played with a stick and a box.

[Jade Warshaw]

Okay. Make it happen.

[Caller]

And so that the caveat is we work full time. So she's with her dad all summer, who lets her do whatever she wants. Being on the phone is what it happens.

[Ken Coleman]

Well, but again, to Jade's point, I think Jade's locked in on something here. Aaron, I'm changing my opinion a little bit. I thought the man giving you 500 bucks for a summer, that's plenty of money to spend on her, if that's what I'm hearing. And I think you have to adjust your life and her lifestyle, like, great. You work. So come up with a better plan than. She's just at her dad's all the time getting spoiled. So make. Make a fix to that. But throwing more money at it doesn't solve all these issues. It just doesn't. You could send her to camp all the time. He still, like, this is. You still got to come back to, I think, therapy and a budget. And I think this guy is probably a little bit more reasonable than he sounds.

[Jade Warshaw]

I think so.

[Ken Coleman]

But he needs a good reason why.

[Jade Warshaw]

Yeah, yeah.

[Caller]

Yes, I think he does. But my reasoning isn't good enough. And I think we argue so bad about it, we just avoid it at this point.

[Jade Warshaw]

Yeah, that's the therapy part of it.

[Ken Coleman]

I think therapy will change this in such a positive way. I'm hopeful. Like, I really believe this. If you guys submit to this process and go in and go, okay, we're gonna allow ourselves. Ourselves to be open to this process and meet in the middle. I think. I think you guys can solve this.

[Jade Warshaw]

I do, too.

[Ken Coleman]

It's complex. Given the relationship with the divorce and the dad and all this stuff, that's tough. But you guys can figure it out. This is the Ramsey Show.

[Dave Ramsey]

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[Ken Coleman]

Welcome back to the Ramsey show alongside Jade Warshaw. I'm Ken Coleman. Thrilled to have you with us. 888255225 Triple 882-55-2225 is the phone number. Our Ramsey show question of the day is brought to you by. Why refi. Why refi refinances defaulted private student loans, which are different than federal student loans. Why refi refinances your defaulted private student loan and builds a custom loan based on your ability to pay. So kick your private student loan debt out of your life by going to yrefi.comramsey that's the letter y r e f y.com Ramsey may not be available in all states.

[Jade Warshaw]

Alrighty then. Today's question comes from Olivia in Mississippi. She says, last week I was approached by a friend who recently became a multi level marketing representative. She asked me to join her team and said that many money experts recommended their company as a side hustle to get out of debt. Not this money expert. She said that she had been skeptical when she first started, but the checks were clearing and they weren't doing anything illegal. They emphasized that the business is not about recruiting people, but doing so leads to earning more money. Is this going to cost me more money than I would be making or does that depend on me and how wisely I use this business? She's asking us like we're the gurus of this multi level marketing business.

[Ken Coleman]

Yeah, I don't even know how I.

[Jade Warshaw]

Would just steer clear of it all together if I were you. In your shoes. Yeah, I mean, I've. Can I just. Okay, let me confess something. I have fallen victim to this. Like back in the day.

[Ken Coleman]

Oh, you did?

[Jade Warshaw]

Yeah, I just graduated. Let me tell you the quick story. I just graduated college. I was working in the mall and a guy came in to my store in a nice suit and I, I thought I was helping him sell, selling him a suit. And he was like, you know, you're a sharp young lady. He kept calling me a sharp young lady. And then he said, you know, I'm looking for people just like you to, to work in my business. You know, I'm. And I was like, you know, I'm in college, I'm like, okay, I can make some money. He starts telling me, you can make six figures a year. And I'm like, really? Like, I was falling for a hook, line and sinker, right. Ended up going to lunch with him, with my Sam, who was my fiance at the time. And we still didn't understand it was multi level marketing at the time. And he's like, yeah, you know, you know all you have to do. And then, and here's the thing. When he showed up at lunch, he showed up in a really nice Mercedes. And I was like, this guy's making me.

[Ken Coleman]

He's got all the, whatever he's doing, right?

[Jade Warshaw]

Then he starts talking about energy drinks. And I'm like, energy drinks? And I realized that's what I'd be selling is energy drinks.

[Ken Coleman]

That's the product.

[Jade Warshaw]

Well, it was the one product he decided to highlight. Then he says, man, let me tell you about my boss. He is killing it. He takes us over to his boss's house that he described his boss as like living in a mansion. Boss is living in, like a normal, nice house.

[Ken Coleman]

And you still, and you still got sucked.

[Jade Warshaw]

Listen, I bought the energy drinks. I can't even remember what they're called. I couldn't sell one. Dagum. It was energy drinks. Paper towels. He was, and his, his shtick was, I mean, everybody needs paper towels. Everybody needs.

[Ken Coleman]

I've heard that before. Toilet paper was the one that I heard.

[Jade Warshaw]

Toilet paper.

[Ken Coleman]

Yeah, yeah.

[Jade Warshaw]

And I'm like, I didn't sew one dat go.

[Ken Coleman]

How much money did you have to front?

[Jade Warshaw]

I think it was like 150 or something like that. It wasn't a whole lot.

[Ken Coleman]

Yeah, yeah. I mean, listen, I'm with you. I just think this whole thing just sounds like a house of cards and you just shouldn't invest your time into this.

[Jade Warshaw]

Yeah, I wouldn't, I wouldn't. I mean, the truth is, I, Yeah, I guess there are people who are making money doing it.

[Ken Coleman]

Oh. First of all, there are people who crush it. Make no mistake.

[Jade Warshaw]

Yeah. I mean, I'm not saying there's not.

[Ken Coleman]

But just the way the tone of the question, everything else this is, it just doesn't sound like it's the right thing for you. You got to be really focused. And by the way, let's be very clear, all of those models are based on recruiting people.

[Jade Warshaw]

That's right, they are. So I don't like the dishonesty of saying, yeah, it's not about that.

[Ken Coleman]

Yeah.

[Jade Warshaw]

Yeah.

[Ken Coleman]

All right.

[Jade Warshaw]

Pass. Hard pass.

[Ken Coleman]

Yeah, I, I, by The way I like to buy my toilet paper from a store. I do not from somebody dropping it off in a bag. You know what I mean?

[Jade Warshaw]

Yeah.

[Ken Coleman]

That was always the thing for me when my parents. My parents got into that for.

[Jade Warshaw]

Yeah.

[Ken Coleman]

I was like, we got all this toilet paper at our house and, like, gum and all the things energy drinks talking about. It's like, what are we doing here?

[Jade Warshaw]

Oh, gosh.

[Ken Coleman]

Oh, that's good. All right, let's get back to the phones. Marie is joining us in South Bend, Indiana. Marie, how can we help? Hello.

[Caller]

So I am wondering how my husband and I should prepare for planning to pay for college for two children under two without overfunding a 529 plan and if we should potentially also look at other investment options to help set them up outside of the 529 plan.

[Jade Warshaw]

Yeah. Okay, so you're on baby step five.

[Caller]

We're on, like, four, five, six.

Yes.

[Jade Warshaw]

Okay, great. So you're. You're currently putting away the 15% for your retirement. And then on top of that, how much are you able to kind of put into these 529s every month.

[Caller]

Right now? Probably just like, a couple hundred dollars. The big thing is that my husband actually works at a university who will pay half of whatever their tuition is to go anywhere else.

[Jade Warshaw]

That's awesome. That's great. Okay.

[Caller]

Which makes most state schools and even some, like, smaller private universities, like, very cheap or completely free.

[Jade Warshaw]

Yeah.

[Caller]

How old are we trying to figure out?

[Jade Warshaw]

How old are they?

[Caller]

The oldest. Yeah, the oldest is, too. So that's the big thing of, like, things can change. He has no intentions of leaving, but if he does does, then we do lose that benefit.

[Jade Warshaw]

That's true. I mean, yeah, this is a long, long way in the future. A lot can change in many, many ways. But it is a cool thing to. To have right now. If I were you, the amount that you're funding, what is it? Did you say $100 per kid every month?

[Caller]

Yeah.

[Jade Warshaw]

I don't think that's going to get you to the point that you're just busting at the seams with. With cash, because there could still be books, there could be other things to spend that money on, and there are two. So as you get closer, you can decide to pull back, you can decide to ramp up. You can decide. Do you see what I'm saying? Like, you don't. This is not something that you have to lock in, and you can't change at any point. You have a lot of freedom here.

[Caller]

Right. And we were Hoping to start contributing more, but we're just trying to figure out how much do we put into a 529, knowing that room and board week would be on the hook for.

[Jade Warshaw]

Have you projected it? Have you projected what that $100 per kid will when it's time for them to go to school?

[Caller]

I have not. I need to.

[Jade Warshaw]

Okay, I would do that. I would do that. I would look at the 529 that you're interested in. I would look at the average rate of return for that and see, okay, If I put $100 in here, you know, after 16 years, what's it going to be? And then you can decide, okay, let's work backwards. How much do we think room and board will be? And kind of work backwards from there? And that's what I. That's. If I were in your shoes, that's where I would start.

[Caller]

Perfect. And if we get to the point where we are potentially going to overfund it, are there other investment opportunities that you would look at doing to help set them up for when they graduate and things like that?

[Jade Warshaw]

So what I would do at that point, once I funded a 529, working through the baby steps, if I had extra money after that, I would put it towards paying off my house. And then once I've paid off my house, then I would start looking at other things that I could do. I know my husband and I, one of our big goals is to have a fund for our kids to help them buy their first house, like that sort of thing. But that comes after mama and papa pay off their house.

[Caller]

Yeah, right.

[Jade Warshaw]

Yeah.

[Caller]

And ours will be paid off here in a few years, so.

[Jade Warshaw]

And so I'm trying to think, yeah, after that, then I just probably start with a brokerage account, something that you can dip into. It's not part of your retirement. And you can gift them a certain amount each year. You know, under the gift tax, you and your husband are both entitled. What is it, 14? I can't remember.

[Ken Coleman]

I can't remember the exact amount.

[Jade Warshaw]

You'll have to check it. And it might be different by then, but that's what I would do. And that way you can kind of see, okay, here's the amount that I can give them every year, or here's the amount that I can give them as a lump sum. And again, you guys can kind of project down and see, okay, what do we think that we want to be able to give them? How long would it take us to save it at the rate that we're able to save.

[Caller]

Perfect.

[Jade Warshaw]

Yeah. Makes sense.

[Ken Coleman]

All right, thanks for the call, Marie.

[Jade Warshaw]

Good.

[Ken Coleman]

Love it. Love when parents are thinking about that. And by the way, I think the advice is great to kind of go, okay, looking at tuition now, there's really no way to know what tuition is going to look like. Just the way that the higher ed industry is kind of evolving right now. I mean, so it's kind of like you got to do your best with those projections to kind of go, okay, based on where we are right now, adjust for inflation and then you kind of back into your number.

[Jade Warshaw]

And his was based on a work benefit that who knows in 16 years right where they'll be, you know, so.

[Ken Coleman]

All right, let's go to San Antonio. Oh, wait, actually, no, we're not. Look at that. The little ding. That was me off. That's right. We are running out of time in this segment so we will take a quick commercial break. Don't move. The phone lines are lighting up. Triple 8. 8255225 is the number alongside Jay Warshaw. I'm Ken Coleman. You're listening to the Ramsey Show.

[Dave Ramsey]

People tell me about their experiences with big banks all the time. Bad service fees that nickel and dime them to death and predatory lending that tries to catch them in never ending cycles of debt. So if you're ready for a bank that puts people over profits, check out Fairwind's credit union. I recommend Fairwinds because they share our Ramsey values of helping people get out of debt and live generously. If you go to fairwinds.org Ramsey you'll see the combined checking and savings account bundle they created just for Ramsey fans. This account bundle is designed to help you take control of your finances and stay out of debt. And Fairwinds also has a great mobile app that's safe and secure so you can manage your transactions with peace of mind. Fairwinds has been helping people avoid big bank traps for 75 years. So go to Fairwinds.org Ramsey to learn more. It's easy to join no matter where you live. That's F A I R W I n d s.org Ramsey welcome to the.

[Ken Coleman]

Ramsey Show, America, where we're here to coach you up. So you're winning in your money, winning in your profession and winning with your relationships. Alongside Jade Warshaw, I'm Ken Coleman. The phone number to jump in is 888-8255-225882-55225. We're going to start it with Nicole, who's joining Us in Toronto. Nicole, how can we help?

[Caller]

Hi. I've been with my boyfriend for some time now and basically for the last year we've been kind of planning to buy a house together. So I've been going through the steps and saving money. And recently he's been kind that he's going to propose soon. So I kind of sat down with him to see over the last year how much he saved towards this house. So we kind of know where we're falling. And I discovered after a year that he basically hasn't saved any money. And during that period of the year, I have been taking on most of the financial burdens because I make significantly more money than he does. I'm kind of shocked by the fact that he hasn't saved any money and I don't really know how to go forward. So I wanted your advice.

[Jade Warshaw]

Yeah, good question. On the one hand, I get why you're concerned because in you guys relationship it sounds like there was kind of an agreed on point that you wanted to reach and you were going to try to reach it together. And it seems like he hasn't, you know, held up his side of the deal. But from my perspective, I would say he doesn't have to come, he doesn't have to contribute to this at all because it's really not a great idea for, for you guys to buy a house together if you're not married. And it's really not a great idea for you guys to be combining your money in any sort of way if you're not married. It's really great for you guys to say, okay, say you do live together, I'm paying my portion, you pay your portion. But we're not doing this thing together until there's some legality, protection surrounding it in marriage.

[Ken Coleman]

I agree with that. But Nicole, how did you feel? I got a point to make after I asked her this question. How did you feel that's actually when.

[Caller]

You found out actually the plan? Yeah, sorry, I don't mean to interrupt you go ahead. But the plan is not to buy the house until we get married. That's why he's telling me that the engagement is coming soon. So like that's, we're getting the ducks in the row for. Okay, we're engaged now. That means after we do the wedding, we're going to be buying the house, but the house is going to be the biggest fee.

[Jade Warshaw]

Right, I see, I see, I see.

[Ken Coleman]

Yeah. But okay, so, okay, so how did you feel, what, what emotions and thoughts did you have when you found out that he hadn't been saving any money.

[Caller]

I was absolutely devastated because he's living at home with his. We don't live together now. He's living at home with his family.

[Jade Warshaw]

Ah.

[Caller]

And I've been printing the money on everything, all of our dates. I've been putting away tons of money, and I make three times the amount of money he does.

[Jade Warshaw]

How long have you been dating?

[Caller]

Just over a year, I think.

[Ken Coleman]

This is a very clear. I'm going to call it yellow light.

[Jade Warshaw]

Oh. I would have said red flag.

[Ken Coleman]

Well, you always surprise me. I feel. I think it's a yellow light. I think in the sense of this. What I mean by yellow light is proceed with caution. No, it's. We sit down. She doesn't dump him. Red light to me is dumping, leaves him. I'm out. Yellow light is sit down and go, we need to do some premarital. I mean, if we're talking this, we need to get in alignment on this, because this is what. I was devastated. And you may have already shared that with him, Nicole, but even if you have, there needs to be a true alignment conversation. And is he going to show you in the days and weeks and months ahead that he understands your values and is in alignment with your values and he begins to save some money? I would not even say yes to his proposal. I wouldn't move forward on anything until that. That's what I mean by yellow light.

[Jade Warshaw]

I agree with that. I think. I think Ken and I are saying the same thing. We just used different colors because red, for me means, like, let's stop and see if anything dangerous. Else dangerous is happening.

[Ken Coleman]

Yeah.

[Jade Warshaw]

And so my question for him would be, like, okay, you've not been saving. Can you tell me why? Why? And then can you tell me, like, well, what have you been using your money for instead? Because you're still living at home. I would have real questions and I would want real answers because that's indicative of what it will be like in your marriage when you speak about money.

[Caller]

Well, I know the answer to that. I did ask that question. And the majority of his money has been spent on food and video games.

[Ken Coleman]

Again, massive. Massive. Like. Like construction sign going, watch out, watch out, cliff ahead. You know, I. Nicole, are you feeling that, too?

[Caller]

Yeah, that's. That's what I'm calling.

[Ken Coleman]

Because it's okay. Can I play? If I could play older brother or I might be old enough to be your dad for all I know. I would just tell you that this is a serious, serious conversation. He needs to make some Changes in his life. If he wants to be in your life. That would be my bumper sticker.

[Jade Warshaw]

What. What do you see about him that's really. I want to go in another direction. What do you see about him that is really great that you go, this guy, this guy's got motivation. This guy's got that thing. This guy, like, tell me those things. I'm just curious why.

[Caller]

I love him. He has been my rock. I've opened up a ton of new businesses in the last year and every single one I've done, he's had my back through every single one. He's so genuine, he is so sweet and he is so kind hearted. I've never met a man like him in my life.

[Jade Warshaw]

Okay, I like that. Listen, I'm gonna, I'm gonna say something really harsh and I realize this. You can get all of those things from a pet support, somebody to be there to talk about. I want you to be able to say deeper things. Does that make sense?

[Ken Coleman]

Oh, it makes sense. I love this. I love. You're bringing the heat.

[Jade Warshaw]

What you said, like, that's a golden retriever and we love that. That's why we love our animals. They're. They're always there for us unconditionally, you know, they're. They're there to support us. They've got that, that, by the way.

[Ken Coleman]

He'S doing by playing video games and buying fast food. He is essentially the same as a golden retriever there as well. Just costing, costing you money.

[Jade Warshaw]

And I want to hear you say, you know, wow, he. This guy, you know, he. If you were to ask me or my husband that same question, it would be more about what they bring out of us and what I see when I go, when I go. Oh, man, nobody works harder than Sam Warshaw. Like, that's inspiring to me. The way he will get up and, and do whatever it takes to take care of his family, the way that he'll take care of his kids. Like the way he's sacrificed for us year after. Like, those are the things that I want to hear. And I'm not hearing that. That's why I kind of flipped it to see, okay, how is. What do you guys mean to each other and what roles are you playing? And is it beyond just. Well, you know, they're. They're there when I need them, you know. And what does that even mean?

[Ken Coleman]

He's very sweet guy, a nice guy, all the things. He's also a pretty decent gamer, sounds like, you know, but we gotta. You see where I'm going, nicole, I got a level I gotta chuckle out of you. I mean, listen, you can love someone and decide to also say they're not the person that they need to be right now for me to decide to marry them.

[Jade Warshaw]

Yes.

[Ken Coleman]

I think this is a very real conversation. Back in my day, we used dtr. Define the relationship. Kids don't know what that means. I'm sure dtr. I'm sure I dated myself again on that. But I think that's what's got to happen.

[Jade Warshaw]

Yeah, I think so too, because give her the.

[Ken Coleman]

All right, so. So give her the. You're the strong female. I think she's a strong female. Give her 30 seconds on how she starts that conversation with our guy.

[Jade Warshaw]

Oh, boy. How she starts the conversation or sets it up. I've been thinking.

[Ken Coleman]

Okay, give me more.

[Jade Warshaw]

I've been thinking. You know, I. I love you because you've always been there for me. You've. You've been my rock. But I really needed you to be there for me. I really needed you to show up when it was came time to talk about our goals as a couple. And when it came to our goals as a couple, you let me down. You didn't show up with your side of the money. You said you were going to do this. You said you were going to do that. And I haven't seen that. And this is the first time you've let me down. And unfortunately, it's in an area that really matters to me. Because it's not just about you or me. It's about us.

[Dave Ramsey]

Wow.

[Jade Warshaw]

All right.

[Ken Coleman]

Oh, it's good. It's good.

[Jade Warshaw]

All right.

[Ken Coleman]

I think it's gonna get his attention. Well done. Poor guy. But he's gonna have to stand up at some point. We'll be right back. This is the Ramsey Show.

[Dave Ramsey]

You shouldn't own a gun you're not willing to shoot in moments of self defense. A burner launcher lets you protect yourself in a non lethal way. That's exactly why burner launchers were created. Everyone from parents and nurses to pastors and even special forces veterans rely on burner to protect themselves and their families. I own several burners myself. They look like guns, but they're not. They shoot a 68 caliber round, kinetic or chemical irritant projectile that can disable a threat from up to 60ft away. And they're powered by compressed CO2 cartridges, so they're classified with paintball and airsoft guns. But they're more powerful than those for increased protection. Not to mention, burner launchers are legal in all 50 states with no permits required. And because they're not firearms, they can be shipped directly to your door. Plus, Ramsey fans can get 10% off an exclusive bundle which includes a burner pistol, CO2 cartridges and ammo. And other burner products like safety alarms, defense sprays and body armor are also 10% off. For our listeners, just go to byrna.com Dave to learn more. That's b y r n a dot com Dave people ask me all the.

[Ken Coleman]

Time, George, what's your number one money saving hack? I'm glad you asked. Nothing makes me happier than helping another frugal friend. So here's the hack. Get on a budget. Seriously, how are you supposed to save money if you don't know how much you're spending in the first place? And that's what makes the EveryDollar budgeting app a game changer. With EveryDollar, you'll get a clear picture of your spending and from there it's easy to see where you can get more intentional cut back and save more money. So how much money are we talking here? Well, the average everydollar budgeter frees up $395 in their first budget. That's the hack. And if you ask me, I think you're way above average and you'll save even more. So what do you do when still listening to me? Go download the EveryDollar app for free and start saving more money right now. Welcome back to the Ramsey show alongside Jade Warshaw. I'm Ken Coleman. Glad to have you with us. Triple 882-55-5225 is the phone number. Hey folks, as the the Ramsey work guy here, helping you win at work so you can make more money. Really excited to tell you I've been dreaming up a concept for a long time, Jade, you know this. It's called Front Row Seat, where we're having deep dive conversations with movers and shakers, thought leaders, people that are successful from every walk of life designed to do three things to get better as a person so that I take a better version of me to work so I can move up the ladder professionally. And then as I move up the ladder, I'm going to be put in a leadership position. How do I lead? And so helping you grow in your professional developments called Front Row Seat. And it is now out on YouTube wherever you get podcasts. So check it out. Front Row Seat. It's a lot of fun. And here's what's unique about it. We have a live audience and the audience sits with me and the guest, and they get a chance to ask questions as well. So it's not just me asking questions. I wanted the audience to be able to learn as I'm learning, Engage with me with our guest. And they also represent the larger audience. So download front row seat or not download. Subscribe wherever you get your podcast. And on YouTube, just search front row seat Seat with Ken Coleman. All right, let's go to Orlando, Florida, where Mo joins us. What's up, Mo?

[Jade Warshaw]

Yeah.

[Caller]

How you guys doing today?

[Ken Coleman]

Good, how are you?

[Caller]

I'm well. So I just been doing research with my financials, and then I came across George Camel on YouTube and then that's why I saw the Ramsay show.

[Ken Coleman]

Yeah, you gotta love George.

[Jade Warshaw]

Oh, yeah.

[Caller]

Yes, sir. He's very amusing on YouTube. So if you guys ever see him, please give him a thank you for how he.

[Ken Coleman]

Believe me, I'm gonna tell him on the next break because he loves hearing it.

[Jade Warshaw]

How can we help?

[Caller]

My question is, I. So with the baby steps, I feel like I'm in limbo between baby step two and baby step three. I have $6,000 right now in my HYSA, so I feel step one is definitely complete. So my financial situation. My wife and I, we closed on a home in June of 2023 out in California. Our mortgage is, sorry, expense wise. We're stocking away $5,200 a month into another HYSA to cover the mortgage, property taxes, and insurance.

[Jade Warshaw]

Okay, so you move. Let me just make sure I understand. You moved from California. You hadn't sold the house, so right now you're still paying for the house.

[Caller]

No, I'm. I'm gonna. I'm moving out to California.

[Jade Warshaw]

You're moving out? Okay. Okay, I think I understand.

[Caller]

That's. So that's the mortgage there. And then I have non traditional student loans. My parents, my. My parents had a 529 plan for me and my siblings, and they want half of the money back of what they totally spent for my college university. And then.

[Jade Warshaw]

Okay, hold on, let me clarify, Let me clarify. Make sure I understand that. Are you telling me your parents created a 529, you use the money for education and they're like, hey, pay us back some of what you used from the 529.

[Caller]

Correct.

[Jade Warshaw]

That's wild. Okay, how much do they want?

[Caller]

They only want 50% back of what my costs were.

[Jade Warshaw]

Which is What?

[Caller]

Which is $75,000.

[Jade Warshaw]

Now, that's wild.

[Ken Coleman]

I've never heard of a parent investing in a 529 and then saying, hey, Kiddo, pay me half of it back.

[Jade Warshaw]

Did you know that on the front side or is this new information?

[Caller]

No, this, this was when I was a teenager in high school.

[Jade Warshaw]

So you knew.

[Caller]

Yes.

[Jade Warshaw]

Okay. Okay, that's, that's okay. Whatever you guys decided, that's the deal. All right?

[Ken Coleman]

That's different.

[Jade Warshaw]

What else? So you owe your parents $75,000. You've got 6,000 the HYSA. Why did you say earlier that since you had 6,000 in the HYSA, you had moved from baby step two to baby step three?

[Caller]

No, no, I moved from baby step one. And now I feel like I'm in limbo between baby step two and baby step three.

[Jade Warshaw]

Okay, got it. Well, technically. Well, let me clear that up. You are in baby step two because baby step two is we pay off all of our consumer debt. Anything except our home, if we have a mortgage at that point. So you are in baby step two. And part of that is taking your savings down to a thousand and putting the rest at the debt. So in this case. Yeah, you'd be dropping that HYSA down to a thousand and throwing the rest at the debt. Is there any other debt aside from the student loans?

[Caller]

The. Yeah, for the. So we, when my wife and I closed on our home, we don't have PMI, so the other 10% came from a loan from her parents.

[Jade Warshaw]

Okay, and how much was that loan?

[Caller]

That now I believe is. I think it's $50,000.

[Jade Warshaw]

Oh, sir. Okay, man. Let me tell you something. I'm going to be flat out. I'm going to be straight up with you. Owing money to like debt and creditors sucks, but it kind of feels worse when you owe it to family members because they have.

[Ken Coleman]

That's a different emotion.

[Jade Warshaw]

It's a different emotion. I. I want you to get out of debt so quickly. Okay, so you're moving to California. You've got the house. What are you going to be making?

[Caller]

My gross salary last year was 137 and I'm predicting it'll go up. It's not a. It's not a predictable set. It's predictable in that the salary will increase, but it's not a predictable number per year.

[Jade Warshaw]

What about your wife?

[Caller]

She's predictable at around. I think her gross last year was 80,000.

[Jade Warshaw]

Okay, so you guys are going to be a little bit over 200. Like maybe 210.

[Caller]

That sounds about correct with our gross income for last year.

[Jade Warshaw]

Okay. And so I just want to. I just want to make sure. Because Your mortgage is 5,200amonth. What's your, what's your month?

[Caller]

The mortgage is $4,252 a month.

[Jade Warshaw]

Okay.

[Caller]

And then we also sock away extra money. Property taxes are now increasing. It was. It's about $8,400 a year now. And then California does its 2% increase from Prop 13.

[Jade Warshaw]

Yeah.

[Caller]

And then we also sock away extra money for the insurance. I have a question last year was.

[Jade Warshaw]

I have a question in all of this because I'm, I'm trying to track with you on the math as much as I can, but I don't know these direct numbers. How. What percentage of your take home is your mortgage going to be? Because California is expensive, tax wise. And what the number you gave me, the 4,000, that's not including taxes and insurance. So what percentage is it? Have you done that math?

[Caller]

Yeah, I think it's about 50 to 60%.

[Jade Warshaw]

My guy.

[Caller]

I know it's supposed to be 25%.

[Jade Warshaw]

Yeah. And you're not even a little bit over. We got to go back to the drawing board. And I want that for you. Like, I don't want you to be in this situation because you're about to be stressed to the team.

[Ken Coleman]

I was going to ask, do you feel stress mo when you start thinking through this?

[Caller]

I have, but now I've accepted the terms of it and I feel relaxed because of the nature of my job. I feel content that my wife is, she is 20 minutes away from her parents and the nature of my job. I'm gone for two weeks at a time. So emotionally I feel okay because I know she has somebody to rely on while I'm gone.

[Ken Coleman]

But you don't have any negative emotion about the lack of margin because of how much you're paying in mortgage.

[Caller]

I used to, I, I've come to, I've come to terms with it and accepted it.

[Jade Warshaw]

I mean, I'm just like percentage wise. I just want to lay this out because I, I think you understand it conceptually, like on a very like not detailed level, but like actual numbers. Putting it in your budget. Because I'm looking at it like this, I'm like, okay, 15 in a little while. 15, well, not for you. It's going to be a while. But at some point, 15 is going to go to investing. 10 is going to go to giving. You are, you're at 60 on your mortgage. That leaves you 15 to live on. That's not much. And at this point that, that would be for paying off debt, which is going to take forever at that rate. So I strongly urge you to consider nothing's done that can't be undone. Right. Like you don't have to stay in this situation. It might be, and I think that it is you not keeping this house. It's too much house. You got to get out of this house. That's what I would do. And then I'd work on paying off the debt that you owe to your family.

[Ken Coleman]

Yeah, I agree. Thanks for the call, Mo. Please reconsider. Don't move. We'll be right back. This is the Ramsey Show.

[Jade Warshaw]

You know how when you go against what society thinks is, quote, normal, like avoiding debt, it feels weird at first? Well, I'm here to tell you that is okay. I want you to be weird if that means you're being intentional, including how you budget. And one way to be intentional about how you spend your healthcare dollars is with Christian Healthcare Ministries. CHM isn't health insurance. They're a biblically based alternative. CHM is a health cost sharing ministry that's helped hundreds of thousands of families take care of healthcare costs without sacrificing their freedom. As a CHM member, you'll share 100% of your eligible healthcare costs with a dedicated Christian community. And in return, your monthly contribution goes towards other members medical costs. So no matter where you are in your financial journey, CHM can help you reach your money goals and still get the care you need. Plus, programs start as low as $98 a month. So go to chministries.orgbudget to find out more. That's chministries.orgbudget.

[Ken Coleman]

Hey, guys, George Camel here. Do you ever feel like insurance companies only care about your money and not what you actually need? Well, there's a better way. When you go to Ramsey's Insurance Resource Hub, you'll start feeling confident that you're getting the right coverage that's truly best for you. You'll find helpful info on everything from life insurance, health insurance, identity theft, protection and more. And when you're ready to get the coverage you need, you can connect with a Ramsey trusted insurance pro who will only get you what you need at the best price. Go to ramseysolutions.com insurance ramseysolutions.com insurance welcome back to the Ramsey show alongside Jade Warshaw. I'm Ken Coleman. Phone number to jump in is, 8825-5258-8825-5225. Ray is joining us now in Dallas. Ray, how can we help today?

[Caller]

Good afternoon.

Thank you so much for taking my call.

[Ken Coleman]

Sure.

[Caller]

I have a bit of a Unique situation. A little different than others. I'm in my late 70s, Quasi retired, and I've amassed an estate a little north of $30 million.

[Ken Coleman]

Way to go, Ray. Come on.

[Caller]

Now, we have no debt. We have no mortgages, we have no credit card debt. Everything is paid, and we have approximately 17 million in cash and equities and the balance in property.

[Jade Warshaw]

Holy smokes.

[Caller]

My question is that we've set up a very, I think, qualified estate plan with competent estate lawyers. And the beneficiaries of my estate are approximately a third. A third? A third. My daughter and my grandchildren and my wife. The monies that are spinning off of our investments are more than my grandkids could legitimately or reasonably spend when they become of age.

[Jade Warshaw]

Right.

[Caller]

I want to. Right now, the estate plan calls for up to $250,000 per annum for my. For my grandchildren. By the way, my grandchildren are six and nine.

[Jade Warshaw]

Okay.

[Caller]

So they're going to build a lot of wealth over the next several years. When they're 21, they get a modest amount of money for five years, and then at 25, they begin to kick in. My question, a simple1, is $250,000 a year too much or too little? Given the fact that the, you know, the growth of the estate will be much larger than that?

[Jade Warshaw]

I. That is a good question. I don't know that I can tell you if it's too much or too little. I think that.

[Ken Coleman]

Yeah, I would return that with a question. Do you think it's too much or do you think it's too little, or you think it's just right and why.

[Jade Warshaw]

Yeah.

[Ken Coleman]

Throw it back at you?

[Caller]

Well, at this stage, you know, in our economy, in our country, I think it's just right. But I'm concerned that there will be that. The growth of the investment portfolio, you know, it'll be selfish not to let them grab more of it. And the whole reason for having an estate is to take care of the little ones, you know, in the future when you don't know what's going to happen.

[Ken Coleman]

That's right. However, you decided that 250,000 at this point in time does feel right, and.

[Jade Warshaw]

It'S per year, correct?

[Caller]

Yes.

[Jade Warshaw]

Starting at 21.

[Caller]

No, at 21, I think it was a little bit too much. So we're gonna do five in a month between 21 and 25, and then 250 and then a map to 25.

[Jade Warshaw]

Yeah, I. I think it depends on, you know, I'm trying to channel Dave right now. I think gifts are really great And I think how people use gifts depends on who they are as people. Because in one person's hand, 250, 000 a year is like, hey, this was my grandfather's legacy. I'm going to do great things with it. It's not going to stop me from reaching my personal potential. It's not something that I'm going to use as a crutch in life. Whereas another personality, it could become, you know, really a stumbling block for them. So I, I wonder more about the type of language that's built in as far as who, what type of person does this grandchild have to be in order to get this money? And is their language built in that says if, if, if, if it's harming them, what takes place? Those are the things that I'm thinking about. And I know it's, you know, it's not like you can reach out from the beyond and control everything, but those are the things that I'm thinking about the other part of this. And again, this is your estate. I am not trying to overstep. I see what you're saying. You're like, there's a lot of money that's going to be generated here. I don't want to not let them have it. But I also wonder, okay, well there's other things that you can get give to. That's not just kids and grandkids because you might, it's in many ways like that you've got so much money, you can only give them so much without really giving them a ton of money.

[Ken Coleman]

Right. How, how long would the, the 250 be paid out? Is it in perpetuity?

[Caller]

Yes. I mean we don't have a stop on it. And then they're, one would assume that they were. By the way, just to comment on your last statement, we have clauses, estate plan. They have to be good people of good character, you know, drug and disease free and all of those.

[Jade Warshaw]

Okay.

[Caller]

We have a very competent trustee and you know, with a wonderful moral compass and you know, we're comfortable about that, but I'll be gone.

[Ken Coleman]

And so let me ask you this then Ray. So they get the 250 each year, by the way, is these are the grandkids we're talking about once they get to 25. Okay, so at what point would they get the rest of their inheritance? Is there a, is there like a kick in at like a retirement age where they get it all? Because you were, because you were saying they're going to be build, building tremendous wealth and it's like the 250s, a nice dividend if for lack of a better way of describing. Is that right?

[Caller]

That is essentially correct.

[Ken Coleman]

So when would they get the big chunk?

[Caller]

There is no clauses in the estate plan in which they get to clean out the drawer. So I would assume that that legacy would continue on with their wills and estates to where they could leave it to the great grandchildren whom I will never know.

[Ken Coleman]

Okay, so it's 250 each year and they never, it's not like they get it all at one lump sum. That's all they get. And that's very generous by the way.

[Jade Warshaw]

And then it transfers to their children's children.

[Ken Coleman]

Yeah, I hope so.

[Caller]

And, but we could well afford just with the increases in the portfolio of the investment side of it to give them more. I'm concerned to do that for all the reasons that you already know.

[Ken Coleman]

You know what I'm thinking, Ray? I'll just, I'll get out of your way, Jade. But I was just thinking, I really trust your gut. I think you are a man of wisdom and you have proven it with how you've lived your life and as to where you stand today. So I'm not going to second guess your plan. However, if I personalize it and if I was doing this for my grandkids, which I don't have. But if I'm sitting there thinking this, I'm wondering if even the most mature of 25 year olds, it's not that they can't handle it, but how would it change their perspective if they knew they were going to be making a quarter million dollars every year whether they do anything at all. And I almost, I almost would want to maybe put it to them in different ways. So for instance, they get a really big lump sum to buy a house, but it can only be used to buy a house, cash, that you can put that in the trust. Right. So that's one thing I think about. You know, I'd be thinking about it can only go to an investment, it's going to be put in an investment thing at which point you can only pull out at retirement. It, you know, like I, that could be another way of doing it. Right. But I'm not second guessing your plan, Jade.

[Jade Warshaw]

Yeah, I agree with Ken. The other question I had for you, Ray, was you said okay, obviously this 250 is paying out to the kids grandkids, but that's by no means gonna drain basically your estate nest egg. And then you said I hope it would go, but they never get the lump sum. So what happens to it? Based on the estate, what happens to it? Do you know what I'm saying? Like what, what's the transition point?

[Caller]

Well, the, the transition point is, is that following our conversation, you know, with you guys, you know, we'll certainly go back to council and we'll amend these things to make sure that we, you know, make that money's available either in the gift side of it or increase in the 250 or include the, the unnamed biological grandchildren in the, in the state. Our major concern was giving them too much too soon.

[Jade Warshaw]

Yeah, I agree.

[Caller]

And our major concern was requiring him to be good citizens and no criminal record and all those things that you can think of. So that's kind of what we're leaning on. But with insurance and property taxes and we want them to have cars that work and a good vacation and IV rent, Ivy League school. If they choose to do that, there's plenty of money there to do that.

[Jade Warshaw]

Well, well done. I mean, I, I wish we had more time. I want to know how he, how he came up with this 30 million, maybe another call.

[Ken Coleman]

I mean, Ray's my hero. I would love to be Ray one day. To be able to bless my kids and, and my grandkids that way. That's really awesome.

[Jade Warshaw]

What a blessing. What a, what a legacy.

[Ken Coleman]

Well done. This is the Ramsay show.

[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.

[Ken Coleman]

Welcome back to the Ramsey show alongside Jay Warshaw. I'm Ken Coleman. So glad you are with us. Triple Blake. 825-5225 is the phone number. Let's go to Devonte in San Antonio. Devonte. How can we help?

[Caller]

Hey, how are y'all? Good to talk to y'all.

[Ken Coleman]

Good. How are you?

[Caller]

Good, good. So I'll get right into it. Me and my wife, we started a Christian based after school program last year and long story short, you know, we felt led to do it but it.

[Ken Coleman]

Did not end well.

[Caller]

We took some risk. I mean it started with personal finances and then credit cards, and then we did a HELOC loan. 50 grand. Okay, fast forward to right now. Got all the credit card debt paid off. We went down two cars, but the Lord bless us. We're back to both cars being paid off, but I got this 50,000 HELOC loan. I want to know what y'all would do if they all are. Me, I got a two year old, a baby on the way. I'm trying to be like, Ray, come on.

[Ken Coleman]

Come on.

[Jade Warshaw]

Me too.

[Caller]

No, it says to leave an inheritance to your children's children, spiritually and financially.

Right?

[Ken Coleman]

That's right.

[Jade Warshaw]

That's right.

[Caller]

I'm ready to. I'm ready to. I'm not. I'm about to be Dave Ramsey bonafide from now on.

[Jade Warshaw]

I'm not doing that anymore. Good.

[Caller]

Now.

[Jade Warshaw]

Okay, so for. Are you guys homeowners? Your homeowners, what's your house worth? Like, what do you owe on it and what's it worth?

[Caller]

It said, I want to say 120. About 120 is left on the loan. It's about 250 to 260.

[Jade Warshaw]

Okay. Yeah, I. The reason I asked is because we kind of say if the HELOC is more than half of what you owe on the house, then you kind of throw it to baby step six and it's part of paying off the house, but if it's less, then it's part of baby step two. So for you guys, I would treat this HELOC as though you're in baby step two and paid off in that way.

[Caller]

And I think it's possible. I'm in real estate and, you know, it's had some good years. Last year was tough, but still did pretty well. But I'm torn between, you know, emergency fund and paying off the heloc. Like, how should I attack that? Because I don't have our emergency fund where I want it.

[Jade Warshaw]

Okay. And you've got the baby on the way, right? Yeah, I hear you on that. You're technically in stork mode, I would say, in that case, which is you just piling up money to save for this baby being born. And the hope is, you know, you stack up a bunch of money, the baby is born, everything's all good, you know, maybe you pay the insurance deductible at most, and then the rest of it can go on to the debt. And it's kind of like push play on the baby steps at that point. That's. That's what I would do in your situation. As far as the idea of saying, I'm gonna kind of skip baby step two and I'm gonna do baby step three first, I would not do that. Because if you do that, you're honestly putting yourself back in the position that got you into this mess, which is when we don't have savings and when we don't have cash, we use debt to do the things that, that become emergencies or even the things that we say we want to do. And so having that emergency fund there is so important so that later on, you're not dipping into things like the 401k when an emergency comes or a HELOC when the emergency comes.

[Caller]

Got you. Got you. So Lane, in a little bit, you know, have a considerable amount in emergency fund, but attack the. Attack the heloc.

[Jade Warshaw]

No. So we'll talk. Let me, Let me put it to you two ways. You're almost there. So the baby steps are baby step one's a thousand dollars saved. After you get a thousand dollars saved, you do baby step two, which is pay. You pay off all of your consumer debt. In your case, that's including the heloc. And then baby step three is you save up three to three to six months of expenses, and then you go on baby step four, five, and six on down the road. We don't need to cover those just now. In your case, though, since there is a baby on the way, we kind of call that storm mode, which is whatever baby step that you're on. In your case, baby step two, we stop, pause, and we stack up as much money as we can. Knowing that there's a baby coming, there could be added expenses, and we want to be ready for that. So once the baby comes and you go, okay, everything's good. You know, like I said, maybe you paid the deductible, but you've still got, I don't know, 10 grand sitting there. That 10 grand doesn't stay there. Now you push play on the baby steps, and it goes back to paying off the debt. Does that make a little. Does that make it a little clearer?

[Caller]

Yes, that makes perfect sense.

[Jade Warshaw]

Awesome. Listen, that's. That's what Ray would do. That's what. That's what Dave would do.

[Ken Coleman]

So true. I love that. Hey, devonte, man, listen, I love your spirit. I love that you've got a clear goal ahead of you. And, and, you know, right now, this is. You're working as hard as you can work. You are stacking jobs. You're.

[Caller]

You're.

[Ken Coleman]

You're just not able to be turned Down. If you're out trying to sell a house or sign up somebody who's looking for a house. You know, you just have got to turn this into big time intensity. And that's the best thing you can do for, you know, when you've got this, this sense of, oh, I gotta provide. And I get that. And I can hear it all over you. And no judging yourself, just moving forward. Just turn that angst into effort. And I think if you do that, you will be surprised at how quickly opportunities come to you to make more money so that you can move forward. So I mean that, that is, that's the play. Owen is up next in Asheville. Oh, and how, excuse me, Nashville. Owen, how can we help?

[Caller]

Hey guys. I was hoping to get your take on, you know, how, how young, you know, young couples can kind of navigate car ownership, some things like that. You know, honestly, I'm actually currently working on my wife's blown up car to repair it, to either keep it or sell it. But man, we've been shopping around for a car and the used market, the new market. And I'm just over here like, wow, do people really buy these things? Like that's too much. And I'm like, use Rav Fours. $30,000 for a used car. I'm like, no, I'm just not doing it so well.

[Jade Warshaw]

What do you have to spend?

[Caller]

Well, kind of, kind of whatever I want. But then I'm hitting our savings and things like that and we have a very large savings for a home right now. So that's kind of what I'm hoping to get through and hopefully.

[Ken Coleman]

What do you want? What do you want to get? What kind of a car? What do you want out of it?

[Caller]

So currently my wife has a Prius, which is one of the larger small cars and she is, she is pregnant.

[Ken Coleman]

Okay.

[Caller]

And so we're expecting a child.

[Ken Coleman]

So a small SUV to mid size suv?

[Caller]

Yeah, something like that.

[Jade Warshaw]

Okay. You guys debt free?

[Caller]

Completely, yes.

[Jade Warshaw]

Okay.

[Ken Coleman]

What about 15 grand? How's that number hit you?

[Caller]

No problem. We were going to put that down and, and try to maybe finance a little extra finance.

[Ken Coleman]

15 to 20. If you can do 15, you can do 20 and not feel indigestion, right?

[Caller]

Well, we were looking in the 25s, but the problem is for the, for the kind of vehicle that we can get for that price range, you know, now I have my wife in a car with 200,000 miles on it.

[Ken Coleman]

Not true.

[Caller]

And our new child.

[Jade Warshaw]

Oh, and wait a minute. Even to that degr my car has 200,000 miles on it. Almost.

[Ken Coleman]

Well, but we're in the wrong narrative.

[Jade Warshaw]

Yeah.

[Ken Coleman]

Oh, and I just bought my son two years ago a Ford Explorer that had 98,000 miles on it. We got it for 13 grand. It's an older model, but it's in phenomenal shape. And it's got, like I said just right now, he's only got 101,000 miles on it. So this idea that you can't get something that's decent mileage in the 15 to 20 range is not true.

[Caller]

Yeah. Well, that brings me to the. I guess the frustrating part is when we look at vehicles like that, we always look at each other and say, well, why don't we just keep your Prius then? Because it's about to be, you know, have a rebuilt engine in it.

[Jade Warshaw]

Does it fit everybody?

[Caller]

200, 000?

[Ken Coleman]

Well, the baby doesn't care, and the baby fits in there if everybody fits.

[Jade Warshaw]

I thought the reason was nobody. We couldn't fit as a family in the Prius.

[Caller]

No. Well, she wants something a little bit bigger because neither three is. Is tight.

[Jade Warshaw]

Here's what I think. I think you need to do more shopping. If I were in your shoes, I would set my budget first because I, I want that to be the driving factor. Here's what I'm going to spend. Here's. I don't want to spend any more than this number right here. Right. I'd set that first.

[Caller]

Our top cap is 26.

[Jade Warshaw]

Okay. So to no more than $26,000. And then I just work backwards. I say, okay, what are we looking for? We want four doors. We want a mid size. We want it to be the color black, whatever it is. And then run that back because the, the options are there. They might be higher mileage. And then as you begin to narrow that funnel, you might decide, listen, I thought I cared more about the make and model, but really I care more about the mileage. And I just, for whatever reason, I'm not saying it's right, but you might go, I just don't feel good about a car with150,000 miles. Fine, that's your prerogative. But it's going to shift the year in the make and model of car that you get.

[Ken Coleman]

Yeah.

[Jade Warshaw]

So I think that you just have to have a set of priorities listed in order of most important to least important. And then we're working through that model to actually get where you want to go.

[Ken Coleman]

And by the way, you get where Owen is by budgeting, by having an idea what it is that you have and you keep it. The best way to make the most of your money, by the way, is creating and sticking to that budget. And we've got the best tool. It's every dollar. Makes it simple to plan spending, track expenses and savings, save for what matters most to you. It's an easy to use app, so go get it. You can get it at the App Store or Google Play or click in the link of our show notes. Get every dollar right now for free. This is the Ramsey Show. The right questions are the key to unlock personal and professional potential. That means if you're not where you want to be, you are not asking the right questions. I'm Ken Coleman and this is what my new show Front Row Seat is all about. Over my career, I've had the distinct privilege to interview successful people from all walks of life and to coach over 10,000 professionals who wanted more. What sets successful people apart is a never ending desire to learn and grow. Each week I'll be joined by industry leaders and world class experts to have a conversation about how to get better, move up and lead well in work and life. But the best part of this show is you get to be a part of the conversation. Live In Studio will have a group of professionals just like you who have the power to ask questions and steer the discussion in real time. It's an opportunity to get real answers to real questions like how to make the right decisions, have hard conversations, live a balanced life and discover your next steps to growth. Join us every Tuesday for conversations that are guaranteed to surprise, challenge and inspire you. Check out Front Row Seat wherever you get your podcasts.