Sacrifice Now To Secure Your Financial Future

Summary

Podcast Summary: The Ramsey Show – "Sacrifice Now To Secure Your Financial Future"

Episode Details:

• Title: Sacrifice Now To Secure Your Financial Future
• Release Date: May 26, 2025
• Host: Ken Coleman and George Campbell
• Description: The Ramsey Show empowers listeners to build wealth and take control of their lives, regardless of past financial mistakes. Hosted by Dave Ramsey and his team, experts provide solutions to common financial challenges.

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Introduction

Ken Coleman and George Campbell welcome listeners to another episode of The Ramsey Show. They briefly mention their recent participation in the Avail Leadership Summit before diving into listener calls about various financial dilemmas.

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Caller 1: Alex from Seattle, Washington

Timestamp: [00:52] – [08:37]

Situation:

• Age: 60
• Employment: Fired from a home care agency after 10 years.
• Financials:
  • Debt: $2,000 in credit cards.
  • Assets: Owns one home outright (~$700k) and a second home with a $279k mortgage.
  • Retirement: No IRA or retirement plan.
  • Rental Income: Son rents the second home, covering mortgage and utilities.

Discussion & Advice:

• Job Valuation: Ken emphasizes Alex's valuable administrative skills, encouraging confidence in the job market. (02:00)
• Retirement Planning: George advises paying off credit card debt immediately and leveraging the second property as a potential retirement income source. He highlights the importance of diversifying investments beyond rental income. (06:23)
• Maintaining Assets: Ken and George recommend not selling the rental property yet but using it strategically to bolster retirement funds. (08:08)

Notable Quote:

"You've lost all of your confidence. You've lost your mojo. So part of this journey is rediscovering this new chapter for Alex." – George Campbell [07:19]

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Caller 2: Daniel from San Antonio, Texas

Timestamp: [10:40] – [19:58]

Situation:

• Debt: Approximately $50,000 across multiple lines of credit.
• Income: Combined household income of $120,000.
• Issue: Significant debt accrued from purchasing a new home and door-to-door sales.

Discussion & Advice:

• Budgeting: George introduces the debt snowball method using the EveryDollar app, urging Daniel and his wife to create a stringent budget by cutting non-essential expenses. (15:05)
• Debt Elimination: Emphasizes aggressively paying off the smallest debts first to gain momentum. (17:49)
• Income Enhancement: Ken encourages seeking additional income sources, such as taking extra shifts or side jobs, to expedite debt repayment. (16:25)

Notable Quote:

"You Guys have a lot of time left. If you're in good health, you could work another 10 years and really build up a sizable nest egg." – George Campbell [07:09]

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Caller 3: Joe from San Diego, California

Timestamp: [22:28] – [31:25]

Situation:

• Business Scenario: Acquired a colleague’s book of business without purchasing it financially, in exchange for employment.
• Dilemma: Determining appropriate salary for the employee, considering the employee's personal debt.

Discussion & Advice:

• Fair Compensation: George advises basing the employee's salary on market rates and the value they bring, not on their personal financial situation. (25:58)
• Maintaining Professionalism: Emphasizes treating the employee like any other, ensuring dignity and fairness to prevent resentment. (30:25)
• Business Health: Recommends not letting personal feelings affect business decisions, even if it means hiring externally to maintain a healthy work environment. (30:32)

Notable Quote:

"We don't want people going into debt because they took on a job. So we don't do it to say, 'Hey, you need 10,000 to live, let's pay you 10,000 a month.'" – George Campbell [24:29]

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Caller 4: Lindsay from Maine

Timestamp: [34:11] – [37:34]

Situation:

• Debt: $3,000 in non-refundable airfare for a canceled trip that must be used within a year.
• Dilemma: Whether to use the tickets in a cost-effective manner or accept the loss while continuing on the debt payoff journey.

Discussion & Advice:

• Utilizing Sunk Costs: George suggests maximizing the use of the tickets by planning a budget-friendly vacation, such as staying with family to minimize lodging costs. (35:42)
• Balancing Finances and Memories: Encourages finding a middle ground where Lindsay can create memories without significantly impacting their debt repayment strategy. (36:00)

Notable Quote:

"We're going to go down to one of those little Elvis wedding chapels. God bless." – Ken Coleman [53:23]

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Caller 5: Bethany from Los Angeles, California

Timestamp: [37:34] – [43:12]

Situation:

• Income: $600 monthly surplus after paying off all debts except a $50,000 mortgage.
• Financial Goals: Interested in investing for retirement or saving for a house down payment.
• Current Investments: Multiple TFSA and RSP accounts with $12,000 in savings.

Discussion & Advice:

• Emergency Fund: George recommends building a robust emergency fund of 3-6 months of expenses before further investing. (38:27)
• Investment Strategy: Suggests utilizing a brokerage account for non-retirement investments, focusing on mutual or index funds for growth over the 10-year horizon. (39:31)
• Maximizing Contributions: Advises increasing contributions to retirement accounts like the Roth IRA to 15% of household income to bolster long-term savings. (73:36)

Notable Quote:

"The power of you guys making this move will change the direction of your family in the best way, and the money will just show up because you guys are willing to work for what's important to you." – Ken Coleman [76:20]

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Caller 6: Zachary from Las Vegas, Nevada

Timestamp: [55:54] – [65:00]

Situation:

• Career Conflict: Struggling with selling whole life insurance products he no longer believes in while transitioning to a professional basketball career.
• Moral Dilemma: Balancing financial needs with personal integrity and career aspirations.

Discussion & Advice:

• Ethical Selling: George encourages Zachary to align his sales role with products he genuinely believes in to maintain personal integrity and mental well-being. (62:10)
• Career Transition: Advises focusing on the impending basketball career and suggests severing ties with the insurance role to prevent further moral conflict. (63:53)
• Financial Stability: Emphasizes the importance of making decisions that support both financial and emotional health. (64:07)

Notable Quote:

"You're not going to thrive, mentally and emotionally, when you are selling a product that you don't think is a good product." – Ken Coleman [61:22]

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Caller 7: Aaron from Columbus, Ohio

Timestamp: [79:00] – [85:07]

Situation:

• 401(k) Issues: Experienced a loss of potential gains due to a 7-day blackout period during a 401(k) provider switch, resulting in missed market rally gains (~$18,000).
• Investment Horizon: 30 years until retirement.

Discussion & Advice:

• Understanding Limitations: George explains that such blackouts can lead to missed gains but are a part of retirement plan transitions. Advises focusing on long-term investment strategies rather than short-term setbacks. (82:19)
• Action Steps: Recommends obtaining detailed reports from HR and 401(k) providers to understand the specifics of the transition and prevent future occurrences. (81:49)

Notable Quote:

"What's important is to not let this get you down. It's a part of the reality of an employer retirement plan." – George Campbell [82:19]

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Caller 8: Ruby from Washington, D.C.

Timestamp: [83:55] – [77:28]

Situation:

• Debt-to-Income Ratio: Currently at 42% due to $34,919 in consumer debt.
• Houseing: Paying $2,660 mortgage monthly, including utilities close to $2,990.
• Employment Uncertainty: Husband may lose work permit in two years, risking income stability.

Discussion & Advice:

• Risk Assessment: George advises selling the home to reduce financial burden, especially given the potential loss of income. (86:02)
• Alternative Options: Suggests moving to cheaper rent to minimize expenses and reduce financial risk. (86:35)
• Future Planning: Ken and George emphasize the importance of financial stability over maintaining home ownership under uncertain income conditions. (87:04)

Notable Quote:

"If he loses his income today, that mortgage becomes 70% of your take-home pay. There's no way to keep this house." – George Campbell [86:52]

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Conclusion

Ken Coleman and George Campbell wrap up the episode by reinforcing the importance of budgeting, strategic debt repayment, and making informed financial decisions to secure a stable future. They encourage listeners to subscribe, like, and share the show to reach a broader audience and provide resources through the Ramsey Network app.

Notable Final Quote:

"Subscribe because that helps us grow. You know how the algorithms work." – Ken Coleman [78:53]

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Key Takeaways:

1. Confidence in Job Skills: Recognize and leverage your valuable skills in the job market.
2. Debt Snowball Method: Systematically eliminate debts by focusing on the smallest balances first.
3. Fair Compensation: Base employee salaries on market rates and job value, not personal financial situations.
4. Utilize Available Resources: Make the most of sunk costs by planning budget-friendly strategies.
5. Emergency Funds: Prioritize building a robust emergency fund before aggressive investing.
6. Ethical Financial Practices: Align your career with products and roles you believe in to maintain integrity.
7. Long-Term Investment Strategies: Focus on long-term growth and avoid getting discouraged by short-term market fluctuations.
8. Risk Management: Be prepared to make significant financial decisions, such as selling assets, to mitigate future risks.

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This episode of The Ramsey Show provided comprehensive advice across diverse financial scenarios, emphasizing the importance of strategic planning, ethical decision-making, and maintaining financial stability amidst life's uncertainties.

Transcript

[Ken Coleman]

Brought to you by the EveryDollar app. Start budgeting for free today. This is the Ramsey show, where America comes to have a conversation about their money, their profession, and their relationships. We're so excited to have you with us alongside the incomparable, the Natalie attired, George Campbell. I'm Ken Coleman. The phone number to jump in today is 888-825-TRIPLE, 882-55225. It's Friday, George, and you know, welcome home. It's good to be back.

[George Campbell]

You and the crew have been at entree Leadership Summit.

[Ken Coleman]

Leadership Summit, Our signature leadership event. Always fun and just a joy. So let's get right to it, shall we? Alex is in Seattle, Washington. Alex, how can we help today?

[Caller]

Thank you so much for both of you taking my call. And I'm sorry if I sound a little nervous. I'm 60 years old. I'm being quiet. Fired from. And I don't know if I'm going to be able to find work. And so I'm trying to figure out what my next steps could be.

[Ken Coleman]

What do you do? Right now?

[Caller]

I do. I work for a home care agency and I do billing, payroll, scheduling, and I hire.

[Ken Coleman]

Okay.

[Caller]

I've been doing that for 10 years.

[George Campbell]

Jack of all trades.

[Ken Coleman]

Yeah, but, but, but very administratively gifted, I'm gathering.

[Caller]

Yes.

[Ken Coleman]

You see details and checklists and you go through them like a lawnmower, right?

[Caller]

I do. I do.

[Ken Coleman]

Okay. The reason I stopped and kind of focused on that is I want you to understand how valuable you are in the marketplace right now. There are just always going to be companies, small businesses, who need somebody like you, who could wear a lot of different hats, as George pointed out. But you're just so valued because your ability to come in and take details and what might be a bit of a mess and clean it up. Does that still feel right to you?

[Caller]

It does.

[Ken Coleman]

Okay, so that's the narrative. That's the mental language you need to be using for yourself as you begin to start looking aggressively. I'm assuming you're looking for other jobs right now, given that you feel you're being quiet. Fired.

[Caller]

Yes. I've been looking for work, and then I've been looking at maybe starting something, you know, that I don't know if I'm too old.

[Ken Coleman]

What do you mean by starting something?

[Caller]

Start starting a small. Like starting my own small business and doing this for other. Instead of just doing it for one agency, doing it for, you know, I like the service.

[Ken Coleman]

I like it. I think it's both. And though, in other words, if we can find something here soon to create a bridge for you. In other words, no interruption in payment. We get out of the current situation that we're in and then we get stable by just walking right to something else. And then begin to contract yourself out and build that to where you can be very, very successful over the next eight, ten years. And. And I want George to jump in here on the. On the retirement question, but one other quick question. What makes you feel like you're being quiet?

[Caller]

Fired three months ago. So it's a. I worked for this company for 10 years now, but two years ago, a year and a half ago, it was sold. The person that has it now stopped talking to me about three months ago. Does it. I'm shunned in the office. People just kind of walk around me the whole. I can feel it in the air. Meetings I used to be included in, I'm no longer included. They need me to do the thing doing. But you really get the feeling that I'm not valued.

[Ken Coleman]

Yeah. Yeah. I'm so sorry, Alex. And here's what I want you to hear. The good news, this is all bad news. Except there's one little silver lining in this I'm gathering. And the silver lining is that they're not brave enough to actually fire you. They're cowards. And you're still. And they're not hampering you from doing your job. Correct? Did I pick up on that?

[Caller]

Correct.

[Ken Coleman]

Okay, so here's the deal. So Alex, here's the deal. This sucks. I'm not going to try to put a. I'm not going to try to put lipstick on a pig here. Okay? This sucks. This speaks to why I'm in the work that I am. Because this is an example folks of what it feels like when you aren't valued at work. It's soul sucking. It leads to burnout because you're a human being. All of this sucks. But the one piece of good news is they're not pushing you out. And as long as you don't rock the boat, I think they'll probably just wait you out. So let's play their game. Game. So let's flip this thing. And now you become you. You do your job, but you are every extra second you have at night. You. You are now treating a full time second job as getting the next gig. And do exactly what the advice that I gave you. But I want to. You got what I'm saying?

[Caller]

I do.

[Ken Coleman]

Aggressive. Aggressive. And don't worry, don't try to fix this situation. It's not fixable. But let's take advantage of it in that they're not pushing you out. And I gave you what I think your next steps are. But I want to bring George in for the retirement question because, George, I don't want her to get panicked in this situation. I want you to give her, give her some coaching here on how she could prepare and where she's at. Give us a sense, Give George a sense of where you're at today in retirement.

[Caller]

So I have 60. I don't have an IRA or any actual plan. So let me just start by saying that. And I. That keeps me up as my. I just didn't do it. I just didn't do what I needed to do. I have 60. I have $2,000 in credit card debt. I own one home outright. Whenever I look at that on, you know, one of the sites, it goes anywhere from 7 to 800k. And then I have a second home with a current mortgage of and on that is. I owe $279,000 on that house.

[George Campbell]

Is it being rented?

[Caller]

Yes. My son currently lives in it and he rents it. He's good about that. I want to try to keep it.

[George Campbell]

Is he paying market rent? Like, what's your total expenses versus what he's paying?

[Caller]

So the total expenses to do that home is to manage that home is about 4,000. The mortgage, utilities, all of those kind of things to live in there. And he pays that. I don't make anything, but I don't paying anything.

[George Campbell]

Okay, that's for another time, but at least tells me that you do have some money laying around. Let's say, worst case, you could sell that property and use that for retirement income or use the rental income as a retirement income. So all is not lost here. I don't want you to give up hope, but you do need to get investing. It's wise to be diversified and not rely totally on rental income or the sale of this property to fund the rest of your life.

[Caller]

Okay.

[George Campbell]

And I would pay off the credit card debt today.

[Caller]

Okay.

[George Campbell]

Why are you hanging on to the credit card debt?

[Caller]

I don't have a good reason.

[George Campbell]

Okay. I would encourage you to pay it off and then even cut them up. Take it a step further because you don't need lenders. You have Alex. You have bank of Alex at your disposal. 60 grand saved. You have an income still. I would utilize that. And I feel like you have lost all of your confidence. You've lost your mojo. So part of this journey is rediscovering this New chapter for Alex. And you keep saying I'm too old, I'm too old. Dave Ramsey's offended. He's just a few years older than you. And the man's just getting started. And so I want to encourage you, you still have a lot of time left. If you're in good health, you could work another 10 years and really build up a sizable nest egg and make a real impact with your career and help a lot of people along the way.

[Ken Coleman]

Yeah, real quick. I wanted to jump in, George, and ask, how much is the rental house worth and how much do you owe on it? Tell that real quick.

[Caller]

I owe 279,000 on it. And when I look at that, it's anywhere from 4 to 500. I bought it and when I was older.

[George Campbell]

Amazing. So you're, you're a net worth millionaire, Alex, you're not doing as bad as you think. I'd keep my chin up, go find another job, go help some people and start investing as much as you can.

[Ken Coleman]

George, point blank, would you sell the rental house and stick that into the retirement strategy?

[George Campbell]

That would be my jump start play as a worst case scenario. All right, that would definitely hold on.

[Ken Coleman]

To it for now.

[George Campbell]

Yeah.

[Ken Coleman]

All right, very good. All right, Alex, listen, get your chin up, take control of the future right now and find a place where you're valued. It's going to change your life. You know, one of the first things I discovered working in the financial world is how absolutely devastating it is when the breadwinner of a family dies and there's too little life insurance or none at all. Grieving families are suddenly left behind, scrambling.

[George Campbell]

To pay bills and trying to make ends meet.

[Ken Coleman]

I also discovered that there are a lot of rip offs in the life insurance world like that whole life crap posing as an investment opportunity. What you need is level term life insurance, usually 10 to 12 times your income, which is the smartest, most affordable way to protect your family. The key is finding an independent broker who represents a ton of companies and works for you, not for the insurance company. This is exactly what my friend Jeff Zander and his team at Zander Insurance are all about. They shop the term life companies to find you the best options. And they've been around for over 95 years, so you know they'll be there when you need them. Zander is the real deal and that's.

[George Campbell]

Why they've handled all my personal insurance.

[Ken Coleman]

For over 25 years. I trust them and you can too. Visit Zander.com for instant online quotes or for a more personal Touch. Give them a call at 800-356-4282. All right, Daniel's next in San Antonio, Texas. Daniel, how can we help today?

[Caller]

Hey, thanks for taking my call. I just have so many different debt. Lines of debt, lines of credit. And I don't know exactly when each payment's coming out or how much is coming out. I'm just wondering how I kind of get that under control.

[Ken Coleman]

All right, well, you're in the right place. George loves tackling multiple lines of credit.

[George Campbell]

I love it.

[Ken Coleman]

It's like trying to untangle fishing line for you.

[George Campbell]

That's a reference I don't understand, but I imagine it's difficult. That's what I know. I get. I get the vibe My.

[Ken Coleman]

My guess is you're better at this than that.

[George Campbell]

Yes, thank you. Yeah, I'll stick to lines of credit.

[Ken Coleman]

Okay.

[George Campbell]

So, Daniel, how long of a period of time has this been happening? Is this years, or was this a sudden life change that caused you to go into all this debt?

[Caller]

Well, it's really only been a big issue since I bought a house.

[George Campbell]

So you couldn't afford the house when you got into it, and then there was what, Repairs, renovations? What happened?

[Caller]

It's a brand new house, so no repairs or renovations. But those door to door guys are pretty good.

[George Campbell]

Did you get sold on solar.

[Caller]

And a water softener?

[Ken Coleman]

Oh, my gosh.

[George Campbell]

Hey, let's stop answering the door for strangers. Daniel, can you make a promise? Just imagine, it's stranger danger and a Kirby vacuum. Vacuum.

[Caller]

We got it for 1500.

[George Campbell]

What a deal.

[Ken Coleman]

Wow. So he's got a clean house. It's powered by the sun and his water salt.

[George Campbell]

Yeah. Who's we?

[Caller]

Me and my wife got married in January. We bought the house in December.

[George Campbell]

Oh, so there's an accomplice to the crime.

[Caller]

Yes.

[George Campbell]

Okay. Are you feeling the brunt of this? How is she feeling about all these lines of credit and drowning in the payments?

[Caller]

We are very much together on feeling the brunt of it. We both work together a lot on getting this paid. We don't right now have an account together, which we need to do. That's something we've talked about is getting.

[George Campbell]

A bank account together 100%.

[Caller]

Don't really?

[George Campbell]

That should have been day one.

[Caller]

Yeah.

[George Campbell]

Get one joint checking account that all income goes into and all expenses flow out of. That's the simplest way. Because right now you've overcomplicated your life. It's overwhelming. And we can help with the. With the credit side. Have you pulled your credit report to understand Everything that's out there.

[Caller]

I'm not sure I completely understand. I don't think I have.

[George Campbell]

Okay, so the credit report will show you every single line of credit, what is owed, who holds it. So that's going to be your homework. And go to this website, annualcreditreport.com and you can pull your credit report from the bureaus. There's three of them.

[Caller]

Okay.

[George Campbell]

Yes. And never pay for this. It's, it's free to do. And you can pull your report from all three bureaus, Experian, TransUnion and Equifax. You'll see it right there on the site. So request the free reports. Once you get those, it'll give you a real clear picture of what is owed. And so it's going to show you, the creditor name the balance, the apr, the minimum monthly payment. And if you can't find any of this out on the credit report, contact the creditor to find out, hey, when it, when is the due date, what is the minimum monthly payment, what are, you know, make sure that everything lines up the last four digits of the account. So you've got some administrative work to do. And then the real work work begins of going, okay, we got to clean this mess up. That's the bigger problem, right?

[Caller]

Yes.

[George Campbell]

What's the total debt amount as far as, you know, excluding the mortgage?

[Caller]

Excluding the mortgage. Okay, so that makes a little easier.

[George Campbell]

You can ballpark it. Is it 10 grand? Is it 100 grand?

[Caller]

Around 50. Okay, around 50 grand.

[George Campbell]

And that is between the lines of credit, the things you guys went into debt for, for the house. Anything else? Are there cars, are there student loans?

[Caller]

No, no student loans. And we both have a paid off car.

[George Campbell]

Okay, so you have 50 grand in debt. What is your household income?

[Caller]

That's kind of spotty right now. I'm in. I just got a new job. I'm a waiter. So the, it goes up and down, but we've both made consistently anywhere from 60 to 70,000 each the past three years.

[George Campbell]

Okay, and so you're on track to make 60,000 as a waiter this year? You said a new job. Okay, what were you doing before making 60 or 70?

[Caller]

I was a waiter at a nicer restaurant.

[George Campbell]

And why did you downgrade?

[Caller]

Well, the company I worked for transferred me to a struggling location and then I quit that job to become a door to door salesman.

[George Campbell]

And that worked out?

[Caller]

Well, I don't do that anymore. I was selling Internet. Yeah, I was selling Internet.

[George Campbell]

Okay, well, here's the key. I want you to get your Income back up so that we can get out of this debt faster. Because you're telling me right now you guys make six figures as a couple?

[Caller]

Just about.

[Ken Coleman]

Yeah, yeah, Daniel, just jumping in real quick. You need to be working as much as you possibly can. So I don't know if that's another restaurant, a better restaurant, adding two restaurant jobs, even if it's picking up two or three shifts, you gotta get more income in here to get some momentum.

[George Campbell]

Okay? And as far as the plan to get rid of this debt, you and your wife are going to sit down tonight and you're going to make your first budget and we're going to gift it to you. It's called EveryDollar. It's an app that you both can log into, have total, you know, transparency into what's going on with their finances. You're going to list your take home pay for the month. So you're going to list your paychecks that are coming up. Right. You'll kind of have a ballpark of what those are. And then beneath that, you're going to list all of your expenses. And if to make this easy, you can look at your bank statement from the last month to show you, hey, here's what our light bill normally is, here's what our mortgage is, here's our insurance bills, all the things. And then what you're going to do is judiciously cut every single thing that you do not need for survival. Do you understand what I'm saying?

[Caller]

Yes.

[George Campbell]

So if it's not food, utility, shell, you know, shelter, transportation, insurance, it goes out the window, which means we're not eating out, we're going to cut subscriptions, we're going to cut everything out of our life that we don't need for survival. Because right now we are in survival mode. And I want to get you out of that.

[Caller]

Okay?

[George Campbell]

And at the bottom of that budget, you're going to list your minimum debt payments. And that's going to give you a really clear view of where you're at. You can list the balance and the minimum payment and then you're going to follow what we call the debt snowball method, where you systematically knock out the smallest debt first while making minimum payments on the rest. And that allows you to do something you haven't been able to do in a long time, which is just focus, focus on one thing at a time.

[Caller]

Okay.

[George Campbell]

You guys have any savings right now?

[Caller]

We used it all while I didn't have a job.

[George Campbell]

So you're down to like just paycheck to paycheck on the checking account. Nothing in savings.

[Caller]

Nothing in savings.

[George Campbell]

Okay, so your step one is Baby step one, which is the thousand dollar starter emergency fund. And that's going to happen in the next paycheck or two, right? You guys will have $1,000 flow through your hands.

[Caller]

Yes.

[George Campbell]

Okay, what you're gonna do is set aside the thousand dollars before you start attacking this debt snowball. And what you're gonna do is ignore the interest rates. You'll know what they are, but you're gonna ignore those and just focus on the smallest balance. Can you tell me what the smallest balance is?

[Caller]

Thousand dollars.

[George Campbell]

Perfect. So that's your next goal. How quickly can we knock this out? Making extra payments, working extra, selling stuff, doing whatever it takes. And once that's knocked out, you free up that payment. That payment's what, a hundred bucks? 200 bucks.

[Caller]

That minimum is $29.

[George Campbell]

$29. So now you free up 29 bucks to apply to the next debt and you see how the snowball starts to roll and gain momentum.

[Caller]

Yes, sir.

[George Campbell]

That is the key. That's how millions have done it. That's how I did it. And I'm telling you, if you just trust the process and trust the plan, you guys will be out of this debt. I'm guessing, let's see, making 120k, you owe 50. You could probably get out of this thing within a year. Okay, but you know what that means, right? Basic napkin math says we got to put like four grand a month towards this thing.

[Caller]

Yes.

[George Campbell]

And you're bringing in probably eight grand a month. So you see the game here? It's to find as much margin as we can by spending less and making more. And so every month, come hell or high water, we're going to throw four grand of this debt because we want to be done with this within a year and not be a married couple 10 years down the line, still in crippling debt. So hang on the line. We're going to send you every dollar premium to help you guys through this. And also Financial Peace University so we can walk with you, give you the financial literacy and the tool to apply it with that budget. We're rooting for you, man.

[Ken Coleman]

I like that you pulled an old phrase out. Hell or high water. I'm not even sure you understand it.

[George Campbell]

I think there's water and fire involved.

[Ken Coleman]

There is.

[George Campbell]

That's all I know.

[Ken Coleman]

And neither one are good choices.

[George Campbell]

I like it.

[Ken Coleman]

You gotta make something.

[Caller]

There's a time in your life and at the baby steps for renting but you don't want to do it forever because when you rent, you're still paying for a mortgage, just somebody else's. Plus, rent means instability in your budget because it always goes up, never down. So when you're ready to buy, make sure you work with a mortgage partner. You can rely on Churchill Mortgage. Churchill is Ramsey trusted to help you make the move from renting to home ownership wisely. Churchill understands that when you buy a home the Ramsey way, your mortgage payment will be a consistent, manageable part of your monthly budget. Plus, when your home is paid off, that was your largest expense. Now it's extra money in your pocket and an asset towards turning you into a baby steps millionaire. Get started on the American dream of home ownership [e-mail] that's Churchillmortgage.com.

[Ken Coleman]

Hey, how many of you out there are tired, exhausted about the paycheck to paycheck style of living? You just want to get out of it. The hamster wheel is just wearing you out. If that's you, you gotta listen. This is an opportunity. Low, low effort, but high return. It's a free budgeting training. This month you're gonna learn step by step how to make and stick to a budget. Using EveryDollar, you can get all your biggest budgeting questions answered in the live Q and A. This is free, folks. Sign up for [e-mail] webinar everydollar.com webinar this is the way to kind of just kick the tires and take the and actually learn how to do the one thing that will change your financial life. So check it out. We'd love to see you there. Joe is up next in San Diego, California. Joe, how can we help?

[Caller]

What's going on? Thanks for taking my call.

[Ken Coleman]

You bet.

[Caller]

Maybe a loaded question, but pretty much is it appropriate for me to ask an employee about their personal finances? Try and dig into it to understand what to pay them in the situation that I did buy this person's book of business in exchange for them having a job, steady income.

[Ken Coleman]

All right, before we dive into that, and I'll defer to George on this one, but I, I'm curious, is there not a market value range of salary that you already aware of? And then are you asking this question in the context of that, in other words, you know, the range of what the market says you should pay somebody with his experience or his or her experience and skill, or are you just sticking your thumb in the air?

[Caller]

So I have a general idea and it's A lot less than what they're getting paid right now. But I also know that they're have a lot of personal debt from their business line that we purchased. I know the person has a friend, you know, now we're just work colleagues, you know, there's not really too much friendship. But the answer is I do know.

[Ken Coleman]

Okay.

[Caller]

But it's kind of the struggle to keep a good workplace and make sure that they are, in a sense, taken care of. Also because I'm, you know, I'm weaning them off right now. Weaning them off being used to be able to live frivolously.

[George Campbell]

When you said you bought the book of business, did you write them a check? How did that go?

[Caller]

No, I actually acquired it for free. So it's actually, we had a document drafted that pretty much gave us the book of business in exchange for their employment, guaranteed for six months.

[George Campbell]

What do they get out of this?

[Caller]

So they get a job. Essentially. They get a job. He's getting paid off. The bottom line. He runs one of our branches. We have two branches. It was a big plus for us in terms of going from probably 300 to 400,000 for this year to probably a million plus in revenue. So there's a big benefit on our end. And unfortunately, he ran his business into the ground culturally, financially. So that's where we came in. Compliance wise, they didn't get the insurances they needed because of law.

[George Campbell]

So you swooped in and said, hey, I'll take over and I'll give you a job. And that was agreed upon. Deal?

[Caller]

Yes.

[George Campbell]

Okay. I'll tell you how we view this at Ramsey. And we never look at someone's personal finances to figure out how much we're going to pay them. The only reason we do a budget in the interview process is to make sure that what we pay them is enough for them to live. And so that gives them an out to say, hey, listen, I'd love to take this job, but I can't afford to. We don't want people going to debt because they took on a job. So we don't do it to say, well, they need 10,000 to live, let's pay them 10,000amonth. I think that's a different situation. So I would not base it on how much debt he has. I would base it on the value that they are bringing to the organization and what the market rate is. Because what you don't want is for them to get underpaid to where they go, well, I can go elsewhere and make more, but I'm in this contract and stuck in this purgatory with handcuffs on because that's not gonna create a great employment situation for them, which is only gonna hurt you in the end.

[Caller]

Yeah.

[George Campbell]

So give me a ballpark of what you think this role would get paid. What would you pay someone else to run a branch if you hired from the outside?

[Caller]

75 to 80,000 hourly with some bonus based off performance.

[George Campbell]

Great.

[Ken Coleman]

What were they paying themselves before you bought their business?

[Caller]

It's hard to determine. I went into their numbers. They were pretty much paying themselves out of the business, him and his fiance, anywhere from 15 to $20,000 a month or more on big months.

[George Campbell]

And you're telling me that was a poor choice based on how this business was run? He was overpaying himself, Overpaying themselves, taking.

[Caller]

On debt they didn't needed. They didn't need spending out of the business, haven't paid taxes in three years. So he owes back taxes for those, for that business for all through the last three years.

[George Campbell]

Wow.

[Caller]

Like he's mentioned like some like 20 something thousand, but you're telling me 80k.

[George Campbell]

Is market rate to run a branch in your field?

[Caller]

Yes, I'd say, yeah, that'd be the higher side. You know, with his experience and his repertoire and being able to handle sales and logistics.

[Ken Coleman]

Okay, but that's. Yes, that's a big gap. So.

[George Campbell]

Yeah. Is it going to be on him to say I can't take this job? Because it sounds like he has to take it based on the agreed upon contract.

[Caller]

He doesn't have to. So he doesn't know. He. We don't. We don't. Essentially he's very, He's a valuable asset to the team, but it's just trying to figure out the balance between being a good guy and making sure he's taken care of. That's why I feel like I need to see something. And I know him, like I said, as a, as a friend from prior to business. I actually, long story short, I started helping, started helping build his business. We had disagreements. You know, I was like, hey, I need ownership in this thing. It was kind of like a young start. I'm relatively young. And he's. We went down the road of no. So I left, started my own business in the same field now. Now acquired his business line.

[Ken Coleman]

Sure. No, I get that. Let me, let me jump in here because I really appreciate your heart. You're a good dude and I love the spirit by which you're entering into this decision. However, you've already pointed out that He. That he was paying himself too much based on the business. And I understand you already have an existing business, but you. You, as you talked to us today, you have a pretty good idea the market value you told us, but you also have a pretty good idea about what's a healthy number. And anything above that is you doing charitable work, True?

[Caller]

Correct. Yeah.

[Ken Coleman]

What's that?

[Caller]

Charitable work.

[Ken Coleman]

What's the max number that you're. Let's forget anything that he tells you in the days ahead as you dig into his finances or the way George told.

[George Campbell]

Whether he has 500,000 in debt or nothing, it doesn't reflect what you pay him.

[Ken Coleman]

That's. So what I'm getting at is what's the max number? That's not charitable.

[Caller]

Max number. That's not charitable. 85 to 90. Like, not much higher than that. I'd be like, the best of the best.

[Ken Coleman]

Yeah. You can't justify a nickel beyond that. True or false?

[Caller]

That's true.

[Ken Coleman]

Well, then that's the number.

[Caller]

Okay. Yeah. The other reason I guess I was justifying it was this was partially the debt, but then also partially, like, well, look, we wouldn't have this business line. But I was telling him, dude, there has to be business, a balance. You can't just say, oh, well, you wouldn't have this business line if.

[Ken Coleman]

Exactly.

[Caller]

If it wasn't for. You know what? I was like, well, you wouldn't have a business at all.

[Ken Coleman]

Exactly.

[Caller]

We didn't step in. And now his employees are getting way better ratings, better performance. Everything's improved, you know, Everything has improved from A to Z.

[Ken Coleman]

Correct. So, Joe, that's why I'm jumping in here to say if you pay him any more than the number you just gave us, you will. And he doesn't make any changes at all. And there's a good chance that he won't make any changes, correct?

[Caller]

Yeah, there's a good chance. I'm worried about.

[Ken Coleman]

Guess what happens. You become resentful.

[Caller]

Yeah.

[Ken Coleman]

And then this whole thing just becomes a negative taste in your mind. Just a nasty taste. So the max number that you've already. That's it. Don't go beyond that. Now you can incentivize him.

[George Campbell]

As the business grows, as the bottom line grows, so can his income.

[Ken Coleman]

Yeah, but that. It is what it is, my friend. So don't go any more than that. And for that reason, George, I'm gonna come back to what you already said, and I wouldn't be digging in too much to this guy's stuff, because then.

[George Campbell]

It'S gonna feel like you're trying to pull a fast one on him. Based on. And even if it's high or low, I want to treat him like I would any other person who was applying for this job. Give him that dignity and kind of remove all of the history and context and go, this is what I can offer you. And if he becomes resentful or entitled, that's a good sign that he's not the guy for this job. Job.

[Caller]

Yep.

[George Campbell]

And it's gonna suck to have to go back to the drawing board and hire someone from the outside to run this thing. But that's the healthiest thing for the business.

[Caller]

Do that.

[Ken Coleman]

Yeah, exactly.

[Caller]

Honesty, business numbers. I'd rather hire someone else. Train them.

[Ken Coleman]

There you go.

[George Campbell]

And because I like you, Joe, I'm gonna. I'm gonna send you the entree leadership guide to hiring. That's gonna help you make the most of this hire and everyone after that. So hang on the line. Christian will pick up. So we'll make sure to get that guide over to you, my friend.

[Ken Coleman]

Love that. Gotta be careful, George, in trying to be kind that we don't make bad business decisions on a personal decision and it ends up affecting the personal. You gotta have some boundaries based on kindness, but also good common sense for your business. Great stuff there. Thanks, Joe, for the call.

[Caller]

All right, Dave, you have some strong opinions possibly? Yeah, I think so. Okay. Because you really prefer credit unions over big banks.

[Ken Coleman]

Well, credit unions, for one thing, are nonprofit, which means that the members, the customers own the credit union.

[George Campbell]

So any profits that the credit union.

[Ken Coleman]

Makes goes back into customer pricing. So you get better interest rate on savings, cheaper checking and so on, that kind of thing. But what's more important than that though is the fact that the customer is the owner, changes the spirit on the credit union. So I find very few credit unions that aren't very customer centric.

[Caller]

Well. And I think we have found one that is incredible and that's Fairwinds. They are an incredible credit union that is really out with the heart to help the customer.

[Ken Coleman]

They're the right kind of people with the right kind of values and they've done a really, really good job with.

[George Campbell]

Customer and the deals that they're offering.

[Ken Coleman]

The Ramsey tribe is incredible.

[Caller]

Yeah, absolutely. And I love that the things that we teach, they so line up with. And you're right, their customer service is unbelievable. Winston and I just signed up and we got an account. And I'm not kidding, it took less than five minutes. It was so user friendly. Like the step by step approach was Unbelievable. And then the next day, my phone rings and it says fair wins on my phone. So I answered it and talked to someone there and they said, yeah, they give calls to every new customer. And so, again, they just really care about your experience, and I so, so appreciate that. Plus, anything that you can do at a traditional branch, you can do with [e-mail] or on their app. And you'll have free access to over 33,000 ATMs.

[Ken Coleman]

Hey, you guys know how much I hate banks in general. And so for me to do this is a big deal. Talk to our friends at Fairwinds and.

[George Campbell]

Check out the combined checking and savings.

[Ken Coleman]

Bundle that they created just for the Ramsey tribe. You guys, it's incredible.

[Caller]

Yeah, you gu. It's so easy to join Fairwinds no matter where you live. So go to fairwinds.org Ramsey Fairwinds is.

[George Campbell]

Federally insured by NCUA.

[Ken Coleman]

It's time for our why Refi Ramsey show. Question of the day. If you're buried in defaulted private student loans, you're not alone. You can reach out to Y Refi to see if they can build a custom plan to help dig you out. Visit yrefi.comramsey today. That's why refi y r e f y.com ramsey it may not be available in all states.

[George Campbell]

Today's question comes from Lindsay in Maine. Last year, I bought plane tickets at a cost of $3,000 for me and my three children to go on a trip. Unfortunately, it had to be canceled, and the only thing we couldn't get a refund on was the airfare, which had to be used within a year. Fast forward one year and I'm still working to pay off my debt. Do I go ahead and take a loss on these tickets or try to plan a cheap vacation somewhere? Adding more debt to my budget. What a conundrum. So the airfare didn't go to waste, but she has to use it within a year. But she's on her debt payoff journey still, so she's sort of like, hey, there's a sunk cost here. Do I take advantage of the flights because I still have 3,000 bucks I can use for flights and do it cheap? Or I just don't like the way it was phrased at the end. Adding more debt to my budget. My budgets are for cash flow planning, not planning to go into more debt.

[Ken Coleman]

Yeah, I'm not sure why that has to be the scenario. I, I, I'm curious to know what you think here. I'm wondering if, okay, we've got the tickets. Can we go? You know, is this a thing where we pause the debt snowball, you know me save up for a cheap vacation. In other words, but only bologna sandwiches. We're staying at a discount hotel. A George Camel special. Or is it. Sorry, you're. You know, because this is the Dave. I hear Dave right now going, you're not going on vacation.

[George Campbell]

Yeah.

[Ken Coleman]

You're not doing anything.

[George Campbell]

But if I Knew I had $3,000 in credit, what would I personally do if I was a person?

[Ken Coleman]

That's why I think this is interesting.

[George Campbell]

I'm going to try to give some grace here, some grace and mercy, which is something I rarely do because I'm the get out of debt guy. At all costs do it. But I'm also Mr. Frugal and I go, there's a sunk cost here. And it hurts my soul to just lose $3,000 when I can create a memory. We already the stupid tax hath been paid.

[Ken Coleman]

I see you in their kitchen, George, coming up with a super saver vacation to use these tickets. Don't. I see you doing that.

[George Campbell]

I'm leaning that way.

[Ken Coleman]

I see you doing that.

[George Campbell]

I don't know where they could go without while limiting how much they're spending now. Because my thing is you got to eat anyways, whether at home. So can you go on vacation and go to the grocery store and pass some bologna sandwiches for the week? Great. Can we do all the free activities in that area? Great. The only issue is going to be lodging.

[Ken Coleman]

That's right.

[George Campbell]

So that brings me to. Could we visit family, stay with family and make a trip around that to limit the costs?

[Ken Coleman]

See, I knew you could do it, George. That gives me a headache. But you actually figured that out. If we go stay with family.

[George Campbell]

That's my final answer. Because the, the true cost of vacation is going to be the travel is one of the highest costs. And then you got transportation and food and lodging.

[Ken Coleman]

Yeah.

[George Campbell]

And lodging can really eat up a big portion of the budget. So if you remove the lodging, we can eat cheap and have cheap transportation, have family member pick us up. So I don't know Lindsay's situation, but that's, that's the only way I would feel good about doing that while on the debt free journey.

[Ken Coleman]

Yeah. Yeah, I like that. Well done, sir.

[George Campbell]

I tried to find some middle ground here, find a compromise.

[Ken Coleman]

I think you did. I think you went beyond compromise. I think you got a now you. In exchange, you're staying with the family. You know, that is an exchange. You're staying With Uncle Larry and Aunt Mildred. But they got two extra bedrooms they're in. They got some parks and, and stuff around their house.

[George Campbell]

And if I think the kids can make it it fun.

[Ken Coleman]

Yeah, yeah.

[George Campbell]

They don't need to go to Disneyland and drop another two grand while they're on the debt free journey. So I'm not advocating for that, but I think there is a middle ground here.

[Ken Coleman]

Yeah, let's go to Toronto, Ontario, Ontario rather, where Bethany is waiting. Bethany, how can we help?

[Caller]

Hi, how are you?

[Ken Coleman]

Good. How are you doing?

[Caller]

I'm good. So my question is, I paid off my only debt I had, which is my car payment and I have about $600 extra and I've been putting my money, paycheck to paycheck into like different TFSA accounts and to. I have like three TFSA accounts and I got two RSP accounts running right now. But I want to put my money into something that will give me more money back when I retire or like when I go buy a house. And I don't know where to start to put my money into that.

[George Campbell]

Do you have any savings?

[Caller]

I have like 12,000. That's it.

[George Campbell]

Okay. Is that considered your emergency fund? Is that enough for three to six months of expenses?

[Caller]

So my three, six months, I would, I have about five grand.

[George Campbell]

Okay. What's this other seven grand investments? The tfsa?

[Caller]

Yeah, it's just in my rsp, those ones.

[George Campbell]

Okay. I would focus on building an emergency fund because you haven't quite built the foundation to build wealth yet. Because what's going to happen is there could be one or two emergencies that knock this savings out and now you're back going into debt to cover it. And so I would add up what your total expenses are for one month on average, multiply that between three and six, depending on the stability of your situation, and then begin investing. Okay, and what you're saying is, if I'm getting this right, I'm trying to make sure our American listeners know the equivalence. The TFSA is essentially like the Roth IRA in America. Yeah. After tax dollars. So like it grows tax free. But it is an investment account, it's not a savings account.

[Caller]

Yeah.

[George Campbell]

Okay. And then the RSP is more like a traditional 401k or traditional IRA.

[Caller]

Yeah, like. Yeah, like the. I can't take money out of my rspo so I get taxed.

[George Campbell]

So you're looking for a non retirement account so that you can invest and have your money grow at a higher rate than a high yield savings account, which I Don't know what the equivalent is in Canada. I imagine the rates aren't as great as the US do you know what the rates are for a savings account?

[Caller]

Well, right now I think it's, I'm, I'm at, I think about 5%.

[George Campbell]

Oh, that's amazing. That's great. And you're saying you want to grow it beyond 5%?

[Caller]

Yeah.

[George Campbell]

How soon are these goals going to happen? You're talking about a house down payment.

[Caller]

I would like to get a house down payment in within like 10 years, by the time I hit 40.

[George Campbell]

Okay, so you're 30 years old right now. You're saying there's a long time horizon for this goal. Can I invest it rather than save it?

[Caller]

Yes.

[George Campbell]

Yeah, I like that plan. I'll tell you my parameter. If the goal is longer than five years, I would say let's invest that money. If it's less than five years, I'm more inclined to put it in savings to keep it liquid. Because we've seen at least in the US stock market that over a five year period of time, generally we're going to see growth, we're going to see ups and downs. But if you just look at any five year period, generally you're going to see it go up and to the right. And so I like this plan of you putting this money to work. But I would first get the emergency fund in place and then begin investing in a non retirement account. So this would be like a brokerage account. I assume it's going to be the same in Canada that you can open up one of these where it's just a taxable brokerage account. There aren't really any tax advantages and you can just stack money away there, invest it into the market. I would choose like a mutual fund or an index fund to do this instead of a single stock. I imagine you have similar things in your retirement accounts and that's going to allow that money to grow hopefully at a higher rate over the next 10 years. Okay, I hope that helps you. I'm proud of you.

[Caller]

Oh, thank you. But also, like, do I, like, do I continue even putting money into my RSP account? Because I heard someone say you shouldn't, you should just keep your money into a TFSA account. It would give you more like, oh, I see interest rate onto it.

[George Campbell]

Well, the, the tfsa, what's happening is you're using after tax dollars so you're not getting a tax advantage this year, but the tax advantage is that money won't be taxed again.

[Caller]

Okay.

[George Campbell]

And so I'm a big fan of that because in retirement it just causes less confusion. And if you have a million dollars sitting in that tfsa, that's like a million dollars of take home pay that the government doesn't get to touch again. And so you're kind of betting that hey, tax rates will likely go up over the long haul. And you're also in the US there's different stipulations like required minimum distributions don't apply to those tax free accounts like they do with the traditional because the government want a piece of the pie and because you already gave it to them, they don't get it again. So a lot of advantages there. I would just stick to the TFSA if I were you for investing. And that's 15 is what I'd recommend. And then anything beyond that put into that non retirement account for the house down payment.

[Caller]

Okay.

[George Campbell]

That'll give you some parameters to go. And that's, it's, that's pretty nerdy, Ken, but that's kind of Our Baby Step 3B. 4 is I'm saving for the down payment. I want to invest. Invest. You can invest anywhere from 0 to 15 in baby step 3B. But she's saying 10 years. I do not want her pausing investing for 10 years.

[Ken Coleman]

I agree. And I think that number could change the 10 years. Right. I'm assuming she was on her own on that deal, so I don't know, double income. So hopefully she can get that down payment a lot sooner than that.

[George Campbell]

Who knows what homes in Canada will cost 10 years from now. That's a scary thought.

[Ken Coleman]

So true.

[Caller]

You guys. One of the best gifts that you can leave your family after you're gone isn't stuff, it's peace. When something happens, your loved ones don't want to be digging through drawers or guessing passwords to access your important information. That is why I love Knockbox. That's n okay as in next of kin box. Knockbox is a a super practical physical system that helps you organize all your important documents like accounts, passwords, assets, medical records, even your will in one safe place. And your Knockbox is divided into user friendly categories to help you get organized so you can give your family clarity, not clutter when they need it Most. Go to knockbox.com ramsey and check it out.

[Ken Coleman]

Okay, guys, I got big news. Aldi is now the official grocery sponsor of the Ramsey show. Yeah, Ramsey is teaming up with Aldi, the grocery store that cares as much about saving money as I do. Get this. Aldi branded Products save you up to 63% over similar name brand products at other stores. It's great quality and big savings on everything you need with no gimmicks, no membership fees or coupons required. See for yourself how Aldi is saving Americans across the country. $8.3 billion a year here. So stop paying more and start shopping at Aldi where they have the lowest prices of any national grocery store. Find a store near you today at Aldi us That's a l D. I dot us. This is the Ramsey show where America hangs out to talk about their money, their work and their relationships. Triple 882-55-5225 is the phone number. I'm Ken Coleman. George Campbell joins me and we're gonna go to Jake who's joining us in Las Vegas. Jake, how can we help? Hey, how's it going guys?

[Caller]

Hey, Quick, quick question for you here. So I'm planning on moving in with.

[Ken Coleman]

My longtime girlfriend by the end of the year probably.

[Caller]

Yeah.

[George Campbell]

And buy her dinner first.

[Ken Coleman]

Yeah, I've bought her plenty. So she's actually been in school for.

[Caller]

The past couple of years and will come out earning. She's graduate school. She's going to come out earning a pretty good chunk, maybe close to 130 to 150. And I'm just looking for some help on how to budget that because she's going to be the higher income earner but she'll also have a lot more student loans. So just looking to see how you guys would recommend we balance that, that household budget.

[Ken Coleman]

Well, that sounds like you guys are combining finances.

[Caller]

That is the plan.

[Ken Coleman]

Yep. Or at least in some way contribute.

[Caller]

To the household, the goals together.

[George Campbell]

Let's can we play out a worst case scenario because that's 99% of the calls we get on this show.

[Caller]

Yeah, let's do it.

[Ken Coleman]

But before we do that, George, I just want.

[George Campbell]

I was so excited.

[Ken Coleman]

Well, you're gonna get to do it. Super quick question. What's your income? We know hers or what it's going to be. What is yours?

[Caller]

So I'm making pretty good money.

[Ken Coleman]

I'm making about 90 right now. And she's going to be in the 130 to 150 range.

[Caller]

Probably. Yep.

[George Campbell]

How much debt do you have?

[Ken Coleman]

I, I have none and I have.

[Caller]

A pretty good savings investment accounts built up.

[Ken Coleman]

We're both really young, so I'm in.

[Caller]

A very good place.

[Ken Coleman]

She just has the student loans as well.

[George Campbell]

All right.

[Ken Coleman]

George, dash his dreams.

[George Campbell]

I'm not here. I'm just, I want to show you? Yeah, because I, I got worried when you were saying, hey, we're going to move in together. Are you guys going to buy a house?

[Ken Coleman]

No, we're going to rent an apartment together.

[George Campbell]

Okay, and then what about the payoff? Because my concern, and we've seen this happen, is you help girlfriend pay off her loans, a breakup happens, and now you just have a sunk cost of helping this person pay off $50,000 worth of their debt with no financial relationship.

[Caller]

Yes. I'm not planning on paying off her loans, but I'm wondering how much she would expect. I guess that would be a conversation for her, but how much she should contribute to the household versus living off of one income. Having her use her income to pay off the debt, primarily.

[Ken Coleman]

Well, it's simple. It's simple. You guys are roommates. You guys are roommates. You're not married.

[George Campbell]

So with roommates you'd go, all right, we're split 50.

[Caller]

Okay.

[George Campbell]

And you know, she pays half the housing expenses and everything else she needs to be putting toward the debt. I don't know how gun ho she is about getting rid of the debt. So she may be less excited about this plan of living. Like she's broke after finishing her program and making this amazing income and then still living like, man, I'm still eating ramen over here. How intense is she about getting out of debt?

[Caller]

She is wanting to get rid of it asap.

[George Campbell]

Okay, and do you know the total amount?

[Ken Coleman]

It's a couple hundred thousand. Hello.

[George Campbell]

What was her program? What degree is this?

[Caller]

It's a medical degree.

[George Campbell]

Okay, is this like a nurse practitioner type thing or is it on the administrative side?

[Caller]

Physician assistant.

[George Campbell]

Very similar pa. All right, so what's.

[Ken Coleman]

Her long term income possibility?

[Caller]

So probably at most, probably getting up to around 200,000.

[Ken Coleman]

Yeah. How long you guys been dating?

[Caller]

I've been dating about three years.

[Ken Coleman]

And you've never lived together? Well, she's been in school for the.

[Caller]

Majority of that time and we've actually been doing long distance for about two years of it. But anytime she comes home, we are those staying together. So we sort of have a history of living together for a few months at a time and goes really well. Of course we have those long term plans together. So we are.

[Ken Coleman]

How old are you, Jake? Very young.

[Caller]

20, 25, 26 years old.

[Ken Coleman]

Okay. Are you thinking about marrying this girl?

[Caller]

Yeah, that's on the agenda for both of us.

[Ken Coleman]

Where is it on the agenda? Give me a date.

[Caller]

Just five years down the road. Engagement? Probably.

[Ken Coleman]

Why five years?

[George Campbell]

Hold on. Another five years yeah, probably something like that.

[Ken Coleman]

Why?

[Caller]

At least, maybe at least three at a minimum.

[Ken Coleman]

What's up with the minimum for financial advice, guys?

[George Campbell]

I'm just, well, I'm just curious. America is also wondering.

[Ken Coleman]

Jake with the Heisman, he stiff armed us. Yeah. Hey, look, you're right. You did call in for financial advice. But guess what's involved in finances?

[Caller]

True. Good point. Yeah, I mean, we're just sort of feeling it out. We're not in any rush right now. I want to enjoy time together while we're young. And neither we know the vision we have. So we're not in a rush to get married. We just want to enjoy our time together.

[George Campbell]

Okay. I've done all I can do. Jake.

[Ken Coleman]

Jake gave us the boundary.

[George Campbell]

It's not a. To me, Jake, this is not, it's not like a moral thing. I'm not here to make judgment calls about your life. I'm just telling you that financially, you're going to be so much better off by combining your financial lives, working toward a goal together, working toward a vision together. And right now it feels like we're just kind of looking to play house and have a good time. And you can do all of that and be married. So if you're committing to live with someone, committing to help someone with their debt payoff journey, whether it's, you know, support or financial, I would just go, hey, hey. We're going to pay this thing off a whole lot faster if we work together. We're going to build wealth a whole lot faster if we work together. And if, you know, she's the one, I don't know the reason for a five year delay.

[Ken Coleman]

Hey, hey, George, back off. He didn't call in for relationship advice.

[George Campbell]

One man's take no more than fine.

[Caller]

I didn't mean to get a yes.

[Ken Coleman]

I'm just having fun with you. It's Friday. I like to have a good time. Here's the deal. I, I hope she's on the same page as you because with the plan that you've given us, there's a good possibility she starts making really good money as a pa and you guys aren't combined finances so you don't get a say and she starts get a credit card here or car payment there. That's why I'm saying that's why we like the marriage play on this. If we know it's a foregone conclusion, it just makes a whole lot more sense. And if not, you're gonna have to have some real boundaries financially in order that it doesn't hurt you relationally. Do you understand what I'm saying?

[Caller]

Yeah, that makes. That makes sense. Yeah.

[Ken Coleman]

So I would. I would.

[George Campbell]

Because if I'm girlfriend, I'm going, hold on. I got a. I got hundreds of thousands of student loans. You want me to pay half of you can cover all the bills just fine on your own. I want to focus on my debt payoff. Can you take on the brunt of the bills? Boom. Red flag. Resentment. That's kind of how I see this playing out because that's how it happens in real life.

[Ken Coleman]

And she makes more money than you, pal. Or she's going to.

[George Campbell]

Should she be paying more of the bills? Should be based on income.

[Caller]

That's sort of what I'm getting at is because we are both on the same page financially. I'm a very financially conscious person. She knows my attention and dedication to just building a future for myself and ourselves there. So she wants this paid off. She wants to contribute towards the household. So I guess a big question of what I'm asking is with this future we're both envisioning for ourselves together, marriage aside, we'll table that for the time being. But how much do you think is it at this point? 50, 50 split? Or would those plans to marry down the road, should it be Maybe I do 60, she does 40, and we'll.

[Ken Coleman]

Let her tackle more of that debt.

[Caller]

Knowing that that's going to be the problem.

[Ken Coleman]

Oh, that's so goofy. Do you hear how goofy that sounds? It's 50. 50. It's what I said seven or eight minutes ago. I haven't changed my mind. Have you changed your mind?

[George Campbell]

No. Although I am. I'm just picturing you saying, hey, you make 40% more than me. I think you should pay 40% more of the bills, too.

[Ken Coleman]

I'd like a video of that. Could send it to me so I have something to watch when I get bored during the day. That's going to be fun.

[George Campbell]

That could go viral, Jake, if you film that scenario.

[Ken Coleman]

Yeah.

[Caller]

All right, fair enough.

[Ken Coleman]

Well, thank you guys for the help.

[George Campbell]

Best of luck. Yeah, he's in Vegas. Just go down to one of those little. Elvis.

[Ken Coleman]

Elvis, Seriously. You know, there's a wedding chapel on every corner. It's kind of like a church in the South. You know, there's wedding chapels everywhere.

[George Campbell]

God bless.

[Ken Coleman]

Get him or get her a ring, man. Yeah, we're gonna put that off. We're gonna talk about our future together. He said, marriage aside, we're gonna put that one. We're gonna talk about our future.

[George Campbell]

We'll put one thing that actually legally means we're together. We'll put that aside. God bless. James.

[Caller]

Hey.

[Ken Coleman]

Hey, guys. I. I call. I didn't call for relationship advice. Back off. Let's get real, folks. Healthy eating sounds good until your day gets really busy and suddenly you're gulping down your third frozen pizza of the week. That's why I love field of Greens. It's a superfood powder. It gets me real fruits and veggies selected by doctors to help my heart, lungs, metabolism, and so much more. I mix it with water, shake it up, and boom. I'm fueling my body without slowing down my day. And here's the truth. I expected it to taste like dish soap, but it tastes great. Really great. Plus, field of Greens promises that your doctor will notice your improved health or you get your money back. Go to fieldofgreens.com Ramsey for 20% off your first order. That's fieldofgreens.com Ramsey and save 20% on your first order. Hey, what's up? Dr. John DeLoney here. The new dates have dropped for the money and marriage getaway over Valentine's day weekend in 2026. This is your chance to hit pause on everything in your life and reconnect with your spouse over a long weekend in Nashville, Tennessee. Me and my friend Rachel Cruz will be digging into topics like sexual money, communication and more. This weekend is happening on February 12th through the 14th and early bird. Prices start at 749 per couple, but the prices will be going up soon. Get your tickets [e-mail] events. Let's go to Zachary in Los Angeles, California. Zachary, how can we help?

[Caller]

Hey, thank you guys so much for taking my call. The. The issue that I'm having, it's actually more of a moral dilemma, and I'm looking for some guidance from you guys, so.

[Ken Coleman]

Hello?

[George Campbell]

We lost you.

[Ken Coleman]

Zachary. We do not have a moral dilemma. We have a technology dilemma.

[George Campbell]

I was so excited.

[Ken Coleman]

I was, too. I love.

[George Campbell]

Let's see if we can get him back. Maybe the guys can get on the line with him, see if his line can get. The pipes are clogged, apparently on the phone.

[Ken Coleman]

Is that right?

[George Campbell]

I think. I don't know.

[Ken Coleman]

I appreciate that.

[George Campbell]

He was sounding good until he wasn't.

[Ken Coleman]

I appreciate that very much. All right, well, while we're trying to get him, this is a good time to talk about. You and I were talking about during the break. You're getting ready to. Getting ready to move. Got a. Got a new home.

[George Campbell]

We just Love to move. I realize I like pain and suffering and so every few years, why not, you know, every thousand days, just up and move.

[Ken Coleman]

Yeah, well, a lot of people are thinking about buying or selling. George just started his process of selling and you know, we always recommend don't do that on your own. It's such a massive, massive financial decision. We want to make sure that you understand what's going on in the market and the latest trends, make sure that you understand them. Median home prices, for example, George went up slightly last month to about 430,000 more. Homes are on the market, nearly 1 million. That's the highest since 2019. So there's no longer an inventory issue. The average 15 year fixed rate rose to 5.9% last month. So the point is, if you're financially ready, don't worry about what's going on in the market. But we want to make sure that you know what's going on in the housing market trends and get some free tools to help you buy or sell. And we've created a wonderful website for you. Ramseysolutions.com Market Ramseysolutions.com Market all right, let's see, we gotta look at that. You see what I did there? I helped people out with some good real estate information and in the interim we got Zachary back on the line. Zachary with the moral dilemma. Are you there?

[Caller]

Hey, yeah, can you guys hear me?

[Ken Coleman]

Well, that's so good. All right, lay it out. George and I have our fake robes on our judges. Robes and powdered wigs. What's going on?

[Caller]

I appreciate it. So about a year and a half ago I got got, quote unquote recruited into the insurance industry. As I'm sure you can guess, it's the whole life insurance industry. Oh, and I graduated from college in 2023 and just graduated from grad school about a couple weeks ago. Full time college basketball player as well.

[Ken Coleman]

As working part time.

[George Campbell]

I got married in August.

[Caller]

And so my, my moral dilemma is a little bit unique because this industry has done a lot for me financially. But the more that I've listened to you guys and the more that I've just grown to learn the financial industry as a whole, the more I am struggling to sell a product that I.

[Ken Coleman]

Don'T necessarily believe in.

[George Campbell]

Did you ever believe in it? What caused the turn?

[Caller]

I got a cold DM on Instagram about a guy that played sports in college and does sales and I was like, oh, that should work for my situation.

[Ken Coleman]

And my managers allowed me to do it part time and I really Got to kill it.

[Caller]

When I was working full time and I didn't have a great understanding of the product at all. I just knew it was sales and it became lucrative. And so it was one of those things that was difficult to step away from and especially getting married. I'm not sure.

[George Campbell]

But what caused you to go. I have a different understanding of this product now. Why do you think it is a bad product?

[Caller]

I just listen. I mean, listening to you guys, if I'm being completely honest, like, I understood if you. I was pretty naive. Like when I started, I just knew it was sales. I knew it was insurance. You're getting told by all these people that it's helping people. You know, it's. It's. It's a product, it's cash value, it's building, it's an investment. So you're learning from people that don't.

[Ken Coleman]

Know, and then you learn a different.

[Caller]

Side and you do research. And so that's where it was really kind of more difficult for me to start.

[Ken Coleman]

And the kicker is I'm actually leaving.

[Caller]

In three months to go to Europe with my wife to go play professional basketball.

[Ken Coleman]

Nice. Congrats.

[Caller]

Thank you.

[George Campbell]

You can't do this anymore. Then it feels like this is your out. I mean, why not just leave and not do whole life anymore?

[Caller]

And that's.

[Ken Coleman]

That's really like the, the quote unquote.

[Caller]

Dilemma is like, is it something that I. Because my. The earnings potential through the summer is. Is so high and it's just so, like conflicted with, like, do I provide for my wife and I versus what do we do?

[Ken Coleman]

Yeah. So, Zachary, let me put the question to you, okay? Because you actually said this at the beginning of the call, and I paraphrase here, if I can remember how you said it, but you said, is it a moral dilemma or. I have a moral dilemma because I'm selling a product that I do not believe in. So you tell me, is that immoral? Yes or no?

[Caller]

It sounds pretty immoral.

[Ken Coleman]

It's not so much that it's immoral. It's not like you're selling an illegal product. You're not selling drugs. Okay, yeah, yeah, yeah. So I don't. I don't think it's immoral, and that's why I'm putting it to you that way. But I. Let me put it this way. Do you think that you can thrive, and I mean not just financially thrive, mentally and emotionally when you are selling a product that you don't think is a good product? Yes or no?

[Caller]

It's. It's becoming more difficult too.

[Ken Coleman]

And I, like I said, I want to just preface it by saying I'm.

[Caller]

I'm super blessed with an incredible wife.

[Ken Coleman]

An incredible faith and incredible family.

[Caller]

So it's like I. I am so blessed in my life and I never take that for granted financially, relationally.

[Ken Coleman]

And so I just like the work.

[Caller]

The work that I've been going, especially the last month since I've been done with school and basketball and trying to get back into it full time, has been much more difficult this year than it was last year.

[Ken Coleman]

Right. And why is it difficult?

[Caller]

Difficult because of that little voice in.

[George Campbell]

Your head that it's eating away at your soul.

[Ken Coleman]

So, so the answer. The question is not for George and I to answer. The answer's for you to answer. What's the answer? Say it.

[Caller]

Yeah. Just to be done.

[Ken Coleman]

Be done and done.

[George Campbell]

Here's what you're good at, Zachary. You're not good at selling whole life. You're good at serving people.

[Ken Coleman]

Yeah.

[George Campbell]

And so you can use that skill to go sell something else that you do believe in that might be insurance. There's a lot of types of insurance that we do recommend that you can feel good about, and there's types that we don't. And so I would go find something that you feel good about selling in the financial space in insurance or maybe there's something else out there for you entirely. And this was just a fun thing you did for a little while to make ends meet.

[Ken Coleman]

What's the. When do you leave for overseas to play ball?

[Caller]

Yeah. Most likely the middle to end of August. And that's. That was also kind of the other part of the question is like, what's. What does it. Like what. I don't know if there's advice or what does it look like? Because making it there doesn't really feel like to me it makes a lot of sense to make a change, career change.

[Ken Coleman]

I agree. I agree.

[Caller]

Agree.

[Ken Coleman]

And so the next question is financial for me. Do you start getting paid already on the contract for the overseas team or is that not.

[Caller]

No, I won't get paid until probably September. And so that's the thing, is how.

[Ken Coleman]

Much money do you need to stay afloat between now and getting paid in September? I mean, need is.

[Caller]

I, I don't need, I guess, quote, unquote, need any money. In terms of like, we have. We're. We're pretty, we've set up pretty well. I mean, we have. About the thing for me is the just. Yeah. I don't, we don't need anything.

[George Campbell]

You're saying is your wife working? You have income and savings that can support you guys if you quit insurance cold turkey today?

[Caller]

We do, yeah.

[Ken Coleman]

Go do some side projects. Just if you're just looking to bring in some cash, just go do something. You're in this really interesting season, man. What are you going to make as a professional basketball player?

[Caller]

Not a lot in the first year. It's usually two or three grand a month, but there's no expenses either. And so it's, it's no how. Your house, a car, food. So it's.

[Ken Coleman]

I would walk away then from this whole life stuff that you don't feel good about and enjoy these next few months. That's all you got. It's going to be over like that. If you want some extra spending cash, go do something that's just super part time and easy, you know?

[Caller]

For sure.

[Ken Coleman]

Yeah. Hey question and you may not feel comfortable telling me, and that's okay. Where'd you play ball?

[Caller]

Yeah, I played a Point Loma Nazarene in San Diego as well as Seattle Pacific and Seattle.

[Ken Coleman]

Good for you, man. Well, man, that's exciting. You're gonna have a season of life. A young married couple over in Europe playing basketball. That's not a bad gig, you know, and hopefully you stay healthy and can start cashing in on a big contract or so and go for it, man. But do what's right. That's. That's the thing. And, and you're determining what's right. I don't get to tell you what's right.

[Caller]

Yeah, that makes a lot of sense.

[Ken Coleman]

Yeah. So good, man. Appreciate the call.

[George Campbell]

Yeah, I love the honesty there. That takes a lot of self awareness and soul searching to go, man. I'm making great money and it's eating away at my soul.

[Caller]

I can't do it anymore.

[Ken Coleman]

George, I love the way you said it. Because the bottom line is if you're selling something that you don't believe in, it will eat away at you. There's just no question about it. And it's not worth the exchange.

[George Campbell]

Selling your soul at that point, that's his whole life.

[Ken Coleman]

Yeah. Really good stuff. All right, George, I'll explain to you what basketball is. And you know, alley oop, that's a movie move. Okay, you got that one. Very nice. All right. Keep it up, buddy.

[Caller]

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[Ken Coleman]

Listen, guys, I've heard just about every.

[George Campbell]

Excuse for why folks think they can't get ahead with money.

[Ken Coleman]

So let's go ahead and settle this right now. You get the final say on what happens with your money. That's why you have to start telling your money where to go so you can stop wondering where it went. So if you're gonna start win money.

[George Campbell]

You have to get on a budget.

[Ken Coleman]

The easiest way to get started and stick to it is with the Every Dollar budget app. It'll help you make a plan for every single dollar coming in and every single dollar going out every single month. And guess what? It's free. So no excuses. Download Every dollar in the app store or Google Play today. Let's go to Laura in Columbia, Missouri. Laura, how can we help today?

[Caller]

Hi. My question is if you guys would think that it would be feasible for me to be a stay at home mom. So I've kind of ran the numbers and I've made a budget for my husband and it's kind of looked everything over and it's taken him a while to finally, like, agree to it and be comfortable with it. But my thought was if I could get the Ramsey network to, quote, unquote, approve it, then maybe we could make it happen.

[Ken Coleman]

Oh, wow.

[George Campbell]

That feels like pressure, Ken.

[Ken Coleman]

So, like, he's already sort of okay with it, but you need our final stamp of approval and you're hoping that that gets him on board?

[Caller]

Yes.

[Ken Coleman]

Oh, boy, oh, boy.

[George Campbell]

You know what?

[Ken Coleman]

I got no problem getting in the middle of this one. What do you think, George?

[George Campbell]

You're good.

[Ken Coleman]

All right, so you got to give us the details. So let's cut right to the, the most important part of it here. When you've done the budget, because we don't have time to go line by line. So when, when you do the budget, what does that show us? And we're looking for, what surplus do you have after you've paid all the bills? And then tell us what baby step you guys are on to? Give us a quick picture there.

[Caller]

Yep, it's tight, but it's very, very doable. So the reason why I'm still employed is so that I can get my pension. I'm almost five years vested with the state. And then after that, that's whenever we're looking for me to be able to stay home. So we have a 2 year old and an 8 month old, both 20 months apart. And so line by line, he makes about 1200 a week. And so it would be tight, but we could do it.

[Ken Coleman]

How much tight? Like what would be Left over?

[Caller]

Probably two to $300.

[Ken Coleman]

Okay. And then I can't remember if you told me. I apologize. What baby step are you on?

[Caller]

So everything's paid off besides the house? We just have 50,000 left on the house.

[Ken Coleman]

Great. And you have a fully funded emergency fund?

[Caller]

We do. We have about 20,000 in savings.

[Ken Coleman]

Way to go. That's fantastic.

[George Campbell]

Congrats. And when you say you have 2 to 300 bucks extra, is that after all expenses are paid? Health care. Are you investing 15% of his income at that point? Point. And there's still 300 bucks left over?

[Caller]

Yes.

[George Campbell]

Okay, so your only other financial goals would be saving for college and paying off the house and the baby steps.

[Caller]

Yep, Yep. So we cash bought a vehicle in March. We traded my old equinox in for a minivan. So I'm a minivan mom. And so we were able to pay cash for that, which is pretty awesome feeling. And then everything else is paid for. So we have no debt, no nothing. And then he has side job Saturdays and I have side job Saturdays. And so I'm a part time photographer. And so he's a blue collar man. So he goes and welds and what does he make? Cattle and all.

[Ken Coleman]

Okay, this is great. I have a couple more questions and I'll be ready to rule. I think George is probably already ready over there. I seem.

[George Campbell]

No, I'm hesitant.

[Ken Coleman]

You're hesitant? Okay, I got a couple of questions. I may help judge George.

[George Campbell]

Okay.

[Ken Coleman]

All right. How much does he make? Right now just in his trade job.

[Caller]

His main job, probably right around 70,000, I think. And what were you after? Taxes.

[Ken Coleman]

Okay, great. And what were you making? Now let's assume you're already gone. So what, what has been your salary?

[Caller]

50,000. 50.

[Ken Coleman]

So we're taking a $50,000 hit. My question is with you doing the, what'd you call them Saturdays? What'd you call it? Side.

[Caller]

Side job Saturday.

[Ken Coleman]

Side job Saturday. I love that. Are the side jobs that both of you are going to continue to do, are they included in the budget number that you gave us?

[Caller]

I. Not his. Mine was, I do photography and So I charged $300 a session and I just budgeted to do two sessions. Month. That's very minimum.

[Ken Coleman]

Gotcha for me. And so what about his side hustle stuff? What will that generate?

[Caller]

It could be a thousand a month easily.

[Ken Coleman]

And that's not included in the numbers you gave us?

[Caller]

No.

[Ken Coleman]

So in all reality it's, it's, it's, it's reasonable to assume that from your budget alone, just going down to one income, you're going to have, let's call it $300 of surplus a month. Month. After everything's taken care of and then we add his. A thousand. So we're going to be, we're going to be in the black, let's say thirteen hundred dollars a month. Okay, that, that to me, I'm okay with it. I'm fully okay now. Because what I was going to suggest is how could he make an additional $50,000 a year professionally and the fact that he's blue collar but he's kind of in the trades, I think there's, there's, there's very reasonable expectation that he can do that. That, and if he were to get close to replacing your 50 in the first 12 months, to me that's a no brainer. But I'll, I'll, I'll see what Judge George thinks. He's over here quietly tapping his pen.

[George Campbell]

Tap, tap, tap. No, I like this plan, Laura. I'm not worried. I just want to make sure that you guys have enough margin to create sinking funds to save for vacation. Create a sinking fund to save up to upgrade the cars eventually to have enough to throw a little bit at college savings, to have more on top of that, to throw at the mortgage to be able to give and spend the way you guys want and not just be right up to it every month. Because when you said it's tight, I feel like that's, that brings its own stress. But I also Know that staying at home is such a big decision and it's such a family values decision that it sort of trumps the just math numbers.

[Ken Coleman]

Yeah.

[George Campbell]

And that's where I go. If you guys both agree this is the right move, do it. And then figure out a plan to achieve those further goals. And that might mean, mean he busts his butt and gets some raises. It might mean that you have to continue this side hustle for the next three years until we get to a better place. But if you guys are willing to make those sacrifices necessary, you have a green light for me.

[Ken Coleman]

Yeah. And, and, and you know, you have a green light for me already. And I would also add to it, you will not regret this decision to come home. If you change your mind, you can always go back to work. But you'll never get this time back with those little ones. And I'm, I'm. Listen, I'm, I'm speaking as a guy who. I'm watching my kids grow so fast, it's freaking me out. You know, I got a kid, finished his freshman year in college and I thought I was changing his diaper yesterday. It goes fast. And so I, I just think, and I'm gonna also say this. And by the way, my mom was a working mom and my wife has worked during many years of our kids lives. So I don't want what I'm about to say to get misinterpreted because that happens in today's age. So I'm gonna say this as clearly as I can. I am pro women who want to work for financial reasons or professional reasons. Love it. But I also think that the greatest job in the world is a stay at home mom. And I applaud you. Give it a shot. So is your husband listening in right now or is this, we're going to tell him this later.

[Caller]

I was going to tell him later.

[Ken Coleman]

All right.

[George Campbell]

When is this happening? You said is it a little ways out?

[Caller]

So I would be vested for retirement at the end of July and so then probably August.

[George Campbell]

Okay. Just a few months away.

[Ken Coleman]

Yeah.

[George Campbell]

Congratulations.

[Caller]

We wanted to stay that vested so I could get the pension when I retire with the state. But then also I put in extra retirement. So I put in about 15% of my income once I started here. And so I have roughly about 30,000 in retirement just with the state.

[George Campbell]

Awesome.

[Ken Coleman]

Nice.

[George Campbell]

Way to go. I think that's a very wise move. And I'll tell you, Laura, my wife decided to stay at home after a nine year career at Ramsey. She was thriving, crushing it. And it was the right decision for her, as hard as it was. And so I think, like Ken said, you're not going to regret this. And it is definitely a. It's a big move for your family.

[Caller]

Yeah, it is. And I love what I do, so I work in recruitment for a college, and I love what I do to recruit these students for technical education. It's just my babies are calling me home.

[Ken Coleman]

Come on, Mama. I love it. I think that's fantastic. George, really quick, because we got about a minute and a half left with her. I'd love for you to give her some advice on what to do with that pension and maximize that.

[George Campbell]

Oh, absolutely. So you said you're fully vested. When will you have access to it?

[Caller]

When I retire.

[George Campbell]

Okay, so we're talking 60.

[Caller]

Yeah.

[George Campbell]

What will it end up being per month?

[Caller]

Right around 15 to 1900, I think.

[George Campbell]

Great. So that'll kind of bolster your retirement. And as long as he's investing that 15%, you guys are still young, right?

[Caller]

Yeah. So he just turned 31 this week, and I'm 29, and we have him putting 500amonth into a Roth IRA already.

[George Campbell]

Okay, but you're not quite at 15% yet.

[Caller]

I am. With my current salary with him, he's at. If we're at 500amonth for him putting into a Roth IRA.

[George Campbell]

So you'll need to increase that to 15%, because it's 15% of household income, which then might change your budget. So I'd go back to that budget and see what it would be like to take 15% out of each paycheck before it hits versus his current $500. I still think you're going to make it happen. And I think the power of you guys making this move will change the direction of your family in the best way, and the money will just show up because you guys are willing to work for what's important to you.

[Ken Coleman]

Yeah. Laura, so, so excited for you. And you're going to be great at home.

[George Campbell]

So.

[Ken Coleman]

Going to be great. Tell the husband it's going to all be okay. It's natural for him to be worried about losing an income, but it'll replace it.

[George Campbell]

Glad we got to make that decision. I think that was the right thing.

[Ken Coleman]

Yeah.

[George Campbell]

For two random guys to do.

[Ken Coleman]

Two random guys. Yeah. To rule on it.

[George Campbell]

Foreign.

[Ken Coleman]

Let's cut to the chase. It's easy to get discouraged about crazy house prices and interest rates, but when.

[George Campbell]

You have the right real estate agent to help you buy and sell the right way, you'll have confidence to make smart decisions.

[Ken Coleman]

Ramsey trusted agents aren't just experts who guide you through buying or selling. They're people you can trust to have your back. From the first call call to closing day. Find a Ramsey trusted agent near [e-mail] agent. That's ramseysolutions.com all right, folks, thanks so much for being a part of our audience. We do this for you and we need your help. You know, the show is continuing to grow new audiences and so wherever you're partaking of the show, if it's on YouTube, we'd love for you to subscribe, like and share. And if you're listening via podcast, give us a follow and a share as well. Subscribe because that helps us grow. You know how the algorithms work. I don't, but that's what they tell me. So we would appreciate that.

[George Campbell]

We don't want to hurt Ken said we do not.

[Ken Coleman]

It's easy to do, George. Say things like algorithm and I just start to get verklempt.

[George Campbell]

Keep Ken out of it, start crying.

[Ken Coleman]

It scares me. Aaron is up in Columbus, Ohio. Aaron, how can we help?

[Caller]

Hi, Ken. Hi, George. Thank you so much for taking my call.

[Ken Coleman]

You bet.

[Caller]

Longtime listener and follower of baby steps.

[Ken Coleman]

Thank you.

[Caller]

Wife and I made it to baby step seven about five years ago.

[Ken Coleman]

Hey. Oh, that's no big, that's no small thing there. That's huge.

[Caller]

Huge. Yeah. Thank you. We've got a problem. I wanted to run something by you, get some advice and see what you think.

[Ken Coleman]

All right.

[Caller]

So one of the things we're doing well that got us there is investing in our company, 401k plans. And I work for a small business, very small family owned company at the LLC and have been in there 401k about 14 years. Have amassed about 315,000 at its height in March of this year. We know what happened in the market in April. So it went down about 250. And around that time the company wants to switch providers. So we get a blackout notice. Everything seems kocher. However, during that switch, I found out that we were fully divested out of the market for seven days, May 7 to May 14. And if you've been watching the market, that was a rally period, so losses were realized. I lost about 237 shares valued at $18,000 out of that retirement account. And I've got about 30 more years projected to my retirement date. So the question I guess is have you ever heard of that? I guess it's standard, I'm told for an old 401k provider to liquidate to cash and then spend some days to move out of the market and then rebuy with the new company.

[George Campbell]

Man, that really stinks. And you know, the changes like this happen all the time, but the crazy fluctuations in the market is just really bad timing to miss out as the market makes a comeback and you're sitting on the sidelines unable to do anything about it.

[Caller]

Sure.

[George Campbell]

And so I don't know that there's anything you can do to get that money back. I mean, essentially it was out of your control and you're going to just have to build that back up. But you can ask HR for a detailed transfer report, you know, and work with the record keeper to go, hey, what exactly happened? I want to make sure that my investments are still invested where they were. It's in the same funds. I have the same amount of shares. But you're telling me that essentially they had to cash out this transfer temporarily for that week, and when they cashed it back in to buy the same amount of shares, you bought less shares because of the price or what exactly?

[Caller]

Price went up about 6%.

[George Campbell]

So it's not a loss in a traditional sense, it's more of a missed gain.

[Caller]

Correct.

[George Campbell]

And that, that unfortunately is just part of the risk of any kind of 401k provider transition. And so you can talk to your employer. I doubt they're going to do anything, especially as a mom and pop kind of small company. They're not a giant corporation where they're going to go. We're going to cover any missed gains that happen because that's on us for changing providers. You guys had nothing to do with that decision. But I, I don't want you to spend too much time reeling over this because you guys are doing so well that it's such a small part of your world at this point.

[Caller]

Sure, yeah, we had, I appreciate that. We did talk to the employer. In fact, this happened in 2017 as well. But it was only 15 shares and about $800.

[George Campbell]

Much smaller scale.

[Caller]

Yeah. I warned the employer and asked the new advisor, hey, I've got scars from last time and the stakes are higher. Can this be avoided? And it wasn't avoided. And when I followed up, the response was, sorry, that can happen.

[George Campbell]

That's unfortunately what I thought the answer would be. I doubt they're like, well, let's just write you a check for $18,000, Aaron, for your missed gains. We're so sorry. I wish it worked like that, but it's just one of those snafus. And the timing could not have been worse. But it's a good reminder to not pull your money out of the market because the stats are pretty wild. Ken, if you missed, you know, the best 10 days of the market because you were spooked, you thought, hey, this is, it's going to go crashing. Well, you're going to really miss out on gains on the other side when the comeback does inevitably happen. But man, it's pretty rare that this kind of stuff happens. It's not every day that employers are just switching 401k provide providers, especially going a whole week with that money. Not sitting in any investment account. But it's just part of the reality of an employer retirement plan. You don't have all the control.

[Ken Coleman]

That's right. Yeah, it stinks. But you got to move on so you know you're okay. This is not a devastating play for you. And it does stink though. So sorry about that.

[George Campbell]

Yeah, I will grieve with you on that one.

[Ken Coleman]

Yeah, absolutely. That one. That one stings. Ruby is up Next in Washington, D.C. ruby, how can we help?

[Caller]

Hi, I was wondering if I should sell my home.

[Ken Coleman]

Okay, tell us more. Why are you wondering about selling your home?

[Caller]

So I am over the 25%. I'm currently at 42%. I have a debt of 34,919. Total monthly income is 6,360. Mortgage is 2,660. And including utilities, it would be 2,990.

[George Campbell]

Okay, we can remove utilities from that. I'll clarify the parameter. It might help your numbers. I'm not sure yet. So the 25% parameter is again just a parameter. So if it's 27%, it's not like, go sell your house today. The goal is just to have enough money left over to fund your other goal. Goals like investing 15% of your household income, putting away some money for college, paying off the home early, going on vacation, upgrading the cars, yada yada. So the after tax 25%, that is before any other deductions like your healthcare premiums, your 401k contributions. So are you factoring that in right now?

[Caller]

Only the health insurance, which is about 220amonth.

[George Campbell]

Okay. So if you subtract the 220 from that, that will help your 25%. And are you doing any investing right now or you have this deb to pay off?

[Caller]

No, no investing. I have the debt to pay off.

[George Campbell]

Okay, and what kind of debt was that? Did I miss it?

[Caller]

This is consumer debt.

[George Campbell]

Okay. Is it is that combined or is that one debt?

[Caller]

No, that's all combined.

[Ken Coleman]

That was the 34,000 number you gave us.

[Caller]

Yes.

[Ken Coleman]

Okay.

[George Campbell]

All right. So if we take out the health insurance, you're likely maybe slightly under 40. Still not a great position. So what I would tell you is this, selling your home is a very expensive transaction. And so I would not encourage you to do that unless there was no hope in sight that you were going to get your income up and your expenses down. So what, what are you doing for work? Is this a sole income for the household? Is it just you?

[Caller]

No, this is me and my husband.

[George Campbell]

Okay. And what does the upward mobility look like in your careers? Because if we get your income up, that changes these numbers drastically.

[Caller]

Yeah, I would say in about just this year, I should be getting about a 7% raise. My husband, on the other hand, is probably going to lose his work permit soon. But we have high hopes that we'll be able to get it back again in about two years just because of timing with uscis and all of that stuff.

[George Campbell]

So what does that mean? Is he going to go without income for two years?

[Ken Coleman]

Years?

[Caller]

It's possible.

[George Campbell]

Then you definitely can't keep this house. What happens if he loses his income today and it's just on you? That mortgage becomes 70% of your take home pay, right?

[Caller]

Yeah. The only thing I can do because he brings in 2,400amonth, is I can rent out rooms that I have. I don't have any kids yet.

[George Campbell]

That doesn't feel sustainable.

[Ken Coleman]

This isn't good. Good. And I wouldn't trust. Listen, I don't. I don't care who's in the White House. I don't trust the government to move on time about anything. So the two years could stretch into who knows what. Throw you guys into a real tough situation. I absolutely would sell the house. And rent, and rent, and rent cheap. You guys are in flux because of his work permit.

[Caller]

Correct.

[George Campbell]

I would really think about this long and hard. And if it's a surefire thing, he's going to lose his income. There's just no way we can keep living like this. So even if your rent is the same, there's still a lot less risk and less expenses that go along with being a renter versus a homeowner. So you might need to delay that dream a little while longer until we get some stable income, like 10 grand a month to afford a $2,500 payment. That's the ma. Hey, what are you still doing here? You know, the rest of the show is happening on the Ramsey Network app, right? So you got to jump over there to continue watching. You can download it for free. Just go to your app store, type in Ramsey Network. It's completely free. Free. And I'll drop a link in the show notes to make it easy for you. So if you're watching on the app, you're in luck. But if you're watching anywhere else, this show is over for you. So jump onto the app and let the fun continue. All right, Go on now. Don't make it weird. Okay, I. I got nowhere to go, so you need to go. Okay, Bye. Bye, now. All right, this is. It's getting weird over there, guys.

[Caller]

I want to.

[Ken Coleman]

We do.