What Are You Willing To Give Up for Financial Freedom?

Summary

The Ramsey Show: What Are You Willing To Give Up for Financial Freedom?

Episode Overview Released on February 24, 2025, The Ramsey Show delves into the sacrifices individuals are prepared to make in pursuit of financial independence. Hosted by Jade Warshaw and George Camel, the episode features a series of caller interactions where listeners seek guidance on managing finances, debt, investments, and major life decisions. The discussion emphasizes the importance of budgeting, debt elimination, and strategic financial planning to achieve long-term wealth and security.

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Caller 1: Chris from Seattle, Washington

Timestamp: [00:33] – [05:02]

Situation: Chris and his wife earn a combined income of approximately $180,000 annually from two businesses. They have successfully completed Financial Peace University, eradicated $25,000 in debt, cut up all credit cards, and built a net worth of around $950,000. Recently, Chris launched a handyman business, adding an extra $75,000 to their income, bringing their total to $250,000. With plans to retire by selling their businesses and home, Chris seeks advice on funding a "mommy makeover" for his wife, estimated between $28,000 and $35,000.

Discussion & Insights:

• Financial Stability: Chris emphasizes their debt-free status, substantial emergency fund, and effective cash flow management.
• Investment in Family: Chris wishes to support his wife's desire for elective surgery, highlighting the balance between financial goals and family well-being.
• Sustainable Growth: George and Jade commend their financial discipline and encourage continued smart spending as their wealth grows.

Notable Quote:

"I'm going to keep a little bit of time in that like three years if I'm lucky." — Chris [02:16]

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Caller 2: Kevin from Spokane, Washington

Timestamp: [05:13] – [08:26]

Situation: At 18 years old, Kevin earns about $14,000 monthly through home improvement sales. Saving 96% of his income, he aims to retire by 26, relying on dividends and rental income to generate $12,000 monthly. Kevin seeks strategies to position himself for early retirement without compromising his financial stability.

Discussion & Insights:

• Early Investment: Jade and George discuss the feasibility of Kevin's ambitious retirement goal, emphasizing realistic financial planning.
• Debt Management: George questions the underlying motivations, urging Kevin to ensure his financial independence stems from healthy motives rather than escapism.
• Strategic Planning: Suggestions include aggressive saving, investment diversification, and considering a more flexible financial approach to accommodate unforeseen changes.

Notable Quote:

"I just want to have the ability to say F you to anyone when I reach 26." — Kevin [07:20]

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Caller 3: Sam from Baltimore, Maryland

Timestamp: [11:15] – [19:37]

Situation: Sam, a new listener, is contemplating whether to pay off substantial debt before saving for a down payment on a home. With existing debts of $160,000 (including student loans, a car loan, and credit card consolidation), and plans to marry his fiancée who has a separate debt of $50,000, Sam seeks advice on balancing debt repayment with future homeownership.

Discussion & Insights:

• Debt Prioritization: Jade and George recommend prioritizing debt elimination before saving for a down payment to avoid financial strain.
• Financial Alignment in Relationships: Emphasis on open communication with fiancée regarding financial philosophies and joint financial planning.
• Resource Recommendations: Suggestion to utilize resources like Rachel Cruz's Know Yourself, Know Your Money and Financial Peace University to align financial goals and strategies.

Notable Quote:

"We are going to have a relationship that you want to have and you guys can tackle this together." — Jade Warshaw [15:28]

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Caller 4: Aiden from Fayetteville, Arkansas

Timestamp: [21:01] – [26:31]

Situation: Aiden, a university student, juggles two inconsistent jobs (Amazon delivery and Anheuser Busch brand ambassador) earning between $300 to $500 weekly. Struggling to manage rent ($700/month), groceries ($300/month), and other expenses without a car note, Aiden seeks guidance on balancing work, finances, and academic focus.

Discussion & Insights:

• Income Stability: George advises seeking more consistent and higher-paying employment to alleviate financial stress.
• Budget Optimization: Jade and George help Aiden identify areas to cut expenses, such as subscriptions and phone bills, to create a balanced budget.
• Alternative Education Paths: Exploration of transferring universities or pursuing online courses to reduce costs and expedite degree completion.

Notable Quote:

"We’re half of your income, you're paycheck to paycheck." — George Camel [26:31]

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Caller 5: Logan from Philadelphia, Pennsylvania

Timestamp: [78:25] – [84:13]

Situation: At 19, Logan is a real estate agent living with his parents, earning an estimated $80,000 annually. With no personal debt and savings of $40,000, Logan contemplates a $3,504 trip to Thailand. He manages a duplex mortgaged through his parents, expecting forgiveness of the remaining mortgage amount in a few years.

Discussion & Insights:

• Financial Flexibility: Jade and George encourage Logan to label his savings for specific purposes (e.g., vacation fund) to alleviate guilt over discretionary spending.
• Investment in Personal Growth: Recognition of Logan's early success and encouragement to enjoy earned wealth responsibly.
• Long-Term Planning: Advice to maintain financial discipline while allocating funds for personal experiences without jeopardizing future financial security.

Notable Quote:

"You've done a great job. Stay out of debt." — George Camel [82:53]

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Listener Questions & Expert Advice

Reverse Mortgage Definition and Risks Timestamp: [32:23] – [36:00]

Discussion: George and Jade explain reverse mortgages, highlighting how they allow homeowners aged 62 or older to convert home equity into cash without monthly payments. While seemingly attractive, they caution against the high costs, dwindling home equity, and potential foreclosure risks associated with reverse mortgages. Alternatives such as downsizing, utilizing retirement accounts, or renting out parts of the home are recommended to avoid long-term financial pitfalls.

Notable Quote:

"Reverse mortgages seem like a quick fix, but they have long term risks that could wreck your financial future." — Jade Warshaw [34:01]

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Caller 6: Stephanie from Charleston, West Virginia Timestamp: [36:21] – [44:36]

Situation: Stephanie, power of attorney for her ailing father, is set to inherit approximately $350,000. She is conflicted about supporting her alcoholic sister, who has been financially dependent on the family. Stephanie seeks advice on honoring her father's wishes while managing the financial dynamics within her family.

Discussion & Insights:

• Handling Dependency: George advises against simply giving money to the sister, suggesting structured support to encourage independence and avoid enabling destructive behavior.
• Emotional Balance: Encouragement to manage guilt and prioritize financial stability while helping family members responsibly.
• Protecting Assets: Jade recommends maintaining control over the inheritance and withholding funds until the sister demonstrates a willingness to change.

Notable Quote:

"You're putting just fuel on the fire of misbehavior by just throwing money at this." — George Camel [38:07]

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Caller 7: Cindy from Kansas City, Missouri Timestamp: [44:36] – [52:35]

Situation: Cindy faces increasing taxes on her employer-provided group life insurance policy, which she wishes to cancel. Despite multiple attempts to terminate the policy, she encounters resistance from both her employer and the insurance company.

Discussion & Insights:

• Understanding Employment Benefits: Jade and George explain the tax implications of employer-provided life insurance and the importance of assessing personal need for additional coverage.
• Proactive Management: Advice to maintain clear records of all communications and persistently follow up with HR and the insurance company to resolve the cancellation.
• Supplementary Insurance: Recommendation to secure personal term life insurance through providers like Zander Insurance for better coverage and control.

Notable Quote:

"Life insurance is something that you get in place as soon as you find out about it if you are someone who needs it." — Jade Warshaw [51:38]

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Key Takeaways

• Prioritize Debt Elimination: Focus on paying off high-interest debts before allocating funds to discretionary spending or new investments.
• Strategic Budgeting: Continuously evaluate and adjust budgets to align with financial goals, ensuring unnecessary expenses are minimized.
• Open Communication: Maintain honest and transparent discussions about finances within relationships to foster mutual understanding and support.
• Informed Decision-Making: Utilize available resources and expert advice to navigate complex financial decisions, avoiding common pitfalls and enabling informed choices.
• Long-Term Planning: Emphasize building a strong financial foundation through disciplined saving, investing, and strategic planning to achieve lasting financial freedom.

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Conclusion The Ramsey Show episode on financial freedom underscores the importance of disciplined financial management, clear communication, and strategic planning. Through real-life caller scenarios, hosts Jade Warshaw and George Camel provide actionable advice tailored to diverse financial situations, empowering listeners to make informed decisions on their journey toward wealth and independence.

Transcript

[Jade Warshaw]

Foreign from the Ramsey Network, it's the Ramsey Show. I'm Jade Warshaw. Next to me is George Camel. We are taking calls all afternoon about your life and your money. And if you'd like to get involved, it is a. A live call. You can call the numbers, triple 882-55-5225. That will get you on the line. George, you ready? Started.

[George Camel]

Game on.

[Jade Warshaw]

Let's do it. We got Chris. He's in Seattle, Washington. Chris, what's going on?

[Caller]

Hey, guys. So happy to be on the show. Thanks for having me. My wife for the last two years has wanted to get a mommy makeover, and I haven't heard an answer to this question yet, so I figured I'd give you guys a shot. We collectively make about $180,000 a year. We have two businesses that we own and operate. And last year we jumped on the. We completed Financial Peace University and we paid off $25,000 worth of debt that we had. We're currently. Thank you. Let's see, we cut up all our credit cards and we have a net worth of about 950,000.

[Jade Warshaw]

Wow.

[George Camel]

Awesome.

[Caller]

Yeah. So it's been a hard road, but last year I decided to spend some of my free time working more and opened up a handyman business. And I added about 75k on top of our regular income last year.

[George Camel]

Way to go.

[Jade Warshaw]

So is that on top of the 180 or that's what you're at now?

[Caller]

That's on top of the 180k.

[Jade Warshaw]

Wow. Good job.

[George Camel]

So you upped it to 250. Is that sustainable? Do you want to continue doing that?

[Caller]

You know, I turned 42 in March and I want to kind of work, Work hard in my 40s, so hopefully it pays off and we can retire when we want to sell the businesses in our home and get out of Washington.

[George Camel]

So what's your question today?

[Jade Warshaw]

How much is the mommy makeover?

[Caller]

It's somewhere between 28 and 35,000. And I. I have about 50k set aside on top of our.

[George Camel]

Emergency fund.

[Caller]

Emergency fund. Thank you.

[George Camel]

Okay.

[Jade Warshaw]

Is that what you earmarked it for? The 50,000, is that what you guys said this money is for, or was it originally for something else?

[Caller]

No, we've been putting it away for this as well as I have a daughter in college and that our responsibility for her is about 14,000 per year. And we've been paying that, you know, in full, in cash when it comes about. And, you know, my son just got braces and paid that in cash.

[George Camel]

And you're cash flowing, everything. There's no worry about the future and retirement and kids college and you've got some extra money and you want to do the selective surgery for her.

[Jade Warshaw]

Listen, mama's getting a new lease on life. Yeah, Mama's getting an upgrade.

[Caller]

She is amazing and she has trouble spending money on herself. And so, like, you know, I told her I've been putting this money aside and I want to pay for it for her.

[Jade Warshaw]

And does she want the surgery or do you want. Does she want it or is this a you thing?

[Caller]

No, she wants it.

[Jade Warshaw]

Okay.

[Caller]

She is.

[Jade Warshaw]

Okay.

[Caller]

She's just. She's been going through a, you know, a health thing and getting herself in shape and changing her diet and all this stuff. So this is kind of the icing on the cake for her.

[George Camel]

For the good of the group and knowing this is a family friendly show, can you entail what this 35,000 includes?

[Caller]

It would be a tummy tuck.

[George Camel]

Okay.

[Caller]

And a lift.

[Jade Warshaw]

Okay, good.

[George Camel]

Got it.

[Jade Warshaw]

Good.

[George Camel]

Here's the thing. I think guys do more to their forerunners and spend more on that. So I got no problem with the selective surgery for all the guys, but I can't believe she spent all that. Listen, bro, let's talk about that under light LED kit you needed to have.

[Jade Warshaw]

Live like no one else. So later you can live like no one else. That's what it's about, right?

[Caller]

You know, I want her to be happy with her body and happy with herself. And I think that she deserves this sort much. So.

[Jade Warshaw]

Yeah, I think you can afford it. You guys have been really smart with your money. Congratulations. You guys are young and you've done a lot and. Yeah, well, my only question would be, are you guys done having babies?

[Caller]

We are. Okay, no more babies for us. We got.

[Jade Warshaw]

And are you having the elective? An elective surgery?

[Caller]

You know, I spend my money, my ex, my play money goes to cars.

[Jade Warshaw]

Got you.

[George Camel]

Okay. There we go. Yeah.

[Caller]

All right.

[George Camel]

Well, you guys have done really well. You're doing it by the book. You guys are debt free with the emergency fund, you're cash flowing everything in your life. You're on the verge of being a baby steps millionaire. And so this might be a shock to a lot of people listening. I can't believe they said they listen.

[Jade Warshaw]

Do it.

[George Camel]

We never said don't spend money. You know, I'm a frugal guy, but once you've hit that different place financially, they make a great income. It's a small part of their world and they're super young.

[Jade Warshaw]

Yeah, I love it for them, that's a really, really good treat that they get to enjoy because they've done everything right. All right, let's go to Kevin. He's in Spokane, Washington, the city I was born. What's up, Kevin? How can we help?

[Caller]

Hi, this is Kevin. So I have a question about what to do for the future. I'm 18. I make around an average of $14,000 a month doing home improvement sales. And right now I'm saving about 96% of what I make and putting it between S&P 500 and some other funds just to pull cash out of really easily. I want to retire by the time I'm 26. I want to have the ability to retire, maybe not stop working. I want to have the ability, through dividends and rent from my renters, to retire. How would you best position myself to get to that position by 26?

[Jade Warshaw]

Have you determined how much money that is? Like, do you know what that amount needs to be in your portfolio where you'll be like, hey, I'm working because I want to.

[Caller]

At this point, I. I want to make $12,000 a month from properties and dividends. I'm not sure the exact amount I'll need, but I do know that I'll need quite a few properties and quite a bit of cash in my accounts in order to make that income.

[Jade Warshaw]

Okay, that was the other question. What part of it is you. Is this. Let me ask this clear question. Is this you really drawing the money out, or is this more of a theoretical I could retire, but. Or is this you really. You're pulling the money out of the portfolio.

[Caller]

Pulling the money out of poor or. I mean, like, I don't want to pull the money out. I just want to let it sit and give me money.

[Jade Warshaw]

So you really would be drawing. You really would be drawing out that money to live on, is what I'm saying. It's not just a theoretical feeling.

[Caller]

Yes.

[Jade Warshaw]

That. I know I have it. Okay, George, you're looking at two questions.

[George Camel]

Number one, way to go. You're 18, and you're making 14,000amonth legally. Right? Is that true?

[Caller]

Yes, sir.

[George Camel]

Number two, who hurt you? Where did this idea come from that I got to have this all done by 26 or else? Where did this idea come from?

[Caller]

Well, when I was 14, I really. I was watching a bunch of financial shows, including yours, and I realized what I really wanted was to have the ability to say F you to anyone when I reach 26. And I want to be able to have a direction.

[George Camel]

You work for yourself. So that's going to be right in the mirror, my friend, if you're your own boss. But I like the attitude. I just want to make sure the motive is a healthy one. Because I get a lot of calls and questions from people who are in your shoes. They don't make the money you make, but they go, I need a million dollars by 26. And I go, why? They go, well, I just. I feel like I'll never be wealthy. And so there's this element of just chasing and this element of, I don't want to get burnt out. So I'd rather you sink your teeth into something that you love to do and continue to work. But the way you phrased it, you said, I just want to be able to let go of this. So here's the deal. 144 grand a year. That's 12 grand a month invested. Eight years of that at a 10% return, you'd have 1.6 million sitting in a taxable brokerage account. So that's one strategy. That's without any other rental income or anything. That's just if it was spitting out 10% on average. I understand that's a crazy thing to.

[Jade Warshaw]

Say, but it's not crazy, George. I'm right there with you.

[George Camel]

So that's one strategy. And okay, 1.6 million. If I could take out 100. 100 grand a year, I'd probably last me a long time. I don't know they're going to retire off that forever, but that'll buy you some thinking time to figure out what you want to do for the rest of your life.

[Jade Warshaw]

Yeah, I don't know that I would draw off that. I think I'd rather have it there, knowing that I have given the middle finger and I'd be motivated to do other things in life.

[George Camel]

Just know the goalpost is always going to move, my friend. So stop chasing. This is the Ramsey Show. Statistics show that half of Americans don't.

[Caller]

Have enough life insurance or they don't.

[George Camel]

Have any at all. I don't understand this, John. Why don't people want to take care of their family?

[Caller]

They think they're not going to die or something. Well, I used to be one of those guys.

[George Camel]

I didn't even think about it. And one of my buddies said, hey, the only reason to not have life.

[Caller]

Insurance is if you hate your wife and kids.

[George Camel]

And I immediately went and got term life insurance.

[Caller]

That's a gut punch.

[George Camel]

For decades, Dave, I've sat across people who've lost a spouse. They've lost somebody important to them. Me too. They don't know what to do next.

[Caller]

You're going to have a crisis here. You know, you got two options. While you're sitting and talking to a.

[George Camel]

Young widow, she's concerned about how she's going to invest all this money properly and not mess this up or she's.

[Caller]

Concerned how she's going to eat tomorrow. That's exactly These are the two options.

[George Camel]

It's saying I love you to your family. Term life insurance Jeff Zander and the team at Zander Insurance makes it easy and affordable.

[Caller]

I've used them personally for 25 years.

[George Camel]

They're the only people I trust. Go to zander.com or call 800-356-4282.

[Jade Warshaw]

George the truth is running a business is hard. It's so difficult if you're a business owner or you know someone who's a business owner, it's tough. It's very difficult. And some days the challenges, they pile up and the fears creep in and you're just left wondering whether you're doing it right. I know that my husband and I ran a business. My husband still runs it. It's been over a decade and it truly can feel overwhelming. That's why Dave, Dave Ramsey wrote a new book called Build a Business you Love where he unpacks how he took his business from a small card table in his living room to a 250 million dollar business. It's the proven system for business owners to grow faster, av common mistakes and create something they're proud of. Truly, it's the baby steps for running a business, which is what we all need. So pre order now for 29.99. That's nothing. And you get over $350 in free bonus items. That includes instant access to Entree Leadership, the Entree Leadership Hiring Playbook. You get early access to the ebook and an enhanced version of the audiobook. Pre order that today@ramsey solutions.com store or if you're watching on YouTube or podcast, you can click the link in the description. Get that book today. All right, George, let's go to Baltimore, Maryland. We've got Sam on the line. What's up, Sam?

[Caller]

Hi, thanks for taking my call. New listener as of about a week ago. And my question is, should I be paying off all of my debt prior to starting to save for a down payment? And if yes, should we just keep renting? I think my future fiance, we're going to be engaged soon, will be ready to kind of buy land or a house before I am. If I do have to wait until I get all of my debt paid off, because I have quite a bit.

[George Camel]

Awesome. Well, thanks for joining us. Glad you're a new listener. Yes. And yes. Yes. You're going to wait until you have all of your debt paid off. You have a fully funded emergency fund before you begin saving up for the down payment. The answer is simple. You want to free up as much money as possible to get out of debt as quickly as possible. Trying to do seven things at once means you're not going to accomplish any of it. You're going to stay in debt. You're never going to make progress on the down payment. So just aggressively attack the debt and keep renting while you're at it. How much do you have left?

[Caller]

So I'm just starting to pay it off because I just switched from a W2 worker to a 1099, like, consistent contract. So I was making. I'm making enough but like, to make all my payments. Everything's current, but I just haven't been able to get out of it because I was living above my means for a little while.

[Jade Warshaw]

How much is it?

[Caller]

I. I have 160 myself. He was debt free, but he just got a truck, so he's got about 50. He makes more than I do. I make 85 and he makes 138 a year. But he also does some side jobs, so that's kind of like his base.

[Jade Warshaw]

You said future fiance. You guys aren't engaged just yet.

[Caller]

No, but we do live together and we split our rent and expenses pretty evenly.

[Jade Warshaw]

So one conversation, I mean, this is kind of aside from the point, but also very important to it is I would start having conversations now. Since you do see that future of you guys getting married, I'd start having the conversation of what our philosophy is about debt. And what do you think it will look like if you become a married couple? Because on the one side, I hear you saying, I'm working and fighting hard to pay off this debt. I want to know, should I pay that off before we buy a house? Which lets me know there's part of your brain that's like, debt is bad. I don't want to stay this way. But then you've got your future fiance who's just bought a $50,000 truck. Right? So you guys need to align. Now is a good time to start having those conversations is what I'm saying.

[Caller]

So we have had those conversations. I'm kind of bullish on it's my debt. Like, even though we're going to marry. That's my problem to solve.

[Jade Warshaw]

And you're right.

[Caller]

He's offered to, like, yeah, he's offered to, like, pay additional, like, money towards our rent to help me get more of my debt off my plate. And we're. We are aligned. But at the end of the day, like, if he wants a truck and he can afford it on his salary, I don't want to, like, hold him back from that.

[Jade Warshaw]

But once you get married, and this is the question that you. You should be asking, when you get married, are you going to view the finances as now we're one, or is this, like, separate living going to continue? Because there's a reason that you're living separately now and it makes sense you're not married. It makes sense that you do your debt, he does his debt, and you have your thing. He has his thing. That makes complete sense. But when you're married, the healthy way to do it is to become one and to come together on that. So that's kind of why I'm bringing that up. Because the truth is, who knows? I don't know what you guys timeline is if it's, you know, six months from now or a year and a half from now, but that $50,000 has the ability to become yours as well when you get married. So that's something for you guys to talk about. Here at Ramsey, you know, we believe that marriage makes you one. So when you come into the relationship, it's our income, it's our debt. These are our assets, and this is our bank account and our budget. We find that when people do that, not only do they have a happier marriage, and the studies do show that they're happier, but they have a more successful marriage. They're able to build debt or. I'm sorry, they're able to pay off debt faster and build wealth faster. And so there's a lot of positives that come to sharing your money. Not just financial, but also in the relationship.

[Caller]

Yeah, I come from separated parents, and that, like, wasn't a great financial example. So I'm, like, trying to make sure if we do buy a house, like, I have skin in the game. And, like, it's not just all on him. So. Yeah, it's just been. He's very good and we have healthy conversations about it. I just feel, like, guilty about it. Hey, a lot in.

[Jade Warshaw]

Let's send her a copy of Know Yourself, Know youw Money. That's Rachel Cruz's book. I think it'll give you some insights on just how you feel about money and why, you know, why you spend the way you do, why you make the choices you make, why you're bent towards certain behaviors. I think that'll help you and your spouse to kind of see each other. Also, I want to give you both financial Peace University. I think that'll be good just to get you guys on the same page and get you started looking at things the same way. And that's really going to help you in the future. What do you think, George?

[George Camel]

Well, you know, when you mentioned Sam, that he can afford the truck, by definition, if he couldn't pay for it in cash, he couldn't afford it. So what you're saying is he can afford the payment that's there, right? And what I found to be true is that everyone can afford the payment until they can't. And until it steals from their paycheck, it steals from their future. And so if he really cares about this future dream of land and marriage, I would go, you know what the truck is? I'm going to have some delayed gratification and buy the truck when I can afford it in cash and probably buy one that's a lot cheaper right now because I got. We got her debt to clean up. And I'm willing to make some sacrifices to get us to a better place financially. Do you feel a difference in that?

[Caller]

My beloved car. So.

[George Camel]

So you're making sacrifices, right?

[Jade Warshaw]

Yeah.

[Caller]

Well, and he. He has offered. He even said, like, let me sell the truck. I'm just a little. I would feel really bad. I would love.

[George Camel]

If a man is willing to sell his truck for you, he might be the one.

[Jade Warshaw]

Why would you feel bad? Tell us more about that. He's. He's making a sacrifice that you've already admitted. Hey, it's. It's not the best thing. I mean, it's $50,000 of debt. Why would that make you feel bad?

[Caller]

Because he'll have his paid off in like two years, maybe max, because he works a lot of overtime. But I'm going to probably be in this like three, four years if I'm lucky.

[George Camel]

What kind of Debt is your 160. What does that make up?

[Caller]

Student loans is 100. I have the car for 38, which I'm going to let go of. And I have a consolidation loan for some credit cards because I was living above my means for a little while.

[George Camel]

That's the rest of it. Okay, so you sell the car. Can you get 38 for it? Will you be able to break even or make profit?

[Caller]

Yeah, so I can sell it privately for 46 or 47. But again, I owe the bank 38.

[George Camel]

Great. And you'll use the difference, hopefully.

[Caller]

Coming. Yeah, I'll put it towards that, that consolidation loan.

[George Camel]

But you'll need a car to still get around, right?

[Caller]

Actually, no, because I work from home. So I can either borrow a car from my parents, which it's already paid off. It was my car before. It's in my name still. Or we have a.

[Jade Warshaw]

Would it be borrowing or they give it to you? Would they sell it to you just for not much that you could know that you have it?

[Caller]

No, it'd be fine to borrow. They don't need it. It just kind of is there for when they do. So I can use that. Or if he keeps his new truck, he does have a beater that he drives to and oh, I just had him get rid of a car that was almost as old as me.

[Jade Warshaw]

Wow. Listen, one thing I want to encourage you is I, you know, again, I don't know the time frame that you guys have for this, and I'm not trying to rush you, but I would not delay moving forward in a relationship because of debt. I would encourage having those conversations because the truth is a good, a good man and a good woman says, hey, I love you despite your debt and I'm coming alongside of you with that debt. And I get it. Like, you do feel guilt. You can feel shame about that. Those are very real emotions. But emotions are meant to go through you. It's when you stay there that they prevent you from moving forward. And so allow that to, you know, you can feel that and let it pass through. But let this good man or whoever's listening let you get that relationship that you want to have and you guys can tackle this together.

[George Camel]

For free. Tools and Resources to help you reach your home goals, go to ramseysolutions.com real estate or click the link in the show notes.

[Caller]

You know how when you go against.

[Jade Warshaw]

What society thinks is, quote, normal, like.

[Caller]

Avoiding debt, it feels weird at first? Well, I'm here to tell you that is okay. I want you to be weird if that means you're being intentional, including how you budget. And one way to be intentional about how you spend your healthcare dollars is with Christian Healthcare Ministries. CHM isn't health insurance. They're a biblically based alternative. CHM is a health cost sharing ministry that's helped hundreds of thousands of families.

[Jade Warshaw]

Take care of healthcare costs without sacrificing their freedom.

[Caller]

As a CHM member, you'll share 100% of your eligible healthcare costs with a dedicated Christian community. And in return, your monthly contribution goes towards other members medical costs. So no matter where you are in your financial journey, CHM can help you reach your money goals and still get the care you need. Plus, programs start as low as $98 a month. So go to chministries.orgbudget to find out more. That's chministries.orgbudget.

[Jade Warshaw]

George, let's take it back to the phone lines. We've got Aiden, who's in Fayetteville, Arkansas. Aiden, you're on the line. How can we help?

[Caller]

Hi, how are you guys doing?

[Jade Warshaw]

Doing great. What's up?

[Caller]

Hi. So I'm a current University of Arkansas student and I am basically on my own when it comes financially. I'm having to pay for my own rent and basically my necessities to get by and I'm just really struggling trying to find the balance because obviously I want to focus on my academics. But the troubles with my finances have really put me under a lot of intense stress and I could just use some help navigating that.

[Jade Warshaw]

Are you working? Like, tell us about your working situation.

[Caller]

Yeah. So I have two jobs right now. I do Amazon delivery and I also am a brand ambassador for Anheuser Busch. But the problem with those two jobs is that they aren't really on a set schedule necessarily. It's more of like they just come up with offers during the week and I pick them up.

[George Camel]

Got it. How much are you working? How many hours per week on average?

[Caller]

On average I'd say about 25.

[George Camel]

And what are you making?

[Caller]

I'd say weekly before my expenses, about 300 to $500.

[George Camel]

Okay. I'm wondering, could we find you a job that's maybe 15 to 20 hours but pays as much if not more that is a little more consistent. Would that solve all of your problems?

[Caller]

I'm not totally sure because I have. Well, if you want to go through my expenses, I have $700 to pay for rent and then usually about $300 for groceries for the month and other various expenses for gas and things.

[Jade Warshaw]

Do you have a car note?

[Caller]

No, I do not.

[Jade Warshaw]

Okay, so paid for a car and.

[George Camel]

You'Re cash flowing college right now. How are you paying for that tuition?

[Caller]

And just my grandpa, before he passed away, he had set up a college fund for me. So I have paid for my college so far, but that money has run out now. So now I only have two years left. I'm going to be forced to take out student loans.

[Jade Warshaw]

Can I ask about your parents where they're at in this, or are you just kind of on your own at this point?

[Caller]

They. They want me to be more independent, so they don't really, like, if I ask, they might help me here and there, but they really get annoyed by that. And I don't like having to ask them for money.

[Jade Warshaw]

I wonder if the context changed. Like, I wonder if the context changed from hey, mom and dad. And I'm not saying that you did this, but if you said, hey, mom and dad, I need money to go out and, you know, for food and clothes, like, that has a different context possibly than mom and dad. This money from granddad is running out. I really don't want to go into debt because I know that debt is a bad thing. Is there any deal we can make where we're working together to pay this tuition in cash or we're cash flowing this. I'm willing to do what it takes. Like, I wonder if those are two different conversations. Do you think that they could value that second conversation?

[Caller]

I think they possibly could, yeah.

[George Camel]

Do they know the situation that grandpa's college money ran out?

[Caller]

They do, yes.

[George Camel]

And they go, we don't give a rip. Take out as many student loans as you need. Budget. You're a grown man.

[Caller]

Yeah, they. They don't really feel the same about debt as I do. They are like, take out student loans. And I really do not want to do that, but, you know, I'm gonna have to end up doing what I have to do to be able to finish school.

[George Camel]

What degree are you pursuing?

[Caller]

I'm in finance.

[George Camel]

Okay, and you have two years left. What is the next semester gonna cost you?

[Caller]

Luckily, I'm not originally from Arkansas. I'm from Oklahoma, but I was able to get in state residency, so I'm looking at about 6,000 a semester.

[George Camel]

Okay.

[Jade Warshaw]

Okay. That's not as bad.

[George Camel]

And you have all summer to work too, to try to cash flow that.

[Caller]

Yes. I just got a internship as well that will be paying $20 an hour, and I'll be able to work lots of hours this summer, so that should be able to help a lot.

[Jade Warshaw]

Do you need to live on campus? Is there, or are you close enough? Like, would your parents let you live at home and save that 700amonth that way to go towards tuition?

[Caller]

My parents, they live in Tulsa, Oklahoma, and my school is in Fayetteville, Arkansas, so I wouldn't be able to live at my parents.

[George Camel]

Do you have roommates right now?

[Caller]

I do, yes.

[George Camel]

How many?

[Caller]

I have three other roommates.

[George Camel]

Oh, it's A party.

[Jade Warshaw]

So you're doing, you're doing the most.

[George Camel]

And have you applied for all the scholarships and grants? Is that part of your part time work?

[Caller]

That is. Yes, I, I do receive financial aid and I have gotten like the Max Pell Grant for school, but I don't really have any like extra from that.

[George Camel]

And you have no savings?

[Caller]

I do not know. I'm really just trying to figure out how I can get at least a baby step one.

[George Camel]

Yeah, I mean it's going to be a struggle when you're, you have a, you have a lot of expenses coming out every single month to cover your normal life plus school. And so you know it's going to take a full time job just to cover this, which is going to make it really difficult. So you're going to need to find something that pays more but you can work less and still cover all of your bills and create a little savings cushion to cash flow because your next payment is going to be in the fall. Are you paid up?

[Caller]

Yes.

[Jade Warshaw]

Can I ask a question? I'm not trying to throw a huge wrench in this, but I want to make this happen for you because I do believe that you don't want student loan debt. Is there a situation? Have you looked in Tulsa to say, hey, I want to finish my degree there, I can live at home, I can do it less expensive, they'll take my credits. Have you explored that? Because getting the $700 back over the course of a year is going to make a big difference on all of, I mean it's almost a thousand bucks a month. Getting those expenses back is going to make really could be the difference between making this possible and it not being possible.

[Caller]

Yeah. The thing is I just feel like I'm already so far into this school here. And the thing with going back home is there's only one four year university there. And I don't know if I'd be able to get into it or not.

[Jade Warshaw]

But that's what I'm saying. I want you to look into it because transferring schools, it happens all the time. Like don't get me wrong, I get that you're comfortable, comfort is a real thing. But transferring schools, as long as you know that they'll take your credits and you don't have to go back at all, then that's great. But if you look into that school and say, okay, here's where I am now. You know, you get in with their administrative, their admissions office and find out what it would look like. This is all research is what I'M asking for just so you can really see what your options are. Because a lot of times we paint ourselves into a corner and we're really not in a corner. There's lots of options. So I would look into that. I'd also look into an online situation and see if there's a way that you can mitigate some of these costs.

[George Camel]

Yeah.

[Jade Warshaw]

What are you trying to do and live elsewhere?

[George Camel]

What's the end goal with the finance degree?

[Caller]

I'd like to become a financial advisor.

[George Camel]

Okay, here's the good news. There are. There. I'm taking. I'm going through a certified financial planning course right now, completely online. And it is not nearly what it costs for even one semester at Arkansas. So I'm telling you that to say there are other paths to the thing you want to do. And my friend Ken Coleman says it this way. Is it the only way and is it the best way? And right now, you haven't explored all of those options. And so I believe it's called Boston Institute of Finance. I think that's the one. They've got an online course you can take for a few thousand bucks total will get you through this whole thing. And so that might mean you don't need to spend another two years. You can go through this course in a year. Get your foot in the door as a financial advisor and start getting some clients and get your experience hours.

[Caller]

Yeah, I. I definitely would like to explore my options, for sure.

[Jade Warshaw]

I think the thing to take away here is you're going to have. There's. There's going to be a level of discomfort in the solution from what you're saying. I don't think you're going to be able to go on as you have. And I think letting yourself know that, like, just kind of taking a moment and standing in the mirror and going, okay, the way I thought this was going to happen is not going to be the way this is going to happen. It doesn't mean it's a bad thing. It doesn't mean I failed. It just means I've got to embrace a new solution. And if you can just get your mind on track with that, I think you're going to find that you have a lot of solutions. And to George's point, I think you're going to end up with a better solution that's faster and cheaper and gets you where you want to go. You know, that's the goal.

[George Camel]

Take that off the table, get creative, do your homework, and you will be shocked at how much easier it is to Just do it. Go to school debt free as a finance major. That's the guy I want to hire.

[Jade Warshaw]

I know that's right. But it's so hard, you know, when we have a way where we thought things were going, it's kind of hard to deviate from that path.

[George Camel]

You feel like you failed.

[Jade Warshaw]

Yeah.

[George Camel]

And you didn't. You just chose a better path.

[Jade Warshaw]

Hey guys, I'm Jade Warshaw and I want to talk to you for a quick second about student loan refinancing. If your payment and your interest rate are burying you and you feel like you can't dig out, refinancing your student loan debt might make sense. That's because a lower rate could free up more money in your budget and a shorter term could help you pay down your debt faster. So reach out to the student loan refinancing experts today@l Laurelroad.com Ramsey. There you'll find helpful resources like a student loan rate table, a refinancing calculator, and other tools. Plus, you can get an initial rate in just a few minutes. Laurel Road offers low competitive rates starting under 5%. And you can get your interest rate even lower if you sign up for autopay. But if your situation is more complex, sign up for a free 30 minute consultation with one of their student loan refinancing experts to get your tough questions answered. Listen, not everybody should refinance their student loan. So make sure you run the numbers. But for some people, it is the right move. Learn more@l Laurelroad.com Ramsey to find out more about their student loan refinancing. That's LaurelRoad.com Ramsey. Laurel Road is a brand of KeyBank National Association. All credit products are subject to credit approval. All right, George. We have a segment that, it's one of my favorites. We call it asking for a friend. Because how often does a topic come up where we don't feel comfortable saying I don't know or I don't, I don't know what that means. And so instead of asking directly, we're like, oh, my friend wants to know what, what a 401k is. Or you know, my grandma was wondering what's the best place to keep her high yield savings account, Right. When really you're the one who wants to know the answer. And so asking for a friend, what's today's. What is a reverse mortgage? Oh, I like this.

[George Camel]

All right, this is one. If you're my age, maybe your parents or grandparents fallen into.

[Jade Warshaw]

Yeah, yeah, it's a big one.

[George Camel]

You See commercials in between, I don't know, Snuggies and timeshares for this thing on, on late night tv From a washed up actor.

[Jade Warshaw]

Yes.

[George Camel]

So here's the definition here. A reverse mortgage is kind of what it sounds like. You're converting your home equity into money for you. So it lets homeowners that are 62 or older borrow against their home equity. So instead of making payments, the bank will send you money either in monthly payments as a lump sum or through a line of credit similar to a heloc. So here's the deal with the loan repayment side. There's no payments while you still live there, which is why people are like, oh my gosh, that sounds wonderful. But the loan plus interest has to be paid back when you move, sell, or you hit the old dusty trail and pass away.

[Jade Warshaw]

Ooh, that sounds risky because you never know what the housing market's going to do.

[George Camel]

But then if I'm that person, you go, well, someone else's problem. Yeah, yeah, that's the people you love. It's going to be their problem. So here's the deal. As you borrow, your home's equity dwindles down. So let's say you start with a paid for home.

[Jade Warshaw]

Uh huh.

[George Camel]

It could end up where half of that is gone. And you now owe 250,000 on a $500,000 home.

[Jade Warshaw]

Wow.

[Caller]

Yeah.

[George Camel]

So you're eating up your biggest asset and you're leaving less for your future and your family. And by the way, they're super expensive. They're one of the worst financial products on the market because of high upfront costs, origination fees, closing costs, mortgage insurance, and then the interest keeps piling up. Which by the way, if you're getting this as a, as a monthly payment or line of credit, the interest is going to be variable.

[Jade Warshaw]

Oh boo. Yeah.

[George Camel]

Which means the lender's passing on the risk of variable interest rates to you.

[Jade Warshaw]

And you're still on the hook, George, for taxes, insurance, property. You know, you still have to cover all of that on your own, homemade for all that. And I mean, it's not on here, but you know, a lot of folks, when they get older, they think, I don't have much retirement, I'll use this. And this will fund my lifestyle until I, you know, take the highway to heaven. And then they end up living longer and they've eaten through all of this equity and then it's like, okay, now what? So it's kind of a scary risk there. So here's the pros.

[George Camel]

People fall for this, it's immediate cash. I can get money during retirement because I didn't save. There's no monthly payments. I get a break from mortgage payments. That's great. And then flexible use. I can spend it on whatever I want. Medical bills, travel. Here's the cons. Here's where it gets real super high costs, like I mentioned, loaded with fees. Then you're losing your home's equity bit by bit. You have nothing to leave to your kids and they have to deal with this mess. And then there's foreclosure risk.

[Jade Warshaw]

These almost always end in foreclosure.

[George Camel]

Yeah, you miss property taxes, insurance payments and you could lose the house. These are for broke people and they think it's some shortcut that's going to let them live their best retirement life and it ends up just making things worse. So here's better alternatives. If you're thinking about a reverse mortgage or someone that's in one downsize, sell the house, buy a smaller one pocket the difference. If you really need money, investments or savings, use a retirement accounts for income instead of one of these terrible products. And then lastly, rent out part of your home.

[Jade Warshaw]

Oh, thank you for being a friend.

[George Camel]

There you go. You can make it like a sitcom situation out of this. You know, just have someone living in there in a spare bedroom giving you 500 bucks a month. That'll replace the payment without the risk and that'll help you out. So reverse mortgages seem like a quick fix, but they have long term risks that could wreck your financial future. So look at other options. Stay debt free, make a commitment to do that and keep your home working for you, not the bank.

[Jade Warshaw]

And if you need help, if you're sitting on a mortgage that you're like, hey, maybe I do need to downsize. Check out our real estate hub there. That's a good one. They'll put the note, the ticket to it in the show notes.

[George Camel]

There we go.

[Jade Warshaw]

Ticket, also known as the link. There you go.

[George Camel]

We get the ticket for you.

[Jade Warshaw]

There it is. Oh, boy. Let's go to the phone lines, please. Do you have more than like I.

[George Camel]

Need to of tums after just reading all that about reverse mortgages that pit in my stomach.

[Jade Warshaw]

I know. Well, we've got Stephanie. She's in Charleston, West Virginia. What's up, Stephanie?

[Caller]

Jen, hey, I'm trying to be. First of all, I just wanted to say hi.

[Jade Warshaw]

Hi.

[Caller]

And I have a question. I. My father's 80 years old. My mother passed away in December of 2020 from COVID And during that Transition. I realized how horrible their finances were. They make a lot of money. They were retired and they had a lot. But my dad has since had a stroke and a heart attack. So I'm now power of attorney. Yes. Now there are two children. There's me and my sister. I'm the oldest. I am the beneficiary on everything. And that is because my sister is an alcoholic. She has never held a job for any reasonable length of time. Her kids and her have lived off of my parents forever. Now everybody in this scenario is an adult. So there's going to be it. When my dad passes away, there's about $350,000 that I am going to inherit. But I have made the promise to my dad to take care of my sister, to help her. And I want to know, with respect to his wishes, what is the fair thing to do and how do you go about taking care of somebody who is an alcoholic? Because in my opinion, I cannot just give her half.

[Jade Warshaw]

Yeah, you can't give her half. That really would be giving a drunk a drink. I mean, I hear Dave say all the time dealing with folks who are in addiction, they don't get control over money, especially large sums of money.

[George Camel]

So in this case, you're putting just fuel on the fire of misbehavior by just throwing money at this. So what I would do is define what it means to help take care of sister. Does that mean we enable her for the rest of her life and fund her in whatever she wants to do? Or does it mean there's strings attached? Do we help her get on her own feet and cause her to be independent and have her go through rehab and put, you know, a certain dollar amount every month and increase it over time as she's able to stay sober? You know, I think we can structure this in a way where it actually helps her instead of just makes the problem worse.

[Jade Warshaw]

Has she attempted to get help before or does she realize she has a problem? Tell us about that.

[Caller]

She knows she has a problem. She's been forced to get help. I. I committed her one time for her alcohol. But once you're past a certain date, you know, in treatment, you can check yourself out. And that's what she does. She has no desire to get help. And you know, I. They've purchased everything for her. A house, cars. She. She had brand new car that she took a loan out on and got it repossessed. And her kids have all had cars. They've had all their. Everything they've ever done has been financed through My parents, me and my house and my children, we've never had anything. We. We've never received anything. We don't ask for anything. I make a. You know, we. My husband and I are retired. We make a great retirement every month. Everything we have is paid for.

[Jade Warshaw]

How many children does your sister.

[Caller]

Well, she had three. One of them just passed away last April, so that took her into a terrible tailspin. As well as the other children.

[George Camel]

And they're adult children. How old are they?

[Caller]

They're adults. The youngest is going to be 19 and the other one is going to be 23 next month.

[Jade Warshaw]

Okay, and are they healthy? Are they reasonable and healthy and taking care of themselves or no?

[Caller]

Well, the daughter, the oldest takes care of herself, but she also has the drinks every day. Oh, God. So it's not a good option to give to her children. The other one, the youngest one is. Oh, he's just a manipulative and has manipulated my father out of.

[George Camel]

Hey, you guys. I'm not a fan of the big banks and you probably already know which.

[Caller]

Ones I mean, but I do like.

[George Camel]

Credit unions because they're non profit organizations that focus on their members. And I'm proud to endorse Fairwinds Credit Union because they share the Ramsey mission of helping people get out of debt and live generously. In fact, they design products to help keep you from going into debt in the first place. Fairwinds has been in business for over 75 years and they serve hundreds of.

[Caller]

Thousands of members worldwide.

[George Camel]

You can feel secure because your deposits are federally insured by the NCUA up to $250,000. It's easy to join and Fairwinds partners with more than 5,000 credit union locations.

[Caller]

Around the country so you can bank.

[George Camel]

In person wherever you live.

[Caller]

But if you prefer the online experience.

[George Camel]

You can log on to Fairwinds and do anything you could do at a physical location. So go to Fairwinds.org Ramsey to learn more. And while you're there, look at the combined checking and savings account bundle they created just for Ramsey fans to help you take control of your finances. That's Fairwinds.

[Caller]

F A I R W I n.

[George Camel]

D s.org Ramsey what does the future hold for business? Ask nine experts and you'll get 10 different answers. Economic growth or a recession? Business taxes will go up or down.

[Caller]

AI will help us work or it will replace us all.

[George Camel]

But there's no such thing as a crystal ball. That's why more than 40,000 businesses have future proofed themselves with NetSuite by Oracle the number one cloud enterprise resource planning.

[Caller]

System, Ramsey Solutions, uses NetSuite.

[George Camel]

And you should, too. Whether your company's earning millions or even hundreds of millions, NetSuite helps you respond to immediate challenges and seize your biggest opportunities with one unified business management suite. There's only one source of truth for the visibility and control you need to make quick decisions. NetSuite's real time insights and forecasting help you see into the future with actionable data.

[Caller]

And when you're closing the books in.

[George Camel]

Days, not weeks, you can spend less time looking backward and more time focusing on what's next. And speaking of what's Next, download the CFO's guide to AI and machine learning.

[Caller]

At netsuite.com Ramsey it's free at netsuite.com Ramsey Thousands. And when I say thousands, since my parents, my mom died, it's close to about 182, 185 that they have went through with nothing to show for it. Nothing.

[Jade Warshaw]

So you're going, I mean, you don't have a great option of who to give this money to in instead of your sister in law that's directly related to your sister in law. You know, I would if I were you. I'd probably hold on to that money and keep it somewhere and earmark it for if she's ever willing to get the help that she needs. That's something.

[George Camel]

Almost feels like she needs to hit her own rock bottom and be willing to change before we throw any money at this problem. It's just going to disappear into the ether.

[Jade Warshaw]

Exactly.

[George Camel]

And then you're going to be more resentful. And so I don't think that honors your father's wishes either.

[Jade Warshaw]

Oh, this is a tough situation. It's not easy, but yeah, I'd hold on to the money. I mean, you're executor, so you have good reason why not to give that money. And I would just stand on business as far as that's concerned. We see you guys after this break from the Ramsey Network. It's the Ramsey Show. I'm Jade Warshaw. Next to me, George Campbell taking calls about your life and your money. George, hit me. You ready to get into it?

[George Camel]

Let's go. I'm always ready.

[Jade Warshaw]

Listen, I'm ready to get right into some calls. All right. Cindy in Kansas City, Missouri is on the line. What's up, Cindy?

[Caller]

I have a question concerning group life insurance to my company who now are having me pay tax. The taxes on it, the yearly taxes on it. And it has just went up $300 since last year, and I have been trying to cancel this policy.

[Jade Warshaw]

Why? What's the problem with you canceling it? Like, what happens when you don't. When you let it lapse or when you just say, I don't want it anymore?

[Caller]

Well, first off, it's there. I'm getting this. You need to talk to your employer. And then my employer says, no, you need to talk to the insurance company. And if they're sending me back and forth. I started this process in December of last year 24. They ended up saving me sending me a waiver paper to cancel the policy, and it is still not canceled.

[Jade Warshaw]

Did you re up it for the new year? Because usually you have to go in there and opt in. Did you do that or did you.

[Caller]

No, I didn't do nothing with this policy. In fact, I just found this policy out last year.

[George Camel]

And you didn't know you were paying for it?

[Caller]

Excuse me?

[George Camel]

You didn't know you were paying for it?

[Caller]

No.

[George Camel]

What does it cost? Every month or every paycheck it cost?

[Caller]

I don't know. They said it's being taken out to the other. The other tax.

[George Camel]

And what do you mean by tax? Are you talking about the premium for the life insurance? I don't understand what you mean by the taxes are going up.

[Caller]

My employer is paying for the premium.

[George Camel]

Okay, so they're paying for it. Not you.

[Jade Warshaw]

Not me. So what are you seeing on your pay? Pay stub. What's it being listed as?

[Caller]

Okay, I was informed it comes out once a year, that I have to pay the taxes on this policy because it is considered impunited wages.

[Jade Warshaw]

And how much is that?

[Caller]

Well, last year I paid 182, and this year I'm paying 180 or 485.

[Jade Warshaw]

So that's the. So they're saying, hey, if we cover this, this is your. This is your fee for having full coverage for the entire year. 182.

[George Camel]

Essentially, the. The IRS sees this as income from your employer because they're covering this expense for you.

[Caller]

Exactly.

[George Camel]

But it's on you to pay the taxes. Okay, I understand that. And it's going up. And it's now 485 bucks a year for the year. Do you know what the face value of the policy is?

[Caller]

Yes, they just told me that today. Matter of fact, they're saying, hold on a second, I'll get. They're saying that the face value. Hold on, I gotta get this paperwork.

[George Camel]

Like, is it 100,000 or is it a million?

[Caller]

It's 84,500 for basic life and 42,250 or personal.

[George Camel]

Okay. Do you have life insurance of your own?

[Caller]

No, I do not.

[George Camel]

Are you self insured?

[Caller]

No, I am not.

[George Camel]

Does anyone rely on.

[Caller]

Because I have no one to pass. No one.

[George Camel]

So nobody relies on your income. If you were, if you were, you know, God forbid you were to pass away today, nobody's going, oh, my goodness, what am I going to do?

[Caller]

Nobody relies on my income, okay. Except for my employer. Well, they don't even. Because they pay me. But I mean.

[Jade Warshaw]

Well, I mean the tr. The truth is, you paying for. The truth is you might be able to. If you, if you want to opt out of this, you 100 could and put that money into something else. You could invest it. Or if you did want to have your own term life policy, you could do that. But my question is why? What are they telling you when you say, hey, I want to let this. I don't want this policy anymore? Is it something that's like some sort of a requirement? Tell me what they're telling you.

[Caller]

Okay. What they're telling me is it's not a requirement, obviously, but they didn't let us know about this until here recently. And who knows how long they've had this policy out on me.

[George Camel]

Well, it's too late now. You're not going to get reimbursed for the years you paid for it. So I think we need to let go of that resentment. I can tell you're up in arms about this. I'd be frustrated too. And part of it is we weren't paying attention about what was happening with our paycheck. And so at least you know, going forward, I'm going to be looking at exactly what's taken out of my paycheck. If something seems off, I'm going to go to hr. And so you need to look into your own policy. Look at the contract and look at the waiver and go, what do I need to do to make this go away?

[Caller]

You are so right.

[George Camel]

And be the squeaky wheel. I can tell Cindy is the squeaky wheel. And the squeaky wheel is going to get that Grace.

[Jade Warshaw]

Yeah, I'd be sitting in the in HR every day, just sitting there waiting.

[Caller]

They told me to do. They told me to go to hr. Now HR is telling me I have to go through the insurance company to cancel it out.

[Jade Warshaw]

Well, have you, have you called them up and said, hey, I have this policy, I don't want it anymore?

[Caller]

Oh, yes, yes, I have called. Today was probably my fifth call in the last.

[George Camel]

Okay. Here's what you do. Keep a record of every single piece of communication. Who you spoke to, what time, what they said, what document they said you needed, and get a next step. Regardless of who you talk to. Say, okay, what is the next step?

[Jade Warshaw]

Or I, or what I do is I'd set up a meeting with someone from HR and in the meeting call the life insurance and say, I want you guys to figure this out because you're, you're doing the Spider man thing where you all point at each other and I want this figured out now. And you set up that kind of a, I don't know, a group call that you can kind of sit through and watch what's going on and give everybody permission to do what needs to be done on your behalf while you're sitting there. That's what I would do. George and I did that today and what happened?

[Caller]

And they said they're going to get back with me.

[George Camel]

I bet they will. I'd be having, I'd have a scheduled follow up email every two days until they finally go, okay, we gotta get Cindy off her back. Can someone just freaking cancel this policy?

[Jade Warshaw]

Yeah, this sounds like something that is in, set in place. Somebody in HR is like, this has never happened before. Nobody's asked, like we should have asked her how big her company was.

[George Camel]

Oh yeah, nobody's actually canceled before, so we don't know. You got to figure this out for the first time.

[Jade Warshaw]

Yeah. But the truth is, I mean, let's talk a little bit about these kind of work life insurance policies. You know, a lot of people when you ask them, do you have life insurance, they're like, yes, Jade, I have life insurance. And it turns out they've got maybe 50,000 or a hundred thousand dollars through their work.

[George Camel]

Cindy, she's got 80,000. That's not enough.

[Jade Warshaw]

No.

[George Camel]

You need 10 to 12 times your annual income.

[Jade Warshaw]

Yeah. And the purpose is for folks who do depend on your income, if you've got kids, if you've got anybody that says, hey, if something happens to Jade Warshaw, these people were dependent on me making money. If that's you, then you need life insurance. And so like George said, 10 to 12 times term life from Xander Insurance is what we would suggest. So if you don't have it, you need it today. And you know, for the price that she's paying, if you're a healthy person, you could probably get the same for the same amount, get way more coverage is what we're talking about. So if you haven't done that, you need to do that today. Life insurance, for clarification, is not a baby step. Okay? It's not something you say when I'm out of baby step two, I'll do it or once I hit baby step four. Life insurance is something that you get in place as soon as you find out about it if you are someone who needs it. So that goes for everything across the board, right?

[George Camel]

Absolutely. So don't just rely on your workplace because guess what? You leave that job, you lose that measly insurance. You need insurance on your own. Separate of that. Jump on to xander.com and get a quote. It's super easy and it's way more affordable than you even think.

[Jade Warshaw]

Yeah, way more affordable than you think. Get that today.

[George Camel]

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[Caller]

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[Jade Warshaw]

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[Jade Warshaw]

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[Jade Warshaw]

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[Caller]

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[Jade Warshaw]

Box.com Ramsey all right, let's get into that Ramsey Show Question of the Day Today's Ramsey Show Question of the Day is brought to you by Y Refi. When the payment on your defaulted private student loan is as much as some mortgages, it's hard to get ahead. Oh, I know that's right. That's when Y Refi can help refinancing to a low fixed rate loan that's built just for you. Find out [e-mail] Ramsey that's the letter y r e f y.com Ramsey may not be available in all states.

[George Camel]

Today's question comes from Isaac in Maryland. Should I Purchase term life insurance. Even if my employer allows me to purchase voluntary life insurance up to 500,000, would a combination of voluntary and term life insurance be wise? I'm 41, so if I'm going to get term life insurance, I would like to do it now for 20 years instead of waiting. It's a great question. We answered a very similar question just now. I know it. So, yes, I would absolutely purchase a term life insurance even if your employer allows you to purchase one. Oftentimes the employer one is very affordable. And so if you want to have that as a little bit of buffer gravy on top, that's fine. But I would definitely get your own term life insurance through Zander. You can jump onto Zander.com and get that handled. And at 41, it should still be reasonably affordable. And you know you can do it. You said you want it for 20 years. You can do a 20 year term policy on that and do a combination. You may not need the employer one on top of that. So you may just want to go 10 to 12 times your salary on your own and not pay for the employer one. Unless the employer one is just such an incredibly cheap deal. It's like five bucks a month or something.

[Jade Warshaw]

Yeah. And what would you recommend George for like a stay at home mom who says, hey, I don't, I don't work, but I do provide value and people depend on me every single day.

[George Camel]

Big one.

[Jade Warshaw]

Yeah.

[George Camel]

At least half a million dollars.

[Caller]

At least.

[George Camel]

As you think about, let's say $50,000 salary times 10, you're looking at half a million on the small, on the short side, especially now with how much childcare costs.

[Jade Warshaw]

Right, Exactly.

[George Camel]

You got to hire Mary Poppins to do this thing. And so daycare alone, you talk about all of the things they're running and doing and chauffeuring around and cooking and cleaning and taking care of all the household pieces. Real monetary value, multiple people to fill that role. So you need to have at least half a million on a stay at home spouse.

[Jade Warshaw]

So, so good. All right, we've got Aisha in New Haven, Connecticut. What's going on, Aisha?

[Caller]

Hi, guys. Thank you for taking my call. So My question is two parts. I am on baby step two. I have $1,000 saved, and now I'm trying to pay off my debt through the debt Snowball. However, I'm 41 and my husband is 57, and we. Well, he has no retirement in place. And so I wanted to know if I should do the debt snowball and put away for retirement. And the reason I say that is because by, by the time we pay off our debt, it'll be about four years. And so then I feel like I haven't put anything into his retirement. Okay, and then my second question, I have a second question, Sorry, My second question is, should I pay off my credit card, which is 5,000 with no interest for the first year, and then start the rest of the debt snowball from lowest to highest, or just do the whole death snowball?

[Jade Warshaw]

Yeah. So my credit card, in situations like yours, you feel desperate, right? Like it's just like, oh my gosh, the time is ticking and the first instinct is, let me, let me get in here and we re weave this plan and make it better what you think is better for your situation. But the truth is I, I would work it as is. I. What are your debts? How much do you have?

[Caller]

So with everything, about 50.

[Jade Warshaw]

Okay.

[Caller]

I just rounded it up.

[George Camel]

Is that between the two of you?

[Caller]

Yes. So there's a couple of hospital and then. So that's no interest with the hospital.

[Jade Warshaw]

How much is it only interest?

[Caller]

We total? I mean I have a, you know, maybe 2, 3, 4, 5. Like 5,000 total.

[Jade Warshaw]

Okay, so 5,000 from credit cards, 5,000 from medical. What else?

[Caller]

No, from medical. Five. So five. Yes, 5,000 for credit card with 0% interest for the first year. Right now. Now tell us total. I'm sorry.

[Jade Warshaw]

Now tell us the medical. Go through and list them out. We don't care about the interest rates. Just tell us the amount.

[Caller]

Okay, so yes, so roughly 5,000 total. And health insure, health, medical insurance, 5,000 in credit card. And then I have tax bills. So tax a 4,000. Yeah, we owe back taxes.

[Jade Warshaw]

Okay, so 4,000 to the IRS.

[Caller]

That's one of them. And then another four and then seven and then eight and then 13.

[Jade Warshaw]

Okay, four, seven, eight and 13 all to IRS.

[Caller]

Yeah, and then, then it's 12,000, 3,000 in medical and then 4,000 in credit, which totals 50,000. And if I do it right off of, you know, our income and snowballing it, I can knock this out in four years. Well, what's your household will be like 50 something.

[Jade Warshaw]

What's your household income between the two of you? And I want them separate. Can you tell me what you make every month, what you bring home in your paycheck and what your husband brings home in his paycheck?

[Caller]

So I'm a stay home mom, but my husband is self employed. So we bring monthly is about 6,000.

[Jade Warshaw]

Okay, and how many kids do you guys Have. Sorry, I'm going through this. I just want to make sure we have plenty of time to help you. So we're just getting the particulars.

[Caller]

No, it's okay. We have one child. One. One one year old.

[Jade Warshaw]

One one year old. Okay. Okay. So when we're talking about the debt snowball. Let's go back to that right quick. These IRS debts have to go first, smallest to largest.

[Caller]

Okay.

[George Camel]

They get a fast pass to the front of the line.

[Jade Warshaw]

They sure do. As lickety split. The other, the other issue here is, okay, so your husband makes $6,000 self employed. How many hours is he working a week?

[Caller]

A lot. You know, all day.

[George Camel]

Okay, what kind of business is this? What is he doing?

[Caller]

Contracts in New York.

[George Camel]

In New York, could he do contract work for someone else full time and make more?

[Caller]

No, he's self employed.

[George Camel]

I know, I'm saying could he make more working less for someone else versus on his own?

[Caller]

I don't, I don't know. I mean he makes. I mean we're, we're not. I don't think we have an income to.

[Jade Warshaw]

Well, you do when you look at the debt. You do when you look at the debt. Because if it was just, hey, 6,000 bucks a month, we're debt free. Our, our living expenses are fine then. Yeah, but in this case we gotta get this done in faster than four years is what George is in myself are getting at. Because to your point, you're on a timetable. Like you gotta get this thing. Zoom, zooming.

[Caller]

Yeah.

[George Camel]

What you're saying is I can only throw a thousand bucks a month at the debt total.

[Jade Warshaw]

Yeah. What's your living? How much does it cost for where you rent or where you are you renters or buyers?

[Caller]

Okay, so if I do. Because I did all the math out. So if based off of once expenses for the house is paid off, I can put. Yeah, about 1100 to each debt. So 11. So if I did the highest amount, 13,000, then yeah, I can put 1175.

[Jade Warshaw]

Can you go back? Aisha, did you say the house is paid off?

[Caller]

No, no.

[Jade Warshaw]

What did you say?

[Caller]

No, no, we owe a mortgage.

[Jade Warshaw]

Okay, what's the mortgage?

[Caller]

And what's 800amonth?

[Jade Warshaw]

2800.

[George Camel]

So half of his income is going to the mortgage?

[Caller]

Yeah, just about. Yeah.

[Jade Warshaw]

Yeah. Because when you add in probably HOAs, taxes, insurance, everything like that. No HOA.

[George Camel]

Okay, here's the deal. He doesn't have money to throw at retirement.

[Caller]

2,800.

[Jade Warshaw]

Okay.

[George Camel]

You guys are paycheck to paycheck.

[Caller]

No.

[George Camel]

And so throwing a Little bit of some pennies into retirement is not going to solve this problem. What will help you retire with dignity one day is at least being debt free and you having a lot more timeline to go back to work. You're going to need to do that eventually. Unless he gets his income way up.

[Caller]

Yeah, well, my plan is to go back to work once he's a little older. So much five years from now.

[Jade Warshaw]

See, that's. I don't think you guys can float a mortgage that's half of your income for five years and tackle the problem that you have here. Like, your, your time frame is tight. How can you tell me how much, how much the house is worth? Like if you were to sell it, would you, would it bring anything?

[Caller]

Yeah, we, it's up to five and we owe 300.

[Jade Warshaw]

Okay.

[Caller]

About eight. 300. 300,000. I don't know how to do that.

[Jade Warshaw]

So maybe if you sold it 170 or somewhere in there.

[George Camel]

Yeah, let's knock out your debt and you could rent for a while.

[Jade Warshaw]

I, I might consider that.

[Caller]

Sell our house.

[Jade Warshaw]

I would consider that. Because the truth is your timeline is really tight. Your husband is saying he's not going to want to work much longer, which I don't know how much I agree with that.

[George Camel]

I don't think it's a choice he has. He's gonna have to work until his body says no.

[Jade Warshaw]

Yeah. And if you want to be a stay at home mom, that selling that house and getting it right sides with your, your income is what you're going to need to do. George, budgeting is such a huge part of the foundation of everything we teach here. Right. We teach the seven baby steps. And a big part of that is saying, okay, you got to get on a budget. And for a lot of folks, they start working out their budget and they run into a couple of walls that they're not quite sure how to overcome, which is completely normal. And so one of my favorite things we do here are a budget breakdown where you send us your budget and we're able to kind of talk you through it. And so Tyler did that. He's from Tacoma, Washington. He sent us his budget and said, hey, can you guys help me out? Tyler, you're on the line.

[Caller]

How's it going?

[Jade Warshaw]

It's going good. Thanks for sharing your budget with us.

[George Camel]

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[Caller]

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[Jade Warshaw]

Okay, so I'll kind of. George, has got your every dollar budget opened up, and I'll kind of go down the line and we'll talk through it and you tell us if we've got it wrong or if there's something that we need to know. But for right now, you're telling us you're 21 years old, you're in the Air Force?

[Caller]

Yes, ma'am.

[Jade Warshaw]

Okay, cool. Married with two kids at 21. Wow.

[Caller]

Yeah.

[Jade Warshaw]

How old are the kids?

[Caller]

First one is 18 months, about to turn 19, and the other one just turned a month today.

[Jade Warshaw]

Oh, man, you're in the midst of it. Wow.

[Caller]

Yeah.

[Jade Warshaw]

So you're bringing home $63,000. That equates to $4,754 that you see in your paycheck every month.

[George Camel]

Is that consistent, roughly?

[Caller]

Yeah. Oh, yeah. Pretty consistent. As long as they don't have a government shutdown or nothing like that.

[George Camel]

Yeah. Okay, True that.

[Jade Warshaw]

Does that include, like a housing allowance or do you get one?

[Caller]

It does, but it doesn't. So the housing allowance is tax free. So It's. It's roughly 52,000 or 5.5200amonth because the housing allowance is not taxed.

[George Camel]

Okay.

[Jade Warshaw]

Okay, so. But that's not. Obviously that's not. You said it's $5,200 a month.

[Caller]

Yes, but.

[Jade Warshaw]

So that's not included in the 4754 you told us.

[Caller]

Oh, well, yeah, I guess. I don't know. It's a. It's kind of. It's kind of hard to track down because it's. I was like, oh, shoot, forgot to include the zero tax part for that.

[George Camel]

But what ends up in your bank account is 4,754 every month roughly. Okay, now I see here that you don't have any debt. You've got about 5,000 in savings roughly. Okay. And I see if you can. I'm looking at the every dollar budget. You are 73 bucks over budget every single month based on all of the expenses you laid out. So you are definitely living paycheck to paycheck. In fact, you're in the red a little bit. Does that sound right?

[Caller]

Yeah, yeah, it's pretty rough. Pretty right.

[George Camel]

Okay, so let's help you out here. What is your next goal? Looks like your savings is low because if you're in baby step three, we need to fully fund the emergency fund, correct?

[Caller]

Yeah.

[George Camel]

And if I see this right, you've got 200 going into savings, but you're also, you skipped to baby step four and you're investing 248amonth. Is that true?

[Caller]

Yeah. So what I was doing is that the military matches a Roth ira and I was just trying to get to the match. So pretty much since basic training I've put all that money away and I've never really seen it.

[George Camel]

So if I told you you could be a multimillionaire at 21 if you just follow the baby steps, would you believe me?

[Caller]

Probably, yeah.

[George Camel]

Okay, so what if we pause your investing to get you some financial foundation because that'll free up 248 bucks that can now go toward that emergency fund. Because at this pace, it's going to take you two years to get a fully funded emergency fund. That's too long.

[Caller]

Right.

[George Camel]

So that's some money right there we can free up. So what I'm going to do is I'm going to move that to zero in investing and add it to your savings so that you now have was at 448 going to savings tracking.

[Caller]

Okay.

[George Camel]

Now we still have to find some more room. We're still 73 bucks over budget. So Jade, look through the list here of the expenses. I assume your income can't change. You can't do anything overtime, you can't get side jobs. How much flexibility do we have on the income side?

[Caller]

Actually, for my career I can start doing like a basically extra thing. And if I. So it's called flying crew chiefs. Basically. Okay. That's what I am. I'm a mechanic on a big heavy aircraft. Right.

[Jade Warshaw]

What can you make.

[Caller]

In a 21 day trip? I can make roughly 2 grand in that.

[George Camel]

And how often can you do that?

[Caller]

As much as they need me, but I have to get to that point, if that makes sense. So I don't know exactly when that'll start, but that's something I could possibly.

[George Camel]

Is it a month away?

[Caller]

Or a year away, probably less than three months away.

[George Camel]

Okay.

[Jade Warshaw]

Okay.

[George Camel]

So we'll just. For this Sake's budget, we're not going to include that. But that could be a game changer going forward for your next goal.

[Jade Warshaw]

Yeah, it could be. Because honestly, when I look at your budget, the thing that stands out to me is, is your rent. And again, I'm not quite sure exactly how your housing allowance is working into this, but all I'm seeing is you're bringing in 47, but then your rent coming out is almost half of that at 23.

[Caller]

Yeah.

[Jade Warshaw]

And so that feels very, very high. I don't know. Are you. Are you on base or what is that?

[Caller]

Yeah, I'm on base. Housing, that's kind of a fixed thing. I can't fix that or I can't change that much. And I kind of look at the pros and cons of living on base versus off. So, like, there's free security. I don't have that off base. And it's kind of a sketchy area to live off base, so.

[Jade Warshaw]

Got you. Okay. That is an area that's going to be tough because when it's almost half your income, your margin is just so low at that point. So that's one area. What about gas?

[Caller]

We're actually pretty good. We use probably 100 bucks per vehicle. So I have two vehicles. So 100 bucks every two weeks. So per vehicle.

[George Camel]

So it's 400amonth. That's what's in the budget. And there's not much we can do there. Are you driving a lot or is it more your wife?

[Caller]

It's not really driving a lot. It's more. I got a nasty truck where it's got a big old turbo on it and likes to drink fuel.

[George Camel]

Oh, boy. Can we get rid of the truck?

[Caller]

Yes, we could, but I'd rather not.

[Jade Warshaw]

How much?

[George Camel]

Wait a minute now you just made Jade angry.

[Jade Warshaw]

No, I'm not mad. I just. One of the things that you'll have to do. We were talking about this in an earlier segment. At some point, you're going to have to look at this and go, something has to give and it's not going to go. If you want to get this budget right side up, you're going to have to hold everything very loosely in order to do that. So tell us more about this truck. I'm going to pull that string a little bit. What's it worth? What do you owe on it?

[Caller]

I don't. So I put. I bought it for $4,000 back in what 2017. And now it's probably worth about 15 with everything to it. But like I said, there's a lot of work into it that I've done. It's not like I brought it to a shop and did it, so.

[Jade Warshaw]

Sure.

[Caller]

It's a very sentimental thing, if that makes sense. It was me and my dad's project, so.

[Jade Warshaw]

Okay, I understand. All right. All right.

[George Camel]

What else can we. So we can't really move the income, we can't move the rent, but I see a bunch of bills here that can go. Who's watching all this? Cable?

[Caller]

Yeah, that's. That's my. That'd be my daughter. She. She likes to watch certain shows and it kind of sucks because it's on a. Multiple things, if that makes sense. But I was also thinking about, like, just dropping a couple of those because.

[George Camel]

Well, you got 47 bucks in subscriptions, too, so you got 88 bucks going out in cable and subscriptions.

[Jade Warshaw]

Listen, they have Coco on YouTube and it's free.

[George Camel]

My daughter just watches old Barney clips on YouTube. Yeah, so that's a. That's a much cheaper option.

[Jade Warshaw]

Yeah, I would.

[Caller]

Tonight got her into the old Sesame street, which is pretty good.

[Jade Warshaw]

So, yeah, tonight I think cable and maybe keep one subscription just so you're not completely in the stone age. But I dropped that. I mean, that's. That's fine. And you. Almost 80 bucks right there.

[Caller]

Right?

[George Camel]

And then the phone bill. You guys have two cell phones?

[Caller]

Yes, we do.

[George Camel]

Are the phones kind of being financed through the plan? Because I see that it's.

[Caller]

Oh, no, they. They are there. Everything's paid off. There's no debt at all.

[George Camel]

Okay, who's the carrier? Because you are overpay. Overpaying for two phones.

[Caller]

It is a T mobile, all right?

[George Camel]

You're paying 65 bucks a pop. I would switch to a budget friendly carrier like Tello or Mint or Boost and reduce that down to. You could get that down to 50 bucks easily.

[Caller]

Right.

[George Camel]

Which would save. Which would save you a good. What, 80 bucks just by doing that this month. 80 bucks a month freed up just.

[Caller]

By doing the greenish.

[Jade Warshaw]

So give me. Give me a sense of where we're at, Tyler.

[George Camel]

Now if I cut the. If I cut your phone bill down to 50, right. And I cut. Let's say we can cut cable and we just keep one of the subscriptions and we cut a few of the subscriptions. We get it down to 30 bucks for subscriptions. Now instead of being 70 something bucks in the hole, you're 63 bucks in the black Just by doing those few things without changing your rent or your income. So I feel better about this already. And then on top of that, have you reshopped your insurance lately? Your renters insurance, your auto insurance?

[Caller]

Yeah, I did and I, I did find the cheapest one out of all the area or out of all the names. So.

[George Camel]

Okay, there's, there's not a whole lot else here, Jade. I mean, groceries, you're feeding four people. Yeah, that's like 800 bucks.

[Jade Warshaw]

In today's world, the only thing your wife could do is she could get together with maybe some other wives on base and say let's create some sort of a co op that I take you guys kids, you take my kids and I go work and you go work and you figure out times.

[Caller]

She's, she's actually going to school right now to become a teacher. So that's what we're working on.

[Jade Warshaw]

Okay, good.

[Caller]

Listen you guys, we're about two years out for that.

[Jade Warshaw]

You guys are young and you are in the thick of it right now and I think the horizon for you guys is good. I think if you do what George said, you'll make a lot of changes. But this is going to be slow going for you guys. Just don't give up.

[George Camel]

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

[Jade Warshaw]

The truth is, investing can be so overwhelming and so confusing. I don't know about you, but when I hear. For me, when I first started learning about investing, I needed to hear it over and over again. I needed somebody to explain it in a way that made it simple. And it's not something that you can just get in a 60 second social media post, I'm telling you right now. So if you are unsure of where to start or if you're afraid to make any mistakes, our Investing Essentials virtual event is going to teach you everything that you need to know about how to get started. Guys, I'm telling you, they're going to teach you how to maximize your investments. It's happening March 4th and 5th, and tickets start at just 199. It's hosted by Dave Ramsey, the goat. And the guy next to me, the other goat, George Camel. Plus, it's the only place where you're going to get Dave's personal playbook on real estate investing. He's going to explain how he made hundreds of millions in property investments. So you can invest with confidence and you can start building wealth. And this is the way to do that. Get your tickets [e-mail] events or you can click the link link in the show notes if you're tuning in on podcast or YouTube. George, what do you want to say about this? Because you're part of.

[George Camel]

Oh, my goodness. Well, number one, I make it fun. And so I'm the proxy for the audience. Last time, just so you guys know, I got punched by Dave and he threw a chocolate chip cookie at me. So I know it sounds like nerdy and boring, but we really bring it to life.

[Jade Warshaw]

He was trying to get that gluten on you.

[George Camel]

That's right.

[Jade Warshaw]

I remember that.

[George Camel]

Miss me with that. But really, we. We answer your questions. So you could submit the questions live via email. And I'm taking them live. We're sorting them and going, hey, this one's really going to help a lot of people out there. And so I'm getting a lot of these questions in my DMs. Hey, I don't even know where to get started. Or hey, I'm in baby step four, but is there more? Or hey, I'm in baby step seven. What can I do beyond the baby steps? We go really deep, more than we ever have on this show. And it's a really good time. You're going to walk away with a lot of value for just less than 200 bucks to get, you know, five hours of coaching.

[Jade Warshaw]

I know that's right. And it's live like it's you guys in real time. It's not one of those canned things, things that they just air over. And you know how places will just air the same thing over and over? No, this is live in real time. You're getting Dave and George at their finance moments.

[George Camel]

You have seven days for the standard ticket of 199 bucks. You have a seven days to access the recording. And so if you want to go back, listen to it again, take notes if you missed it on the night it was live, don't worry, you have access to it. Go check it out. Ramseysolutions.com events.

[Jade Warshaw]

All right, let's get back into your calls. But before we do, just remember after this hour, if you want to keep watching the show, you'll have to go into our Ramsey Network app in order to finish it, unless you're on radio. So if you're watching right now on podcast or watching on YouTube, just know that the Ramsey Network app is where you go if you want to watch the rest of the show. If you need that, you can just download it for free using the link in the show notes. Or you could just search Ramsey Network in your app store and that's how you do. And of course, if you're on radio, just stay where you're at. All right, let's go to the phones. Logan in Philadelphia, Pennsylvania. What's up, Logan?

[Caller]

Hey, how are you guys doing today?

[Jade Warshaw]

Doing good. How can we help you?

[Caller]

Yeah, I just had a quick question. I'm Currently, I'm only 19 years old, though. I'm a real estate agent just right out of high school, didn't bother with college. And last year I made just a little over 50 grand this year so far. As long as it keeps this pattern, I'm projected to make right around 80. And I've always been a frugal person throughout life. And I just wanted to see what you guys thought about taking a trip to Thailand. I've always wanted to go. It would cost right around 3504 grand. And, you know, just spending that much money on a vacation seems strange to me.

[Jade Warshaw]

Well, how'd the idea come about of Thailand? Thailand's great, by the way. I've been, it's a bucket list place.

[Caller]

I've had family go there and they all love it. You know, I always see pictures online. People love it. I've had friends go, so just kind of from word of mouth. I've been all over the Bahamas numerous times. It's just I've never been anywhere in that part of the world.

[Jade Warshaw]

Well, let's see, can you afford it? I mean, you're making the projection is 80,000 a year. What's your living situation?

[Caller]

So my living, I'm actually currently still with my parents. So, you know, I don't have many expenses other than lifestyle.

[George Camel]

And you don't have any debt?

[Caller]

I'm not in debt at all, no. Well, I do. My parents, they helped me grow, invest in real estate. So I have a loan out with them. It's for a duplex though. Their plan is they are like, I have it mortgaged through them. They're going to forgive that instead of. Usually for my siblings, they pay for college. They're just going to forget that in a couple years once I move in. So I don't really consider that debt. I'm still paying a mortgage. I have tenants in there that pay it.

[George Camel]

What would make them not forgive it? It sounds like there's a stipulation here.

[Caller]

No, there's no stipulation. The reason why they have it so they'll pay it off just in a couple of years is because I'm not going to colle. You know, they paid for all my siblings college. Okay, so.

[George Camel]

So they have the money to pay off this mortgage?

[Caller]

Yes. Yep, yep. They're very well off.

[George Camel]

Okay, so they basically bought you a house as a kind of a gift instead of funding college. They went, hey, if you want to get into real estate, you're doing well. We'll just go ahead and still give you that money in a different way.

[Jade Warshaw]

That's cool. What's it worth?

[Caller]

Yes. Let's see. I bought it. Well, I bought it at right around 240 and right now I couldn't get it for sell it. Probably 330.

[Jade Warshaw]

Okay.

[George Camel]

And you would rent out one half and live in the other?

[Caller]

Yes. Okay.

[George Camel]

How much money do you have in savings right now?

[Caller]

Savings right around 40 grand.

[George Camel]

Whoa.

[Jade Warshaw]

Good.

[George Camel]

All right.

[Jade Warshaw]

And what's the plan to move out?

[Caller]

The plan? Currently I just have a girlfriend at the time right now, but most likely within the next 18 to 24 months.

[Jade Warshaw]

Okay. Why so long?

[Caller]

You know, I just think I'm still young. I'm 19. I have a few older brothers and, you know, they all still live at home.

[George Camel]

If you're old enough to buy a house, old enough to move out and live in the house, right?

[Jade Warshaw]

That's right.

[George Camel]

Who's living in the duplex now?

[Caller]

I just have tenants in there on both sides.

[George Camel]

Who's getting the money?

[Caller]

I am. I'm cash flowing. I'm paying them a mortgage. They have amortized over. Amortized over 30 years. I'm still paying one, though. They're just going to forgive the rest, whatever is remaining.

[George Camel]

You're going to kick out a tenant to live in one of them?

[Caller]

Eventually, yes.

[Jade Warshaw]

So let me. I'm just. Sorry, we're going to answer the Thailand question, but I've got a lot of interest in what you're telling me. So right now there's two tenants in the duplex. Who has the short. Like who's. Let me ask you this. Like, obviously if they're good tenants, you're like, I want to keep them in there. But you're also paying for it, so that doesn't leave a whole lot for you to go rent somewhere. Is that where the problem is?

[Caller]

The problem is I'm just. Usually when I put money into savings like this, 40 grand, I never touch it. So, you know, it's very strange, me just to pull out a few grand for a vacation when I'm so used to money away.

[George Camel]

And here's what solved this for me, Logan. Let me unlock this for you. You need to label your money. Right now. It's just labeled savings. It needs to be labeled emergency fund, high yield savings, Vacation fund, high yield savings, car upgrade, High yield savings. And that way there's no guilt when it comes to what this money is for and should be spent on. You've got it labeled. So an emergency fund for you for six months right now doesn't even really make sense because you don't have a lot of expenses. But let's say it's 25 grand. That leaves 15 grand of money you can assign to whatever task you want. I would say, all right, we're going to take this four grand vacation. The other nine grand we're going to put as a car upgrade fund or a home maintenance sinking fund for the duplex, whatever you want. But I would label them and put them in separate accounts to help solve this in the future.

[Caller]

Okay. Yeah, that makes perfect sense.

[George Camel]

Short answer, Enjoy the vacation. You're doing very well for your age. You've done a great job. Stay out of debt. And I would move out as soon as you can, because I think you have a maturity beyond a lot of older callers that I talk to.

[Jade Warshaw]

Yeah.

[George Camel]

And there's a. There's. There's the kind of. The comfort crisis vibe, you know, Michael Easter's book of. If I'm in mommy and daddy's house and I'm living rent free and I'm making money from my tenants, what real benefit is there to ever move out?

[Jade Warshaw]

I know.

[George Camel]

Keep me here in my warm cocoon.

[Jade Warshaw]

Yeah, but he needs. He needs that. That. That feeling of rent is due. You know what I mean? You need that feeling of, I need to buy groceries. I. I need that urgency.

[George Camel]

Gotta go find some problems.

[Jade Warshaw]

Yeah. And especially if he wants to be in real estate. I mean. I mean, have. Have a time where you're a renter, so you know what it feels like. Learn what that feels like. So I think that'd be good for him.

[George Camel]

He is the renter and the landlord. You know, it's gonna be an awkward phone call when the H Vac guys out. Hello? Hello?

[Jade Warshaw]

But what he's talking about, I've heard from a lot of folks who are in the baby steps where it's like, okay, I finally got into baby step four, or I finally got into baby step seven and they're just worried about, can I spend my money? Is this too crazy? Is this lifestyle creep? Am I going off the deep end? And so I felt that way as well. And so I kind of came up with five pillars that if you can check green on, chances are you can say yes.

[George Camel]

Hit me.

[Jade Warshaw]

So number one, if you're a person who lives on a budget, like no matter what, even if you're in baby step six, you're still on a budget. You're still doing that. Are you a person who's out of debt and staying out of debt, right? Yes, I am. Do I carry the proper insurances? Am I, you know, doing my coverage checkup yearly? Yes, I, I'm doing that. Okay. Am I a person who's saving for the future? If I'm baby step four, I'm continuing that process. Yes, that's a green light. And is generosity a priority in my life that month to month I'm practicing that. Yes. Chances are if you're hitting green on all those, when you're beyond baby, you know, baby step four and above, that is a green light to go. Yeah, I can take this trip, I can do this fun thing, I can buy that couch. You're doing all the things that make you a financially responsible adult and it's good to remind yourself of those things from time to time.

[George Camel]

The right questions are the key to unlock personal and professional potential. That means if you're not where you want to be, you are not asking the right questions. I'm Ken Coleman and this is what my new show, Front Row Seat is all about. Over my career, I've had the distinct privilege to interview successful people, people from all walks of life, and to coach over 10,000 professionals who wanted more. What sets successful people apart is a never ending desire to learn and grow.

[Caller]

Each week I'll be joined by industry.

[George Camel]

Leaders and world class experts to have.

[Caller]

A conversation about how to get better.

[George Camel]

Move up and lead well in work and life. But the best part of this show is you get to be a part of the conversation.

[Caller]

Live in studio will have a group.

[George Camel]

Of professionals just like you who have the power to ask questions and steer the discussion in real time.

[Caller]

It's an opportunity to get real answers.

[George Camel]

To real questions like how to make the right decisions, have hard conversations, live a balanced life and discover your next steps to growth. Join us every Tuesday for conversations that are guaranteed to surprise, challenge and inspire you. Check out front row seat wherever you get your podcasts.