Your Future Self Deserves Better Choices Today

Summary

Podcast Summary: The Ramsey Show - "Your Future Self Deserves Better Choices Today"

Release Date: January 27, 2025
Host: Rachel Cruze and Jade Warshaw
Description: The Ramsey Show empowers listeners to build wealth, pursue meaningful work, and foster strong relationships, regardless of past financial mistakes. Hosts Rachel Cruze and Jade Warshaw, alongside their team of experts, address listeners' most pressing financial and personal questions.

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Introduction

In the episode titled "Your Future Self Deserves Better Choices Today," Rachel Cruze and Jade Warshaw engage with callers seeking guidance on various financial and personal challenges. From managing family dynamics and debt strategies to navigating career changes and homeownership decisions, the hosts provide actionable advice rooted in the principles of financial responsibility and personal growth.

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1. Chris from Dayton, Ohio: Navigating Family Assistance and Homebuying Decisions

Timestamp: [00:52 - 04:53]

Situation:
Chris and his wife recently welcomed their first child and are contemplating moving from Dayton to Columbus, Ohio. Chris's parents offered financial assistance by covering the down payment difference between the two cities' housing costs. However, this gift required equal distribution among siblings through estate planning, making Chris uneasy about perceiving it as an inheritance loan.

Key Discussions:

• Perception of Financial Gifts: Jade Warshaw reassures Chris that accepting the money is a gift rather than a loan against inheritance, emphasizing trust in healthy family relationships.

  "I wouldn't think of it as borrowing. You're just getting a piece of it earlier."
  — Jade Warshaw [02:16]

• Long-Term Benefits: Rachel Cruze highlights the advantages of receiving financial support early, such as accelerated home payments and increased investment opportunities, aligning with the book "Die with Zero."

  "It's actually putting you in a better position 30, 40 years ahead."
  — Rachel Cruze [03:48]

• Emotional Readiness: Both hosts encourage Chris to assess his emotional comfort with receiving financial help, suggesting that a healthy relationship should accommodate such gifts without ego conflicts.

Conclusion:
Chris is advised to accept his parents' generosity, given their financial stability, and focus on the long-term benefits of the assistance. Emotional preparedness and trust within the family are crucial for a smooth acceptance of the gift.

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2. Catherine from Portland, Maine: Overcoming Savings Hurdles Amidst Emergencies

Timestamp: [05:01 - 08:56]

Situation:
Catherine, a stay-at-home mom with side hustles, is struggling to save for a home down payment due to recurring emergencies like medical bills and car purchases. Despite being debt-free and saving a few hundred dollars monthly, unforeseen expenses deplete her savings, making the goal of saving for a down payment seem distant.

Key Discussions:

• Creating Financial Momentum: Jade Warshaw advises Catherine to explore ways to increase income, whether through additional work or optimizing current earnings, to build financial resilience.

  "When your income is low, you've got to do something that's going to create momentum."
  — Jade Warshaw [07:00]

• Adjusting Living Expenses: Rachel Cruze suggests reviewing current rental costs to identify potential savings, such as downsizing, to accelerate the down payment savings strategy.

  "Maybe we go to a smaller place and that frees up enough margin that we can get this done a lot faster."
  — Rachel Cruze [07:22]

• Balancing Baby Steps: The hosts discuss the importance of prioritizing savings for emergencies and a down payment over aggressive retirement contributions at this stage.

Conclusion:
Catherine is encouraged to seek ways to boost income and reduce living expenses to overcome the savings cycle. By creating financial momentum and reassessing her budget, she can move closer to her goal of purchasing a home.

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3. Richard from Florida: Balancing Retirement Investments with Significant Financial Commitments

Timestamp: [10:15 - 19:02]

Situation:
Richard, 58, has recently increased his 401(k) contributions to 75% of his income while simultaneously managing a new motorhome purchase that serves as his residence. With limited retirement savings and a considerable loan on the motorhome, Richard seeks advice on whether his current investment strategy is sound.

Key Discussions:

• Investment vs. Asset Management: Jade Warshaw raises concerns about investing heavily in retirement while holding a motorhome, an asset that depreciates rather than appreciates like real estate.

  "You're kind of investing on two ends. You've got your retirement Fidelity investment, but when you buy a house that's also investment."
  — Jade Warshaw [17:36]

• Diversification and Housing Stability: Rachel Cruze emphasizes the importance of diversifying investments and considering long-term housing stability, advising Richard to prioritize stable housing investments over depreciating assets.

  "You're putting all your eggs in that basket at this age, it is scary, Richard."
  — Rachel Cruze [18:10]

• Debt Management: The hosts encourage Richard to evaluate the sustainability of his motorhome loan and consider options to stabilize housing costs for retirement security.

Conclusion:
Richard is advised to reconsider his high retirement contributions to accommodate more stable and appreciating assets, such as real estate. Balancing investment strategies with sustainable debt obligations is crucial for his long-term financial security.

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4. Andrew from Cheyenne, Wyoming: Funding Experimental Medical Treatments Without Compromising Financial Stability

Timestamp: [20:00 - 29:43]

Situation:
Andrew and his wife are seeking experimental medical treatments costing between $10,000 to $30,000, not covered by insurance. They are considering taking out a loan but are hesitant due to their commitment to remaining debt-free.

Key Discussions:

• Prioritizing Health vs. Debt: Rachel Cruze and Jade Warshaw emphasize the importance of addressing health needs while maintaining financial responsibility, suggesting saving aggressively for treatments without accruing debt.

  "I would bump that $600 a month up to a thousand and save for 10 months."
  — Rachel Cruze [26:03]

• Negotiating Medical Expenses: The hosts recommend negotiating with healthcare providers to potentially reduce costs and exploring all available financial options before considering loans.

• Balancing Baby Steps: Advice is given to prioritize saving for necessary medical treatments while continuing to manage existing debts responsibly.

Conclusion:
Andrew is encouraged to save diligently for his medical treatments by increasing monthly savings and negotiating costs, thereby avoiding additional debt. Balancing immediate health needs with long-term financial goals is essential.

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5. Mikayla from Kansas City, Missouri: Overcoming Shame and Seeking Transparency with Family About Debt

Timestamp: [31:16 - 40:48]

Situation:
Mikayla, 22, has reduced her debt from $37,000 to approximately $30,000 but has not disclosed her financial struggles to her parents. She desires a more adult relationship with her mother and is grappling with feelings of guilt and fear of disappointing her family.

Key Discussions:

• Emotional Impact of Debt: Rachel Cruze and Jade Warshaw address Mikayla's feelings of shame and emphasize that debt does not define her worth or character.

  "You may have made mistakes with your money, but you are not a mistake."
  — Jade Warshaw [40:12]

• Honest Communication: The hosts encourage open and honest conversations with her parents, sharing the reasons behind her financial decisions without oversharing unnecessary details.

  "You can have a deep relationship with someone and be able to share what you're going through."
  — Rachel Cruze [36:42]

• Letting Go of Guilt: Mikayla is reminded that everyone makes financial mistakes and that overcoming them is part of personal growth and financial responsibility.

Conclusion:
Mikayla is advised to communicate openly with her parents about her financial journey, focusing on transparency and self-forgiveness. Embracing honesty can strengthen family relationships and alleviate feelings of guilt.

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6. Lori from Los Angeles, California: Deciding Whether to Sell a Property to Alleviate Financial Strain

Timestamp: [42:05 - 50:45]

Situation:
Lori, 63, moved back into a long-owned rental property to establish it as her primary residence, incurring additional expenses to make it sellable. Facing significant tax liabilities and ongoing costs, she contemplates selling the property before meeting the two-year primary residence requirement to save on taxes.

Key Discussions:

• Financial Viability of Keeping vs. Selling: Rachel Cruze and Jade Warshaw analyze Lori's financial strain from maintaining the property, including high monthly costs and significant tax obligations.

  "I don't see how you can keep this going without going into debt."
  — Jade Warshaw [50:29]

• Tax Implications: The hosts explain the tax consequences of selling before the two-year mark and weigh them against the financial burden of ongoing expenses.

• Practical Advice on Housing: Lori is advised to prioritize financial stability by potentially selling the property and seeking more affordable housing options closer to her family.

  "I would sell it. You're going to take the hit on the capital gains. That's fine."
  — Rachel Cruze [50:20]

Conclusion:
Given the substantial financial strain and impending tax liabilities, Lori is encouraged to consider selling the property to restore financial balance and seek more sustainable housing solutions.

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7. William from Portland, Oregon: Pursuing Trade School While Managing Existing Debt

Timestamp: [53:00 - 58:38]

Situation:
William, 23, aims to attend trade school for trucking to potentially double his income from $60,000 to $120,000. With $24,600 in debt and an emergency fund, he seeks advice on whether to prioritize paying off debt before taking out a student loan for trade school.

Key Discussions:

• Strategic Debt Management: Rachel Cruze and Jade Warshaw advise William to save up for the trade school expenses instead of taking on additional loans, highlighting the immediate income boost from trade school as a means to accelerate debt repayment.

  "I would save and then pay off the debt aggressively once your income increases."
  — Rachel Cruze [54:03]

• Asset Liquidation: The hosts recommend selling his 2022 Highlander, which is not underwater, to eliminate auto debt and free up funds for education and future expenses.

  "I'd sell it. You're going to be debt-free."
  — Jade Warshaw [56:26]

• Financial Responsibility: Emphasizing the importance of living within means, the hosts encourage William to maintain his disciplined spending habits even with increased income.

Conclusion:
William is encouraged to save for trade school expenses, sell his current vehicle to eliminate auto debt, and leverage the anticipated income increase to swiftly repay existing debts. This strategy aligns with maintaining financial discipline and achieving long-term financial goals.

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8. Tanner from Tampa, Florida: Choosing Between a Starter Home and Future-Oriented Homebuying

Timestamp: [75:32 - 79:29]

Situation:
Tanner, 23, is considering purchasing his first home and seeks advice on whether to buy a starter home or save longer for a home intended for long-term living. Having recently become debt-free and earning a steady income, Tanner aims to make an informed decision that aligns with his life stage.

Key Discussions:

• Life Stage Considerations: Jade Warshaw emphasizes the unpredictability of life in one’s twenties, advising Tanner to opt for a smaller, affordable starter home that can accommodate future changes.

  "You have no idea what house you're going to live in for the rest of your life."
  — Jade Warshaw [76:11]

• Financial Stability: Rachel Cruze underscores the importance of being financially prepared, recommending Tanner ensure his mortgage does not exceed 25% of his take-home pay and to opt for favorable loan terms.

  "You want to make sure that your home payment does not exceed 25% of your take-home."
  — Rachel Cruze [75:49]

• Flexibility and Knowledge: Both hosts advocate for education and flexibility in homebuying decisions, encouraging Tanner to leverage available resources like Ramsey’s Real Estate Home Base for informed choices.

Conclusion:
Tanner is advised to purchase a starter home that fits within his budget, offering flexibility for future life changes. Emphasizing financial stability and informed decision-making ensures that his home purchase supports his current and future needs.

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9. Gregory from Washington, D.C.: Tackling Credit Card Debt and Collections

Timestamp: [80:45 - 83:26]

Situation:
Gregory, 26, faces $13,105 in credit card debt across four cards and $1,760 in collections. With minimal savings and a part-time income, he seeks guidance on prioritizing debt repayment.

Key Discussions:

• Prioritizing Collections: Rachel Cruze advises Gregory to focus on settling collections first, as these can have immediate legal implications, while maintaining minimum payments on existing credit cards.

  "You're going to be able to knock out that 24,000."
  — Rachel Cruze [82:08]

• Increasing Income: Jade Warshaw and Rachel encourage Gregory to seek additional employment or overtime opportunities to boost his income, thereby accelerating debt repayment.

• Negotiation Strategies: The hosts suggest negotiating with collection agencies to potentially settle debts for lower amounts, especially for debts that have been in collections for an extended period.

Conclusion:
Gregory is advised to prioritize settling collections to prevent legal actions, increase his income through additional work, and negotiate lower debt settlements. Focusing on these strategies will help him regain financial stability and move beyond his current debt challenges.

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Final Insights and Resources

Throughout the episode, Rachel Cruze and Jade Warshaw reinforce the importance of financial discipline, transparent communication, and strategic planning. They provide actionable advice tailored to each caller's unique situation, emphasizing that personal growth and financial responsibility are key to overcoming challenges.

Notable Resources Mentioned:

• Books:
  • "Die with Zero"
  • "Breaking Free from Broke" by Jade Warshaw
• Tools:
  • Ramsey's Real Estate Home Base (ramseysolutions.com/realestate)
  • Every Dollar Budgeting App
• Experts:
  • Ken Coleman: Recommends the "Find the Work You're Wired to Do" assessment in his book "Get Clear"

Listeners are encouraged to utilize these resources to enhance their financial literacy and make informed decisions that benefit their future selves.

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This detailed summary aims to encapsulate the key discussions, insights, and advice provided in the episode, making it accessible and informative for those who haven't listened to the full podcast.

Transcript

[Rachel Cruze]

Foreign live from Ramsey Solutions. It's the Ramsey show where we help people build wealth, do work that they love and create amazing relationships. I am Rachel Cruze hosting this hour with my good friend and best selling author Jade Warshaw and we are answering your questions. So give us a call at 888825 5225. We'll talk career, relationships, money, anything and everything. So give us a call. We're going to start off this hour with Chris in Dayton, Ohio. Hey Chris, welcome to the show.

[Caller]

Hi. Thank you for having me.

[Rachel Cruze]

Absolutely. How can we help?

[Caller]

So my wife and I recently had our first child. She is a daughter which is awesome. Thank you. And my parents live in Columbus, Ohio which is about an hour and a half away and naturally they would like to see us and their grandchild more. We are looking to upsize our home and we were looking in the Dayton area originally because cost of living, we can afford it. They then offered to give us an additional the difference between the prices of the home and Dayton to Columbus that would go towards our down payment, making it affordable. Affordable if we moved to Columbus. That sounded good. It would be a gift, not like a loan. But then they mentioned that they would have to make it even and change the will slightly so that money was even with my siblings. So I got an extra a hundred thousand. My brother would get a hundred thousand in the world, etc.

[Jade Warshaw]

Yeah.

[Caller]

But then I started booking it as like an interest free loan against myself in the future.

[Jade Warshaw]

You're saying because. You're saying because if you had received it as inheritance, you would have done what with it?

[Caller]

Well, it's not that I would have received it inheritance, I would have done anything with it. It's just that it looks like I'm borrowing from my inheritance, which is weird because my wife and I worked really.

Hard not to be in debt at all.

[Jade Warshaw]

Well, I wouldn't think of it as borrowing. You're just getting a piece of it earlier.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

For something that you want to spend it on, it's not alone.

[Caller]

So you, so you think that's fine then?

[Jade Warshaw]

I do, yeah. It feels like a gift.

[Rachel Cruze]

Very much so. And as long as are your parents in a good financial situation to give you this cash and it not hurt them.

[Caller]

Yeah, yeah, they are.

[Jade Warshaw]

Listen, I hope that one day, I mean one day I will be there when my kids buy a house and I'll be like, here's some cash to put towards your down payment. That's what I plan to do with Sam. And so I don't think there's anything wrong with this. If it's a place that you want to be, it keeps the payment where you had it originally. I mean, Rachel, no, not at all.

[Rachel Cruze]

I mean, I mean, and if again you trust there no strings attached, you know that it is a free and clear gift. And what's interesting, Chris, there's a book called Die with Zero and it's a really interesting read. And one of his takes that majority of people cannot do. A lot of people are not in your parents position to have the cash flow to do something like this. But he was saying in the book if you did that actually your kids would benefit more from your money in their 20s and 30s than they would when they're 60 and 70 when they receive the inheritance. So it's actually, I would see it not as borrowing against your inheritance. It's actually putting you in a better position 30, 40 years ahead to get you getting your house paid off that much faster to invest that much more for your kids. Does that make sense? Like it almost is a better use of that money the earlier you get it. If you do something wise with it, like put it towards real estate, does that make sense?

[Caller]

Yeah, that makes sense. And we are in our late 20s, so that kind of checks out.

[Rachel Cruze]

Yeah. So this is great.

[Jade Warshaw]

I, I love this for you. I feel like this is exactly what it's all about. Like it's all about having your money in order so that you're able to put the next generation in a better position. And so this is really money doing its doing God's work, doing what it should.

[Rachel Cruze]

Oh, well, I hope that helps Chris. And I would say too, you know, to something to think about for yourself, Chris is, you know, are you in a position emotionally to be okay with being given money? Because I know that's true. There's a level, you know, not to stereotype but you know, even some dudes like there, I don't know, there's, there can be something to feel weird. I'm like, oh my gosh, I'm getting helped by my parents. But what I would say to that, again, if the relationship is healthy and good, like put the ego aside, receive the gift.

[Jade Warshaw]

Yeah.

[Rachel Cruze]

Because that's. Yeah. I mean I think you're, I think it's fine.

[Jade Warshaw]

I feel like it could definitely feel different if it's, if you're the. I'm not trying to enforce gender roles on anybody, but I feel like it could feel different if you're the guy and it's like the mother Your, your wife's family.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

Yeah. I feel like it could feel different.

[Rachel Cruze]

Totally.

[Jade Warshaw]

Listen, a gift is a gift, it's a blessing.

[Rachel Cruze]

Yep. That's great, Chris. Awesome. Okay, up next we have Catherine in Portland, Maine. Hey Catherine, welcome to the show.

[Caller]

Hi.

Thanks for taking my call.

[Rachel Cruze]

Absolutely. How can we help?

[Caller]

So we live in a single income household. I'm a stay at home mom. I do have side hustles. But bas, we've been in a like rinse, wash, repeat cycle our entire marriage four or five years where we are debt free. We are able to save a few hundred dollars every single month and we're trying to save for a down payment on a house. But pretty much what happens is we either get hit with like we have my daughter two years ago, so we had a big medical bill or we had to buy a new car, you know, new to us car. But it's like that savings gets depleted and it basically takes us, you know, a couple years to save up, you know, double digit money and then we have to spend it on something big. So I just see that happening again in the next couple of years. Like we have our cars, but when I look at saving for a down payment, I think it's going to take at least five to seven years, maybe longer. And I'm looking at our cars and I'm like, well, we're going to need to buy a car.

[Jade Warshaw]

I mean what you're talking about, how to do that, what you're talking about is so common whether it's saving up for a down payment, Rachel, or if it's just I, I'm trying to get three to six months saved, whatever it is. I find that when your income is low, you've got to do something that's going to create momentum so that you can like build up that speed to get over that wave. Right? And so for you guys, it might look like building up income, working extra for a season so that you can really get past those hurdles that you see and kind of get that, that footing under you. Because the truth is all the things that you're talking about, I mean that is life, right? Cars break down, it's time to replace the, you know, having babies. Yeah, having babies. I mean all of that is just kind of part and partial to life. And when you have a lower income, you're right, it does it, it feels like two steps forward, one step back. Right. So you're going very slowly and I challenge you to say where, where is an area that you can pick up work? I mean, you said You're a stay at home mom. It sounds like you have a two year old. What could you do to add to the income? What could your husband do?

[Caller]

Yeah, I mean he's working overtime. I have side hustles especially.

[Rachel Cruze]

How much you guys make in a year, Catherine?

[Caller]

About 65, 000.

[Rachel Cruze]

Okay.

[Jade Warshaw]

And then yeah, the other question is where you're renting now, what percentage of your income? Because it could look like, okay, we're going to sacrifice where we're renting now, maybe we go to a smaller place and that frees up enough margin that we can get this done a lot faster. So I would just challenge you to look at some of those areas that maybe you thought were untouchable because we all have those areas that we kind of like hold close. That's like I'm not changing, you know, this is my apartment, we're comfortable here. I'm not moving or this is my schedule, it works for me, I'm not changing it. And unfortunately a lot of times our opportunity rests in those areas where we're comfortable.

[Caller]

Yeah. So let me ask this too. So in like the baby step list.

[Rachel Cruze]

To. Sorry Catherine, you're good, you're good, go ahead.

[Caller]

Sorry. And the baby step list, it says that like you pay off your debt and then you start investing in retirement. So like my husband and I, the, he works for the state and because of that he has to opt in to like the state retirement system. And we're like, okay, so we're okay.

[Rachel Cruze]

So sorry Catherine, I'm going to have to put you on hold because we're about to hit a hard break. So yeah, if it, if it is dictated to you, then cut that in half and half of that would go towards your 15%, if that makes sense. So sorry to cut you off to get you there, but I hope that helps. Catherine, thanks for the call.

[Jade Warshaw]

For free tools and resources to help you reach your home goals, go to ramseysolutions.com realestate or click the link in the show notes.

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[Rachel Cruze]

Welcome back to the Ramsey Show. I am Rachel Cruze hosting this hour with Jade Warshaw. And we are taking your calls at 888-825-5225. Up next, we have Richard in t Florida. Hi, Richard. Welcome to the show.

[Caller]

Hi. Thank you for taking my call.

[Rachel Cruze]

Absolutely. How can we help?

[Caller]

The reason I was calling is I just recently changed my fidelity 401k account and I've actually brought it up to 75% of my income. And we have a military pension and my wife works. But my question is we recently purchased a brand new motorhome and that is our residence. And so we have no other bills other than the motorhome itself. And we weren't sure whether or not I should be investing like I am into my 401k. I didn't mention that I am. I'm 58. I would like to retire at 62 as well as my wife. So we're just a few years out from that. And so we're just going, I wanted to get the money into the market as early as I could in this new year. And so we're, you know, I just, I upped it up to 75%. I wanted to see if that made good sense or not, if it makes good sense.

[Rachel Cruze]

How much do you have currently in your retirement?

[Caller]

I have 117,000 in my 401k and my wife has about 13,000 in hers. And, and yeah, I guess that's about it. And then we do have our high yield savings that we're using for, we have money in there for our emergency fund.

[Jade Warshaw]

And the 75%. What, what, what does that amount to every single month that you're putting away?

[Caller]

Well, right now I haven't seen my pay slip, but I'm somewhere in the, in the proximity of 1600-1800 every two weeks is going into that.

[Jade Warshaw]

Okay.

[Caller]

And then I'm, I'm getting a paycheck of like $390, close to $400.

[Jade Warshaw]

Okay.

[Caller]

And I put, I put that into the high yield.

[Rachel Cruze]

And then you're using your wife's income for you guys to keep afloat, bills and stuff. Is that right?

[Caller]

And, or, and the military pension? That's correct.

[Rachel Cruze]

Okay. And the military pension. Okay.

[Jade Warshaw]

Okay.

[Rachel Cruze]

You know, I'm not mad at a catch up considering your age and you guys want to retire in the next, you know, four, five, six years because you don't, I mean, 117,000 won't, won't get you into retirement. So I understand the, the, the aggressive catch up.

[Jade Warshaw]

Right, right, right.

[Rachel Cruze]

To get there. My only concern, Richard, is do you guys, do you guys own a home as well as having the, the rv?

[Caller]

No, we don't. We, we actually sold our house a couple of years ago and relocated to Tampa.

[Rachel Cruze]

Okay, where did that money go from the sale of your home?

[Caller]

Well, we paid off our car and then we bought another, we bought another camper and we paid cash for that. So that wiped us out of all that. So we, we became debt free at that point.

[Rachel Cruze]

And, and so, so I'm just thinking, okay, so my only hesitation is, and again, you can do this later through your investments after you retire. But one thing to consider is that the one line item in your budget going into retirement that we want stable is housing. And I just wonder if a camper is going to be literally your housing until the end of life and it probably won't be. So I would be thinking towards we're going to have to buy something very small and inexpensive, but coming out of this retirement savings eventually and again it may be in 15, 20 years, but think about, the market continues to grow, so housing is only going to get more and more expensive. So that's my only concern about this plan in general is something that, just to be thinking about that, you know, your primary residence is something that's going down in value in a mobile home or in a camper. And you probably aren't going to live in that, you know, for the rest of your life. So I would be putting, I would be thinking about housing long term.

[Jade Warshaw]

What's your pension?

[Caller]

Right.

[Jade Warshaw]

What will you receive monthly right now?

[Caller]

Well, with disability it comes out to $2,500 a month.

[Jade Warshaw]

Okay. And what do you, at this point in you guys life? What's kind of that number that makes your budget run? Just kind of your, your normal month to month budget?

[Caller]

Yeah, our month to month budget and this includes putting. We have money that goes to our grandkids, we save for them and then we also have a extra that my wife has out of the budget, but it's 50, like around 50, $500. But that also out of that, there's, there's 800 of it that goes into savings. Okay. Into savings. So it actually could be a lot.

[Jade Warshaw]

It'd be like 4800 maybe.

[Caller]

Yeah, something like that.

[Jade Warshaw]

Okay.

[Caller]

What it costs to operate. So that includes the, the payment of the motorhome. And we do use the, we do use the. Every dollar. We're religious about that. We love that app.

[Jade Warshaw]

What's the motorhome payment?

[Caller]

Thirteen hundred dollars a month.

[Jade Warshaw]

Okay. Yeah, I agree 100% with Rachel. Unless you guys have decided that this is just your way of life forever and you have just given the finger to home ownership. I agree with what Rachel is saying. I think you do want to stabilize that and you probably want to get into something that you, not only that you can afford right now, but you'll be able to afford in the long run if your income changes, if you stop working, that sort of thing. And so you guys have a lot to think of here because 2500, while it's a stable amount that'll be coming, it's not very much. Right. And I do want to, I mean, at this rate, if you keep saving at the rate that you're saving. Yeah. You'll be close to a million, a little less. 850 maybe. And so I see why you're trying to kind of speed that process up. Now is the time that I'd be putting the pedal to the metal and bringing in as much income as I possibly could to save up not only for a down payment, but keep investing that 15% and get this thing done.

[Caller]

So are you saying that you would recommend that I, I back off my contribution or would you leave it at 75 and go? Or are you saying, well, I just.

[Jade Warshaw]

Don'T see how you're going to be able to, to save up for a down payment on a secure home at 75%, do you? Unless you see a way that I don't see.

[Caller]

No, no, I get it. I agree with you. I just, I wasn't sure whether or not I needed to back down my, my contribution to my Fidelity account and then, and then go aggressive. I, you know, I have contemplated that.

[Jade Warshaw]

But I mean you could, you could do up to your catch up contribution, which is still not going to be 75%. I don. Think. What's in the, what's in the high yield savings? What do you have in there?

[Caller]

We have a 14,000 in that.

[Jade Warshaw]

Okay, so that's a, that. I mean, what is that six months of expenses? Is that five months? What is that?

[Caller]

That's that's probably about five months.

[Jade Warshaw]

Okay. So I'd keep that just like that. And yeah, I mean, it's really going to be you balancing how much, how much do we need to save for a home and then doing kind of working backwards and saying, okay, this is what we need to save. How long will it take? And at this savings rate and then you say that takes too long, let's, you know, come back further. Truly, if you're walking the baby steps, truly, what you would do is you would back it all the way down to 15%, save up for that down payment and you would start like knocking away at that home payment before you upped your, you know, Fidelity contribution.

[Rachel Cruze]

Yeah. And how much is left on the camper, debt wise?

[Caller]

Well, we just bought it. We've only had it for about three months. So it's, it was expensive. We have about 150,000 left on that.

[Jade Warshaw]

Okay. Yeah. The problem is what Rachel and I are asking you to do, you're kind of investing on two ends. You've got your, you know, retirement Fidelity investment, but when you buy a house that's also investment, it's something that's going up in value. So while it may feel like you're pulling away from your 401k or Fidelity investment, you're actually kind of diversifying in that way. Whereas now you're putting money into something that's going down in value. And do you see what I'm saying? So Rachel and I are giving you two income tracks as opposed to just one.

[Caller]

Yeah, that makes good sense. I like that.

[Rachel Cruze]

All right. I hope that helps. Richard, thanks so much for the call.

[Caller]

Thank you so much. That's good guidance. I appreciate it.

[Rachel Cruze]

Absolutely. Well, thanks so much. And you know, and when we talk about that, you should not own anything with motors and wheels that is more than half of your annual income. You know, Richard's going against that, but that this is where he's primary living, which again from a long term we, I don't recommend because unlike real estate, if you go and buy, you know, a two bedroom condo somewhere, it's going to go up in value. That's right where a camper is going down. And so to put all your eggs in that basket at this age, it is scary, Richard. And so, yeah, I mean, I don't think I realized you owed that much on it. So. So almost backing down, paying that off.

[Jade Warshaw]

Or maybe I wouldn't pay it off. I just, I think they need to get into a house sooner than later, like as quickly as they can afford.

[Rachel Cruze]

And selling the camper and renting. Yeah, Yeah. I don't know. I don't know. There's some, some options to look at. Well, thanks, Richard, again for the call. This is the Ramsey Show.

[Jade Warshaw]

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[Jade Warshaw]

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[Rachel Cruze]

With the last caller, we were talking about real estate and what that looks like to start saving up towards a home. And you guys, when it comes to buying and selling your home, there's a lot of decisions. It can feel very overwhelming, but you don't have to go that through that process alone. We created Ramsey's Real Estate Home Base. So this is a place with so many resources and tools like calculators, start to finish guides, how to articles, a podcast, a book, a video course, like everything around the subject of real estate. Because again, buying and selling it can just, it can be an overwhelming process. And the more information you have that you understand and you know, the more clarity you're going to have walking into that, which is huge. Like you, you want to be armed with so much information before you go and buy or sell your home. So make sure to check it [e-mail] real estate or click the link in the description if you're watching on YouTube or listening on podcast. Because if you need some next steps towards your home buying or home selling process, make sure to check it out. One of my favorite things on it is the dashboard. They have the US Housing market trends and they keep it updated and it's just constantly kind of a, kind of a pulse of what's going on with interest rates, median house Home prices in America, total days on the market, how many homes are for sale around the country? I mean, it just kind of gives you the snapshot picture of the real estate market. So again, you can go to Ramsey Solutions.com real estate. All right, we're going to the phones and we're going to Andrew in Cheyenne, Wyoming. One of my favorite. One of my favorite country songs. Hey, Andrew, welcome to the show.

[Caller]

Hey, thanks for having me.

[Rachel Cruze]

Absolutely. How can we help?

[Caller]

Hey. So my wife and I were on baby step two, and it kind of took us a little bit to get there, mostly because we've been. We've been pretty sick, both of us, for the past few years, and we're seeking some medical treatment to hopefully nip this in the bud, hopefully in a few short months. But the medical treatment that we're looking at that was recommended by our doctor is experimental and it's not covered by insurance. And the treatment can be between $10,000 to $30,000. So we're kind of in a position where we.

[Rachel Cruze]

Oh, no. Andrew, are you there? Andrew? Oh, no.

[Jade Warshaw]

Oh, man.

[Rachel Cruze]

Andrew, we'll give you one more second. Oh, yep, that's a bad line. I think we're going. There you are.

[Jade Warshaw]

Oh, you're back.

[Rachel Cruze]

Good.

[Caller]

Sorry.

[Rachel Cruze]

You're good, you're good.

[Caller]

My phone's a little weird, so. Yes. I don't know if my wife and I should actually take out a loan or not. We really don't want to, especially since we're.

[Rachel Cruze]

Can I ask you out of. And share as much as you feel comfortable? But what's going on health wise?

[Caller]

We were. So. We got pretty sick from the home that we were living in and so.

[Jade Warshaw]

Like mold.

[Caller]

Yeah. So it's just been a lot of stuff that's been going on where a lot of the treatments have been not either FDA approved or treatments that have been getting us better. We are better, but it's just been a really long process. So the last time we talked with our doctor, he said that we should try and do like a hyperbaric treatment, which seems great. You know, he's had really great success with it. But the only problem is that the. The payment has to be up front. And so that's. That's the only issue.

[Rachel Cruze]

And insurance, this is obviously something more in, like, in a natural bent, I'm assuming. So insurance isn't going to cover it.

[Caller]

No, insurance won't cover it.

[Rachel Cruze]

Tell me, just health wise, are you guys able to. Are you able to work? Are you able to function? Like, how are you guys. You Said you're doing better. I'm just trying to get a gauge about how urgent this, this is for you guys.

[Caller]

Yeah, so, so we are better and we are both working right now. We make about, I want to say close to 70 or $80,000 right now a year.

[Rachel Cruze]

Okay.

[Caller]

The, you know, the only problem with this is that the longer we put it off, the worse it'll get.

[Jade Warshaw]

And so just what's your margin every month? Like what are you right now putting towards debt and baby step two that you could put potentially towards saving up for this or doing one at a time?

[Caller]

Yeah, we're able to put close to $600 or so a month into debt.

[Rachel Cruze]

And how much debt do you guys have right now?

[Caller]

We have about, I want to say about $20,000 in student loan debt and then about 50,000 in a, in a business loan.

[Rachel Cruze]

Okay. Man, this is so hard because I do feel like they're just from my own, not my own experience, but people within my close circles of friends and family even that I know. You know, when you get something, it's like autoimmune or mold or whatever that it can end up feeling. Andrew, like there's always something else. We have to, like there's a long line of things that are continual. And so what I, you know, always just think about and kind of caution is I would number one, maybe get a second opinion. I'm sure you know your doctor well and trust them. But you know, I mean we're talking about 10 to $30,000, right? I mean if it was $2,000, that's one thing. But I mean you're talking, you know, five figures going in with treatments.

[Jade Warshaw]

And so is that a piece or all in?

[Caller]

That would be for us combined.

[Rachel Cruze]

And is this ongoing or is it kind of a one time, Lord willing.

[Caller]

It'D be just a one time, like you know, one, one to two months worth of treatment. So it'd be okay. 20 sessions is like, is about $10,000 on the high end. So we hope to be done in about a month.

[Rachel Cruze]

Okay. So you know what, what I would probably do because again, I feel like this can sometimes feel like a never ending cycle. I would and because it's not a. And I know you guys are saying, I don't want to downplay it all the sickness, cause I'm sure it's just miserable. But it's not a life or death, like, okay, I have to save my child right now because you know there's a, you know, like it's not this, it's not an urgency, but it is something for the betterment of your health. You want. So what, you know, what I would probably strive to do is whatever I could to get, because 10 to 30 is a big range. So I would get as close to that 10, and I would talk, negotiate doctor's bill. I mean, I would do whatever I could to get it down to that 10. And you guys are, you know, I would work to save a thousand a month. I would be okay right now because it is a health issue. Maybe to pause the debt snowball, stay current on your bills, but I would bump that 600amonth up to a thousand and save for 10 months. And then starting October, November, Andrew, start this treatment. And then hopefully by this time next year, you're through it, you're done. And then press play on the baby.

[Jade Warshaw]

Steps, and maybe one of you goes at a time to see if it's helpful.

[Rachel Cruze]

Oh, that's a good point.

[Jade Warshaw]

You know, I know you're two different bodies with two different sets of, you know, but that might be a good way to say, listen, I did it. It did nothing for me, or I did it, and it really, really helped. That might give you some confidence going into the next treatment, too. It's just a thought. Like, I don't know what you're facing. I don't know if it's headaches or every time you eat, you know, whatever it is, if it's something that's truly debilitating. But if it's just. And again, I'm not. I don't want to downplay it either. But if it's something that's more of an annoyance that you're learning to live through, that gives you, you know, there's a little bit more timeline there to.

[Rachel Cruze]

Get this done, for sure. And the sense, too, that, you know, you don't want to prolong it too long because of what you're saying, you know, they can come back and get worse unless you have this treatment. So getting to it. Right. A level of urgency, but it's also not like we have to do this next month. The only option is a loan and we're done. Like, yeah, if you can. And it's not debilitating because you guys are working and all of that, I would. Yeah, I would find something because. And I would. Cash flow. And the other thing, Andrew, that's interesting is when you are working with cash, even when we're talking about, you know, health situations, it does force you. This is why I like cash. Forces you to look at other options, other Decisions like sell something.

[Jade Warshaw]

Yeah.

[Rachel Cruze]

There's just other parts of your brain of problem solving versus with debt. It's like, here's a chunk of money. This is all we're gonna do. We don't really have to pit the brain power to think through other things. It's just here. But when you're paying with cash and you're working and saving hard, like, I don't know, it just. It forces other things to come to the surface of other options and choices. That's also true.

[Jade Warshaw]

But.

[Rachel Cruze]

Yeah. So, again, I'm so sorry. That is stuff that is like. And that's. And that has been. I don't know. I don't know if you've. I've just had people and it's like you go to the next thing and then it flares up again. I don't know. It just feels like it's like whack a mole a little bit sometimes with different things. So I do want you guys to get that treatment, but. But because it's not. It's not life or death, right in this moment, I would. I would calm down. I mean, I would pause a little bit and save up for it.

[Jade Warshaw]

That's difficult. I remember when Sam and I were getting out of debt. This was before the days of Obamacare, and you had to have insurance or else you're penalized. We didn't have insurance, and one day he was pulling our luggage out of the back of the Jeep and it got caught on his finger and he broke his finger and we didn't have insurance. And I was like, listen, head over to Walgreens. It's crooked to this day. And you know he plays instruments. It wasn't good.

[Rachel Cruze]

Take care of yourself.

[Jade Warshaw]

Take care of yourselves.

[Rachel Cruze]

Is that insurance? This is the Ramsey Show. Hey, y'all, it's Rachel Cruz. Just about everything costs more these days, and unfortunately, healthcare is no exception. So if you're looking at your healthcare options during open enrollment and finding that your costs are increasing while your number of choices are decreasing, be sure to check out Christian Healthcare Ministries. CHM is not health insurance. It's a biblically based health cost sharing ministry that's helped hundreds of thousands of families just like yours cover nearly $10 billion in healthcare costs. With no networks and the freedom to choose your healthcare provider, CHM is an affordable option that aligns with your values and. And makes it possible for your family to save on healthcare. Plus, you can join at any time, including open enrollment. You guys. CHM has been helping Ramsey fans for 15 years, and they're the only health cost sharing provider endorsed by Ramsey, so you can trust CHM to take care of you like we would. Programs start as low as $98 a month. So find out more and join [e-mail] budget. That's chministries.org budget. Welcome back to the Ramsey Show. Up next, we have Mikayla in Kansas City, Missouri. Hi, Mikayla, welcome to the show. Hi.

[Caller]

Can you hear me right.

[Rachel Cruze]

Yes, we can. How can we help?

[Caller]

Hi. So I have a kind of indirect financial question, if you will. Not necessarily about my finances, but a conversation I would like to have about finances in my family.

[Rachel Cruze]

Okay.

[Caller]

So just a little bit about my situation. I am 22 years old. I'll be turning 23 on Sunday this upcoming week.

[Rachel Cruze]

Oh, happy early birthday.

[Caller]

Thank you. From 2021 to 2024 is when I accured all of my debt to around 30,000.

[Rachel Cruze]

Okay.

[Caller]

And so my question is, I would like to. I've been taking care of it since September of last year to now, which originally was 37,000 plus, but since then I've taken care of about seven to eight grand of it so far.

[Rachel Cruze]

Good for you. That's great.

[Caller]

Thank you. My concern though is that while I cured this debt, neither of my parents know anything about it or about my financial situation.

[Rachel Cruze]

Do they support you financially in any way?

[Caller]

So yes and no. My father, he doesn't live with us, but he, he is supportive of me. If I were to need some financial situation or some financial help, he would. And I live with my mother and my grandmother. But considering how much I make, I make enough where I think I'm okay enough without asking for help.

[Rachel Cruze]

Yes.

[Jade Warshaw]

What caused you to go into the debt? If you were in this or were you not in this living situation before, either way, what caused you to go into the debt?

[Caller]

I. Before, if you were to ask me that question, I would have made up a lot of excuses. But I'm, I've worked on it enough and made enough accountability to say myself. Come 2021, I had kind of moved out from my mother's house and lived with my ex. And so it was through some immature purchases on my end and his end, I had set up a joint account for the both of us. And so he was taking out most of the money between how much we were both earning and I was the more so the breadwinner compared to what he was making. And I was, I was okay with it. I would have just liked a heads up because I was working about maybe 60 plus hours a week.

[Rachel Cruze]

So he was using. He was using your. Yeah, he was using your money plus going into debt under your name?

[Caller]

Yeah. Wow. I was. I was really stupid, essentially.

[Rachel Cruze]

Mikaela, you're listening.

[Jade Warshaw]

We all make mistakes.

[Rachel Cruze]

Yeah, it was just. I was just trying to. More of a clarifying question, making sure I understood the situation. Okay, so my next question is, why do your parents need to know?

[Caller]

Well, the reason why is because my mom and I have been talking a lot more and one of my biggest goals for this year is to be more open and honest with the people in my life, my loved ones, my parents. And I want more. Instead of like a child, mother relationship, since I am getting older, I want more of an adult relationship with my mom. The other two really big concerns are since I worked these two jobs, my mom has been open about like what she sees in me and how they're both physical labor jobs. And so she says how exhausted I look and how tired I look. And the other part is our grandmother lives with us, but she has Alzheimer's. And so on top of working two jobs, I try to help my mom as much as I can with my grandmother.

[Jade Warshaw]

So are you saying that they're wondering, Are you saying that you kind of want to give them some context as to why you're working so hard at the jobs you're doing? Is that what you're saying?

[Caller]

Yeah.

[Rachel Cruze]

So why don't you tell me?

[Caller]

I'm sorry. The other big thing was with everything going on politically, my mom has made it quite known to me how concerned she is about me and my family's well being. And she has said consistently on numerous occasions, if things were to go from push to shove, she would like for us to leave the country.

[Jade Warshaw]

Okay.

[Caller]

With us. With her bringing that up continuously, having some experiences already.

[Jade Warshaw]

Are you guys from. Do you have a non US background? Is that what you're saying? Are you concerned about immigration? Is that what you're saying?

[Caller]

No.

[Jade Warshaw]

When you say force to leave the country.

[Caller]

African American.

[Jade Warshaw]

Okay. Oh, I. I hear you. Okay, enough said. Here's what I'm thinking. Here's what I'm thinking. I get what you were saying earlier. You're talking about a lot of different things. So let's talk about first the financial side of things. A. If you want to give somebody context without giving them a ton of details, that's fine. You can say, listen, I've got some debt I'm trying to pay off. That's why I'm working so hard. If you don't want to tell them the whole 30,000. Hold on.

[Rachel Cruze]

You want me here? Do you want some more?

[Jade Warshaw]

I've got water. Sorry, guys.

[Rachel Cruze]

I'll take over for a second.

[Jade Warshaw]

Thank you. Go ahead.

[Rachel Cruze]

Give me a. Give me a wave, Jade, because she's got some good stuff to say. Yeah, so. So echoing on what she's saying is that you can have a deep relationship with someone and, and, and be able to kind of share what you're going through of, like, the struggle of, like, oh, yeah, you know, I do have some debt I'm trying to pay off. That's why I'm putting in these hours. And this is the why behind it. And I do agree you don't need to walk alone when it comes to your money. So having somebody in your life that has context and knows what's going on, I think is important. It doesn't have to be your parents. And I wouldn't say your parents have to know every detail of your life in order to have a, A close and great relationship. But if you want that peer to peer mentality, too, Michaela, you are your own person as well. And so if your mom, you know, has, you know, and maybe you share in her fears or not, I don't know. But she can have her own, you know, set mindset of, you know, what's going to happen for her future or what she thinks may have to happen. But also, Michaela, you know, you're 22 years old, and so you get to make some decisions and decide for yourself, hey, here's, you know, here's the reality of my life, too. And just because my mom goes one way, I don't have to go that way either. Unless you do think that. Right. And you may have context in that, which is totally fine. But I do think you are your own standing person at 22. Your parents don't need to know these things, but I understand. Opening up and wanting them into what's going on with your life, I think is great. And if you want to tell them the number, tell them the number. Like you didn't. You know, we always say, like, debt is not a sin. It's not a salvation issue. You know, it wasn't some, like, big moral failure. Yeah, yeah, you made some mistakes. You look back, I'm like, that was stupid with my ex. Why did I do that? But listen, we all make mistakes. Like, like things happen in life, Michaela. So you're 22. Do not beat yourself up about it.

[Jade Warshaw]

I couldn't have said it better myself. Rachel said it while I was in a coughing fit. And she covered it.

[Rachel Cruze]

You probably have a lot better, more to. Some more to add.

[Jade Warshaw]

That was it. She covered it. That's exactly it. I won't repeat it, but I think, Michaela, you know what you have to do. And just listen. Above all, don't be influenced by somebody else's fears. Like, if they have fears and concerns, they're. They're. They're able to have those. Everybody gets to have the emotional train that they want to have. And if you feel the same way, fine. But don't let it. If you don't, don't let that fear kind of lock you into something you should or shouldn't be doing with your money.

[Caller]

Okay. I. Thank you. Thank you, truly. I, I, I'm sorry. I'm really trying not to cry.

[Jade Warshaw]

That's all right.

[Rachel Cruze]

What is it? What's. What is making you want to cry?

[Caller]

I don't think I would cry.

[Jade Warshaw]

That's okay. My dad are really big people in.

[Caller]

My life, and I really, really look up to them.

We're not.

We're not super rich, but I get, I get my really hard work ethic from them. And so they taught me what I know about finances, and I felt really, really dumb getting where I am now.

[Rachel Cruze]

I see you feel guilty.

[Caller]

Don't worry that you'd be disappointed in me with where I am.

Oh, my God.

I am so sorry.

[Jade Warshaw]

No. That what you're talking about is so real. Like the guilt that we feel over previous mistakes that we've made with our money, the guilt that we feel having not met expectations that we feel were put on us, or maybe that we've put on ourselves. What you're talking about, Michaela, is such a real thing. And a lot of times when we think about getting our money under control, we kind of think it's just this light switch that we flip. All right? I'm getting on a plan. That's it. And I just do it. And I feel nothing until it's over. And that is simply not tr.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

You go through a wide range of emotions, and guilt and shame is one of them. But I want to tell you, Michaela, you may have made mistakes with your money, but you are not a mistake. Okay? You are not a problem. A problem. You are not a burden. It was just something. You went and you went through it and let those emotions go through you. Okay? It's when you get stuck in them that they become a problem.

[Rachel Cruze]

Yes. Yeah. It does not define who you are. Your past mistakes don't define who you are, Michaela. So know that there's freedom in it and opportunity ahead. Thank you so much for the call. Thanks to all the guys in the booth. Thank you Jade for a great hour. This is the Ramsey Show.

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[Rachel Cruze]

Live from Ramsey Solutions, it's the Ramsey show where we help people build wealth, do work that they love and create amazing relationships. I am Rachel Cruz hosting this hour with best selling author Jade Warshaw and we are taking your calls about your life and your money. So give us a call at 888-825-5225. Starting us off this hour in Los Angeles is Lori. Hi Lori, welcome to the show.

[Caller]

Hi Rachel and Jade, thank you for taking my call. I am beyond thrilled to have the two of you answer my question.

[Rachel Cruze]

Oh well, I'm so glad you called. How can we help?

[Caller]

Okay, so I have a scenario that I have not heard and I have been wanting to pick your brain for a long time. I. My question is basically simply what is the next best move to make based on your advice? And my situation is I am 63 years old. I have moved back into a property I've owned for 28 years to establish. I had it. It was a rental property. I moved back in to establish it as my primary residence to save $80,000 in taxes. Okay. Because of the of it not being my primary residence, I wouldn't. Okay. Now I don't own another property. I have 50,000 in retirement. I have an account that has 200,000 non retirement. I spent $30,000 plus. Well actually 40,050. I've spent $60,000 so far, and I'm.

[Rachel Cruze]

A year in, like, your living expenses, Is that what you're saying? Lori, it takes $60,000 for you to live, Is that right?

[Caller]

Oh, it's. It took. I spent 60 above and beyond what I bring in on my income because I actually put the house on the market because I thought, this is ridiculous and upside down and against my, you know, money philosophies. And it fell out of escrow twice because there was a repair. Just, you know, things happen in real estate, so I had to spend.

[Rachel Cruze]

Okay, wait, wait. Okay, okay, let me. Okay, so you use 60,000 above and beyond your living expenses to fix up the house to sell, Is that what you're saying?

[Caller]

Well, part of that was fixing it, and part of that was, you know, just an additional to just keep the house running with insurance and, you know, utilities and whatnot.

[Jade Warshaw]

What is it costing you now to live there? Like, what's the payment? Or is.

[Caller]

Okay, it. Okay, so it cost me $3,800 to maintain the house. A month and. A month.

[Jade Warshaw]

Okay, and that's rent and what. That's. What is that rent and utilities? Or is there something else we need to know about that goes into maintaining it?

[Caller]

Okay, so that includes my mortgage, property tax, insurance, utilities. That is everything. I am super. I am also will tell you I am a huge fan of, you know, our budgeting.

I'll just lost it.

What's every dollar?

[Jade Warshaw]

Every dollar.

[Caller]

Oh, my God, that's great.

[Rachel Cruze]

She's like, I know it and I love it.

[Caller]

Okay, so I have. I am telling you, the two of you, I know every penny that I spend and that. So I am so organized here.

[Jade Warshaw]

So you're paying 3,800 every month with your mortgage, all in, all included. What are you. What's. What's your type? Top line of income? What are you bringing in every single month?

[Caller]

Okay, so I bring in about 90,000. I'm. My income can fluctuate, but I'm going to. I'm going to say that it is. It averages. And this is on the conservative side, 90,000 a year.

[Jade Warshaw]

Okay, and what's that look like monthly for you, on a good month or a normal month?

[Caller]

It looks like probably, I'm going to say, let's just say 6,000, 6,500.

[Jade Warshaw]

Okay.

[Caller]

Okay. And here's a couple of things that are important to know. I don't. I thought at some point maybe I would, you know, pay this house off and stay here, but I don't want to be here, period. And I will also throw in because it's expensive, because of the expenses, because I don't want to live in the area. It's far from my kids and my grandkids.

[Jade Warshaw]

Where do you want to be?

[Caller]

And I want to be closer to where they are or I am willing to go a little outside of the area to stay within my personal comfort financially. Okay, right now, what would that look like?

[Jade Warshaw]

Sorry, I'm moving you along so I can make sure that we answer you.

[Caller]

I'm fine. Okay. What that would look like is right now honestly creating some more freedom for myself, freeing up the equity that I have in the house, getting accounts set up properly, renting for some period of time and something as in what location.

[Rachel Cruze]

Lori, Is this still in California or is this like Arizona? Is this Missouri? Like where are you talking?

[Caller]

Well, unfortunately those grandchildren are in California.

[Rachel Cruze]

Okay.

[Caller]

But you know, it is maybe outside of Los Angeles because, you know, I'm in a fire zone too.

[Rachel Cruze]

So. Yeah.

[Jade Warshaw]

Lori, what's your main question? What are, what can we help you with today?

[Caller]

My main question, Jade, is, is it, does it make sense for me to sell the house before it hits the two year mark as primary residence, I would be foregoing about you know, 70 to $80,000 of tax, you know, but I've already spent 60 and I'm going to spend another 30 or 40 for the rest of the year and I'm choking.

[Jade Warshaw]

What, what's causing you to, what's making you feel like it's to the wire that you have to do it, that, that you would even consider doing it below the two year mark?

[Caller]

Because it feels financially absolutely. So uncomfortable.

[Jade Warshaw]

Right. Because it's more than half.

[Rachel Cruze]

And what are you fixing when you keep saying you're going to be. When you say I'm throwing an extra 40,000 at it, is that because it's almost $4,000 a month to keep it afloat or is that an additional 40 on top of just maintaining it?

[Caller]

No, that's. Again, that's an additional. So I'm going to.

[Rachel Cruze]

And is that because it's a broken down house? Like what, what, what's the extra 40 going to be going to.

[Caller]

That's going to be just covering all the nut because. Yeah, because you're more like.

[Jade Warshaw]

But you're only making 66 to 6,500. You're paying almost $4,000 a month for housing. So.

[Rachel Cruze]

Yeah, it's not going to.

[Jade Warshaw]

There's no way you can keep that.

[Rachel Cruze]

How much will you, how much will you. If you sold the house today for what you want ideally, how much equity would you be walking away with?

[Caller]

I would be walking away with about 1.1 or 1.2 million. Million.

[Rachel Cruze]

Wow. Okay. And it'd be 80,000 in taxes. Is that what you were saying because of capital gains?

[Caller]

No, the taxes would be because I bought that property for such so low amount. The overall with everything said and done is still going to be like 300,000 of taxes to pay. Okay, so it's like under that category of math is not a feeling. It's like as you can hear, I am like struggling every month.

[Jade Warshaw]

You're exactly, you're exactly right to feel this. I mean this is far exceeding the amount that we would say it should be. I don't know. I don't see how you can keep this going without going into debt. I'd sell it. You're going to take the hit on the capital gains. That's fine. You made money. And then truly you've got to get in a situation where you're getting that payment that's 25 of your take home whether you're buying or renting for a season. Still don't let it exceed that.

[Rachel Cruze]

Yeah. And Lori, if you have the ability to get in a small condo to buy with this equity, I would do that versus renting long term because eventually you're going to have to buy something and the sooner the better. Thanks, Lori. So much for the call. This is the Ramsey Show.

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[Rachel Cruze]

Solutions is a paid non client promoter of participating pros. Learn [e-mail] SmartVestor welcome back. We are taking your calls at 880-882-55225. I'm Rachel Cruz hosting with the wonderful Jade Warshaw and we're gonna go to Portland, Oregon next and we are talking to William. Hey, William, welcome to the show.

[Caller]

Hey, how are you doing?

[Rachel Cruze]

We're doing great. How can we help?

[Caller]

All right, so I have a few questions, but so I'm looking at going into trade school or, well, trucking. I don't know if that's considered a trade, but trade school, I guess. And I don't have enough in my savings. I just have enough for the emergency fund I'm currently on baby step number two.

[Rachel Cruze]

Okay.

[Caller]

And I have $24,600 roughly in debt.

[Rachel Cruze]

Okay.

[Caller]

And so I was wondering if, I know you guys generally say not to take out student loans and this is not, it's not a huge student loan, but it's still money. It's, it'd be six and a half thousand. And I was just wondering, should I pay off my debts first, which would take me around two years or what.

[Rachel Cruze]

Would be the jump in income realistically from what you're making now to after you graduate?

[Caller]

It would go roughly from 60 to 120. So double.

[Rachel Cruze]

Okay. Okay. That's a good investment. How long is school for?

[Caller]

It would be roughly for about two months and then trying to get a job after that.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

Wow.

[Rachel Cruze]

How long would it be to get into, you know, because I know with that it's, it's either you, you own a truck, you work for a company. Like what kind of route are you thinking about?

[Caller]

Yeah, so I would be working for a company and I've already talked with the owner.

[Rachel Cruze]

Okay.

[Caller]

And roughly around 100 is what he's going to be starting me at.

[Jade Warshaw]

Yeah, that's right, 6,500. How quickly can you save that? If you paused your snowball at my.

[Caller]

Current amount, probably in around four months. Three, four months.

[Rachel Cruze]

That's great. I mean, honestly, William, that's probably what I would do. And the only reason I would say to pause your snowball to do this is the immediate jump in income and trucking for the most part. I know people can kind of get a little bit into the weeds if you own your own truck. I mean, I know there's some expenses that can happen, but the path you're doing is very predictable. It's not like you're going to school to get a master's in psychology and you're hoping to do X, Y, and Z. And it's a little ambiguous because it is such a short amount of school and because it's pretty guaranteed. That's the. That's one reason why I would. Or two reasons why I would say. I. I would. I would pause and how old are you? Young.

[Caller]

I'm 23.

[Rachel Cruze]

Yes, for sure. I would do that, William. Honestly, I would not for sure take out loans for it. I would save. And for you to be able to pay off 24,000 with a hundred to $110,000 on the road, where a lot of your expenses are paid, like sleeping. Right. Like, you're. You're going to have lower expenses, too, just because of the lifestyle. So you'll be able to knock out that 24,000. I mean, you can make an aggressive goal and say you're going to do it in six months and live on half of what you're making or, you know, something crazy. Yeah.

[Jade Warshaw]

You're used to living on 60,000, so why not? Oh, I concur. Great.

[Caller]

Yeah, that's kind of. Yeah, that's kind of what I was thinking was once I get that jump in income change, absolutely nothing.

[Rachel Cruze]

Yeah.

[Caller]

Just because I have more doesn't mean I have to spend more.

[Rachel Cruze]

Yep, that's right.

[Caller]

And then just knock it out. But also, my other question was, so out of that 24,000. 20,000 is auto loan. And I was wondering, should I just sell the car?

[Jade Warshaw]

Oh, tell us more. What's it worth?

[Caller]

It's worth roughly 36 to 38. It's a 22 Highlander.

[Jade Warshaw]

No brainer.

[Rachel Cruze]

Yes. Today, William. Today.

[Jade Warshaw]

And what you with what you get with it.

[Caller]

It.

[Rachel Cruze]

You're gonna be debt free.

[Jade Warshaw]

Yeah. And he'll pay for you. Pay for a cash car or whatever, you know.

[Rachel Cruze]

Oh, yeah. Pay for a cash car. Yeah.

[Jade Warshaw]

Wow. Yeah. That's a good conversation.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

You're.

[Rachel Cruze]

You're rare, William, in the sense that your car is not underwater. We talked to so many people that have bought in the Last few years when cars were so up in value and they bought high and now they're trying to sell. And so you're.

[Caller]

Yeah, I'm a very big. Yeah, I'm just like when it comes to cars, like, I was doing the research for months. I never buy any warranty. Never did any of that.

[Rachel Cruze]

Yeah.

[Caller]

And I would not buy over MSRP, even though I did buy in 2022 when cars were like crazy high and they were doing markups everywhere.

[Rachel Cruze]

But it's holding its value that well, huh? I mean, you. Kelly Blue Book, and that's what you're seeing.

[Caller]

Well, Kelly Blueberg, private party. It's. Tell me around 41, but I had it on Facebook marketplace for about 39 and no luck so far.

[Jade Warshaw]

So, okay, so you're thinking 36, is that what you're saying?

[Caller]

36 is what I get through CarMax as like an instant offer.

[Jade Warshaw]

So if you. Let's just say you did that. I'm not saying that I would do that, but I mean, that gives you. You're gonna come out of this with 15 or $16,000. That gives you enough to pay off the remaining debt. That gives you enough that you could pay for school and buy a junk. A junker. And you're only going to drive that beater car for a little while because you're going to be making a hundred thousand or maybe you'll drive because you're on the road. Yeah. Wow. I love that. This. This Highlander's breaking you free. This is great.

[Caller]

Yeah, that's kind of like my original choice was like a BMW 750 and those just think like a rock. So I'm pretty glad I didn't do that.

[Rachel Cruze]

Well done, William.

[Caller]

Also, I am a little, like, still disappointed myself that originally My budget was 3, 500 or 35, 000. Sorry. And then I went and spent 55. But.

[Jade Warshaw]

Well, you'll never go into debt for a car again. You've learned your lesson. And with what you're setting yourself up, up. The next time you buy a car, it's going to be in cash and it's not going to be a junker. It's going to be something that you've, you know, vetted and looked at and used in nice. Right. You're setting yourself up to be able to do that in the future.

[Rachel Cruze]

Yep. And then when you get that first paycheck, it's all yours because you're debt free because you sold the car.

[Jade Warshaw]

Boom.

[Rachel Cruze]

All right, let's go to Josh and Boise. He is up Next. Hey, Josh. How are y'all doing? Great. How can we help?

[Caller]

Good. So I've got a couple questions. So first off is my wife and I, I recently moved to a remote town in Idaho where there is no major companies and there's no handyman up here either. So my wife and I decided this year, we're on baby step two currently, and we've kind of decided that this year might be a good year for me to start a handyman llc. I've already got all the tools to do it. The only thing it would cost me out the door is the initial startup through the state for the LLC paperwork and the filing fee and all that. So that's roughly about $500. The downfall is I'm having a really hard time finding business insurance as well as the only thing it would cost me running this LLC is my time and my fuel. That's all it would take. So those are my two main questions. Is starting an LLC at this point in our life a good idea, a bad idea? And then as far as business insurance, I don't know what to do anymore.

[Jade Warshaw]

So is the problem that when you're looking for business insurance, you're just not finding anybody who will offer it, or is it the price? Tell me more about that and also have you. Yeah, tell me that first.

[Caller]

Okay. So I've been told by multiple companies that because I am too much of a jack of all trades, that they won't cover it because of the fact there's too many things that I can do. They're telling me that I need to specialize in one or two specific skills. If. But the downfall is if I specialize in flooring, then I can't do trim. If I do trim, I can't do painting, stuff like that.

[Rachel Cruze]

And I didn't realize. Contractor type.

[Jade Warshaw]

Huh? Huh.

[Rachel Cruze]

I mean, I know it's not that. That. Yeah. Intense. But that's. That's what it's sounding like.

[Jade Warshaw]

Is that the problem that you're calling yourself a handyman and you should be titling your. The type of work you do differently? Is that what they're looking for? I'm not. I'm not an expert on business insurance, so I'm just asking questions to see if we can drill it down.

[Caller]

Yeah, no, it's fine. So I could get my general contractor's license. It's not overly expensive, but they do require you to put down one or two specialized skills specifically instead of having a large array of certain things.

[Jade Warshaw]

And maybe. Maybe that is what you do in order to kind of get your foot in the door because I feel like the more you're in this world, the more you're going to learn. And it might be a good idea for you to start small. I would. Oh, go ahead, Richard.

[Rachel Cruze]

Well, I was asked what's the biggest need? If you were to drill it down to two things versus jack of all trades, what do you see as the most lucrative?

[Caller]

Well, there's a lot of flooring up here that needs done as well as everybody around here has got a piece of wood busted, broken somewhere. So it's, it's. I mean, it's a little.

[Rachel Cruze]

And I don't want to be, I don't want to sneak around the law or anything, but my question is. Yeah, could you just do, could you, could you go flooring and trim? And then if someone's like, oh, gosh, well, I need, you know, this help too, you're like, oh, yeah, I can fix your toilet, too, for an extra 100 bucks or I don't know, like, could. Is that plausible just as a freelance type work?

[Caller]

Yeah, it probably could be.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

I'd get into some, I don't want to sound like I don't understand the Internet, but I'd get into some chat rooms or like get on Facebook, get in some forums and ask people, hey, what license did you do? How were you able to be a handyman or kind of just stack up all trades and also be insured and see what people who are doing it, how they're insured.

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[Rachel Cruze]

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[Jade Warshaw]

All right, today's question comes from Melody in Virginia. She says, my husband and I are in our early 40s and got married last year. While we were dating, my husband bought a house for us. I participated in the whole process and he paid the down payment and the mortgage until we got married. We have joint accounts. All that we make goes there and we treat all income as ours. We worked together to pay off the debt we brought into the marriage. My husband recently became very ill and agreed to do some estate planning. I asked him to add me to the house deed and mortgage, but he wants to just stipulate in his will that the house will be mine if something happens to him. I don't care about the house's itself. But while, but while I made sure to put him as a beneficiary for everything that is mine. He has friends and family as beneficiaries for what is his. Am I wrong in feeling off about this whole situation? Yeah, I, I would definitely feel off about this. The truth is. Okay, so let's talk about the will thing first. Because if you were like, hey, I'm not on the deed and there's no will, that would really be a problem, just looking at it as that. Because I'd say, well, if, especially since you guys bought this thing before you were married, it could go to probate, depending on what state you're in.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

And it would take time for it to really iron out and go to you. The other thought is, but there is a will, then my next thought is like, have you seen the will? Because I want to see it with my eyeballs on it. For real.

[Rachel Cruze]

Yeah.

[Jade Warshaw]

So. Because if not depending on what your state, what your state is, again, there could be an issue there. Then there's the relational side of what's going on here. Like, why doesn't he want that? And I also want to know, well, why are your friends and family on the other assets? Like, what is it, what could it be? A 401k? Anything else? A savings account. Anything else that would have a beneficiary.

[Rachel Cruze]

That would be in his name exclusively that she couldn't be on.

[Jade Warshaw]

Yeah, yeah. So what, what stands out to me and I, I'm gonna read a lot into this, but this is just what stands out to me. You're in your 40s, you've only been married for a year. It sounds like there's something previous that's playing into this. Like maybe there was a previous spouse or a previous relationship and he has trust issues. Something is going on there. I find that when people are later in life, in those relationships, there tends to be more walls up.

[Rachel Cruze]

Yeah. More experience. Bad experiences that happen with life. And because of that people get protective and they want to protect themselves, which in one case is totally understandable. But also as it plays out in the health of the marriage, it ends up being more detrimental than beneficial. And that's where you guys have to like really get on the same page. So. Yeah. Yeah. Unless to your point that he promised his brother that he would help pay for the brother's kids college. I don't know. It's like there's something there that makes sense to you, but for you not even to understand why that's a bigger problem to me, you need to know that, you know, Jade, I was stopped by somebody recently out and about and she, she was very kind, but she was like, can I just ask you a quick question? I was like, sure. But she was saying that they, her and her husband are working their way out of debt. She has, I think, like, maybe, I can't remember the exact word, maybe $20,000 left in her name because they're her student loans.

[Jade Warshaw]

Okay.

[Rachel Cruze]

And they were going to go and refinance the house. Well, if they put her name on the deed in the, in the refinance, then they're not going to get as good of a rate because of her credit score and everything. And so she was like, we want to refinance but should we hold off till we're debt free or could we go ahead and refinance and my name not be on the deed, but I could put it on the deed after I, I'm, you know, get out of debt. Anyways, it was this whole like situation and I, you know, and I told her, I was like, I mean, yes, you want your name on the deed. Eventually it's, and if it's not, it needs to be in the will like what you're saying. But the. I Think the ownership aspect of both being on the deed is important, but also in a short term, if it doesn't make financial sense.

[Jade Warshaw]

Yeah.

[Rachel Cruze]

Save the money and then put your name later. If your name is in the will.

[Jade Warshaw]

Yes. For it.

[Rachel Cruze]

You know what I mean?

[Jade Warshaw]

That makes sense. Yeah.

[Rachel Cruze]

Just in case something happens to him. Because the whole point again, of sharing assets. Yes. Is from a tactical standpoint. So we want to be smart about that. But it's also from a. From an ownership perspective and a unity perspective.

[Jade Warshaw]

And depending on the state. I don't want to get this wrong, but depending on the state, let's say that the house was bought. It was bought pre marriage. It was bought in his name. Technically, let's say that he passed away and there was debt that she didn't know about it. That house, depending on the state, could be treated as an asset and they could sell the house to pay the debt.

[Rachel Cruze]

That's right.

[Jade Warshaw]

So this is important. You know what I mean? It's important, A, to know your state law, B, it's important to make sure that these assets are protected because it's probably the thing that they have that's their biggest asset that has the ability to generate the most money for her if she were to sell it. So this is. This is an important issue.

[Rachel Cruze]

All right, let's go to Richard and Rapid City, South Dakota. Hi, Richard. Welcome to the show.

[Caller]

Hi. Thanks for having me.

[Rachel Cruze]

Absolutely. How can we help?

[Caller]

Hi. So I was just let go from my job suddenly this past Thursday.

[Rachel Cruze]

Oh, gosh, I'm sorry.

[Caller]

My question for we'll make it through. We're on baby step three. We've got our expenses saved up.

[Jade Warshaw]

Okay.

[Caller]

But my question for Dave was, what should I be doing during this time? Should I be looking for a part time job maybe to help bolster that emergency fund, make sure it doesn't run short or dry? Should we move out of the house? Are there any special considerations?

[Rachel Cruze]

What were you doing before?

[Caller]

I was the director of music for a large, well known church in the area.

[Rachel Cruze]

Okay. Do you see a position opening up and doing something similar anytime soon?

[Caller]

It's kind of thin. It can take a couple months, three months, conservatively, to find a job that's so specific.

[Rachel Cruze]

Sure.

[Caller]

That matches my very narrow field of expertise.

[Rachel Cruze]

Yep. For sure. Well, yeah, I would be for doing something in the meantime. And I always feel like the transitional season, like what you're in, it is harder because, I mean, I. I think for a lot of people you kind of have to go into it with a lot of humility being like, okay, I was doing one thing and now I'm doing something I never thought I would be doing. But at least I'm earning a paycheck to keep us afloat. Because you're right, you don't want to sit there and just drain your emergency fund all the way down, you know, three to four months in. So keeping as much afloat as possible. Does your wife work?

[Caller]

She teaches some piano lessons here and there, but she really likes being the stay at home mom.

[Rachel Cruze]

Sure, sure. Yeah. So, I mean, Richard, I would be doing anything or everything. And again, it's probably, it's not going to probably be in your field of what you're saying short term. And it may not even be a job you thought you'd ever be in, but you're earning something and bringing something in while looking, simultaneously looking for something that you had or it may, or stuff may have to just shift in your, in your, you know, professional career. I. If you hold on the line, when we get done with this call, Christian's gonna pick up and I'd love to give you some of Ken Coleman's material because he writes about this of whether it's a job loss that is, you know, sudden or expected, or you. Or you decide to change careers because it's not what you're passionate about, you know, regardless of your reasoning.

[Jade Warshaw]

Right.

[Rachel Cruze]

Kind of re looking and just saying, hey, what other strengths are out there? Because like you're saying if it is a narrow field and if there's not a reality of you getting something very similar to what you are doing, you want something that is full time, that is fulfilling, but it may look different and maybe something more, you know, that you, you aren't thinking about. So I'll give you. Yeah. Ken's book. And he has the get clear assessment, a code for that in his book. And so you can actually take that. And it's a great assessment. It's very thorough. Just maybe just to get your wheels turning and thinking of other things.

[Caller]

Yeah, thanks for the advice. Would you push me more in the direction of a full time job or would it kind of depend on the situation?

[Jade Warshaw]

I mean, I'm of the mind to take any job until you get the job, whatever it is. You know, right now you're unemployed, so let's get something just to keep you going.

[Rachel Cruze]

And if it is full time with insurance and benefits, that's a bonus for sure. You know, and knowing that it may be short term, but getting something that has kind of a well rounded package I think would Be ideal. And if not, you may have to go down to an hourly type job, which is fine too, but. Yeah. At least you're making something.

[Jade Warshaw]

Yeah. Do you have six months of expenses? Three months. What do you have?

[Caller]

We have about five.

[Jade Warshaw]

Okay. Yeah. I mean, I'd make it my goal to like in two months start. You know what I mean? Like, put a goal out there because if you aim at nothing, you'll hit it. So give yourself a clear goal of. Here's the timeline I want to meet. And if. And give yourself contingencies. If this doesn't happen, then I'll do this and really write out a clear plan so that you don't feel like you're just floating, but that you feel like you're making intentional steps in. In a. In a real direction.

[Rachel Cruze]

Yeah, for sure. Yeah. Richard, hang on. Christian's gonna pick up and we're going to give you find the work you're wired to do by Ken Coleman with the get clear assessment to help you maybe. Yeah. In just a new direction. Kind of take that narrow path and maybe expand it a little and see what else is out there. So good luck to you. I'm so sorry. That's. That is not fun. This is the Ramsey Show.

[Jade Warshaw]

I still remember 10 years ago, 23 years old, I was frustrated, anxious, and flat broke. I had followed all the ways that toxic money culture had led me down from well meaning parents and misguided guidance counselors. And it left me with a pile of debt. But I'm telling you, it doesn't have to stay that way. Over a decade, I went from broke to millionaire and I break it all down in my new book, Breaking Free from Broke. I'm going to show you just how toxic this money system is and how you can break free from credit scores and credit cards and student loans and auto loans and investing traps. And finally live a life that you're not exhausted by. A life with more margin, more options, and more peace. If you want to check out the book, go to ramseysolutions.com store to get your copy of Breaking Free from broke. That's ramseysolutions.com store.

[Rachel Cruze]

So one of the best ways to make the most of your money is by sticking to a budget. Creating a budget, sticking to, to it. It is the roadmap you guys for your money. And every dollar is the best budgeting app to help you plan to spend your money, track it when you spend, save for what matters most. And it is just amazing. So keep a pulse on your spending and really make Progress with your goals this year. Be intentional. And every dollar, again, it is just, it is my favorite app. I was saying this in our livestream and I'm not kidding. When I opened my phone, you know how you, like, subconsciously go to things on your phone that you don't realize you're in? Mine is Instagram and every dollar. I ended up in every dollar.

[Jade Warshaw]

Sometimes I'm like, every time I open it instead of Spotify, because it's, they're both great.

[Rachel Cruze]

Yes, I know, but for real, Jade and I both, we use every dollar. We love it. It is, it makes it so easy. I just was doing our February budget. I mean, it's, yeah, it is great, you guys. So you can actually download it for free in the App Store or Google Play or click the link in the description if you're watching on YouTube or listening on podcasts. Because again, getting great tools with you that are simple and easy and help you make progress, that is like, that's where technology is at, at its best when it's helping you. So honestly. Yeah. Make sure to check it out again. That is every dollar. All right, let's go to Tanner in Tampa, Florida. Hi, Tanner. Welcome to the show.

[Caller]

Thank you for having me.

[Rachel Cruze]

Absolutely. How can we help?

[Caller]

So I'm in the market of buying a house and I'm looking at buying one and I'm wondering, should I buy a starter home or should I save up for the home that I plan on living in for the rest of my life?

[Jade Warshaw]

Ooh, you know what?

[Rachel Cruze]

How old are you, Tanner?

[Caller]

23.

[Rachel Cruze]

Okay.

[Jade Warshaw]

Yeah, you know what, Tanner? I'll be honest with you. So much life happens in a five year span, in a 10 year span, in a 30 year span. So I, I, as much as I love the sentiment, the truth is you have no idea what house you're going to live in for the rest of your life.

[Rachel Cruze]

Don't put pressure on you at your age either. If you were 65, we'd be like, okay, sure, we can decide what else you'll be in, you know, for the next 30 years. But not at your age. So, no, don't, don't limit yourself to that. Yeah, smart move, I would say, would be get into something, you know, I, I, when I say as soon as possible, usually that means a couple years of savings. So it's not that urgent. But I, I would be, I would be getting in. So tell us about your financial situation. Do you, do you have any debt? Do you have savings?

[Caller]

I just got out of debt. I just paid off my Truck building up my savings.

[Rachel Cruze]

Awesome. How much do you make a year?

[Caller]

Around 90,000.

[Rachel Cruze]

Okay, good for you.

[Jade Warshaw]

And it's just you or do you have. Okay, listen, that's even another reason to think this through, because chances are on down the line, you'll. You'll meet a Mrs. Tanner and she's going to have a different expectation of where she wants months to live. So right now I'm with Rachel. I would focus on something smaller, something you can afford. You know, the rule of thumb that we go by is of course, you want to have your three to six months emergency funds saved up and then you're saving a separate down payment, no less than 5%, but if you get can get it to 20, that's great. And all in house taxes, insurance, HOA. You don't want that payment to be any more than 25 of your take home, home. And so that's what we're looking at. If you can get a 15 year fixed rate. That is amazing. So that's kind of the standard that if we're saying like, good, better, best, that is the best way that you could possibly buy a home. And then above that is just you paying cash. Right?

[Rachel Cruze]

Yeah. And Tanner, also remember too, just because of your season of life, you know, from an age perspective, that you want to be in your house, you know, I would say for at least five years, four to five years, to get kind of the market, if you will. So there'll be some ups and downs or not really. I mean, yeah. And just you pay so much at closing to make sure that you kind of get enough equity built in. That it makes sense. So are you in a pretty stable job? Do you think you'll be in the Tampa area for the foreseeable future unless something changes?

[Caller]

Oh, yes, ma'am. My job, we travel, but we're based out of Tampa.

[Rachel Cruze]

Okay.

[Caller]

I plan. I don't plan on leaving. And I there. I'm hoping to get moved up soon.

[Rachel Cruze]

Okay, that's great. Yep. Well, I would do exactly. Yeah, what Jade said. Start getting that emergency fund in place and then saving up a down payment. And yeah, you never know where life takes you in your 20s. It's a pretty. It's a wild decade. There's a lot that can happen, a lot of change. But that's exciting, Tanner. And let me say this from all the single ladies that work with me here at, at, at Ramsey, they're always like, if they're going on a date with a guy, they're always like, he's a homeowner like it's a commodity.

[Jade Warshaw]

It's a thing. Commodity.

[Rachel Cruze]

It's hard to be a homeowner these days. And if you're a homeowner and a guy, it's extra points. It just means you're very responsible. I'll throw that out there for you, Tanner.

[Jade Warshaw]

Yeah, get, get after it, Tanner.

[Rachel Cruze]

And make sure to. If you want to go check out our real estate home base, you can go to ramseysolutions.com real estate. And we have great, great agents there. Ramsey trusted agents that can help you in the Tampa area when you decide to buy. And also just some articles and podcasts, like just kind of start to learn up on this process of homeownership because the more knowledge you have, the better.

[Jade Warshaw]

Rachel, let's talk briefly about that Forever home deal because I hear that a lot. And in his case, listen, his. Tanner's heart is pure. Like he, he just, he's just a simple guy who just wants to settle down. But sometimes I hear that and it's almost like an excuse to spend more or kind of like push the. Push that barrier. Do you know what I mean?

[Rachel Cruze]

Yes.

[Jade Warshaw]

Because, like, this is my dream house. We're never moving anywhere else. This is it.

[Rachel Cruze]

And you know what's funny? Even if it's not the quote unquote dream house, and your sentiment isn't lifelong. I've had a lot of friends and their sentiment is, oh, yeah, we'll be in here till at least the kids go to middle school and it's a 10 year house. But then they get four years in and they're like, oh, gosh, the schools weren't what we thought. The house is a disaster. It's leaking. We're doing a repair. Like, you just never know. So you never know. I mean, it is something that you kind of go in with like, you know, this is a big investment. We're going to be as smart about it as possible. But also, it don't feel like you're like crushing your dreams. If you set out to think like, oh, we're going to be in this for X amount of time. Life just changes.

[Jade Warshaw]

No way to know. Yes, there's no way to know.

[Rachel Cruze]

It's a great point. It's a great point. All right, real quick, let's go to Gregory as we finish out this hour of the Ramsey show and he's in Washington, D.C. hey, Gregory, welcome.

[Caller]

Hey.

[Rachel Cruze]

Hi.

[Jade Warshaw]

How are you guys?

[Rachel Cruze]

Can you hear me? Yes, we can. How can we help?

[Caller]

Hi, good afternoon. And my name is Greg. I'm 26 years young. And I have a lot of credit card debt and on top of that, collections as well. So in total, I have 13,105 in credit card debt split between four different cards and 1760 with collections. Okay, my, my question is, is should I pay the collections first or should I try and attack the credit card with Discover? Because they are, they're like giving me a lawsuit for attorney. So I don't know which one I should be paying first.

[Jade Warshaw]

Well, they're, they're both, they're almost equally important. The Discover one, how much is it? What are you on the hook? Balance wise?

[Caller]

6,031.

[Jade Warshaw]

Okay. And then just for clarity, the collections, it's 1,760. Is that what you told me?

[Caller]

Correct.

[Jade Warshaw]

Okay, so. Oh, go ahead.

[Rachel Cruze]

Oh, sorry. How long has it been in collections?

[Caller]

One, I have two in collections. One has been in collections for about a year and a half and then the other one in collections for around four months.

[Rachel Cruze]

Okay. Do you have any money saved? Like $400, $500?

[Caller]

I have $9 saved, so probably not.

[Rachel Cruze]

Okay, what, okay, so what I would do, Gregory, is if you can. Yeah, I would be getting an extra job. I mean, I would be working 80 hours a week getting any amount of money because the ones in collection, you're have a better time negotiating those down. And depending how long they've been, and especially the one that's been in there a year and a half, it's been probably sold four different times to four different companies and some guy in a cube and who knows where. I mean, like, it's just, it is, it is long gone and they will be more likely to settle with you super cheap. So that would be probably my first goal. And then, I mean, I would tell Discover I'm gonna be keeping my minimum payments. But sorry guys, I'll get to you when I get to you.

[Jade Warshaw]

Yeah, and listen, they might sue you, but you don't have anything. They have nothing to take. And so this, that process, it's really more, at this stage, it's likely more of a scare tactic. So just there, after these collections, it's the next thing in your debt snowball. What's your income? What are you bringing in every month? Because you got $9 saved. Tell me real quick because we're about to head out right now.

[Caller]

I'm making 21 per hour, but it's more so part time.

[Jade Warshaw]

Okay, so there's your issue right there. And I think you know what we're going to tell you. You've got to get up to full time time, a full time schedule. Full time at 21 per hour. You can get some things done. But let's find a way to get that income up because that's really the key to this puzzle.

[Rachel Cruze]

Full time and overtime. Greg, that's going to be your forever young, if you will. This is use that young energy to be working. Thanks all the guys in the booth. Jay, thank you for a great hour and we'll see you guys at the Ramsey network app. If you are on radio, stay tuned and we will see you next.