Live from the headquarters of Ramsey Solutions, broadcasting from the Dollars Car Rental Studios. It's the Dave Ramsey. Your dad is dumb. Cash is king in a paid off home mortgage. Taking the place of the BMW, does the status symbol of choice, my co-host today here on the air, Rachel Cruise, number one, best selling author, Remzi Personality, my daughter, YouTube, YouTube, YouTube star, YouTube.

Oh, yeah. There we go. And there you go.

Because she's the nice version of the family and people like her on YouTube because she's not nasty.

No, I don't know if that's it. I'm told sometimes. So you weren't nice. I mean, we have a different approach of how we. Take we give the advice sometimes people love you, though, that's why they're listening right now. That's right.

You make good radio.

Well, it's compelling. Yeah, it's true. You're compelled to listen.

All right. We're going to talk to you guys about your life and your money. We're here to do that. And we obviously have a good time doing it. We hope you are eight eight two five five two two five. The advice is free. Some say it's worth what you pay for it.

Adams in Philadelphia. Hey, Adam, what's up? I'm going to love you, Dave, and then I deserve how can we help? So I think my wife and I just recently bought a house that might be too much for us, so it's about time to discover it's too much after you've already bought it.

Yeah, well, actually, we bought it in later, two months later discovered, you know, not not the greatest timing, which really done it before.

And that happens a lot, though, Adam. It's OK. So so what's the what's the math? What's happening?

So I mean, it's not well, too much on these different issues, but so based on our monthly income, what I understand is we want our mortgage payment to be about roughly 25 percent on a 15 year. We're about thirty point five on a 30 year fixed mortgage and we fill out that. So I'm not sure it's like I maybe jumping to conclusions that when you downsize for it, maybe I should follow my gut and we should downsize.

Yeah, there's two levels to making two levels of panic are there's two levels of something of motion that cause you to move on this level.

One is panic, which you can't exist today and you can exist today. OK, then there's another level that says out there, four or five years, are you still not prospering because of this thing, but you've been able to exist?

OK, you're not in the first one. You're not in a panic, but you've got you do have a little bit too much.

And you've accurately identified that you signed up for more than we would tell you to sign up for. So what is your household income and what do you do for a living?

So before taxes were about one 150, 120 based on bonuses and my wife and I are both teachers. OK, so you're probably not going to see a skyrocket in your income, we're not going to project it's going to double in four years, right?

No, we're about we're both charter school teachers as well as so she's performance based. But I'm pretty much the inflation rate and we really don't see much of the decline. Yeah, OK.

All right. And how much debt do you have other than the home? 24000, OK? Not too bad. Yeah, I feel like, you know, for you, Adam, you kind of are on that on that cusp and and what's what's hard again, it's like, OK, look out five years. Yeah. You're you guys are both teachers, like you said. So it's not like you're going to make commission and you're going to be able to, like, just blow your income out of the water kind of thing.

So. So you have to take that into account and then do the math and figure, OK, how quickly or how much are we willing to sacrifice to get out of this? Twenty four thousand dollars of debt. How long will it take us to get an emergency fund, like kind of go to map out like the next couple of years mathematically of what your money is going to look like and then see where you guys are and be like, OK, if we had a 25 percent take home pay mortgage, how much would that be?

Would we that extra money, is it worth it at that point to sell and buy another house and go through that whole process? So it's kind of one of those I mean, if it was 50 percent of your take home pay, it's like a no brainer for me. You got to go down. Yeah, that 30 percent. I mean, it's it's right there at the at that, you know, kind of that edge. So I think it's something you and your wife need to talk about and say, OK, is it worth it of what we're going to save if we did get a lower mortgage and a different house, or are we going to be in this and we're going have to sacrifice other parts of our lives to get out of this debt faster?

Agreed.

Let me give you a strategy that goes exactly with what she's saying. Let's try this, OK?

Let's say we're going to tutor extra after school and create some sort of income. We're going to get on beans and rice, rice and beans budget and clear up the twenty four thousand, which is stuff you already knew we were going to say. Right.

And as soon as that's cleared up or while that's cleared up, let's run the math out and say if we were to pay this mortgage that we currently have at the current interest rate at a fifteen year rate rather than a 30, that creates a payment of X.

What does our income need to become so that that X is 25 percent of it and let's say that within three to five years, somewhere in that range, if you don't get your income to that level, then you probably are having a house that's slowing down your progress, because the problem with having a house payment is not that you can't pay it in your case because you can pay it.

The problem is it weighs down everything else. So when you get rid of next car, you didn't have any wiggle room in your budget to save up to pay for the car. When you get ready to go Christmas or going on vacation, you're having a budget really, really, really tight because all your money is being sucked up by a house payment. And in your case, it's not all of it. It's just too much of it. And I think you can make it.

You're just going to make very careful choices. And I think your income is going to reach that 25 reached the point that you're paying a 15 year on this mortgage and it's 25 percent of your income. I think you'll probably reach that in three to five years. And so you'll be fine. It's not ideal. It's not what we would have signed you up for. But it's not bad enough to force the sale of the house artificially right now. OK, that's encouraging.

Yes, we'll get to work right now and make sure we're doing the right thing.

Yeah, absolutely. And then, Adam, I will add the other side of the coin to that. We do talk to people and that they decide on their own. Even with all that math there, you know, it's not worth it. Sell get a smaller house and just, you know, have have extra money to go crazy on the debt and lifestyle and all that. We just have more wiggle room and it's worth it for them to do it.

So again, it's not like an either or answer. And so it's kind of it is up to what you guys what you guys want to do, because we've heard both sides of the story. Right. I'll give you an example of that.

That's not it's not Adam's situation.

But when you were a tiny child, a couple that was in our church and they had three kids that were older than you all, and we considered them good parents. So we were kind of looking as parents of babies. We're kind of looking at this couple like kind of like to have parts of their parenting. I like what they're doing.

They right before we met them, they had moved down in a house like 30 percent down.

I mean, weigh down like a substantial change in neighborhood and house and everything, because they felt very, very, very strongly in their house.

And I'm not impugning this on everyone that that the lady wanted to be at home full time with her kids.

And the only way she could be a full time at home mom with the kids was not in the house they had. So they said, we're making a choice here. She can either be home or we can have this house. Oh, yeah. And they said we want her home. And they moved him home. And they did end up raising great kids, for that matter. This is the Dave Ramsey Show. Hey, business owners and anyone who has to talk with customers often listen up, you are the backbone of this freaking economy.

And just by staying open to serve your community, you're providing hope to your customers. That's why my friends at podium want to do something special for you. They're offering you the opportunity to text your customer base for free. So sign up at Podium Dotcom now and join our crusade to communicate, connect and spread hope. That's podium dot com.

My co-host on the air today, Ramsey personality number one, best selling author, a couple of times over with a new book out, No Yourself Know your money to presale right now is Rachel Cruise. Rachel Kruse's my daughter, of course. And, you know, this is this is part of her story right here.

Nearly every great success has a never again moment where you run into something and you say never again am I going to be here. That happened to me the year Rachel was born in 1988. I filed bankruptcy that year and I said, never again is my family going to be in this position.

Never again is American Express going to call my house unless it's a wrong number. Never again are they going to take the water meter out of our house. To make sure that we didn't turn the water back on illegally, never again. Are we going to feel that level of stress around money in our home and once you have that never again moment, it changes things. Some of you are having that moment because of the economic upheaval caused by covid. You've lost your job, you've been furloughed, you've been pushed around, you've been pulled around, or you've been afraid that you're going to be and you're saying I don't have any money and I'm deeply in debt and never again am I going to be in this place.

My grandfather had a never again moment in the Great Depression so that when I'm pulling nails out of boards with him in nineteen seventy two at 12 years old, I got ready to throw the nail away and he said, oh no, no, no, no, we don't throw that away.

We put that in a coffee. Can we straighten it out. We're going to keep it because his life was changed because he said never again. If you're in a never again position right now and you're ready. Well, with a lot of our stuff is available to your family. Plus is got a free trial running right now, which gets you into financial peace university.

A lot of our life changing books and tools are seventy three percent off. And that includes our kids Pack the Adventure Pack for Kids, which includes a box of teaching age to our bedtime stories to read to children. And one of them is about you.

I don't got my own kids book in there. Yeah, well, you're the subject anyway. Yeah, that's true. Remember my name. Yeah, I don't remember the name of my book.

You don't have a few segments ago, but I'll remember this book. Oh yeah. Well this book is called Karalis at the Carnival, Karalis at the carnival. Because it really happened. It did really happen. Yes. We talked about it.

The smart money. Smart kids I think. Teuton. Yeah, yeah, yeah. As every parent knows, your kids are obviously also different. And so yeah I was the the still am the spender kid.

Love spending money still to this day. I love spending money and I. Yeah. Spent it too quickly at a theme park and you guys said once your money, once it's gone you spend it all on the games you're done no more. And I spent it like two minutes playing some three games and I was like, can I have more money, shoot the water in the clown's mouth and blow up the balloon?

Yeah. The Kanae, the Karani stuff it rip you off. Those games are all designed to lose. Rachel, you're going to lose and you're going to be out of money and you're going to be wanting the rest of the day because we're not going to give you any more money. And I got to tell you, she wanted to the day, but she learned her lesson. She learned I was perseverance, really tried to really tried to get some more money out of your system.

So so is so is a kids book. Yeah.

The kids books are there and to teach kids those same kinds of things, OK, don't don't be impulsive and out of control where you're spending and you joke about being a spender.

It is your nature, but you're very mature and very controlled.

Oh you know, I've learnt. Yes, yes, yeah.

I've developed a discipline and a skill that's not nerdy. You're out of control, but it gives you an adult view on spending versus a child's view on spending.

Oh, for sure. Yes. Well, that's the one thing about the budget, you know, that I always talk about that. It was so hard for me like the budget was one part of of personal finance. I was so tough just because I'm not great at details. I felt like the whole time budgeting was just like, oh, constrictive means you can't make fun, like you can't do anything. And I was like, oh my gosh, I don't want to do a budget.

And then actually doing it and living on one later. I have to once and I got married and realizing, wow, a budget really gives me that permission to spend like it allows me to spend money. Well, I'm in control. There's still guardrails, there's no boundaries. But I can spend money now without second guessing, without worrying, without stress. Like all of it really is this tool in my life that I'm able to do what I love.

Akay spend money, but I am doing it. Yeah. With a boundary in place. But it just it's so much it's so much more enjoyable. Like even Amelia, she started kindergarten. She had her half day to day or full day. It's Monday. So technically I still say she's not started pretty well. So I still have four more days. OK, technically as hasn't started, but we did some back to school shopping stuff for clothes and I put it and our effort, our budget, like back to school shopping with an a dollar amount.

So I was able to go in like we were able to pick out some stuff and get it. And I wasn't freaked out. I wasn't like this too much is it's OK. Like it was all right. They're all questions are answered when you budget and when you spend and control. So yeah, that is me.

I went from Karalis the carnival to an every dollar budget user. Yeah.

And I love it. I'm not gonna lie if you every dollar budgeters, if you know it, the transactions come in and you get to drag and drop them. Oh it's my favorite. I love it. I do. I love it.

Turned her into a nerd show season. Utah. Hey Chelsea, what's up. So you have a question. So I'm in baby step two, but I just had this like aha moment where I know what I want to do with my life. And I, I found that I want to start a business organizing home. Right. Good. In order to do it legally, I'm going to have to put some money into it, which is it's not going to be any more than five thousand dollars.

So it does not take five thousand dollars to start a home organizing business. Well, I have to get like licenses and like, oh, you do in classes and they don't have to take a class on organizing.

You are already an organized person. Look up organizing on YouTube and watch it for five hours, you will have become the most most educated organizer on the planet and then just hand out some cards and go to people's houses and take their money for that. You don't even need to get licensed. It's not illegal to operate a single person, service oriented business where you go to someone's home out of your home on a small scale in any municipality.

You have you have you built this up to be way bigger than it is, just go do some work, make some money. OK, how much you go charge? I was thinking probably like 100 to 200 per room.

Where'd you get that number? Out of my boat. Oh, well, probably more each other.

Oh, Lord, have mercy. I'm losing it.

I'll take over. Yeah, please pick up. I was going to say I'm organizing. It is like a fad right now. There's a lot of Instagram accounts. There's a lot of people doing it, a lot of people doing it.

So you really you will be able you will be able to do it well and then and then ask around different competition around to see what they literally are to go online and start doing some research for home organizers in your area and try to find out what they're charging.

And so what you do is you study competition in your area and people that are doing it in similar sized cities across America. You can do all of that with some simple Google Google searches and then you'll figure out that it's ten dollars a room and not one hundred dollars a room. Or you'll figure out that they don't charge by the room, they charge by the house or by the hour or something else. So you look at different pricing models and different ways to pull this together and you lay that out and.

You pulled. Oh, y'all, if I could just close my eyes, I could keep talking. It's got to be a full moon or something.

So, yeah, it's in business when you're looking for you look for successful people and you copy their ideas. We call it best practices. And so if we're launching a marketing campaign or a pricing structure or a business model around here, we try to find someone who's been successful in that space before and we emulate or model or copy them after that.

So, hey, thanks for the call. This is The Dave Ramsey Show.

People all over the country are discovering a faith based and budget friendly way of meeting health care costs through Christian healthcare ministries, Christian Health Care Ministries, which is a non-profit organization that helps members carry one another's burdens with health care expenses, and they have successfully shared each other's medical bills for nearly 40 years. CFC is right for you by visiting S.H. Ministries. Doug c h m is a proud sponsor of Dave Ramsey live events.

In the lobby of Ramsey Solutions on the debris stage, Alex is with us. Hey, Alex, how are you? Hey, Dave. Hey, Rachel. How are you? Welcome. Where do you live? I'm from Hartford, Connecticut. Cool. Well, welcome to Nashville. Thank you. And all the way here to do your debt free scream.

How much have you paid off? About one hundred ninety three thousand nine hundred dollars.

Good night. How long did this take? 19 months. OK, this is the story. And what's your range of income?

I started about 100000, worked its way up to about one hundred and sixty. And then, you know, covid shifted that a little bit since then. OK, cool. What do you do for a living?

I'm a software engineer for data analytics with the health care company.

And you are kicking butt. Yeah, well done. Very well done.

So 194 in, what, 19 months? Student loans new. What was it? It was my house.

You paid off your house? Oh yeah. Yeah. Weird girl. I am for sure. How old are you? I'm 27. Oh my God. Yes. Wow. Yeah, you are awesome. Because the. What? You did it. I didn't pay any of it. What's this. What's this house worth.

It's probably about 270, 280 now. Good Lord.

It's amazing. Yeah. You can't be sold old.

You got to be like on air.

It feels great. It feels great. What made you, Alex, want to do this? Because at 27, a lot of people just kind of settle in with the mortgage and just say, you know, it's just the, you know what, 15 years.

Yeah. Why did you decide to kill it?

Well, I well, my story started before then, probably about ten years ago. I graduated college, didn't know anything about money, but happened to listen to podcasts, got books from family and was able to pay off about 30000 student loans pretty quick. And I love learning. So I kept listening to the podcast. I kept reading your books and it just was more and more ingrained in me over all that time. So I bought my house about two years now ago and I thought, well, I'll probably do it quicker than 15 years, but I wasn't going to go super Gazal.

Then it became a game. If I throw this bonus at my house, if I get an extra room to live with me and I bring that in, if I get an extra side hustle, I think at one point I had up to six side hustles. So I was doing a lot. I liked staying busy.

What kind of so what was the most lucrative shot?

US probably having roommates for sure. OK, anywhere between two and four at a time. But I had a couple of catering jobs. I turned all of my passions into hobbies. So I love fitness. I became a personal trainer and a bunch of other little side miscellaneous things, but it became a game the more I could throw. I saw my spreadsheet nerd through all this extra money, how many months it would take off of my mortgage being able to pay off the house and eventually, you know, down to ten years, down to eight, down to five.

Then it was nineteen months and I said, you know, I got to do it. So I did it. Knock it out.

Yeah. Amazing. And your family's with you. So what, what have they been saying about this.

Wow.

Not much they can say but yeah they're very, they're very impressed and they helped me along the way. Parents became debt free last year, so that was helpful along my journey. Yeah. Friends from Connecticut following the plan just became debt free. So we're kind of doing that together. Yeah, everyone's very happy and whirlwind.

Everything you touch gets knocked over. Well done. Something like that. Well done. Well done. Wow.

So what was the hardest part? Are you. Yeah. Because you're what. Twenty seven and the seven. So it's OK as a twenty seven year old. I mean you're working like crazy. Yeah. Making sacrifices obviously not doing anything crazy extravagant with your bonuses that you're getting none of that. So like how does that work. Because some 20 year olds are watching or listening and they're thinking oh man, I don't know, is it worth it?

She didn't have a very good life. Well, I was still a little bit in poor college student mode, maybe a step above that. But I was able to save a lot and I didn't really need to spend money. I knew what my needs were versus wants and just prioritized. I wanted to get my house paid off. It seemed like a great goal. So that was my priority. I stuck to it.

Have you always been like goal driven, like since you were little kid even? Probably, yeah. Yeah. So like at least in her head. Yeah. Entertainment for you is knocking stuff over. Yeah. I mean knocking goals.

OK, set a goal that's entertainment over more entertaining and going out to a club or going on a trip entertaining for you.

Knocking something down. Getting knocked it out. Oh yeah. Raising something up. I'm, I'll hit that and then you hit it.

Yeah. You just you're you're belltower. That's incredible. Yeah. Yeah. You apply and you applied it to this subject matter. Yeah. Yeah. Wow. Exactly.

And obviously to your career as well because you were making an outstanding. Yeah. For sure.

I'm so just touched down girl. Way to go, right, Alex? So what was what was the hardest parts, as you know? You know, I think of the 20 year olds watching right now and they're thinking that is impossible. I don't even know how. How did she do that? Like, what would you say is like, oh, yeah, this was the tough part of it.

But obviously, it's not all unicorns and Skittles.

I mean, well, maybe it is unicorns and Skittles. So I'm a very disciplined person. And so it really wasn't that difficult for me. I knew what my goals were and I stuck to it. You know, some days last summer I probably work 16 to 18 hours at three or four jobs a day. You were tired? I was tired. I would come home and I'd have roommates all over, which they were all great people. But, you know, sometimes you just need to relax and rewind.

But I knew what my goal was, though as tough as that might have been, I was able to get through it. Amazing.

Absolutely incredible, Alex. Absolutely incredible. I'm blown away.

The bumper sticker on her refrigerator door says, no whining. She knocks it out. You're incredible.

Absolutely incredible. Very, very, very well done.

OK, so we have somebody out there that has a mortgage or has a large student loan debt that's in your age group. And we've all read news reports that say some people think in any age group, but always in your 20s, you're more susceptible to it that I'm stuck and I can't get ahead. So what what do you tell them from your life experience? You literally paid off one hundred and ninety four thousand dollars in nineteen months.

So what do you tell them? The key to getting out of debt is because it can be done. You're you're standing here is proof.

Yeah. One of my favorite sayings that, you know, started when I was big and fitness came into my financial life is sacrifice today for a better tomorrow. So you'll make your life better with the things that you do today. You say multiple different versions of that same quote throughout your show, live like no one else show later.

You think you have like no one else. Yeah, yeah, yeah. And it feels great when you're there, so just pursue. Yeah.

So basically it's a short term sacrifice and you can, you can, you can do almost anything for nineteen months. Yeah. You really can. If it's only nineteen much, if you did that for 19 years we would call you a workaholic and you'd be out of balance psychologically and everything else. But for nineteen months it's paying a price to win the Super Bowl and now I have so much freedom because of that.

You can do anything you want, do the rest of your life. You're going to be a multi, multi, multi millionaire before you're even forty. Ethical.

The the math. The math is unbelievable. Yeah.

I mean, you take 150 grand a year coming in and you have zero payments in the world, no house payment even, and you start investing just a decent share that somehow you have an incredible life and of consumption and generosity. But just investing a decent share of that, it turns into serious. So how did it feel the moment you paid that last mortgage payment? It was great.

I was in the office and it was two days before Connecticut shut down for covid. Whoa. And so I was able to do a little I'm debt free scream with my family because no one was in the office. I was alone.

But it's great. It's great. That felt amazing.

Well, I think over this and you got no payments. Exactly. I didn't have to worry. I wasn't really worried about jobs in particular. Then it was pretty stable, but I still had that in my pocket.

You had to worry about it. You're so impressive. What a hero. Thank you. Well done. You're inspiring to our viewers, our listeners, everything else. Absolutely. Absolutely incredible.

All right.

We've got a copy of Chris Hogan's book for you Everyday Millionaires, because there's no question that's the next chapter in your story. Yeah. So very, very well done, Alex from Bloomfield, Connecticut, 27 years old. Ninety thousand paid off in nineteen months.

That's her house and everything. She is a hundred percent debt free. She's officially weird. Count it down. Let's hear a debt free scream. Three to one.

I'm debt free. Oh, wow. Absolutely incredible, amazing, so impressive. Wow, this is the day Ramsay Chef. Rachel Cruz, Remzi personality number one, best selling author, is my co-host today here on the air. Kylie is in Kansas City. Hey, Kylie, how are you?

Hi, Dave. Hello, Rachel. My husband just popped in and said we should probably know the answer to this like we're coordinators, but I think we've just had a little bit of hesitancy and a little bit more confidence, I guess. We've been doing the baby steps for about four years and we started with one hundred and thirty four thousand in student loan and no mortgage debt. And we found this house. We live about three hours away from family and we found this house that's pretty perfect for us for eighty thousand dollars.

And we just closed on it last week. So we have like a bridge loan for that. And we have our house in Kansas City under contract and it's looking like we'll have about one hundred thirty two thousand dollars in proceeds from selling our house. So we're just trying to decide, like, do we pay cash for this house in our hometown? It needs about 30 to 40 thousand dollars in renovations to be livable. We need to pay off our student loans about sixteen thousand five hundred lefton that.

We need about four thousand dollars for baby step three. And so we just want to make sure we're, like, stewarding this money well and making a good choice with this whole on student loan payments and things like that. We've had some people kind of say it's dumb to just throw all your money out to us right now. We don't already think you should just hang onto that.

So some people are confidence. So people are stupid.

You're a financial peace university coordinator. You know the answer to this. I just I guess we're just nervous. So what would you do? What would you tell somebody in your class? What is the range? What is the Ramsey answer to your question?

So work the stats. So pay off our student loans squared away, baby. Step three. And then I guess that's the issue that we're having with paying off the house and the renovations is just if things come up that it ends up being more expensive than we thought, like we've done our due diligence and what needs to work on the house. But there's always surprises that I don't want to back ourselves into a corner and then not have the cash on hand to get it livable.

What is your household income? One hundred and twenty thousand. And what does it take to get confidence in the bids on the rehab because you're not confident in your rehab bids?

I think about 40. No. What does it take for you to get confident that your rehab bids are accurate? I guess just knowing once we start, I think that's know that. No, no, no, no, no, no, no.

You are not you are not confident that the rehab bid is accurate, because you told me four times that once we get started, we think we're going to uncover something. Something's going to come up, it shouldn't come up, a rehab is a project, a project is estimable. Get more bids, get more contractors to look at it, do more in depth, figure out ways to get fixed pricing on some of these things so that, you know, you've got a complete job for X price.

And let's get more confidence in the rehab beds before you start the rehab.

OK. OK, because, listen, if you were 100 percent sure or 98 percent sure what you feel like, you're about 60 percent sure to me that it was going to cost you 30000 dollars to fix this house up, you could run this out and answer the question by running the baby steps.

But the place you're stumbling is every time in the conversation you get to the rehab portion, you say, well, that part I'm not sure about. And that's what's scaring me. Am I wrong? Did did I miss something? You know, it's just I just think there's so many unknowns once you start tearing the house apart because it's an older home and you're worried that, yeah, they on the floor and it's all rotted underneath and you got to do the foundation again.

So, yeah. I mean, you've been in real estate your whole life, Dave, so to speak. So pull up a piece of the floor and look at it. Right, like we said, when we close on it, we found out there was like beautiful hardwood floors underneath the carpet. So that was like a big win. But like, the foundation is work. And this is this will be our fourth house. So we're a little confident in flipping it like we're not newbies.

We're not getting in over our heads. I don't think too much, but like, we've never had to do foundation work. And what if, like, I don't know, sometimes I go with contractors, it just like adds up and then adds up and adds up. And it's in a new town where we haven't worked with people. Like, what if we just end up with a bad contractor?

You've got to manage the project better than you're outlining for me. I ran rehabs for years, I built houses, we built buildings, commercial buildings here, and there's you know, when we dig a hole next door over here, which we did the other day to put a building on and the buildings up. Now, we don't know in Tennessee whether we're going to hit rock or hit a sinkhole. It's an unknown and so we can blow up a budget on a 50 million dollar project because you could have a you're going to have a million dollar swing and it can all go into a hole in the ground.

Right. And so what are we what do we do to offset that? Well, before we set the budget. We do some core drills over there and we found out what the flip the soil is. And then we go, OK, we got some bad stuff over here in this corner. So we're probably going to have an extra 200 grand on that. And it's just another zero in your numbers. But it's the same process. You manage the risk of the project by continuing to unfold and gather information on the project and top things down.

You can't just run around with your hair on fire going, I don't know. I don't know. I don't know. I don't know.

That's too much stress. You can handle. You can handle, you can handle it as long as you know what it is and you can manage through it and you can decide, OK, we're going to have to not do this portion of the renovation until we have the money out of one hundred and twenty thousand dollar income. So if I'm in your shoes, I'm going to do that. I'm going to get a lot more detailed in my due diligence, get actual contractor bids, multiple contractor bids on things I'm really unsure about.

You're unsure about the foundation. Let's get three or four bids, talk it through. You're going to start to see some trends in the way those guys are talking about that.

And you're going to go, OK, I feel very confident now after talking to four different people that will be able to do it for X, and it's not 100 percent, but your confidence level goes up versus one guy goes on with these foundations.

Once you start, you don't know what you're going to get. Well, you just got fired. OK, I'm going to give me another one. Right.

And so and you just got to manage the risk on your project.

That's what you're doing and so on.

And really, before you pay off the bridge loan, you get all those numbers together, but you do certainly finish getting out of debt. You finish your emergency fund and then you're sitting on enough that we think pay off the house and do the rehab in the ballot in the remainder.

But you got them. You got to get your details home down tight, tight, tight, tight.

Pretend like I hired you to do this rehab and you had to report to me for the accuracy of your estimate. And you were working for someone else. In other words, and then that forces you to not be sloppy with managing the risks on these details, Rachel's husband, Winston, runs all of our real estate. This what he does all day long? Oh, yeah, absolutely.

Well, and that's that's how I was going to say that to. It's your family home. It's in a new city. Again, those unknowns are there. And when you don't have choices, you don't have options. You feel stuck in something. That's when the stress happens. But just like I mean, just like you said, though, I might get a couple of bids, get options. When you have options, that gives you power to say, OK, this is what we're in.

This is this is the reality of what's going on versus it just being all up in your head. And you have one guy that tells you one thing and that's it.

So, OK, so at this point, you're debt free, you have your emergency fund and you have one hundred and. Ta ta ta ta ta, 10000 dollars sitting in the bank and you have an 80000 dollar bridge loan. OK, that's roughly where you're going to end up. And so you got about 30000 dollars, we think, for the way we have thirty thousand bucks for the renovation if we pay off the bridge loan, which was 80 grand.

And so now you've got to manage the project to get the house livable within 30000 thousand and then stage anything above 30000 in phases to come out of your income, which, by the way, you have no payments and you make 120000 hours a year. And so you can stage into that. I do not think this 80000 lower house is going to eat much more than 30 grand if it eats 40 grand. The other 10 is in two phases of 4000 and 6000 phase that you cash flow out of your income.

And you'll be able to do that easily because you have no payments.

So that's how you're going to work it. But the stress will go away. Jim Collins talks about this in leadership and in business all the time.

And Dr. Boloney talks about this, too, that the a challenge does not cause anxiety and stress. The unknown causes anxiety and stress. And so that's what you're looking at right now.

That's what I keep coming back to in your situation, is the unknown is what's driving you nuts and making you go crazy and not follow the steps that you know to follow. So all I'm trying to do is get this into a known situation.

We're going to if you can get this house livable and I'll bet you dollars to doughnuts you can within 30 grand of rehab, then you're going to have a paid for house and you're probably going to have some other work you want to do that you're going to cash flow and you're going to do that in phases. That's what it's the number so like to me. Great job, Kylie. Thanks for being a coordinator. By the way. This is The Dave Ramsey Show.

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