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Live from the headquarters of Ramsey Solutions, broadcasting from the car rental studios. It's the Dave Ramsey Show where debt is dumb, cash is king in the paid off home mortgage has taken the place of the BMW as the status symbol of choice. I'm Dave Ramsey, your host. Thank you for joining us. Open phones at eight eight two five five two two five. That's triple eight eight to five five two to five.

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Anthony O'Neal Ramsey, personality number one, bestselling author, is my co-host today answering your questions. And eight to five, five to 25, Anthony, back off a six day quarantine in New York City in order to get to do six minutes. Yeah, on the Ryan and Kelly show. Yes, sir. I don't know if that's a trait or not, but it's a trait you made. It's a try to me. And it was a good try.

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Is a good hit. Yes. It aired last Friday.

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For those of you that don't watch Ryan and Kelly. I got that right. Yeah. Yeah. And it's a Ryan Seacrest and Kelly Ripa. Yeah.

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And but your segment was really strong as well done.

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Thanks. Dave means a lot. He's got six days now. Like I said that six days for six minutes. I'd even really put two and two together. It's a fair trade idea. Yeah. You're willing to do things.

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I'm not willing to do pay, but I'm old and uglier and no, I'm not as desperate.

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And you just older, wiser, have been in the game a lot longer than me.

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So I got to put it already paid some dues or I don't have to do that crap. So yeah. I mean, it's the the, the requirements to do stuff in New York these days are untenable for most of us.

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But you paid the price to be there and so your Instagram was real busy because you're stuck in a hotel room with a breach and you got a lot of stuff done that week and then got to do the hit and then come on back here. And it airs on Friday. So well done.

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Thank you, Dave. Thank you, Dave. It feels good. I mean, to be home, I didn't really understand how much I valued my home until I got back.

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Yeah, well, the other thing about you being on, like Kelly and Ryan is that you're you're cool enough to pull that off because I don't even use the same words.

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My cool factor. I'm serious. I'm in the boomer land, so. Yeah, you and you even had them back on their heels a little bit.

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It was great. It was fun. It was fun. Afterwards, I didn't know that Kelly had actually read my book, Get Three Degrees. Who was talking about that? About her and her son and how she read it last year. So it was is good to know that I was invited to be on the show because they wanted me on the show. Yeah. So that was such a huge honor.

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Yeah, that's very cool. Well done. All right. Open phones at eight eight eight two five five two two five.

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Anthony is the host of The Table, which is a newly minted podcast, has been on YouTube for quite a while. And this week you want what do you want to tune in for? Sure. I was telling Anthony before we got on the air, I listen to the first half of it on my walk this morning, came out this morning.

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And of course, it's Black History Month or next month, if I got that right back here every month. But we're doing it for just a whole week on the podcast, OK?

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And you guys are walking through that. And so some good, solid info there. The table is about having a discussion. Yes, having a conversation about everything. Everything. Not just race. No, but certainly concentrating on black history issues and black issues this week for sure. And so be sure you tune into that and learn something. It's it's it's a good open conversation by very bright and articulate people. Yeah. They come around that table on different things.

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Last week was Matthew McConaughey. Yes.

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And I was actually a real good one. I actually had a blast. You were a little bit fan, Boyd. I really was. I know that, Dave. You were a little bit jacked up because one of my favorite movies is Lincoln Lawyer. And so I was like, OK, this this the guy, you know?

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So you were you were you were excited. I had a planned interview. It's a good interview. But you or you're fired up mean it was almost like when I first met you for the first time.

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And after that I, I yeah. Right now, David, not even the same category.

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You're not fooling anybody with that. That's a great ASBA. All right.

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Anthony O'Neil, again, my co-host today, Jamie Lee is with us in Salt Lake City to start this hour off. Hey, Jamie Lee, what's up? I know I just have lots of questions, but I want to ask really quick so we have a whole life insurance and term life insurance and our whole life policy cost is like one hundred nine dollars a month and it builds up kind of an investment over the years. So currently we have like two thousand on the three thousand dollars and we still have six years left in our whole life before the penalty goes away.

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So if we canceled now, we would lose the two thousand dollars that we've occurred in the last three years. But it does cost us one hundred million dollars on top of the like forty dollars that we pay for our term life insurance. So I'm just wondering whether or not it would be worth it for us to lose the two thousand dollars now and save ourselves more money in the long run, or if we would be better off waiting, that might be the next waiting to six years and then canceling after the six years is up.

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I really don't want to spend thirty six hundred dollars trying to get 2000.

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I was the numbers you just gave me to catch it. Hundred dollars a month for 36 months. Do you get the two thousand? Well, we have well, we would have like seven or eight thousand dollars by the end of the nine years, not after surrender charges.

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So I'm getting out of here. You got a hole in your pocket, showed up. Quit putting money in it. Yeah, it's a it's a bad idea. Now, the whole life life insurance is a complete rip off. Yeah.

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Yeah. I'm with you, Dave. I'm sticking with the term life insurance and I'm definitely counseling that. I thought she said six years she had left. I was like, no, I'm absolutely that's almost six grand. So even 1200 compared to the two thousand.

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I'm not doing it. Yeah. No, thank you. Yeah. The the deal is this. Make sure you have the proper amount of insurance in place before you cancel it and go to Zander Insurance Dotcom. You can get a quick, easy quote there. A gazillion companies and you may even be able to beat the current term policy you've got because I'll bet you got it through the same people. Yeah. And if you're buying term through a whole life company, it's always way more expensive term because they want to show you that there's not much difference between the two, which there's a ton of difference between the two.

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You know, building up a cash value inside of a policy is a horrible thing. As she just told us the first three years, you pay extra to build up the cash value. And how much is in your savings account? Zero.

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How about you go down to the bank and put money into the bank and you put.

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Hundreds and hundreds and hundreds of dollars in there. Yeah, a year for three years and then you go down there and they should know your balance is zero. Yeah, yeah. And for those who are listening right now, Dave said, make sure you have the right amount. What we recommend here that you have 10 or 12 times your annual income in a term life insurance policy. So I just want to make sure we added that in there. There we go.

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Open phones at eight eight two five five two to five. Life insurance is never.

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In capital letters never highlighted, never a place to invest money.

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Number one, they keep all your money for the first three years after that, that they pay you one to two percent. After that, when you die, they keep your money again. They only pay the face value when you die. So if you build that up, that whole life, in her case, it's got 3000 or 7000 and you die, they keep the 7000. They only pay the face amount you've been paying for cash value, build up extra 20 times extra because five dollars will buy you the same amount of term that a hundred dollars will buy you in whole life.

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In monthly premium, you've been paying 20 times more in order to build up a cash value that they keep all of it the first three years. It's got a horrible rate of return and when you die, they keep your money. It's a horrible plan. It's the payday lender of the middle class. The whole lot of companies are screwing you. Are you listening? This is The Dave Ramsey Show. Hiring is more difficult than ever, especially if you're trying to create a rock star team from home.

[00:09:01]

That's why I recommend Zip Recruiter Zip recruiter makes it incredibly easy by using powerful screening technology to do the work for you. I'm talking about scanning thousands of resumes and profiles to identify the most qualified people for your job. And right now you can try zip recruiter for free at zip recruiter Dotcom Slash Ramsey. That's zip recruiter dotcom slash Ramsey.

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Anthony O'Neal Ramsey personality is my co-host today. Sam is with us in Washington, D.C.. Hi, Sam. Welcome to The Dave Ramsey Show. Good afternoon. Big fan here. Thank you, sir.

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How can we help you, sir?

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So I am turning 40 in a few months and I just honestly wanted to validate my plans for retirement later this year. I have, I think, positioned myself in a way to allow for that. And again, I just want to make sure that I'm not crazy. OK. So as far as assets, a little bit, I have about one million dollars in a brokerage account, almost entirely in stocks. I have about one point four million and four one K and traditional IRAs and about seven hundred thousand in a Roth IRA.

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I only have a mortgage or the debt about three hundred and seventy four thousand outstanding at about two point six percent. And intentionally not paying that off because of the low, very low rate. My expenses in retirement are between five and six thousand and net worth is about to point to. What's the house worth? House is about one three one oh, OK. All right. We have to take me there.

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We have three kids all under nine. So much of this. Did you inherited the biggest. Zero zero. So you did this all the way from scratch. Wait it go at 40 years old. You killed it, man. So proud of you. Thank you. Well done. Very well done.

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Well, there's not anything that that we're going to tell you. I mean, you got four million dollars.

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I mean, you've done it. Yeah.

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You know, I can give you some things I would do if I were in your shoes, but they would be fine tuning is all.

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Number one, it's ridiculous, in my opinion that you have a house payment. I just pay off my house today.

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You don't you know, you haven't borrowed a million against that house and you could in order to invest it at a low interest rate. And the reason is you didn't like the risk. But this is a small enough risk that it didn't register on your risk meter. And I think it's just silly that you got a mortgage with that kind of assets.

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So I'd pay it off today. You know, you're asking what I would do. That's what I would do. The second thing is the one million in the brokerage account in stocks that single stocks.

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It is part of what I would say, 80 percent single stock and about 15, 15, 20 percent ETFs.

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OK, well, you've got enough there that you may be well diversified. I personally don't play single stocks.

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I've got a good deal more than that in the stock market personally between my 401. KS and my other investments. But zero zero percent is in single stocks. I don't like the risk associated with single stocks. And so I'm risk averse in that regard. And it is a misnomer that you can build a portfolio that is as safe in a brokerage account as you can build with a mutual fund.

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And so, you know, I would lean into those ETFs. I would lean into some index funds and some other things that are low turnover with that brokerage account and just let that sit there and grow. If you want to set aside a percentage of it to gamble with, it needs to be a small percentage in your case, three or four hundred thousand max. But I don't personally gamble with any of mine. And single stocks are a heavy gamble.

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So but other than that, I mean, you have done an incredible, incredible job.

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And Dave and everything that you said, I would have said the exact same thing. I was going to ask them why. I mean, why why not pay off the mortgage two point nine percent yet as a low rate, but still you still have debt there. You can be taking that money to put you some other places. So, I mean, you hit it right on day. Yeah, it's but obviously you've done an incredible job, Sam.

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I mean, you're sitting at 40 years old with that kind of net worth.

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Just be sure you don't think that you're ever going to get enough that you can, quote unquote, quit a concentrating and be finding some way to serve.

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The human spirit is not designed to rest. It is designed to serve.

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And you just won't find happiness in just a pile of money.

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It's wonderful to have a pile of money. We recommend getting one, but if you want to smile on your face, it's helping someone serving someone doing something.

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I've got many, many friends over the years that have had a liquidity event where they sold a company or they've just done as well as Sam has done. And at one buddy of mine, he sold his company out for about fifteen million dollars when he was 32 years old. And he thought he was done.

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Yeah, he and he went fishing. Yeah.

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But he was done and he said, I got fat and I got miserable. Yeah. Yeah. And so 24, 36 months later went on a diet and opened another business. Yeah. I had to find something to do to serve something to do to engage himself in humanity. Fishing is fine. Golf is fine. Yes. Whatever your thing is is fine. That's fine.

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But when you do it every day and you do it all with the idea that that's going to make me happy and that's what you call retirement, you're just going to die. Yeah. And that's why people retire and six months later they're dead. Yeah. There's no meaning. There's no purpose. So that's my only other piece of advice to you, is just make sure that you stay engaged.

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And I think that may be a little bit of why I stay engaged. No, I want to stay engaged because I'm having so much fun. Yeah, you are. But but but, you know, I lost the need mathematically to work years a long, long, long time ago.

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And so what I'm doing now is for fun and it's for the I don't know, there's a thrill of the engagement being in the ring and swinging.

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And Dave, I think that's it.

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Go is do what you have to do so you could do what you want to do and you're in the season. Do good. That's what I'd love to do that again. You know, it's just to go do what you have to do so you can end up doing what you want to do.

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It's an Anthony O'Neal version of Live Like No one else show. Later you can live and give like no one else. You go like that. I like you do. Dave thinks maybe a good book deal out there.

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There it is. Is what was Ziggler used to say? That's where I stole it from. I used to say, if you do the things that other people won't do, then later you can do the things that other people can't do.

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Yes. And so you paid the price to win, Sam, and you've really done an incredible job. I just want you to get out of it all. You're supposed to get out of it spiritually, emotionally, relationally and financially.

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Andrea is with us in Rochester, Minnesota. Hi, Andrea.

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How are you? Hi. I have a little bit of a two part question for you. Can you hear me OK? Sure. I'm really glad to talk to you, Dave. Longtime listener and fans. My husband is currently finishing his fellowship. And so essentially our income is going to change drastically in July. And we he's a physician. I'm a physical therapist. And when that happens, you have a mountain of student loan debt. So essentially, my question is, when we're working our baby steps, are we going to need to invest in retirement while we work up to just to reduce our taxable income?

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No.

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OK, you need to reduce.

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How much debt have you got? You're going to blow my mind. I don't want to hear this. Four hundred four hundred thousand dollars. Yeah, yeah, yeah, you don't need to be investing anything, you need to be scared out of your brain. You need to be freaking out. He I know in your world it's normal, but it's what is. Yes, it's terribly, terribly so. Get it knocked out and get knocked out as fast as you possibly can.

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You don't need to worry about that. Anything else right now?

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Yeah, yeah. Beans and rice, beans and rice.

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Rice and beans for me is tomatoes and hot dogs.

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But tomatoes and hot dogs.

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Yes, sir. Yeah. Doctors eat tomatoes and hot dogs. The same from Anthony in the same meal. Yes, sir. Yes, sir. Tomatoes, hot dogs. Are you constrained?

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Yeah, it is. That's just weird. But that's what I grew up on day. James, do you eat tomatoes and hot dogs in the same meal? I don't. Good.

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I'm glad you ever heard of it in the same know better about only from you.

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You've talked about it before, but no.

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Seriously though. You mean what Dave is saying is absolutely right. I mean, I don't see why do you want to invest because you don't want to pay taxes. And here's the thing. Do not get sophisticated. Get scared. Yeah. And when you get sophisticated. When you get stupid. Absolutely. And the thing is, you really need to be very basic and very simple and very primitive in these early days and get the debt cleaned off as fast as you can with his deepest sacrifices you can to where you're broke.

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Doctor friends are thinking you're crazy. Yeah. Let me just tell you, the only thing more likely to be broke than a music star is a doctor.

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Doctors who are broke and make a lot of money are like a stereotype.

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They're everywhere. This is the Dave Ramsey Show. In the lobby of Ramsey Solutions on the debt free stage, they're here, Bill and Tara are with us. Hey, guys, how are you? Good, how are you? Welcome. Where do you guys live? In Ohio. Oh, cool. Welcome to Nashville.

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And how much out of you two paid off? Fifty three thousand sixty five dollars. I love it. And how long did this take? Six months. Six months. And your range of income during that time?

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From 50 to about 70000. Good for you. What are you going to do for a living? I work in customer service and I work and the accounting department.

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All right. Very good.

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What kind of debt was the 53000? Quite a bit of a credit card bill or I'm sorry, college loans, a little bit of credit card bills. OK, and his car.

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And his car. All right. Not your car, but yeah, it's his fault.

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What happened six months ago, I found a job that I really hated and I wanted to quit it. And I knew that we financially couldn't afford it. So I found the debt free snowball and I made a huge wall of it. But they sat and a few months later I was scrolling on. I, I, I was diagnosed with me a few years ago, so I was scrolling on a Facebook page and they said that the average life expectancy is 62.

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And I was like, I'm not living like this anymore. Like I want to see the country and live and not have to worry about the debt.

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Hey, man. So how are you doing with your. I'm fine.

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I haven't relapsed in a few years, so that's good.

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Yeah. Good, good. All right, fine.

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So she comes home and says, we're doing this. What you say. I was kind of hesitant at first. Yeah. You know, I was like, oh, things are going to be fine, you know? But she's like, no, we're doing this. So I kind of went along for a little while. Um, it's kind of hard for me at first. But once I started seeing the first thing, I came off second that came off and I started getting excited like, all right, this works.

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And I got on board and she wasn't pulling me along so much anymore. It was both of us working together. And that's important. It's a big deal. Yes, it is part of it.

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Now, you went up to 70000. So as you're on this journey, what did you do to get this extra 20000?

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Anything possible? We saw thought GrubHub once the car, all the fancy stuff.

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Which one was your favorite?

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None of them. None of them at all. Right, now we still do it and we still hate every minute. Oh, long days.

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But I mean, if you want it, you well, you got to want it. If it's just a dream or, you know, wish it's not going to happen, you got to want it. There's going to be a lot of long days. You're working your first job, you out to your side hustle and you're going to come home late. It's not fun, but it's a short time and it's worth it.

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So something something made you believe it was worth it. What was that? I don't know. I guess I thought it was going to work, didn't you? Yeah. Yeah.

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And I really at my job, I started listening to you nonstop and I was listening to everybody on the stage and I was like, this works. Like I come up with a lot of crazy ideas. It follows me along with. But, you know, this one I was like, you know, let's just try it. And if it doesn't work, it doesn't work. But it did.

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Yeah. Wow. Very, very cool. Congratulations. Absolutely. So I got to ask this question. You said that you didn't like none of this stuff doing it, but what was outside of that? Working two extra jobs. What was the hardest thing? The hardest?

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No, throughout this process, I would say the budget, you know, in the video you talk about somebody talking about a fight over just a couple of movie rental.

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And we had that exact fight over a chocolate Easter bunny from the street fighting over the chocolate Easter Bunny.

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And he's even Hollo. Who knew?

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Now, you said something that's I'm curious. You said you all are still doing extra jobs right now, even though you're debt free. What's the purpose behind keeping that right now?

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Oh, we're paying cash for a house. Oh, well, well, hopefully by the end of the year.

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Are you serious now? Can I ask you, how much of a house are you going to buy it? It's going to be small. OK, I am sick. I don't want to extravagant house. So probably around fifty.

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Wow. Look at you.

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Oh, go, go, go, go, go, go. Oh well done y'all.

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Well done. I'm very proud of you. And I got one more question, Dave. All right. The average person makes about forty eight fifty two thousand dollars in America. Right. So you all are right there in a lot of those people say it's hard to get out of debt making that income. What would how would you encourage that person right now that's listening to you saying I only make fifty two thousand dollars, but I have sixty seventy thousand dollars in debt.

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What's your first piece of advice and words of encouragement to that individual?

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Find something that works for you, something that you know, you're at least somewhat interested in or just something that's that's definitely doable? Well, works for us. May not work for someone else. You have to find what works for you and just decide you're going to do it. Stick with it and. Work hard, just like I said, it's a short time to give up initially to live like no one else in the end. There you go.

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Hey, man, good for you guys. I'm proud of you. I love it. How's it feel now that you're free? I mean, amazing.

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How long have you been married going on? Eight years. Were you ever debt free during your marriage?

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Unfortunately, not until now, right? Right.

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I'm so proud of you guys. Very well done. Thank you for coming all the way down here to share your story. Thank you. Thanks for having. Well done.

[00:25:07]

Got a copy of Chris Hogan's book for you everyday millionaires. And that's for certain what your next chapter in your story is. And I paid for 50000 on our house. A good start. Well done. You never know where you're going to be in 10, 20 years. So you're heading in the right direction. Very, very well done.

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Bill and Tara from Dayton, Ohio. Fifty three thousand dollars paid off in 16 months, making 50 to 70. Count it down. Let's hear a debt free scream three to one.

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That's what it sounds like when you've been. Insta the cartoon, it's the cartoon grab hugging Doordarshan, doing things you don't want to do, so you can eventually do what you really want to do, just what we were talking about just before the break.

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That's exactly right. There's there's a price to be paid. Yes. I will say there's no discipline. Seems pleasant at the time, but it yields a harvest of righteousness. It causes change. It causes transformation. Here's the thing.

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Not only they get out of that. Yeah. But not only is a relationship, but the relationship is impacted positively. They could learn to get on the same page.

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I mean, once you've had the chocolate Easter Bunny fight, you're at a whole new place in your relationship. You're really odd. That's a different one from the dollar store, right? It really is. Which means it's old chocolate Easter Bunny, middle aged yellow, yellow, grey around the little grey around the bottom there.

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Yeah, expiration date is gone.

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He knows not to say the dollar store would sell an expired Easter Bunny, but they might. They might. It could happen. That could be why it's a bargain. I've been to the dollar store quite often, you know. Yeah. And you know, that's funny, though. But but all kidding aside, once you've done that, once you've worked like this so that you don't have to work anymore, you'll never go back.

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They won't go back and look at him. Dave, they're saying, hey, we're still doing the things we don't want to do because we want a house. And so not only do we want to be debt free, but we want to be financially free and purchase our house. Cash, new grooves in your brain.

[00:27:07]

Find out for yourself why Blind's Dotcom is the number one online retailer of custom window coverings. You get free samples, free shipping and new promos all the time. Here's a promo code, Ramsey. They've got our Question of the Day.

[00:27:18]

Anthony, today's question comes from John in Texas. My wife and I have about 150000 dollars and student loans with about 25000 being private. And the rest of the and the rest, to my knowledge, being federal. With the new executive order stopping federal loans until September 30th of this year, would it be wise to take the federal loan payments we are currently making and apply those payments entirely to the private loans? And once that 25 car is paid off, apply the payment amount back to the federal loans?

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My quick answer is do not cheat the debt snowball. Right, OK, just line them up from smallest to largest and just attack it going that way. I get it. You want to go after the things that are still having interest right now. But right now I want you to focus on gaining momentum, gaining excitement. I want to go after the smallest one first. Yeah. And unless I misunderstand, this is mistyped either in the retype or the initial.

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There's not an executive order, to my knowledge, stopping federal student loans.

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I think it stops the interest. Yes, it doesn't say that here, but it is interest on that. And that doesn't matter. You still need list your debts, smallest to largest attack in that order. Get rid of them regardless of the interest rate, get the momentum of having some wins. Get the momentum of knocking things out as fast and as hard as you can. Yes, sir. And that changes changes the whole process. Absolutely. Well done.

[00:28:36]

Good stuff. Good catch. Dave, this is the Dave Ramsey Show.

[00:29:32]

Anthony O'Neal Ramsey personality is my co-host, open phones, a triple eight eight two five five two two five. Alexa is with me and are with us in Atlanta, Georgia. Hi, Alexa.

[00:29:45]

How are you? Hey, I'm great. How are you? Better than I deserve. How can we help? So we my husband and I followed your plan starting about a year and a half ago, and we paid all of our debt off, which were super excited about. And now we still have really worked hard for saving and we've saved about one hundred and seventy thousand in cash and our culture, not our cars. Our house is worth 450 and we still owe 270 on it.

[00:30:17]

Typically at the end of every month, I work for myself and I pay myself the bare minimum and I have about 5000 dollars a month left over. We're trying to figure out if we should take that whole five thousand dollars a month and throw it at our mortgage monthly or if we should be investing that.

[00:30:36]

Are you doing baby for right now, investing 15 percent in and investing into your kids college already as well? Yep. OK, are you out of debt? Yes. Yeah, we have an emergency fund other than one hundred and seventy thousand in cash.

[00:30:51]

Yes. So to be clear, when is on top of you? Six months, right?

[00:30:57]

Yes.

[00:30:57]

And so you tell me, what are baby steps? Four or five and six.

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So I have only listened to your podcast. I have never taken your course.

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OK, so what is your understanding? You have an understanding of that at all, or do we need to kind of back up to there? I need to back up to that. OK, fair enough. Yeah. Yeah. So babysat for is when you invest 15 percent of your gross income, your household income, so are you and your husband doing that?

[00:31:22]

Yes. OK, are you doing more than that? No. OK. Exactly 15 percent of your income is going into retirement. Yes. OK, so maybe step one is a thousand dollars saved, you've done that, too, is debt free except the House you've done that three is an emergency fund of three to six months of expenses. You've done that. These are the progressive steps that lead you to the shortest distance between where you are today and and wealth.

[00:31:52]

OK, and so then baby steps four or five and six we do simultaneously for 15 percent of your income into retirement. Five is kids college and six, just pay off your house as fast as possible. Which leads us to the last step, which is seven. And then you're just nothing left to do then but build wealth and be outrageously generous.

[00:32:13]

So, OK, I'm you have a hundred and seventy thousand dollars. And before I ask to answer this question for you, how much is in your savings account right now, your emergency?

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So basically we have about twelve thousand dollars in that account. And what's your household income is sitting there? I would say about 120.

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OK, that's not that's not a three to six months of expenses, right? Yeah, yeah. That's that's exactly what I wanted to ask that question. So I would up that up to about 25000. Yep. And then the rest of that I will go ahead and just dump straight onto your mortgage. So I wouldn't just do five thousand, I would put the extra five thousand dollars towards it, but I will go ahead and dump the rest of the.

[00:32:55]

I should be worried about when when fifty point forty five hundred forty five thousand dollars. Put that on a mortgage. That's going to bring you down to about one hundred and some thousand. And you go ahead and take it from there.

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Yeah. And you're going you're going to be debt free. You're going to be debt free in two to three years. Yes.

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OK, that's well, that's why we're just making like I want to take the course at our church and we haven't and we kind of just like jumped the gun. That's fine.

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I mean, I just I just didn't want to I didn't want you to I don't want to assume you knew all this stuff and weren't doing it. I wanted to understand where you were at to pick at you, but just to make sure that that we could take care of you.

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So, yeah, the I think the thing to do is. The our purpose is to say, OK, out of the ten thousand millionaires that we did research on, how can we get you to look like them as soon as possible?

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And that is typically a paid for home and a pile of money in a 401k and Roth IRAs as the first one to five dollars million of net worth. Got it. OK. After that, after that, your net worth will start to change in its composition, probably. But the first one to five million, it's going to be largely a paid for home and a big pile of money in a 401k and mutual funds or Roth IRAs and mutual funds are kind of a thing.

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And that's where we're leading you to.

[00:34:17]

Is the cost paid for home at your home with your income and at your age is going to lead you into wealth very quickly, because think about when you don't have 4000 dollars a month going on the mortgage, you've got seven thousand dollars a month going on, two or eight thousand dollars a month going into investments because you don't have a house payment anymore. How quickly that's going to turn into million dollars really, really quick.

[00:34:37]

Yeah, that's pretty cool. Pretty cool, but a great job.

[00:34:41]

I mean, amazing. You're really doing great. Hang on. And we're going to send you a copy of the book, The Total Money Makeover, which gives you all the baby steps on steroids. So you get all the nuances and details of what, when and why and all that kind of stuff. Greg is with us in Philadelphia. Hi, Greg.

[00:34:55]

Welcome to The Dave Ramsey Show. Hey, how are you doing today, Dave? Better than I deserve. How can we help?

[00:35:02]

So my question is, my wife and I currently live in a duplex. It's owned by my father and we play about eight hundred a month. And we want to do is we wanted to purchase the property from my father and then rent out the other floors and just try to turn a profit on that and trying to see if that would be a good investment or not.

[00:35:23]

OK, walk through that one more time. I got lost.

[00:35:27]

Sorry about that. It's my fault. My fault. My my father owns a duplex and my wife and I are currently living in one of the units, so we pay a hundred dollars a month in rent and he wanted to sell it to us for two hundred thousand, which is pretty good for the market around here compared to other houses on the other rental properties on the street. And then what we planned to do was there's actually three to all units to try, but only two of them are currently in livable condition.

[00:35:56]

I was going to fix up the basement and then start renting that. So my my question was, would it be a good idea to do that or just continue to look? Right now, we're pretty financially stable.

[00:36:08]

We have no debt. What's your household in use?

[00:36:11]

Household income combined is like ninety thousand. How long you been married? Three years.

[00:36:18]

OK, I think if you were renting from someone else, you would not be considering the purchase of a duplex. But considering the purchase of a home. Yeah. Yeah, yeah, but you don't think it's I mean, just in terms of just the financial investment, you don't think it's a good investment? I mean, I'm pretty good financially at sixty five thousand and index funds, I have thirty two thousand in a savings account and then fifty thousand for one day.

[00:36:44]

You're doing great and you're doing great.

[00:36:46]

And I just don't I just think that making ninety thousand dollars a year is a couple married three years, the number of times you want to live in a duplex. And rent the place next door is very it's very rare.

[00:36:59]

Yeah, I mean, some people do and I don't and I don't think it makes you a financial genius to do it.

[00:37:03]

And I don't think it makes you a financial stooge to not do it.

[00:37:08]

And so, I mean, I might buy a duplex, but I'm going to buy later after I get my home and get it paid off.

[00:37:14]

And that's where I was going. Would you to as well, Greg? I mean, right now you're young couple making good money. Just go buy a home first. So Dave and I are neither one of us saying buying a duplex is a bad decision where you are. But we're saying right now, take care of home first, get a quality home for your wife, for yourself, and then down the road, pay cash for a duplex that we can really turn into instant revenue for you.

[00:37:38]

Yeah, that's the thing.

[00:37:40]

It this is sounds like you're doing all of this based on the math of being a landlord and the math of, you know, I'm already paying 800 for one side and I could have my tenant next door. And you feel like you're a sophisticated investor and all this math, math, math, math, and you're not thinking about quality of life.

[00:37:57]

Yeah, the problem with having your having a duplex and living in one side is your renter is next door.

[00:38:06]

I mean, does that does that not say at all? I mean, you know, you want to have good boundaries as a landlord and it's very difficult to do when you're renter is next door.

[00:38:16]

I mean, you can do it. It's possible, but it's just a very difficult scenario to pull off and do it well. And so I think the if I'm in your shoes, I'm avoiding that.

[00:38:28]

Yeah, I am, too. I am too. Trust me, I even thought about it as I don't want it.

[00:38:33]

I want it at all. I want a house. Well, there's something going on right now.

[00:38:37]

Real estate's just become as an investment for people in their 20s has become a really popular subject. Yep. As if it's the way and it is a great way to build wealth, but it's also a great way to be poor if you don't have substantial wealth. I mean, substantial. Yes. This is the Dave Ramsey Show. This is James Childs, producer of The Dave Ramsey Show. You can listen to Dave Rachel Cruz, Chris Hogan or the rest of the Ramsey network anywhere with the Ramsey network app on your smartphone, get you all of our full shows, browse by topic or send clips to your friends, head to the App Store and download the Ramsey Network app today.

[00:39:30]

If you're looking for fun and practical ways to save money in your everyday life, you need to check out The Rachel Cruz Show, a podcast from money expert and my daughter, Rachel Cruze. Hey, guys, it's Rachel Cruz. And I'm so excited to tell you about my podcast. A lot of people are living paycheck to paycheck. They're in debt. They don't even know where to begin. But they have this need this want to get in control of their money.

[00:39:52]

And if that's you, you have come to the right spot. So in each episode, you get a ton of inspiration and practical advice. If not, subscribe to the Rachel Cruz show podcast. Make sure you do it today.

[00:40:04]

Hear more from the Ramsey network, including the Rachel Cruz show wherever you listen to podcasts.

[00:40:10]

Hey, it's James, producer of The Dave Ramsey Show. This episode is over, but check the episode notes for links to products and services you've heard about during this episode. Thanks for listening.