Live from the headquarters Reporters of Ramsey Solutions, this is the Ramsey Show, where we help you win in your life, specifically with your money, your relationships, and your work. 888-825-5225 is the phone number. That's 888-825-5225. I'm Ken Coleman. The incomparable, the fantastic, fabulous Jade Warshaw joins me this hour. Always fun partner when we're hanging out together. Now, a little bit later in In the hour, I might reveal, I'll just reveal just a little bit, you have a big milestone coming up, but I don't know whether or not- Don't tell him, Ken. I won't. See, you can decide if you want to tell him. I think you've already decided. I think I just got the message, so I'll hold on to that. But it's exciting.

We're getting a dog.

All right, we'll see. We'll see if I can get her to tell you, but she's awesome. Love hanging out with Jade, and she's going to take your money questions. I'll chime in. I'll take any work-related questions. Let's get that bigger shovel going. How do I make more money? Jade will chime in on those as well. Let's go, America. 888-825-5-225. Kimberly starts us off this hour in Charlotte, North Carolina. Kimberly, how can we help?

Hi. Thank you so much for taking my call. You bet. I moved down here about a year ago. I'm a full-time student, adult student. I'm also a full-time server. I moved down here a year ago Jersey because my mom had gotten sick and I couldn't take care of her on my own. My sister agreed to help out if I moved down here. I was originally planning on going to grad school and to new on in order to get a job with my degree, but that's no longer an option because now I'm caring for my mom. The only experience I have is serving in restaurant throughout that I worked my way through college, and that's not paying the bills, and that's not paying the bills enough to support myself as well as my mom. My sister said that she can't handle it, so she said she's leaving at the end of the lease. I'm going to be on my own, and I graduate this spring, and I have no idea what job I can get and what to do.

What are you graduating with? What degree?

Philosophy and Religion.

In which direction were you going? Because you just said that, I was planning to do this, and now I can't. Where was that going to play out? What was the goal?

Well, I was interested in… I did really well at school, and I was approached by the government for Foreign Service Officer and Policy and Peace That's what I wanted to do. I wanted to do my best making, which really interested me. I always wanted to be the or a philosopher growing up. But before that, my plan was to go into university professor, which requires a master's and a doctorate now.

Okay. But I think you've limited yourself, and that's what I want to do. I want to talk about what all you can do. You are going to finish this degree in May. Is that correct? Yes. You got the bachelor's. What are you making as a waitress? What are you serving? How much are you making?

Nothing.

Well, it's not nothing. Where are you working and how much are you making? We got to walk through this. You got to give me some numbers so we can get somewhere.

I'm probably bringing home I'm around 700 a week.

Okay. You're just working at a chain restaurant? What's going on?

It's a fine dining steakhouse.

Oh, good. Okay, so you're getting some good tips. It's just you're limited in what you can do there is what you're telling us. Right. All right. Here's the deal. You've got a college degree, and I don't care if it's in philosophy or biology, it doesn't matter. With that bachelor's degree, you have the option to teach. Now, you may not be able to teach on the higher ed level, but you can teach, yes or no?

Yes. I looked at...

I'm sorry. I'm sorry, I cut you off. But here's what I wanted to say. You can teach, and you can teach a lot of different topics, and it actually gets you on that path. It may not be the destination that you are aiming at, but teaching is at least that love, that idea that you had initially. What's keeping you from pursuing that? Because there are teachers that are dropping out all the time. School systems need teachers. You're going to a degree, and you're going to make more money. What's keeping you from doing that?

Well, I was looking at that path. I was looking at that path for Catholic school teaching, high school Catholic school teaching. I don't need to be certified by the state to do that. I started contacting the diocese here in Charlotte and got some information interviews about what that would entail. That is a possible path that I am pursuing.

What is the financial outlook, though? What's the pay range? Not just limiting ourselves to the Catholic schools. What's that look like for you?

Well, the Catholic schools is actually a higher pay range than the public school.

What would that range be?

Between 60 and 80 to start. Great.

I want to bring Jade in really quick here. Jade, I'd like to know, Kimberly, what the shortfall is going to be. If Cis is backing out, so she's not helping with rent, presumably, what is the shortfall that you have to be able to take care of your student loan payment plus all of your living expenses? Can you walk Jade through that?

Tell me more about your financials. Obviously, we know you're making around 2,800 a month. What's the total rent or at least payment that you'll be taking on?

I wouldn't be able to stay at the house. It's 2,300 for the house.

Okay. Have you started actively looking for other places?

Yes. When I moved down here, it cost me 5,000 to move down here. That put me into more debt, obviously.

Okay. That's on a credit card?

Yes. Okay.

Keep going. Keep running out the story.

So my total debt right now, I have about 10,000 in debt on credit card.

Okay. 10,000 on credit cards.

My student loans are going to kick in, and I have… Well, they probably won't kick in for another eight or nine months. That's right. But it'll be about $22,000 in total. Okay.

Anything else? Cars?

And then I have $5,000 left on my car. Okay, good.

When you're looking out there for apartments, what do you think you can get, and can you get another roommate? Can you get something cheaper with a roommate. That would be my thing one. I'm not looking for the $2,300 apartment. I'm looking for the $1,800 apartment, if possible. Something I can share with somebody that is reliable and dependable. Because what I'm hoping to get you to is apartment that you could afford on your own in case the roommate moves out, but you've got a roommate there as a safety net so that you can save some money. That's what we're looking for. Listening to what you said to Ken, I just want to know what the timeline is on this Catholic school thing because your problem is an income problem. That's the true issue here. I've said this before, and I'll say it again. Anything that's making more than what you're making now, anything you can add to that is a plus right now. Even if it's not, it might take several months for this Catholic school thing to shake out. But if there's anything that you can add to what you're doing now to solve this income problem that's short term, then do it.

Kimberly, I want to add to that. You You can, and we're going to give you every dollar. Jade, let's give her something here in about 10 seconds. But Kimberly, listen, with that degree and a 3.7 unemployment rate in the United States, and Charlotte is a very good market, you are just using that degree to do whatever you need to do to get a foot into this debt, kick it out, and then we make the progress. But I would be teaching, I'd be going the direction you want to go, which you've got to make more money. Jade, what can we give her?

Let's give her every dollar. Matter of fact, let's set her up with financial Peace University, that whole Ramsey Plus bundle so she can have everything she needs.

Kimberly, follow the steps. You got this. You can do this. This is The Ramsey Show.

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All right, who needs some help out there? You're just going, I'm not where I want to be. I'm not where I want to be with my money. I'm not where I want to be in my relationships. I'm not where I want to be in my professional journey. If that's you, no shame in your game, number one, and number two, we'd love to help. We being Jade Warshaw, my colleague, co-host, and friend. I'm Ken Coleman or Ramsey Personalities, and we're here for you. This is a listener of your show. We are here for you. We take your questions, 888-825-5225, 888-825-5225. Let's go to Detroit now. Kendall is there. Kendall, how can we help?

Hi, nice to talk with you today. You, too.

What's going on?

I just graduated medical school about a half a year ago.

Hey, cool. Congrats.

Thank you. So I have about A year and a half years left. Obviously, residency salary is about 60,000. I have about 220 in student debt, but no other debt in my life. My plan is I can't pay off my debt while I'm a resident. I don't make enough. But when I graduate, I was going to live off of 40,000, pay off my debt in two years. But my question is, I don't have any money saved for retirement, and I'll be 33 when I start making six figures. Should I prioritize paying off my debt or should I start saving more for retirement?

Well, Jade is going to help you on that, but I'm just real curious, what do you think that starting salary is? What do you think the range is maybe in the first couple of years?

270 to 300, most likely.

Jade, you can do something with that, can't you, coach?

Listen, I'm excited for you.

Thank you. I'm very excited, too.

You should be. I'm excited for you. You've got this big milestone coming up. You've got three and a half years left of med school, so that's cool. Luckily, you came out of this with only 20,000 of student loans. Can I just quickly ask you? No, 220.

220? What? 220. I caught that one.

Listen, I'm glad I asked because I was like, How in the world did you do that? All right, so you've got 220 of student loans, nothing else, right?

Yes, nothing else.

Okay. We've got a couple more years of 60,000 salary, 60 to 80 or just 60?

Yeah, like 60 to 70, probably. Okay.

Yeah, I'm with you. They're not going to become due until after you graduate, right? And then you've got, well, are they going to be… Does your residency count for that or is it separate?

I'm on an income-based repayment plan and also the SAFE plan. Typically, they gain $1,000 a month of interest, but those two plans allow me to pay $2,33, and the government pays the rest of the interest. They're not going to grow in residency, and I only have to pay $2,33 a month. But when I graduate, that will change.

Okay, got it. I would try to pay as much as you can with the salary that you have. I mean, that's all that you can do. But what I really want to address is the fact that you said that you're only 33 years old, and you'll be 33 when it's time to retire, or when it's time to start saving for retirement, you don't want to be behind. Whenever I hear that, I just want to let people know I've been there. When my husband and I were paying off our student loan debt, which was about $280,000, we didn't finish that until we were around your age, 33, pregnant with my son, and we hadn't started investing at all. I want you to understand that you're going to be okay. Let's just pretend… I love doing the investment calculator, so let's just play around here. How old are you? Can I ask?

Yeah, I'm 29 right now.

Oh, my goodness. You're 29. Let's just say… I'm going to plug this in. We have a really cool investment calculator. I'm just going to say, let's pretend you're 29 years old now. Let's pretend that you plan to retire at age 62. Let's just say that. You have zero in retirement now, right? Okay. Let's say because you're saving for a home, you're not investing the whole 15% that we would advise when the time comes. Let's say you're investing 10%, so $2,700 a month. Fair? Are you tracking with me?

Yes.

Okay. We're doing 2,700. I'm plugging that in. Let's just be very conservative and say an 8% annualized rate of return. Let's calculate that and see what that will be. When the time comes, you'll have over $5 million.

Oh, okay.

$5 million.

Yeah, that's a lot.

Yeah, I think you're going to be all right.

I think you're going to be just fine.

That's what I want you to leave here with is, All right, I've got time. I'm doing the MD thing. I'm paying as much as I can. Once I hit this salary, I'll be able to knock out whatever remains. I'll save up 3-6 months of expenses in Baby Step 3. By then, like I said, you might be wanting to save for a down payment, too. That's Baby Step 3B, and that comes before you start investing. So you've got time, and you might start to do Baby Step 3B and Baby Step 4, which is investing 15% at the same time. Whatever you choose there, you're going to be fine. $5 million, that makes me sleep a lot better at night, Kendall.

By the way, Kendall, those numbers are going to be way bigger than that. She was just going real conservative here.

That's if you never make any more money. You stay at your starting salary.

What? Two years, you pay off your debt, then you got your emergency fund after that, you save for a house. Let's just say you don't start investing until 36. Again, not an issue because of the amount of money that your 15% represents. The compound interest is insane. You don't have to worry about that. That's the point. That's the whole thing that you called about. You're not too late. You aren't going to be destitute. You're going to be very, very wealthy.

Is it just you, Kendall?

Right now, it's just me. I'm still figuring that out.

That's a great point, Jay. That doesn't take into account a double income. Oh, by the way, you know what else it doesn't take into account? All the money you're going to make on a house because you're going to put a really big chunk down and you're going to pay it off.

You're going to have a paid for house when you retire as well.

I got to tell you, Kendall, I'd be shocked if you don't do what we tell you to do, if you're not in the 10 million range by the time you're 65. Be shocked. That's incredible.

I'm not making that up, am I? I've never thought it was a security.

I don't think that's a stretch.

No, I don't think that's a stretch.

You got this. You got it?

Thank you. Yeah, I really appreciate it.

Follow the plan. Hey, Do you have any of our products? You got any books or anything that you lean on?

I don't. My sister went through your program, and she normally just talks to me about all of this stuff. I don't have any.

I want to give you something, Jade. Let's give her something to cement this so that she can see the process for sure, Total Money Makeover.

Yeah, Total Money Makeover. Hey, I want you to head to everydollar. Com/jade, and I want you to pick up Every Dollar premium, and it'll give you $15 off. What I love about Every Dollar premium is you can The same way that I plugged in your numbers and gave you that snapshot of what your investing future could look like, we've got a financial roadmap planner on there that you can plug in all sorts of numbers to figure out where you want to be and where you're going to meet certain milestones. You can plug in numbers to figure out how long it would take you to save 3-6 months of expenses or how long it would take you to save up for a home, those sorts of things. We'll make sure you have that, and I think she's all set.

Kendall, you're a rock star. Okay, Jade, we got about a minute here. We got new people coming in all the time, so I think it's really good to revisit what is a really sensible question. Yes. And that is, I've got all this debt, and if it takes me six years or five years or four years to pay it off, I'm so far behind the eight ball in investing Why do we teach that the way we do, that we clear debt first before we invest? Explain that to newcomers who might still be going, Really?

I mean, there's a lot of reasons, a lot of good reasons. The first reason is your income is your biggest wealth-building tool. That's a Dave Ramsey classic quote right there. You need your income available in order to be able to invest it. For most of us, we're living paycheck to paycheck. We don't have any money left at the end of the month, but after we've paid our bills, our car note, we've got groceries, we paid the kids' daycare, Most of us don't feel like we have that breathing room because we have so many debts and bills. So the first step is to clear that out. So you get your money back in your budget, and then you save up 3-6 months. Because if you don't save first and you start investing right away, if an emergency comes, you start pulling from your retirement, or you start using credit cards and you go back into debt. So you pay off the debt, you build up the savings, and then, and only then, we start investing. And that's the way it works. If you start doing it out of order, you start messing yourself up, Ken.

You just proved it. Once you start that investing, compound interest becomes your best pal. It can work. You're not too late. Trust the process. It works. We're so glad you've joined us. She's Jade Warshaw. I'm Ken Coleman. This is The Ramsey Show.

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Welcome back to The Ramsey Show. I'm Ken Coleman. Jade Warshaw joins me. We're here for you, America. The phone number is 888-825-5225. Feeling stuck, got some fear, got some doubt around money or your work or relationships. We're here for you. That's what we love to do, is coach you up, help you see a clear path forward so that you can move forward confidently. 888-825-5225. Let's go to the Big Apple, New York, New York. I'm heading there tomorrow night. Jack, how can we help?

Hey, guys. How are you doing? Good. What's going on? Hey. I am actually pretty happy with the career that I have, but I'm hitting income ceiling pretty seriously this past year, and I'm a little bit lost on how to move forward and raise that. I delved into you guys' whole program. Last week, I binged, and I actually paid off all my credit card debt last week. Nice. It wasn't that much. It was just 6K, but I had some savings, so I just went ahead and did it. That's fantastic, Joe.

How'd that feel?

It was great. It was amazing. And it's just like, yeah, now I'm just... I put that $1,000 aside as well. Great.

Good.

I'm just trying to figure out how to get the income up because the big apple ain't cheap. No, it's not.

It is not. I like to visit. I would not live there, and I feel you on that. Okay, let's dig into this. Sure. What profession are you in, and what is your income?

I'm in the interior I'm a decorator, decorating a design business. Then I'm also an oil painter as well, so I get a little bit of my income from selling paintings, too. That's awesome. What's your income? This year, I made 85K.

Okay. What's your living situation? An apartment?

Yeah, I live in an apartment alone.

Where?

You're not on Manhattan.

I was going to say it's not Midtown. I am in Manhattan.

I got very lucky. I'm rent-stabilized. Oh, wow.

Oh, good for you. Ducky. Ducky. What is your rent?

It's 1900.

Wow. That's pretty good. I mean, I'm actually shocked, Jack. I'm really shocked.

I've been here a while, so that's the deals you get when you stick around. There you go. That's awesome.

Good for you.

All right. I'm not as familiar with the field, but I don't have to be, so I need to dig in here. When you say you've hit that lid, I think that's a great way of describing that. Is that because of qualification or is it because of association? What I mean by that is the company you're in right now, there's just a lot of opportunity for growth, if any at all. Explain to me what's the lid.

Yeah. There are two branches of where I get my income in the interior design business. I'm in the Union as a decorator, so that's a 60 an hour set wage, or set hourly, I'm sorry. Sure. Then I also garner freelance work on my own, which I actually charge much more for, but it's much more inconsistent. I have three or four, maybe five clients a year that I do interiors for, mostly restaurants in the city.

Based on your time, do those gigs pay a whole lot better. I know you can charge more.

Way better.

We know that you said at the start of the call that you love the industry, so you want to be in there. I do.

I love it.

Yeah. Well, let me tell you something. The union, and don't take this as a political statement. I'm not making a political statement. But in this case, the union situation for you is the lid. You're just not going to get a bump in pay unless the union fights and then that goes up. What you've got to do here is, I hate to oversimplify this, Jack, but this is about good old-fashioned connections and hustle and get the word out because you've proven you've done it on some level, right? Now, we just got to say this is the play. It's almost like getting a blank sheet of paper, and you get alone, you get quiet, and you go, What do I have to do to double and triple, and list for a heck of a quadruple the amount of what you're calling freelance work? That's the exercise. I'm going to tell you what it's going to come down to. You go Come back to those restaurants that you did work for and say, Hey, would you be willing to make a referral for me? Do you know anybody? Have you had a conversation that I could do some work for?

You are every square second of the day when you're not engaged in work, you're going, Who do I need to connect with this week? Who do I need to connect with next week?

That's not what I'm doing right now.

I know.

I think you're focused on the wrong lid, to Ken's point. I think you're thinking about- You can't control that. My hourly wage, but you're part of this union. But I'm looking at this, I'm going, Oh, my gosh, this is limitless. As long as you know how to do the thing and people have used you out there in the wild on your own, that is invaluable. My goal would be, I want to get away from this union job, and I want to be starting my own thing, and I want my new problem to be, I have so many people coming to me. I only have 24 hours in the day. I need to start hiring some folks. That's really where we're going.

I guess my mindset lately is just that I'm trying to save my butt with more steady union pay, like as just a steady income. Jack, let me tell you what I would do if I were you, okay?

We're going to get real, real, okay? I would keep the union gig, and you need to relax. You got your steady.

You don't have to stop it today.

You don't need to worry about steady. You got the steady. Now you have to say, okay, so you're in Manhattan. Are there a couple of restaurants or social places, coffee shops or whatever that you frequent? Give me a little bit of latitude. Tons. Tons. Got you. Are there wealthy people that also frequent these joints?

Yes. Okay.

All right. Jack, do you have a winning personality?

Yes.

Yes, you do. I was going to say yes. We're going to say yes.

I vote yes.

Jack, I'm starting to talk to people. Do you know what the easiest way to get someone to ask you about what you do? Has anybody ever told you this, Jack? What do you think the answer is?

I have no idea. It's just great.

You know what you do? You start talking to somebody, you go, What do you do? And you'd be super interested in them. Jade, what do you do? Jade starts talking about me, and I need to be so passionately enthusiastic about what Jade's telling me, that at some point, if she's not a sick human being, and she's not, and she's going to say to me- Ken, what do you do? And then I go, I'm an interior decorator. I work for the Union. But I got to tell you, I've just really enjoyed. I did this restaurant over there on 47th and blah, blah, blah.

Well, my friend is looking for somebody to redo his restaurant because he just started- Yeah, or some sweet old lady who's got eight strands of pearls around her neck in Manhattan goes, I'd like to redo my bathroom, or whatever.

And all of a sudden, Jack, we got deals. I know that's right. You understand what I'm saying?

So, Jack, this is about you connecting.

And the more you connect and you share and you show your work, you ought to create a Facebook page by the end of tonight because it's free. You ought to get an Instagram account up tonight because it's free.

Do you have all that, Jack?

Yeah, I do have a website and Instagram for my decorating business. Guess what?

It's one click of a button to share with somebody, Hey, listen, if you'd like to redo your townhome, I'd like to come by sometime next week. Let's take a look. I'll give you a couple of quotes, no cost, no pressure. Then the sweet old lady goes, and then she does it, and then she goes, Jack, I got to tell you about Ethel. And next thing you know, you've got all these big blue blood, upper echelon New Yorkers paying you premium rate, Jack.

Listen, Jack, slide it in my DMs because I want to see what type of work you do because you never know somebody- Wow, that's the first time that's happened.

I've never heard her say that. I just want to see it. Jack, she may be getting something. She may have a project for you.

I know people that know people is all I'm saying, so I might just slide it on in there. We'll see.

Everybody needs a bathroom redone. Everybody needs a bathroom redone.

I promise you right now, Jack. Now, we've had some fun with this, but I'm actually as serious as a heart attack. That is the strategy for you. That is the bridge from where you are today to where you want to be financially. Here's how this works, Jack. You do what Jade and I were just telling you to do. There's going to come a day where you replace all of that union income with the side hustle income. That's when you say, Bye-bye, union, and you start doing the project that you want to do, and you now go from 80 to 160 to 320. That's right. I mean, dude, if I'm an interior decorator, the place I want to be is the Big Apple. Start spreading the news. Jack is designing today. That's right. Come on, Jack. I want to... There it is. You left me hanging, kid. Oh, sorry. Well, I was getting nervous. It was starting to go up a little bit. I hadn't warmed up. Jack, you got it?

Yeah, I got Thanks, guys.

I appreciate it. Get busy. Hang on the line. I'm going to give you my number one best-selling book called The Proximity Principle, which says this, If I'm around the right people, Jade, and I'm in the right places, opportunity finds me. It's that simple, Jack. Oh, by the way, hang on. Jade wants a 20% discount on her new sunroom. We'll see how that goes. This is The Ramsey Show.

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Hey, quick question. I'm in a 401k currently, and it's so too aggressive. It's in a cookie cutter fund, and I was wondering if I should just leave it alone and let it do its thing, or if I should just actively manage it myself.

The 401k is through your job, and it has, I'm guessing, three knobsbs you can choose for it?

Right. It has a conservative, moderate, and then aggressive. I am 25.

Or Or you have the option, is it within the same 401k that you can choose the actual funds?

Yes. So I can actually go in there, and it won't give me every single fund in the stock market, but I can actively manage it myself.

Yeah.

I mean- I was wondering what else you guys were thinking.

I would choose the funds. I would go in and I would try to find one that's growth, growth and income, aggressive growth, and international. And I would split my contribution equally over those four types so that you have your money divided out. Then from there on, I'd set it and forget it. I think that's going to be a little better than to just choose aggressive because you don't really know, you can't really look and see what the funds are and what's part of that mix, right?

So it actually will list out what's in there. So it has a lot of the things that you stated for, but it's also in the total stock market growth and then stable, and then it has international funds. I manage about 45,000 in my own portfolio that I manage myself. Oh, yeah. I have a dividend portfolio, and then I have a little over 30,000 in the 401k. Then I have about 55 and change in cash.

Okay. Yeah. If I'm you, I'm not going to turn that aggressive knob. I'm going to pick the funds myself across that mix of four. My question to you is, what percentage are you investing right now?

Right now, per the budgeting method that I'm using, I have 30% invested. I have 7% of that going toward my 401k because my company matches- Just up to that match?

Okay.

Then you're not going over to a Roth IRA after that?

Because that's what I would suggest. I'd invest in the 401k up to the match, and then I'd go over. If I still had money, I would max out a Roth IRA. If I still had money, then I'd go back to the 401k, and I'd max that out. If I still had money, if I had an HSA, I'd probably go to that next. If I still had money, then I'd go in and go into a brokerage, assuming you're single, that is.

I am married, and I think I can't do... The way that it's set up is really weird. It's a 401k, but within it, it takes out after taxes. So it's like a Roth, but it's a 401k.

Yeah, you can have a Roth 401k.

Okay. Because they weren't explaining it very well, and I was like, so why?

So in that case, since you do have a Roth 401k, I would max that out first completely. You've got the match. It's Roth. That's amazing. So max out that Roth 401(k) first. Then you and your wife are both… Is her situation the same or is hers just a traditional match, traditional 401(k)? Okay.

She's a teacher. I believe- It comes out automatic? Yes. It's very automatic, same thing with mine.

Let me say this in a way that's not confusing. Do you know with your wife's How much are they pulling out of her paycheck each time? What percentage?

They're pulling 5%, I believe, if I did the calculations correctly. Okay.

You're investing far more than we would say. I'm just going to assume that you haven't paid off your house yet, or have you?

I have not.

Okay. Technically, until you've paid off your house, we would suggest that you're only investing 15% of your combined income, right? We would say in your situation with you and your wife, we would say the 5% that she has, you can just treat that as gravy, or you could treat it as half the amount, so maybe 2.5%. Don't treat it as the whole amount because you don't get to really choose what it's invested in. We want to invest as much of our money as we can in things that we're choosing. For that, I would say the first route you're going with you guys's entire 15% is you were maxing out that Roth 401(k). That's the best investment that vehicle that you guys have got. I wouldn't invest anything above the 5% into her 403(b) or whatever it is. I would then next go to both of you, maxing out our Roth IRA, both of you. Then after that, if there's money I probably… Her 403(b) might be fine, but I might still go to another investment vehicle depending on what that's invested and what you've seen the rate of return is on that 403(b). If you've seen that it's good or normal, then you can max that out.

But yeah, that's what I would do in your situation.

Okay, perfect. Because we're using the 50-30-20 method, and we do it separately. Then we have the way that our accounts are set up. I'll just take the 30% from her after the traditional 401(k) and all that from her side. Then I'll use all that and break down my budget for both of us, really.

I mean, the fact is, and I'm not mad at it, we have different ideologies as far as maybe how to budget, how to combine the finances. But hopefully, you'll respect my view on the investing, and maybe you'll consider it. I'm not going to try to shift your whole bedrock here in this conversation because I don't think that you're here for that.

I've watched you all show a lot, and I respect and love all you all's opinions. Okay, good. I formed what I've been doing.

So Listen, I'm not mad at it.

Yeah, absolutely.

You're on a good path. He's gathering information and doing what he thinks is best for his family. I like it.

He sounds like a guy who really understands it, but it makes me nervous, and I want you to I discussed this, and I said nervous, metaphorically, that he's managing his own retirement account, 401(k). Yeah, so let's talk about that. It makes me a little nervous.

Let's talk about that. I spoke to Dave recently, somewhat recently about that, because We did a rapid fire on baby steps four, five, and six. Four is investing 15%, five is investing or setting aside for kids' college, and of course, six is paying off the house. I said to Dave, I said, Listen, most people, they have their 401(k) Okay. Similar to what Young said, you can either choose one of three knobs, like conservative, mediocre, and then aggressive, or you can go in and choose the funds. I said to Dave, I said, Do you really need a professional to help you just pick out your 401(k)? He was like, Not necessarily. But if you're going beyond that, which all of us will and should, then you do want to work with that professional because you don't want to just go out to just open up Charles Schwab and just be out there on your own and I'm going to pick a fund. What do you know? That's like me being like, You know what? I think I have a cavity. Let me go in here and see what I can do.

I think you make a great point. What we teach folks is that you need to understand it. When we talk about a smart investor pro, and we mention them on the website, and they are professionals that, again, they're independent, they're on their own, but we recommend these folks because they believe in the process that we teach. The reason that matters is I sat down. We have our annual meeting. Stacey and I just did it last week. I'm co-hosting this show. I've done this for years, and I still have good questions that I need answers to, and they're simple sometimes. I need to understand every move we're making, But I need guidance to figure out what move to make. Then I understand it to the point where I always make the decision. Stacey and I both go, All right, hey, John, explain this to me, or what about this? I get all the explanation. When I understand it, now I'm in total control of making the decision. That's why the expert, the real pro, comes into play here. They know about stuff we don't know about. They have better strategies. They have experience, and that's why we like to do that.

But, Young, I mean, listen, You're not in bad shape at all. Thank you for the call. Very thoughtful stuff. Great hour, Jade Warshaw. Always fun partner to hang with you. Thanks to James Childs and the crew for keeping us on the air. And thank you, America, for watching. This is The Ramsey Show. Live from the headquarters of Ramsey Solutions, this is The Ramsey Show, where we help you win, specifically with your money, your work, and your relationships. All those go together to live Live that meaningful life to have the life that you've dreamed of. 888-825-5225 is the phone number. I'm Ken Coleman. Jade Warshaw joins me, and we are here for you this hour. 888-825-5225. Let's get it started right out of the gate with Milwaukee, Wisconsin, is where Emily is. Emily, how can we help?

Hi, thanks for having me on. You guys were really awesome to listen to.

It's been great. Well, thank you. What's going on?

I had a question. My husband and I, we've been together for 12 years. We're high school sweethearts. We've been married. It'll be two years in June. Okay. Just the only question that I have is, I guess, 2021, I bought a house. We didn't have him on it because my mom helped and said, Just have you on it because your credit score is higher than his. If his is low, you're going to get a lower loan. No.

And you weren't married yet, right?

No, we were engaged. Now I see that was dumb later because things didn't work out.

No, that was right. We agree with mom. I agree with mom on that.

Okay, all right. Now, when I had to pay property taxes, I'm like, Oh, it's in my old name. It's just me. Should I add them to the deed? Is that going to affect anything? If something happens, would it go to him? Because I talked to my mortgage lady, and she said that it's a marriage estate, so if anything happens to go to him, but would it matter if he's on the deed or not since we're married now?

I would definitely add him to the deed, it makes him an owner because right now he doesn't own it. He's not an owner of your house, only you are. For that reason, and I flipped the script in my mind, I'm like, if I met Sam and he had a house, and I was like, Hey, can you put me on the deed? And he said, No, that would definitely affect me. It would affect him because he'd be on the moon, but it would affect me.

I was going to say, I believe that you would smack him right upside the head on that.

I think for you guys to really feel like one unit and one, I would definitely add him to the deed. Then it does strike up a bigger conversation of just… Did you say you talked to a lawyer or real estate about this?

Her mortgage professional.

Mortgage professional.

The bank's a mortgage person, yeah. Yeah. She says, If I were to do that, I would have to go to the attorney and rewrite the deed, and it cost maybe some money to do that. But she's like, You really don't need to do that Because it's marital property, so he has half.

That's true.

But I just wasn't sure.

I just wasn't sure. I would put his name on it. I'm the type of person. I just like stuff to be sealed tight. I want both people's names on the deed. I have a will, and in the will, everything is specific. So if you don't have that now that you're married, everybody needs a will. But now that you're married for sure, the two of you need to get a will separate that lists what each other wants, and you both need to make sure you have life insurance. Those are the three things that are really important when you join life and join finances. They're just three things that really say, Listen, I love you, and I want to love you well in those ways.

Emily, I did a- We actually just got term life insurance.

That's what I'm talking about.

That was really helpful.

Good job. I completely agree with Jade. If you're looking for what we think, that's it. It's just the right way to do it. It's easy, it's not that expensive. That's right. This is not one of those convenience issues. You just never know. Here's the other thing. You never know what the state legislator is going to do. Are you keeping up with that? The will and the deed will take care of all of this and get it snapped up nice and tight. Brianna, if I got that right, in superior, Wisconsin. How can we help? Hi.

Thank you for having me.

You bet. Did I say your name right? Yes, you did. I'm hooked on phonics. It's very exciting. Thank you. Thank you for letting me know that. How can we help today?

I'm just trying. I'm 20 years old, and I'm trying to find the best way possible that I can pay off my debt and hopefully encourage my boyfriend to do the same.

Let's start with this, you.

That's two different calls.

That is. But look, I'm glad that you're looking out for your guy as well. Yes. Tell us a little bit about your situation.

Like I said, I'm 20. I ended up taking out a credit card and a loan right after high school, so probably a year after high school, so I was 19. Pretty much my whole childhood, my parents were like, Being an adult, you'd take out credit credit cards, you'd take out loans. I thought that that's what you had to do to jumpstart your life as an adult.

You're not alone.

Give Jade your smallest to largest debts. Can you walk us through all those one at a time? Smallest What's the largest?

I have two bank credit cards. The first one that payoff is $500. That was my first one that I took out. I have a second credit card that is $300 to pay off. Then I have a store credit card that is also $300 to pay off.

Okay. What about this other loan?

I have a four-wheeler loan that I ended up taking out when I was 19, so a little over a year ago. It was $3,500, I think, with maybe a 4, 6% interest rate. I haven't checked it.

Is it still $3,500 or have you paid it down?

My boyfriend actually ended up taking out the loan himself. But my parents were telling me, If you really want to help your credit out, you should probably move that four-wheeler loan onto your name. What? So we did move it over, it ended up- What the worst? We ended up having to pay the full amount and start from scratch.

Oh, wonderful advice. Way to go, Mom, Dad. Come on now. Wow. Okay, so now you've got the $3,500 four-wheeler. It's back in your name where it started. You've got the two credit cards for 300 and the credit card for 500. Is there anything else? Student loans, cars?

I do not have any student loans or cars. Luckily, my parents bought me a nice car when I was in high school, so I still drive that.

Is it paid off? Are they making payments for you?

They're the ones that are making payments for me.

Okay. I'm going to ask more about that. Do you know what the car is worth, by the way? I'm just curious.

It's a 2016 Outback, so I think I checked, it's probably around the 6,000 to $8,000 mark on Kelly Blue Book, especially with the miles on it.

Okay. Here's the thing. You've got a lot of debt to off. It's not a lot. You're 20 years old, but it's a lot for a 20-year-old. What are you earning real quick? Just tell me what you make every month. I take home about $2,000 to $2,500 a month. Okay.

All right. Tell you what, Brown, we're running up against a break, and I want Jade to be able to walk you through how to knock this out. Thanks, Kim. We got to do a quick commercial break. When we come back, it's Jade and Brianna, and we're going to show her how she gets out of this debt- You're going to learn today. Pretty quickly. So don't move. This is The Ramsey The Dineo Show.

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Welcome back to The Ramsey Show. I'm Ken Coleman, and Jade Warshaw joins me this hour. Thrilled to have you with us. The phone number to jump in is 888-825-5225. Our question of the day is brought to you by Neighborly, your hub for home services. Winter is rough in some areas the country than others, but there are things that make sense to do no matter where you live. Oh, that's right.

Oh, yeah. Brianna.

Thank you, James. All right. No, it's okay. But this is live radio, and I'm okay with it. James, our fearless leader, reminded to me, we still have Brianna on the line.

Where would we be without you, James?

Someone reminded me to remind you, so it wasn't even me. Probably in the ditch, that we would drive the truck right into the ditch. Okay, so we'll skip the neighborly question of the day for right now. We'll get back to it. I know you all love to hear me read, but here's where we were. Okay, so let me set us up. James, thank you for reminding me, or Austin, or whoever. Okay, so Brianna called in, and she doesn't have a ton of debt. I think I heard a 500, a 500, and a 300, and some credit cards. Something like that. Some credit cards. Not a lot. Very low. Then she's got a $3,500 four-wheeler loan, and I think that's it.

We started talking about her income. Right.

Now, Jay's going to walk her through how she's We're going to pay this debt off. So, Brianna, are you still there? Yes. All right. Okay. Take it away, Jay. Okay.

So you had just told us that you're making 2,500 a month, correct?

Yes.

Okay, good. And what's your living situation? You're living with the boyfriend or no?

Yeah.

Okay. I'm living with them. And you guys are splitting rent or does he own a house or something?

So we live in what they call a luxury flat. We're actually paying pretty cheap rent in our area. So separately, we're paying 600 a month in total.

Okay, so that's pretty cheap. In total. Okay.

Yes. So in total, it's almost $1,200 for a studio.

Okay, great. So you're not overly extended on your rent per se?

Yes.

I would like if it was... Here's the thing, $600 in normal life is great. When you're making 2,500, it's a little more, right? The cure here is you're not going to find anything cheaper than 600, so you've got to get your income up for more reasons than just the rent, also so that you can start making headway on paying off this debt. What's the job? Because I want Ken to jump in here because I can tell you right now, the formula is find more work so that you can increase your income so that you can pay off these debts quickly. Because at the end of the month, after you've paid your bills… I don't know why I want to say your name wrong, Brianna. After you've paid your bills, after you've bought groceries, after you've done the things that you need to do, how much money do you have left over?

For the week, I probably have around 250.

250 each week? Yeah. Okay. So Right now, I mean, actually, that's not bad. You can take that. You should be done with one and a half, one and three quarters of the credit cards, right? Because it's two $300 ones. You could have the majority of both of those paid off this month, and then next month, you'll pay off the other credit card, and then you just walk on down the line, and it's going to take you six, seven months to pay off the loan that you have. Then technically, you're out of debt. But then what I want you to start thinking about quickly is what it looks like. Because your parents can do what they want to do, but I hate that they're in debt at your expense. You might want to ask them about, Listen, what are your plans to paying off this car? Or, I'd like to be in a situation where I'm not causing you to be in debt on my behalf and figure out what that looks like car-wise. Maybe you buy them out and you're just done with it, and now you own the car outright. But I would be looking into that since you've said, Here I am.

I'm on my own. If you're on your own, then they don't need to be in debt for you. That's just Jade's two cents. Ken, take it away.

I actually agree with that. I think it's time for you to grow up, and it's a very nice gesture that they made, but they're not making good financial decisions. I mean, they're the ones that recommended you get a four-wheeler or finance the four-wheeler or whatever that nonsense was. I agree with Jade on that. Let's talk about the bigger shovel. This is the term that Dave has popularized to say we got to get more income so that we get out of debt faster, save, and invest at a much greater rate. That's something you're interested in, yes or Yeah. All right. What do you do now for work?

I am an automotive detailer.

Okay. Automotive detailer. You're making how much an hour?

I currently make 1750 plus.

Okay. What's your long term ideas? I bet you've got two or three or maybe four ideas of what you would like to do because I know you don't want to stay in auto detailing. Is that true?

Yeah, I really like the job, but it's iffy. In the summertime and fall, and spring, people were pretty booked up. I get it. It was pretty much a point you see.

What would you What would you like to do? If you could try something totally new next week, and you didn't have to commit to it for the next 30 years of your life, and you knew you weren't going to screw up, meaning you were going to do fine, you were going to enjoy it, what would you try?

Probably something in the woodworking or welding industry, some type of union.

Very interesting. I love that. You know what's interesting? There's a tie in to the fact that you enjoy detailing cars. The operating word here for you, Brianna, for long term for you, is you're about details. When you're working with your hands and your eyes to get into details, to make something look esthetically pleasing, so that could be the woodworking or welding something that's fixing something or designing something that's really appealing to you, yes? Yeah. That's great. Here's the deal. I want to see you making steps. I want you doing exactly what Jade told you to do, okay? But right now, we're looking to pick up maybe a second or a third job. I don't think you have to have three jobs, but I would tell you a $20 to $22 an hour job is around superior, Wisconsin, and it's not going to require a college degree. That's going to change our situation really quick. But that's short term. Long term, I want you going, All right, what does it look like for me to move into woodworking or welding? I'm going to give you my book called The Proximity Principle, and here's what it says.

In order to do what Brianna wants to do, she's got to be around people that are doing it and in places where it's happening. In the next 30 days, I'm going to challenge you. I'm going to give you the book. It'll inspire you to do it and tell you what to do. But it's just as simple as you getting around somebody that's in woodworking, somebody that's in welding. Hey, how did you get into it? What are the qualifications? Do I need to go to a trade school? The answer is yes for welding. I'm not sure about woodworking, but if you got some natural talent, you start doing some side projects, helping out a woodworker, maybe being an assistant where you get paid. Now I've got more money to pay off my debt to get my emergency fund fully funded, but I'm learning the trade of woodworking, or I'm going to take a welding school after I get out of debt and after I get the emergency fund fully funded, and I'm going to pay my way through welding school, and I'm going to come out, and I'm probably going to be starting in the 55 to $65,000 range with a path to six figures and maybe owning your own welding business.

Come on now. Brianna, now I just talked a lot. What are you feeling? What are you thinking?

I mean, it's 100% possible. I just need someone to give me a little shove in the right direction.

I'm shoving you. That's 10.

I'm shoving you. If I shove you anymore, I'm not a gentleman.

Yeah, I was about to say we're going to have to call the cops.

That's right. Well, I got my friend here. She's going to keep me in check. What I am saying is I absolutely believe that that path is possible for you. I'm going to give you the book, which will stay with you as some accountability, okay? But what I'm saying is you need to decide which one of those paths. The way you decide is by hanging out with people that are doing it, you find out the good, the bad, the ugly, and your head and heart get together and you go ding, ding, ding, or from family feud. Once you figure out which direction you want to go, you go, All right, what does it take to I got an answer. I got a target, and I'm going to walk the baby steps right into that next future for me. That future where I could be a six-figure earner, a multimillionaire because you're going to invest in Baby Step 4.

That's good, Ken.

It's doable. Hang on the line. We'll give you the book, The Proximity Principle. Close us out with a little ra-ra there to Brianna.

I just want to let her know whenever I have a boyfriend-girlfriend living together, she's paying $600, but truly it's $1,200. I I want to make sure she gets to the point that she can handle that rent on her own because I never want somebody to feel like, We were sharing this place together, and I can't go anywhere because I can't afford it. So get that income up, girl.

And I'm old school. Come on, ladies, make that guy put a ring on. Okay. This is The Ramsey Show. Welcome back to The Ramsey Show. I'm Ken Coleman. Jade Warshaw joins me. 888-825. 5225 is the phone number. 825-5225. Let's go to Dayton, Florida, and Daniel is there. Daniel, how can we help?

How are you doing?

Good. How are you, sir?

I'm all right.

Great.

What's up?

I have a question. I'm trying to make a decision. I'm 45 years old. My wife is 36. We recently got married this past November. We've been together almost five years. We are about $128,000 dollars in debt between personal debt and then debt from our businesses. She's a nurse. She had a nursing supply store that she had been doing the business for, and that failed. So we have debt from debt. I'm a barber, and I have a CDL. So the past, say, two, three years, I've been jumping in and out of barbering and trucking, trying to decide which field I I want to stay in. I'm in the same situation. Right now, with the debt, I'm scared, I'm a little nervous, and I'm about to jump back into trucking, and I really don't want to. But that is steady income for me. How much more? About the barbering.

Yeah. How much more does the trucking allow you to make than if you were to stay in the barbering?

Right now, I go off the numbers. Last year in barbering, I made maybe about 26,000. Then if I go in the trucking and I stay in it for a full year, I can make anywhere from 65 to 80, depending on how hard I run. But the trade-off is that I'm in the truck, weeks at a time away from home.

But I'm jumping in as we go, okay? Because we're covering some… This is a work question, but we got some debt we need to take care of. If I'm you, I'm going to jump in the truck because it's the quickest route for me to juice my income. We're talking about maybe as much as almost four times the income. You don't have to be in that truck forever, but it's absolutely the possibility. I don't think you have to leave barbering forever. Maybe you won't have much time to do it on the weekends when you're not in the truck. If you do, I'd be cutting hair as that second gig. But if you don't, let's go all in on the trucking to get that income up so we could start to clean up this $128,000 mess. Now, you mentioned your wife is in nursing or was. Did nursing school. Is she a nurse right now? Yes, she is. What's her income?

Don't know off the top of my head, but I I'll tell you what she… Her last paycheck for two weeks was deposited. It was 2,500.

Okay, so around 5,000 a month?

Okay.

Yes. You don't know this because I'm guessing you guys aren't on a budget, or am I No, you're correct.

All right.

I'm going to bring Jade in here, and let's walk through these numbers because we got to pay the 128 off. But do you understand what I'm saying? Are you with me on the trucking thing? That's not a long-term play, but that's your best short-term play.

Yes. I just needed somebody to confirm that because I was feeling conflicted about it. But hearing you say that, it reassures me.

I get it. You love being a barber, right?

Yes.

But listen, this time in the truck is going to allow you to figure out, what is it that I'm going to have to do differently next time around to make more than $26,000? Because you're worth way more than $26,000. We got to figure out how to do that better next time around. It might be, after we get this debt paid off, it might be staying in the truck a little bit longer to figure out, how do I turn that business into more money? But, Jade, I know you wanted to jump in.

Because here's what I'm thinking. I'm thinking we have an opportunity to test two concepts right now, Ken. I agree. Number one, for the year just started, we're still pretty fresh and new in this new year. If you do the driver thing and you hit somewhere in the middle and you make $70,000 a year, and your wife's a nurse, she's making $60,000 a year. So you're at $130. If you live like you're only making 26k on that barber money and you use everything else to start paying off this debt and you're of debt in the next two and a half years, or I'm sorry, in the next one and a half years, you'll know then that when you're done paying off this debt, okay, I can. If we wanted to take the financial hit and me strike out as a barber, I know I have this baseline of customers and I can just build from there. At least you'll know financially you can do it because you've been doing it for the last year and a half to pay off debt. There's part of me that's like, Hey, that's really great. Then the other part of me, I'm just wondering, I'm not passing a judgment, but I feel like 60K for a nurse right now.

Am I wrong? Am I right? Does it depend on the area?

It definitely depends on the area right now. We're not actually in Dayton. We just thought, so that because they asked for the closest major city.

It also depends on the type of nursing. What is she doing and where is she doing?

She is a traveling nurse. She stays local, but she goes to her patient's homes and see geriatrics. She just sexed on them. Okay,.

Again, I'm not an expert on this part, but I think the geriatric nursing and that local thing is somewhat limiting. She has definite room to grow in her income.

But the point here is what I think can happen, especially in your area, I think you can live off of your income, 70, and I think you guys can put 60,000 on this debt every year. I think you're out of debt in a year and a half, two years.

I agree. Daniel, how does hit you?

There's one more element to the puzzle.

Is it your wife working extra overtime hours?

No. It's not? No, we just found out- I think it's going to be a hurry. Yeah, we just found out that she is eight weeks pregnant, so we're expecting another child. We already have a four-year-old.

Okay. So even more fuel under the fire. Now, here's where this turns this in a frustrating direction, possibly for you. I want you, until your wife has this baby, I want you to pause these efforts because I want to make sure you stack up as much money as possible. Now, here's the thing, and I feel like I have to be very, very clear on this. You're pausing. You haven't We haven't started a debt snowball yet. If you hadn't told me about the baby, I would have said, Okay, you're doing your debt snowball. You're living on the 70,000. You're throwing 60,000 a year at this thing. What I want to clarify and be really just hear me so clearly, so many times people call in, they've already started their debt snowball, and they just want to know where to go next, but they're having a baby. So we tell them to pause the debt snowball in order to stack up money. We call it stork mode. Stack up money until the baby comes. Make sure you can pay for all the costs associated with the baby. Then when the baby's home and healthy, you guys take whatever money is left, throw it on the debt, and keep the debt snowball going.

In your situation, Daniel, you're going to have to be doubly diligent because you haven't You haven't even really gotten started yet. You haven't even really gotten on a budget yet. It could be very easy for you to just lull back into your old ways coming off of this call because you're like, Well, I guess I can't start the baby steps yet. I can't really do anything until this baby's gone. Don't do that, okay? Don't do it. I want you to stack up money as though you were going to put it on the debt with equal intensity. How much?

What do you think the number is for him?

I think they live off of his income.

No, I know. But how much does he save for What do you think that number is?

I don't think he's touching his debt snowball.

I understand, but what's he saving per month based on this? You're saying everything outside of their bills?

Basically. Okay. Whatever he would have put on the debt snowball. Whatever you would have put on the debt snowball, you're saving it, put it in a high-yield savings account, and everything goes well. We're praying, baby goes well, mama goes well, everything is good. All you're on the hook for is your deductible, which is probably $5,000 or $7,000, whatever it is. Then all that extra money that you've been saving up over the course of these months, when everybody comes home safely, you're throwing it at the debt, and it better be a lot.

Yeah. Now, that's $130,000 if you get in the truck, and she's got to work, too. Here's the thing. You have got to get in the budget. You've got to budget and save. Those are the two things that Jade told you to do. Budget so that you can save, and then you take on the debt snowball. But I'm going to tell you one other thing, brother. You've got to commit No more debt on businesses, no more borrowing. No more. You guys, you took in way too much debt. Now, you can get out of this, but you're going to be gutting it out for a couple of years. That means you're in the truck. Yeah. And when you're not in the truck, you're clipping some hair. And that's just how it goes until you get out of this. And you can do it, my friend. Appreciate the call. This is The Ramsey Show. Okay, guys, I'm just going to say it. It seems like a lot of tax software out there wants to keep you in the dark about how simple how much tax filing can be so they can pressure you into add-ons that drive up your bill.

But Ramsey SmartTax is the classic blue jeans of tax software. Not skinny, not bedazzled. It just makes things simple, easy, and exactly what you need. And you can save up to 70% compared to other tax software. And if you register for Ramsey SmartTax today, you'll get free resources to help you feel confident about filing. Just go to ramseysolutions. Com/smarttax and see just how simple tax filing can be. That's ramseysolutions. Com/smarttax. Welcome back to The Ramsey Show. I'm Ken Colman. Jade Warshaw joins me. The phone number, if you want to join us here on the conversation is 888-825-5225. All right, now for our neighborly question of the day. It is Neighborly, your hub for home services. Winter is rougher in some areas of the country than others, but there are things that make sense to do no matter where you live. That's why Neighborley has a helpful winter checklist you can download for free. You can check it out at neighborly. Com/s Ramsey.

All righty. Today's question comes from Gillian in Delaware. How do I deal with incompetent workers, Ken? They're always making excuses or blaming someone else for not doing their job. The work that I do depends on them getting things turned in on time, and I have to chase them down every day. The boss doesn't seem to see what's going on. What can I do? Oh, boy.

Okay, this is a tough one in that their lack of diligence is affecting your ability to do your job. So you have one way to take this, and that's up. You said the boss doesn't seem to see what's going on. If you were on the phone, I could get a little bit more detail, so I'm flying a bit blind, but I would be going to the boss going, Hey, I'm not playing tattle tale. I'm not griping. I'm just telling you what I'm experiencing, and I need you to weigh in. Then you describe. I'm supposed to do this, ABC, but I can't to ABC if this over here isn't being done. I need your help because it's affecting my ability to get the job done. Can you check into this? Or is there something that, what can I do? That's the way you got to take this to them. You're going to find out very quickly whether or not this leader gives a crap. That's what I'm wondering. We're going to find out if, in fact, your coworker's lack of diligence really does affect you as much as you think. I got a hunch, and Jade, this is why I love the question of the day, but it's so limiting because I can't dig.

But I just wonder if this person here, Gillian, who seems to be very diligent, I'd hire Gillian. I would. I can just tell because Gillian is going to get her job done. I think Gillian could be focused a little too much on what everyone else is doing because it's not up to her standard, and it's irritating more than it is limiting her. I could be wrong.

Well, if her job depends on if it's like a flow- Then it is limiting. And they're late on their deadlines. It may not be. It can cause her to be late on her deadline. That I'm acknowledging. If I don't turn in my articles on time, I'm throwing everybody else off. I know.

I get it. But what I'm saying is it might be a situation where it's more irritating than limiting. In that case, here's why I'm bringing this up, because I think a lot of people can identify for this. In that case, you got to do your job, and you do your job really, really well. It is going to then shine a light on everything else. If that doesn't fix the situation, We're moving on.

Let's roleplay this out. She can't solve this. Let's roleplay this out because you be the leader, I'm going to be Gillian. You be Gillian. I just wanted to bring this to you. I'm not trying to be a tattletale. I'm not trying to tell on anybody, but I found it difficult to hit my deadlines, and here's what I'm finding is the challenge. Michael, I love Michael. He's great on the team, but he's consistently late in turning in his projects, and it's causing me to be late or have to work harder to hit my deadlines. I I wonder if there's something I can do to make things run smoother or if this is something you've noticed.

Have you talked to Michael about it?

I haven't. I wanted to bring it up because I didn't want to… I'm not his leader.

Do you feel like if you talk to him about it, he might be defensive and it might not go so well? Is there a little bit of just some emotional safety we want to practice here?

I've e-mailed him sometimes and said, Hey, I just want to check in. I'm waiting for you to get this so I can start.

I need you to detail for me what specifically he isn't doing and how that's affecting your ability. Can you lay that out for me?

Well, yeah, because if he doesn't turn in his articles in time, I'm late. If I'm late, then I'm looking bad. Unless I point back to him, it all falls on me. I don't always want to be saying, Well, it was because of Michael. It was because of Michael.

Got it. Can you give me three specific examples?

Yes, Monday, Tuesday, and Wednesday.

That's a good leader, by the way. I'm role-playing the good leader. That's a great leader. Then the leader is going to go, All right, let me talk to Michael. Let me dig into it, and I'm going to get back to you. I'm sorry that you're dealing with this frustration. That process is on me, so I need to figure out a solution. Stay tuned.

That's what I want to hear.

That's good. That's the good leader. But again, we're role-playing. If that's the response, great. Wait. If it's not the response, start looking handle your business so that you can hopefully be able to control the perception of you if you leave. You don't want to become a thorn in that leader's side because that person, if it's an unhealthy leader, they can end up hurting you as you go to look for something else. In that situation, you I can't fix it. I tried. Let me stay above the fray, protect my image, my personal brand at all cost. That would be the backside of it if it doesn't help. A lot of times, leaders aren't going to fix it, and that sucks. Let's go to Belton in Richmond, Virginia. Belton, how can we help?

Yes. Thank you. It's been my call. I'm 32, single, no kids, graduating this year with my PhD, and I need a new car. My question is, should I be more… I'm sorry. The only debt that I have is my student loans. It's about 67K.

How did you forget about that?

Keep going. I'm trying to figure out if I should be more modest with the car and do something under 20K, about 100,000 miles, or put a little bit more money into getting a newer car that will last longer.

How much money do you have?

How I have 10K saved? And I plan on my goal to save at least another 10 to 15K this year. I make 80 car in a year.

Nice.

Okay. I'm just going to give you a couple of rules of thumb, and then I want to see how it lives with you. Our rule of thumb is we don't buy brand new cars until we have a millionaire networth, a one million networth. The reason for that is because brand new cars lose 60 to 70% of their value in the first 3 to 4 years, really quickly. Most of us can't afford to take that hit. We need that money. We want that money. That's the rule of thumb there. That's rule of thumb number one. Second rule of thumb is we say, okay, if you say, I'm going to buy a nice used car, we would say that it shouldn't be worth more than half of your yearly income. In your case, it's just you, you're single. If you make 80,000, 40,000 would be your maximum limit. That's number one on a used car. Thing three is we suggest that you would pay off your debt, especially if you have a car that works and runs, that you would pay off your debt first before you even consider buying another car or a new car or used car.

Then finally, the kicker is, this is thing four, we would suggest that you pay cash for whatever you do get. You've got four guidelines there. I think the first one, we can tick off the box. I think we can both agree that you buying a brand new car right now is probably not a good idea. We can take that one-off the list, which means we can agree. I think we can both agree on the idea that 40% would be or 40,000 would be the max, right? That's half of your income.

That's a bit more than what I was thinking.

Exactly. We're in agreeance on that. Next thing is, can we agree that whatever you pay cash for it?

Okay.

I'm hitting the resistance. I like it. I like it, Belton. Okay, so let's start with that. Let's agree that you pay cash because here's the thing. There's two thoughts to this because you're going to go off of here and do what you want to do. But the last You know what it feels like to have $67,000 of debt. The last thing you need to do is go back into debt or add any debt to that, correct?

Right. Yeah.

Let's solve the problem. The problem in your financial life right now is debt. I I always say, because you're making a good income, you're getting the PhD, you're doing all the things right. But the glaring obvious problem here is that $67,000 of student loan debt that's standing out. I always tell people you can't solve a problem while simultaneously creating it. If you want to solve this problem of debt, Belton, you've got to decide, I don't borrow money anymore, and I'm not going into debt anymore. That includes the car. You said you've got $10,000 saved, and you can maybe save another $10,000 or $15,000 more. That's $25,000. Where I come from, that's a decent bag. That's a nice car.

Yeah, Belton, I'm going to jump in real quick. What are you hedging on? When she throws that at you and you're going, I don't know. What's holding you up from going, I'm all in?

I guess growing up, it's about being that cash poor thing You're not having cash in the bank versus putting it all on to something.

But it's not yours. You don't have any. You're already for it. It's not yours. As long as you owe 67,000 dollars, you don't have any money. You still owe $57,000. You see what I'm saying? That's just basic math. So what I would suggest you do, keep $1,000 saved, pay off that 67,000 as quickly as possible, save up cash, and pay cash for a car.

This is The Ramsey Show. Live from the headquarters of Ramsey Solutions, this is The Ramsey Show. It's where we help you win in your life, win with your money, win in your work, and win in your relationships. 888-825-5225. 888-825. 5-2-2-5. 888-825. 5-2-2-5 is the number. We'd love to take your question today, we being me. I'm Ken Coleman, and she, Jade Warshaw. We are here for you this hour. Are you ready to go, partner?

I'm ready. We never told him the special surprise, Ken.

Well, I felt like You gave me the vibe like you didn't want to reveal that because it's a very personal a thing. I didn't know if you were picking up what I was laying down.

Turning 30 is a big deal.

Okay. Just saying. Turning 30 years of age. If you're a big fan of Jade- Especially for the second time.

And you should be.

Tomorrow is Jade's birthday, and so I'm not going to be on with you tomorrow. I wanted to say happy birthday to you. We're so glad you're here. She's taking Ramsey Solutions by storm. Stacey and I love her and Sam, and they're two beautiful kiddos, and they've just become a part of our community right away. We're celebrating you tonight. Thanks, Ken. Some of us. That's all I'm going to say. We're going to keep the details on the download. On the DO. But happy birthday. Early Thank you, Ken Coleman. All of you folks jump on the Instagram and wish her a happy birthday. Would you assure her how much you love her? I know she would appreciate that. I'm not going to tell you how old she is, although I actually know.

Thirty, Ken.

Okay. That's what What's your going with?

Plus 10.

Okay. Ellie is up in Lexington, Kentucky. Ellie, how can we help? Hi.

This will probably be a pretty quick question. My husband and I started back in November on the total money makeover, and we've been able to pay a lot of debt, so thank you guys. Awesome. We will have all of our debt paid off by October, and we'll be able to save up a fully-funded emergency fund by June for six months. Nice.

After that, we've already paused investing. We could have our home paid off in two and a half to three years if we kept up the gazelle intensity, but we wouldn't be investing the 15% at that time. Would it be wise to only invest to our company's match since it's going to be such a short time frame, or should we jump in on the 15% right away?

In your case, I'd walk it. In anybody's case, I'd walk it through as the steps say. It's hard because you can get excited. It's like, Listen, if we just keep going with this intensity, we can have the house paid off. But there's a reason. There's a fine line because obviously people call in all the time who are further along, age-wise, than you, and we'll tell them to pause investing to pay off their debt. But then when it comes over the year, I'm like, No, don't pause investing, do your investing and then pay off your house later. The reason for that is if it makes sense for you to take advantage of time in the compound interest equation. We want you to take advantage of time if it makes sense. In your case, it does make sense because you've already paid off your debt. Like you said, you'll have your 3-6 months saved up. You've done everything right. There's no reason for you to continue to put this off and lose out on any time gaining compound interest, because the fact is you are still going to pay off your home, and you're still going to be gaining equity and value in your home during that time.

So really, nothing is lost for you, there's a higher gain and there's a higher percentage of you earning more money if you go ahead and start investing now. Take advantage of that compound interest. And like you said, in a few short years, your home will still be paid off. Here's the thing, you might start making more money. You might have some other things that work in your favor that keep that timeline very similar without you even realizing it.

I agree, Ellie. You're going to look back and go, I'm so glad I listened to Jade and got that three extra years or the two extra years of investing and getting that started. Because you guys are going to crush this. There's a reason why, years ago, Dave put those steps in order, and it is about one word, Ellie, and that's momentum. That leads to mo money.

You hear me? Momentum, mo money.

I love it. Momentum equals mo money.

Ken, you're a true G.

Ellie, are you with me?

Yeah, awesome.

Thank you, guys. Happy birthday, Jade. Thank you.

Happy birthday, Jade. I don't want to miss the fact that you just called me a... Did you call me a real G?

You're a real I don't even know what that means, James. Moment of no money. Come on, Ken. Come on. You've been sitting next to me too long.

I grew up in the '90s. That's all I'm doing. You only do I know who wears a white turtle neck. Okay, first of all, it's not a turtle neck.

It's a mock neck.

Thank you. It's actually a roll neck is the traditional usage of this. You go to jcru. Com. This is a roll neck sweater, not a mock, not a turtle neck. Come on, get it right. I got to fix it. All right, we could keep going. Delees, as in release, is that right? Detroit, Michigan, the Motor City.

Yes, sir.

Happy birthday, Jay.

Oh, thank you, Delice.

I mean, I'm making your day.

I feel like a new woman. This is great. All right, Delees.

How can we help? Release me from all this, please. Help me out. What's your question?

Okay, my question is, should I sell my van or move into it?

Wait a second. What? Are you serious about moving into this van? What van is it? It better be a great van.

It's a Class B. I'm 60, and I'll be retiring in 5-7 years. I'm selling my home, and I'm paying down off my car and my credit card, and it'll either be part of my van, but I'm upside down in the van.

Okay, let's look at this. Okay, let's look at this because I want to see if I can get on the same page as you, and I might end up seeing it from a new viewpoint, which I think I might. Okay.

Yeah. Do you mind if we start with the house? How much do you plan on making on the house?

I own 170, and they say it's selling for 400.

Okay. After you sell, have you done the math? What do you think you'll walk away with? 190?

Maybe. Okay. That was a good question. I wasn't ready for that one. That's okay.

I was 107 on the van, 14 on the car, and 11 on the card.

Okay. 14k, 11K. I'm sorry, go back and tell me the van amount. 111?

108, basically.

Okay. So put me in the know. Tell me what a Class B van is. What does that mean?

That is the higher cost van. Oh, they're just vans with a camper in.

Oh, okay. It's a camper.

Bed and everything.

Yeah. Okay. And it's going down in value because you said you're upside down.

I'm upside down. If it sells for 90, that'd be great. But that means I owe 20,000 on Okay.

If it sells for 90, that'd be great. Okay. Do you have any money saved?

No.

No money saved?

I'm trying to get together for the retirement. My saving situation was basically like a house. I could have 100,000 in when I bought it.

Okay.

What's the car worth that you owe 14 on?

It's a 2019. It might be worth 20. Okay. We sell that today. We sell that today. Something like 17, 18. I'm sorry.

We need to sell that today.

Yeah, I'd sell the car, and I take that money and buy yourself a cash beater. We're going to hold you over because I want to keep helping you with this.

Yeah, we got some work to do, but my goodness, you can get out of this. But I don't think… I don't know, Delees, I don't think you're going to end up in a van down by the river, okay? That's our goal, but you got to hang with this here. Not down by this.

It's luxury.

I bet it is, but still, it's a van. Oh, my goodness. That's all right. Jade is on it. She's got her notes over there. She's warming up. She's going to stretch during the break. You take a stretch as well. We're going to be right back. We're going to help DeLice out and release her from living in the van. This is The Ramsey Show.

Hey, if you want to make real progress with your money and get that extra push to keep going, then you need to be at our brand new event, the Total Money Makeover Weekend. On May 10th and 11th, join me, the rest of the personalities, and a community of people like you at Ramsey headquarters for new talks, new focus, and new motivation to stay gazelle-intense on your money goals. Early bird tickets start at just $99. So don't wait. Get yours at ramseysolutions. Com/weekend.

All right, welcome back to The Ramsey Show. I'm Ken Coleman. Jade Warshaw is with me. And I said that a little too quick. That's all right. And we're taking your calls, 888-825-5225. We took a call right before Before the break, Delisa is with us in Detroit. I want to set the call up if you're just hanging in here or jumping in with us. The question she had was, should I sell my van? And she's got a really nice van. I'm talking it's like a camper. It's deluxe, but she owes a lot of money on it, about $ 108,000. The question is, should she sell her house and move into the van? She's got some equity in the house. That's where we left it. Jade, pick us back up. We're walking through her debt. We We haven't gotten into income yet, so take it away, and I'll jump in as well. Okay.

Delice, we figured out we should probably sell this car. You owe 14,000, but you might be able to get 20,000 for it. That gives you a spread. That's a $6,000 spread. Am I right?

Yes.

Perfect. That gives you some money that you could buy a car in cash, no more payments, and you're good to go on that. Then you've got this credit card. Are you working at all still?

Yes. I make Okay, DeLice, that's just what we're going to need to release us from…

Sorry, Ken, I had to take your- I know.

I'm sorry. It's the greatest name. It is absolutely the best name of any caller I've ever taken. I'm not even kidding. It's fantastic. I'm obsessed.

Here's what I love. Are you single? It's just you? Yes. Okay. You've got a great income. You're going to pay off this $11,000 credit card- Fast. In a month, in a month and a half. This thing is gone, right? Because you make 160,000. What do you take home every month?

$7,8.

$7,8,000. $7,8,000. Okay. You're paying your mortgage. You've got this Class B van. You should be able to pay off that credit card in the next two months. Fair enough?

Okay. Now, hold on a second. I'm detecting something here. I could be wrong.

I hear you hear her.

It's because she's not on a budget. 100%, I don't think she knows that she can do that. Am I right, DeLice?

That's right.

Listen, my colleague, she's a forest of nature. I sniff it out. But I'm going to jump in here, and we got to slow this down and help you walk through what it's going to take. She's right, it's a budget. Do you have any idea month to month? Are you just seeing yourself make it a paycheck to paycheck right now? Basically, yeah. Okay. Right now, you don't see the margin, so you can't believe that you can pay off that debt as quickly as Jade's telling you. I think we need to camp here for a minute. Budgeting. What are your biggest expenses?

The van is 783 a month.

There's one.

The house is 1,600 a month.

That gets us to about what? I'm downsizing. That's about 2,400 there. Where's the rest of the money going? What do you think the big expenditures are? I know you've not done a budget.

The car is 300. I was I'm going to pay that off with the house selling.

And then the car- We're not selling the house. Okay, so you're at 27. Listen, it's a budget because we're adding up these numbers and you're at half of your income. So that money is going somewhere, and it's going to your lifestyle. It's going to the things that you like to do with your friends and your family. I mean, it happens to the best of us. Listen to you guys is going to eating.

And so I'm starting to cut out that whole dinner thing.

Okay, so when you When you're off the phone today, you're going to leave with every dollar, and I want you to have the premium version. At least we'll give you a trial version so you can see how it works. That is the foundation for all of this. If you don't get this budget on and popping and you can set it up in five minutes, it's super easy. If you ever feel like you get hung up, there's EveryDollars YouTube channel that you can check out, and it'll answer all your questions or slide into my DMs, I'll answer your questions. But it's very easy, very intuitive. That is your homework for tonight. You get off this call, you download EveryDollars, and you start setting up your budget tonight. Everydollars, okay. Everydollars. We do- Every dollar. Every dollar. We do, DeLice, what's called a zero-based budget, which means that when you open up every dollar, you'll plug in what you get paid and how often you get paid, and it'll show it at the top of the screen in green. Like, Okay, DeLice, you got $7,800 to spend. Then you literally spend the money before the month begins.

You go through on your budget and say, okay, I'm going to put 783 for the car, and I'm going to put 1,600 for the mortgage, and I'm going to put 300 for my car. And you go through and it'll subtract it from your income. So you'll start to see what money you have to spend on bills and what you have left. And what you have left is what we call margin. And that margin is what you're going to use to pay off this credit card. Here's what I know, Delice, when you sit down and do that budget tonight, you will be shocked and amazed how much margin you had. Because there are certain things that you're going to guess on. You're going to say, Okay, out to eat? I don't know what I spent. Maybe I spent 400, maybe I spent. And you're going to pull up that old bank statement, whatever your bank is, Chase, Bank of America, hopefully not. You're going to pull up your bank statement and you're going to look for the past month and you're going to look at all the transactions that were out to eat and you're going to add them up, and you're going to go, Oh, my goodness.

I got to ask, Delise, why the van? Why did you buy the van? I'm not asking this for you to defend it.

No, it's a great question. My mom died and we had just gotten into COVID. My My grandchildren and my daughter were living with me, and so I had to get away.

You just bought the van to say, I got to drive and get out on the open road and heal?

Yeah, and I did 48 states. I mean, yeah.

Okay. Wow. Jade's walked through the budget thing, but the reason I asked that question is the way you presented your question at the first was, should I move into my van? Did I hear that right?

Yeah.

Wait a second. You got I know, but you've got this amazing house, which becomes a tremendous investment. You've got a good amount of equity in this home. To me, I'd be getting rid of the van and hold on to the house.

Think about it, Delees, with what we just laid out in two months, because I think that you have probably a margin of $4,500 every month. In two months, you're going to pay off the credit card, two and a half months. And in another two and a half months, you're going to save up $10,000. You're going to put that $10,000 with the Class B van and just set it aside. And then you're going to save up another $10,000 and put it with the Class B van. And then you're going to sell it because you won't be upside down anymore. And then you're going to have your entire income to put towards paying off your house when the time comes. You're going to now, like Ken said, have an asset that's yours. It's your house. It already has equity. Now you're debt-free. You got to pay for a car in cash. This is going to happen in the course of less than six months.

Then here's the other thing, Delisa. You were talking about retirement. You're doing what Jade's talking about. Jade's got you on a path to an emergency fund of 3-6 months of your expenses within how long? What are you mapping out here?

I'm trying to keep up with you. She's going to be out of debt in five months, and then you're going to save up six months of expenses. That's basic expenses, which you will be able to look at your budget and see, Okay, what do I need to just keep things running? What's my basic expenses? You'll save up six months of that. That's going to take you another six months. By By the time you're 61, you're going to be completely debt-free. Cash car, six months of expenses. Now you're 61, and you get to decide, Am I going to keep working or not? If you decide, Hey, I got some more years left in me. I'm going to work till I'm 65. Social Security starts at 62. I want you to start taking those distributions from Social Security, and I want you to start investing them. Do you have any retirement? Along with 15% of your income.

Do you have any? Very little retirement. Supposedly, it's 60,000, supposedly.

All right. The point is here is in about a year, with the income you're making, you're going to start pouring on top of that 60,000. You'd be surprised at how quickly that'll compound. If you can delay retirement until 70, then you're going to get a lot more of Social Security, and that gives yourself almost nine years to be piling up cash. At this point, you probably have the house paid off. Let's say that house now grows to $450,000 in value, $500,000 in value. I think you can make the case that by the time you're 70, 75, you're going to be in really, really good shape. But it starts now, the next six months, the next year.

Yeah. Let me roll that out further for you because Ken said it. Once you get that six months saved up, you're investing 15% of your income every single month, every single month. You're making extra payments on the mortgage every single month because you've got the margin to do that. When you get 62, you're still working. Take that Social Security for the next six or seven years. Invest it. This is how you do it, and you're going to be just fine. Give yourself another 10 years to lease. This thing looks totally different.

Yes. And you're not living in a van. Down by the river. Whether it's by the river or by the campground, get rid of it. That's an appreciating asset. Get rid of the van as quick as possible. Thanks for the call, Delees. We love you. You're such a fun character. This is The Ramsey Show.

All right, let's cut to the chase. It's easy to get discouraged about crazy house prices and interest rates. But when you have the right real estate agent to help you buy and sell the right way, you'll have confidence to make smart decisions. Ramsey trusted agents aren't just experts who guide you through buying or selling. They're someone you can trust to have your back from the first call to closing day. Find a Ramsey trusted agent near you at ramseysolutions. Com/agent. Ramsey solutions. Com/agent.

All right, welcome back to the Ramsey Show. I'm Ken Coleman. Jade Warshaw joins me this hour. 888-825-5225 is the number. Every once in a while, Jade, it's really fun because we do have a live studio audience, and I should take this moment to just say, if you ever want to join us, go to the website, ramseysolutions. Com. They've got a show calendar on there, and we'd love to know that you're coming, but we give people free coffee and tease, and there's baked goods over there, and we just love for folks to come watch the show. Well, Melissa joined us today, and in the lobby, and she's from Indianapolis, I'm told. Every once in a while, we'll take a question from the audience in the lobby. Melissa is standing over there on the debt-free stage. Hello, Melissa.

Hi, Jade. Hi, Ken. How are you? I'm good, thank you.

All right. I'm told you have a question for us, so take it away. What's going on? All right.

I'm a physician, and I'm board-certified in family medicine, but I'm about to change specialties. I was accepted into a fellowship Hospice and Palliative Medicine. It's a 12-month training program. It starts July first. I'm a single mom with five kids. How old are the kids? They're 16, 14, 12, 11, and 6.

Bless your heart.

They're a lot of fun.

Oh, man. Okay, so you're busy.

I am. But after the fellowship, obviously, it would be good to relatively quickly get another job of some sort. I need to figure out what I want to do. The fellowship program and the hospital system that it's associated with, they offer something called an early incentive program. Basically, they would trade an extra stipend per month during the fellowship for my commitment to do whatever position in their company beyond the training program. If I were to take the stipend for, say, six months of the fellowship program, I'd be committing to six months in that position. Minimum. How much is the stipend going to be? It's like 2,000, 2,500 a month extra.

Can you live off of that?

I get paid also for the fellowship itself. It's like a residency program. That'll be somewhere between 60, and 80,000 for the 12 months. I'm a health officer, so I help lead a great team in a health department in a small town, and so I make 23,000 from as well.

Where's the problem?

I was just curious if I should go ahead and sign and commit to doing some position with them beyond the fellowship. Okay. All right. Or- Because I don't have to. That's an optional thing. Or I go on my own and over the next 16 months or so, look for whatever position that I want of my own.

I love the question. Let me ask it back to you. Okay. I love it. By the way, You're doing great. Thank you. You're doing great. Would you rather go out on your own, or would you rather... Forget the stipend. The stipend is a non-factor. I appreciate you sharing it.

I don't actually need that.

You don't need the money. You're fine. The question is, would you rather step into their existing job in that program and learn the ropes and get into it and get your sea legs? Or would you rather say, if I had the opportunity, just as I have the The job at the hospital, if I had my own opportunity or something else, which would I rather have? Where is your gut at?

I'd probably rather do my own thing just because I have more control and flexibility and all of that.

Then that's the answer. I'm trying to simplify It's not going to qualify it. Now, I want you to push back here, but based on what you share with us so far- The pros of it, obviously, the stipend, but some guaranteed position, I guess, so that there's less unknown. All right, so let's play this out. If If you went out on your own and you get done with the fellowship, you're going to make 60 to 80 on that. You're making 23. You're already a doctor. Do you have any debt at all? What financial shape are you in?

No, I'm on Baby Step 7.

You're on Baby Step Seven? Yeah. Walk us through Baby Step 7. What What does your Baby Step Seven look like? What retirement do you have?

I'm going through a divorce right now, so it'll be about half of what it is now by the time the fellowship starts, most likely. What will that be? Right now, it's like 500,000. It'll be maybe... Actually, for my part, I'll have the paid-off house and like 100 to 200,000.

I don't see any problems with this.

I was looking at you on the money. I'm okay. I think financially, I feel like I'm doing pretty well.

Because you're still going to keep the 23 with this community health thing?

Yes, I'll continue to do that.

I'd bet on me.

The stipend is not worth it.

No. Not to lock yourself into six more months. You said double the stipend. It would give you 4,500 if I was paying attention.

It's 2,000 or 2,500 extra per month. I think, I don't know, whatever the 60,000 to 80,000 ends up being exactly, divide over 12 months, that's how much I'll make per month during the fellowship. But I make more right now. I work only part-time, but I'm a hospitalist, so I take care of patients that are admitted to the hospital, and I make $200,000 with bonuses and everything, plus the $23,000.

Way to go. Come on, girl. And a single mom. That's what I'm talking about.

What are your fears on this? Because I sense that it's something there still.

I think losing the flexibility because I want to see these five kids grow up. I want to be there to raise them, which is why I'm part-time right now. I need that flexibility. I guess I don't want to give that up and lock myself into anything more. This 12 months is already-Okay, let's stop.

You don't need to. She doesn't need to.

You don't. I think we need to What's this right here? Because now this is what I'm getting at because I could still sense and feel that, okay, this is not a money question. This is a time question. That would still be there. This path is still going to be there once the six-year-old reaches a certain level. I'm going through the teen thing right now. Your oldest is how old?

Sixteen and a half. Yeah.

My oldest is about ready to graduate high school, and I can't even talk about it.

She and I will finish our programs now, basically the same time in 2025.

What's it going to look like if you take the path that you're working for yourself time-wise? You're not going to have the time that you have now, yes?

No, I would hope that beyond the fellowship, beyond the training program, so this will be July of 2025, that I could find something. I could go part-time in the new specialty, or I could do full-time, but I could make it my own and just tell them, Look, here's the schedule I need. Okay.

Now, Jade, that's a slam dunk for me. That's why you would never go work for the hospital. The hospital is not going to give you that freedom.

I don't know. I don't know. I guess there's a lot of unknowns. I may end up doing something within this company because they do have some suburban, rural areas which are closer to home. If it happens to work out, then great. Like I said, I don't necessarily need this stipend and have the absolute definite. That's what I'm going to do. But you want to do this. Because I really want to take... When the fellowship is done, I want to take a month off. Then In August that year, I want to move my daughter into college and things like that. I guess I just don't want to be stuck.

This direction of medicine is what's really on your heart. Yes. Then I'm going to tell you something. Go do it. I think this is about mama time. Whatever step you take going down this path must be run through the filter of how much flexibility I have for this short season because the kiddos are going to get old fast. I think it's the mama time is what becomes her new to filter. What do you think?

When you talked receiving a stipend in exchange for six months in a role that you don't really know what it's going to be, they could put you anywhere. I don't see the benefit not with the money that you're already making and that you'll make coming out. I can't see where that's worth the time.

You're a working mom. That's what I was thinking.

I mean, you get this issue. You're a working mom.

Then once you come out and you do strike out on your own, I didn't write it down, but there's the other job that you had that you're making 23,000 off of that's eating up-time. You can let that go.

Yeah, well, I can do that. That's more of a consulting position.

Okay, so that doesn't require a ton of time.

You're in charge of your time. Yeah, right. Did you get what you wanted to hear? Because I'm telling you the truth, what we think it's the truth. I think you should absolutely do it. Okay. But I would strike out on my own path unless the hospital gives me the flexibility, because the flexibility is the issue, not the financial issue. Right.

Okay. All right. Thanks so much. You're awesome. Thank you.

Hey, I got to tell you, I love seeing single moms, Jade. Just do stuff that just I'm making life happen, taking care of the kiddos. Five kids.

Five kiddos. My goodness.

I'm exhausted right now just thinking about what she has to do, and yet she's doing it with a smile on her face. I know, right? Melissa, you're awesome. Thank you. I think you inspired a lot of ladies. Thanks for sharing that story. All right. Hey, we got to do a quick break, but we're not done. Jade Warshaw is my co-host. I'm Ken Coleman, and this is The Randy Show. Don't move. Welcome back to The Ramsey Show. I'm Ken Coleman. Jade Warshaw is with me this hour. 888-825-225 is the number to jump in. Our scripture of the day comes from Proverbs 25:28, a man without Self Control is like a city broken into and left without walls. Our quote today from the country music legend passed away. Today, I believe it was, is when it was reported, Tobi Keith, who once said, Don't compromise, even if it hurts to be yourself. If I had a solo cup, I would hold it up because he had some great songs.

Dream walking, pillow talking. Come on now.

I love co-hosting with you. We need a music segment where it's like, name that tune, something like that with Jade, because she can sing anything. She can sing the phone ball. How do you like me now? There she goes, folks. Now that I'm on my way. Yeah. Wow, this is great. To be Keith fans are getting a little soul in that number.

You all didn't know that I knew. I know about it.

She knows. All right, let's go to Jessica in Orlando, Florida. Jessica, how can we help?

Hi. Happy birthday, Jade.

There it is. Thank you, Jessica. We're going to celebrate Jade the entire month of February. It's going to be great.

Exactly. Month long.

What's up?

I was calling because I need some advice. Me and my husband just got married last year in September, working really hard on trying to be We're really faithful in our money and keeping a budget. It's all new. I have land that I own, and I'm trying to build a There's a lot of people who are buying a house there. We are currently renting, and so I keep getting this pressure because we're both a little bit older. I'm 41, he's 38. A lot of people are saying, We should really buy a house now. Well, it's not their life. Right, I know. I really want to build this house because I feel like it would be the best financially and investing in our future. But I'm also really worried because, I don't know, accumulating the debt of building a house versus buying a house really scares me. Neither of us have ever purchased or our homeowners or anything like that. Sure. It's just new foreign grounds.

Do you already own the land? You already own the land? I already own the land, yes. What'd you pay for it, or what's it worth?

It's worth right now about $100,070 to $100,000 based off of the taxes that I'm getting charged. But I actually purchased it from my parents for less than $2,000.

Oh, wow. Okay. So it's worth 100,000. You bought it for 2,000. Correct. Okay. What would it cost? I mean, have you done your research? What would it cost to build a home on I mean, are you trying to spend 300,000? What are you trying to spend?

I've already gotten a designer to build the blueprints and stuff and still working with different companies to do the construction papers and things like that. We've been working on that, trying to do it slowly because we're trying to pay it off each time we do it, and it does cost money to get those things done. But it's looking like the house that we are wanting to build can be anywhere between 300,000 to 400,000. A couple of years ago, they were saying it was more towards 500, 600,000 because of how crazy the cost of supplies were, but it's going down.

That's gotten better. Yeah. So you're renting right now. Do you have any other debt?

I have my student loans that I've gotten down to about 7,000. I just have one credit card that's about 2,000, and that's basically it.

What about your husband?

Nope, he has no debt.

Zero debt. We really have to get rid of that. Very good. And what do you earn between the two of you?

I make about 80,000, and he makes about 50,000 to 60,000. Okay.

Here's the parameters that I would give you. I would first, and this is in order of priority, what you do first, second, third, fourth. First, I'm going to pay off this debt. Do you have any money saved? I didn't ask that. Sorry. Do you have any money saved? Yes.

How much? Yes. We have the $1,000 emergency fund, and I have some savings as a cushion in a I have a corporate account. It's like 3,000 or $4,000. And then I have my 401, and I have a couple of stocks that I've done as a child and haven't really ever touched it. So It's just all sitting there.

So you've got the 401k. We're never touching that until it's time in retirement. What's in the stocks?

I want to say it was like 40,000, I think. Okay, great.

Honestly... Sorry? I said great. That's great. I would check it and just see what it's grown and look at it because I'm going to use it. Here's what I would do if I were in your shoes today, Jessica. I would take the 4,000 that I have saved aside from Baby Step and I would pay off the credit card, and then I would take the other 2,000 and throw it at the student loan. Now you've only got a $5,000 student loan. Then I would cash out these stocks and be prepared for the taxes because you're going to pay something on them. I'm going to knock out the rest of that student loan. Now you're completely debt free and you have $30,000, let's say. Then I'm going to set that $30,000 aside and call that 3-6 months of expenses. Then from there, we're going to work and work and we're going to save up so that we can start this construction to permanent loan. That's the type of loan that I'd want you to get on this because you want to make sure that the construction is funded and then that money rolls over into a real mortgage.

You want to do it the right way. There's been times where I've seen people try to do it separate and do a construction loan first and then turn around and try to turn it into a mortgage. They have issues and they end up having to close more than once, and it's just more expensive. Try to look for a construction to permanent loan that does it all with one closing. That's what I would do. Then the goal that you're looking for in spending on this build and on this mortgage is you don't want it to be any more than 25% of your take home pay. That's what we're getting to. You've got to make sure that you're really on this. You create a very clear budget, you know what you can spend, and that's what it is. The plan is only spending what you can afford to spend on this house, building it. That's what you're looking for, 15-year fixed rate.

Okay. I guess I have to calculate what that monthly bill would look like for what we can afford.

That's exactly right. We've got a great mortgage calculator for that. If you go to ramsey solutions. Com or type just to Google Ramsey Solutions Mortgage Calculator, you'll find it and you can figure out, Okay, what does this look like? What do I have to put up front in order to make this happen? I think you guys are on your way. It might end up being 300,000 instead of 400,000. It just depends on how long you guys want to stay.

I think this is a key point, Jessica. You have to determine a realistic timeline based on the financial advice that Jake gave you, because you're going to really, really regret it if you don't take that advice. The idea here is, when can we build the house? Not if. I think you got to change that narrative. If is not the issue, it's when. You will be able to do it. If it's an extra year, fine. One other thing I just want to point out is that there is this notion in America that renting is throwing money away. Have you ever heard that?

Oh, yeah.

Yeah, but it's not. Let me tell you why it's not in your situation, based on the context that Jay just gave you. It's not throwing money away. It's giving you options as opposed to being over leveraged with debt and stressed out. You started the call. I could feel the stress on you just thinking about the idea of building a home. So Why wouldn't you take the option of renting, which is safety, no risk in renting? Do you see it that way now?

Yeah, absolutely. I think that there's just a lot of pressure. It was a little bit less when I wasn't married. Now that I'm married, there's just a lot more pressure applied like, When are you going to have children? When are you going to have a home?

Let me address that, okay? Because we only got 30 seconds. I want you to choose today. You don't have to do it on this phone call. What I want you to choose today Before you go to bed tonight, which pressure do I want to deal with? Do I want to deal with the pressure of family and friends to do what they want me to do, or do I want to deal with the pressure of bone-crushing debt? Those are two types of pressures. I'll take the pressure from family and friends, Jade, all day long. I don't want the pressure of debt that I can't handle. That's true. It's a real clear choice. Great hour, Jade. Thanks for hanging out. As always, James Childs, our fearless leader, and the merry men in the booth. Thank you for keeping us on the air. This is the Ramsey Show. Dr. John Deloney here. Mental and emotional health challenges, broken relationships, it's all just part of life, but they don't have to define you. The Dr. John Deloney Show is here to help. It's a collar-driven podcast where you can get practical advice on dealing with anxiety, loneliness, depression, relationship challenges, your kids, and so much more.

Listen to questions from our callers, or if you're walking through a tough situation and need some help, give me a call. You are never meant to do life alone, and that's what this podcast is all about. Follow along on Apple, Spotify, YouTube, or the Ramsey Network app. Remember, you're worth being well.