Sacrifice Now To Secure Your Financial Future
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This is the Ramsey Show, where America comes to have a conversation about their money, their profession, and their relationships. We're so excited to have you with us alongside the incomparable, the Natalie attire, George Camel. I'm Ken Coleman. The phone number to jump in today is 888-825-5225, 888-825-5225. It's Friday, George, and you know. Welcome home. It's good to be back. You and the crew have been at Entree Leadership Summit. Entree Leadership Summit.

Our signature leadership event, always fun and just a joy. So let's get right to it, shall we? Alex is in Seattle, Washington. Alex, how can we help today?

Thank you so much for both of you taking my call. And I'm sorry if I sound a little nervous. I'm 60 years old. I'm being quiet fired from my job. And I don't know if I'm going to be able to find work. And so I'm trying to figure out what my next steps could be. What do you do right now? I do. I work for a home care agency and I do billing, payroll, scheduling and I hire. Okay.

Okay. I've been doing that for 10 years. Jack of all trades. Yeah, but very administratively gifted, I'm gathering. Yes. You see details and checklists, and you go through them like a lawnmower, right? I do. Okay. Yeah. The reason I stopped and kind of focused on that is I want you to understand how valuable you are in the marketplace right now. There are just always going to be companies, small businesses who need somebody like you

Who could wear a lot of different hats, as George pointed out, but you're just so valued because of your ability to come in and take details and what might be a bit of a mess and clean it up. Does that still feel right to you? It does. Okay, so that's the narrative. That's the mental language you need to be using for yourself as you begin to start looking aggressively. I'm assuming you're looking for other jobs right now, given that you feel you're being quiet-fired.

Yes, I've been looking for work and then I've been looking at maybe starting something, you know, that I don't know if I'm too old. What do you mean by starting something?

I like that. I like it. I think it's both and, though. In other words, if we can find something here soon to create a bridge for you, and

In other words, no interruption in payment. We get out of the current situation that we're in and then we get stable by just walking right to something else and then begin to contract yourself out and build that to where you can be very, very successful over the next eight, 10 years. And I want George to jump in here on the on the retirement question. But one other quick question. What makes you feel like you're being quiet fired?

So three months ago, I worked for this company for 10 years now, but a year and a half ago it was sold. The person that has it now stopped talking to me about three months ago, does it unshunned.

In the office, people just kind of walk around me. I can feel it in the air. Meetings I used to be included in, I'm no longer included. I'm being needed to do the thing I'm doing, but you really get the feeling that I'm not valued. Yeah. People don't value me. Yeah, I'm so sorry, Alex. I'm sorry. And here's what I want you to hear.

The good news, this is all bad news, except there's one little silver lining in this I'm gathering. And the silver lining is that they're not brave enough to actually fire you. They're cowards. Yeah.

And you're still, and they're not hampering you from doing your job, correct? Did I pick up on that? Correct. Okay, so here's the deal. So, Alice, here's the deal. This sucks. I'm not going to try to put lipstick on a pig here. Okay, this sucks. This speaks to why I'm in the work that I am. Because this is an example, folks, of what it feels like when you aren't valued at work.

It's soul sucking. It leads to burnout because you're a human being. All of this sucks. But the one piece of good news is they're not pushing you out. And as long as you don't rock the boat, I think they'll probably just wait you out. So let's play their game. So let's flip this thing. And now you become you do your job.

But you are every extra second you have at night, you are now treating a full-time second job as getting the next gig and do exactly what the advice that I gave you. But I want to, you got what I'm saying? I do. Aggressive. Aggressive. And don't worry. Don't try to fix this situation. It's not fixable. But let's take advantage of it in that they're not pushing you out.

and I gave you what I think your next steps are. But I want to bring George in for the retirement question because, George, I don't want her to get panicked in this situation. I want you to give her some coaching here on how she can prepare and where she's at. Give us a sense, give George a sense of where you're at today in retirement.

So I don't have an IRA or any actual plan. So let me just start by saying that. And that keeps me up at night. I just didn't do what I needed to do. I have $60,000 in savings.

I have $2,000 in credit card debt. I own one home outright. Whenever I looked at that on one of the sites, it goes anywhere from $700,000 to $800,000. And then I have a second home with a current mortgage, and on that I owe $279,000 on that house. Is it being rented?

Yes, my son currently lives in it and he rents it. He's good about that. I want to try to keep it. Is he paying market rent? What's your total expenses versus what he's paying? So the total expenses to manage that home is about $4,000. The mortgage, utilities, all of those kind of things to live in there, and he pays that. I don't make anything, but I don't pay anything. Okay. Okay.

That's for another time, but at least tells me that you do have some money laying around. Let's say worst case, you could sell that property and use that for retirement income or use the rental income as retirement income. So all is not lost here. I don't want you to give up hope, but you do need to get investing. It's wise to be diversified and not rely totally on rental income or the sale of this property to fund the rest of your life. And I would pay off the credit card debt today. Why are you hanging on to the credit card debt?

I don't have a good reason. Okay. I would encourage you to pay it off and then even cut them up. Take it a step further because you don't need lenders. You have Alex. You have Bank of Alex at your disposal. $60,000 saved. You have an income still. I would utilize that. And I feel like you have lost all of your confidence. You've lost your mojo. So part of this journey is rediscovering this new chapter for Alex. Yeah.

And you keep saying, I'm too old. I'm too old. Dave Ramsey's offended. He's just a few years older than you. And the man's just getting started. And so I want to encourage you. You still have a lot of time left. If you're in good health, you could work another 10 years and really build up a sizable nest egg and make a real impact with your career.

And help a lot of people along the way. Yeah, real quick, I wanted to jump in, George, and ask, how much is the rental house worth and how much do you owe on it? Tell that real quick. I owe $279,000 on it. And when I look at that, it's anywhere from $400,000 to $500,000. I bought it when I was older. Amazing. So you're a net worth millionaire, Alex. Yes.

You're not doing as bad as you think. I'd keep my chin up, go find another job, go help some people and start investing as much as you can. George, point blank, would you sell the rental house and stick that into the retirement strategy? That would be my long-term play as a worst-case scenario. All right. That would definitely float everybody. So hold on to it for now. Yeah. All right. Very good. All right, Alex, listen, get your chin up. Take control of the future right now and find a place where you're valued. It's going to change your life.

You know, one of the first things I discovered working in the financial world is how absolutely devastating it is when the breadwinner of a family dies and there's too little life insurance or none at all. Grieving families are suddenly left behind scrambling to pay bills and trying to make ends meet.

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so you know they'll be there when you need them. Zander is the real deal, and that's why they've handled all my personal insurance for over 25 years. I trust them, and you can too. Visit Zander.com for instant online quotes or for a more personal touch. Give them a call at 800-356-4282. All right, Daniel's next in San Antonio, Texas. Daniel, how can we help today?

Hey, thanks for taking my call. I just have so many different lines of debt, lines of credit, and I don't know exactly when each payment's coming out or how much is coming out.

I'm just wondering how I kind of get that under control. All right. Well, you're in the right place. George loves tackling multiple lines of credit. I love it. It's like trying to untangle fishing line for you. That's a reference I don't understand, but I imagine it's difficult. That's what I know. I get the vibe. My guess is you're better at this than that. Yes. Thank you. I'll stick to lines of credit. Okay. So, Daniel...

How long of a period of time has this been happening? Is this years or is this a sudden life change that caused you to go into all this debt? Well, it's really only been a big issue since I bought a house. So you couldn't afford the house when you got into it and then there was what, repairs, renovations, what happened?

Um, it's a brand new house. Um, so no repairs or renovations, but those door to door guys are pretty good. Did you get sold on solar? And a water softener. Oh my gosh. Hey, let's stop answering the door for strangers, Daniel. Can you make a promise? Just imagine it's stranger danger. And a Kirby vacuum. Not the Kirby. It was this $4,000 vacuum? Yeah.

We got it for $1,500. What a deal. Wow. So he's got a clean house. It's powered by the sun and his water salt. Yeah, who's we? Me and my wife got married in January. We bought the house in December. Oh, so there's an accomplice to the crime. Yes. Okay. Are you feeling the brunt of this? How is she feeling about all these lines of credit and drowning in the payments?

We are very much together on feeling the brunt of it. We both work together a lot on getting us paid. We don't right now have an account together, which we need to do. That's something we've talked about is getting a bank account together. 100%. But we don't really have a problem. That should have been day one.

Yes.

I'm not sure I completely understand. I don't think I have. Okay, so the credit report will show you every single line of credit, what is owed, who holds it. So that's going to be your homework. And go to this website, annualcreditreport.com, and you can pull your credit report from the bureaus. There's three of them. Okay, annualcreditreport.com? Yes, and never pay for this. It's free to do.

And you can pull your report from all three bureaus, Experian, TransUnion, and Equifax. You'll see it right there on the site. So request the free reports. Once you get those, it'll give you a real clear picture of what is owed. And so it's going to show you the creditor name, the balance, the APR, the minimum monthly payment. And if you can't find any of this out on the credit report, contact Experian.

the creditor to find out, hey, when is the due date? What is the minimum monthly payment? Make sure that everything lines up, the last four digits of the account. So you've got some administrative work to do. And then the real work begins of going, okay, we got to clean this mess up. That's the bigger problem, right? Yes. What's the total debt amount as far as you know, excluding the mortgage?

Excluding the mortgage? Okay, so that makes it a little easier. You can ballpark it. Is it $10,000? Is it $100,000? It's around $50,000. Okay. Around $50,000. And that is between the lines of credit, the things you guys went into debt for for the house, anything else? Are there cars? Are there student loans? No, no student loans, and we both have a paid-off car. Okay. So you have $50,000 in debt. What is your household income? Um...

That's kind of spotty right now. I just got a new job. I'm a waiter, so it goes up and down. But we've both made consistently anywhere from $60,000 to $70,000 each the past three years. Okay. And so you're on track to make $60,000 as a waiter this year? You said a new job. $50,000 this year. Okay. What were you doing before making $60,000 or $70,000?

I was a waiter at a nicer restaurant. And why did you downgrade? Well, the company I worked for transferred me to a struggling location, and then I quit that job to become a door-to-door salesman. What are you selling? Well, I don't do that anymore. I was selling internet. Okay.

Yeah, I was selling internet. Okay. Well, here's the key. I want you to get your income back up so that we can get out of this debt faster. Because you're telling me right now you guys make six figures as a couple. Just about, yeah. Yeah, Daniel, just jumping in real quick, you need to be working as much as you possibly can. So I don't know if that's another restaurant, a better restaurant, adding two restaurant jobs, even if it's picking up two or three shifts. You've got to get more income in here to get some momentum.

Okay. And as far as the plan to get rid of this debt, you and your wife are going to sit down tonight and you're going to make your first budget. And we're going to gift it to you. It's called EveryDollar. It's an app that you both can log into, have total transparency into what's going on with their finances. You're going to list your take-home pay for the month. So you're going to list your paychecks that are coming up, right? You'll kind of have a ballpark of what those are.

And then beneath that, you're going to list all of your expenses. And to make this easy, you can look at your bank statement from the last month to show you, hey, here's what our light bill normally is. Here's what our mortgage is. Here's our insurance bills, all the things. And then what you're going to do is judiciously cut every single thing that you do not need for survival. Do you understand what I'm saying?

Yes. Okay.

And then you're going to follow what we call the debt snowball method, where you systematically knock out the smallest debt first while making minimum payments on the rest. And that allows you to do something you haven't been able to do in a long time, which is just focus. Focus on one thing at a time. Okay. Do you guys have any savings right now? We used it all while I didn't have a job. So you're down to just paycheck to paycheck in the checking account, nothing in savings? Yes.

Nothing in savings. Okay. So your step one is baby step one, which is the $1,000 starter emergency fund. And that's going to happen in the next paycheck or two, right? You guys will have $1,000 flow through your hands. Yes. Okay. What you're going to do is set aside the $1,000 before you start attacking this debt snowball. And what you're going to do is ignore the interest rates. You'll know what they are, but you're going to ignore those and just focus on the smallest balance. Can you tell me what the smallest balance is?

$1,000. Perfect. So that's your next goal. How quickly can we knock this out, making extra payments, working extra, selling stuff, doing whatever it takes? And once that's knocked out, you free up that payment. That payment's what, $100, $200? That minimum's $29. $29. So now you free up $29 to apply to the next debt. And you see how the snowball starts to roll and gain momentum? Yeah.

That is the key. That's how millions have done it. That's how I did it. And I'm telling you, if you just trust the process and trust the plan, you guys will be out of this debt. I'm guessing, let's see, making $120K, you owe $50K. You could probably get out of this thing within a year. But you know what that means, right? Basic napkin math says we've got to put like $4,000 a month towards this thing. And you're bringing in probably $8,000 a month.

So you see the game here? It's to find as much margin as we can by spending less and making more. And so every month, come hell or high water, we're going to throw four grand at this debt because we want to be done with this within a year and not be a married couple 10 years down the line still in crippling debt. So hang on the line. We're going to send you every dollar premium to help you guys through this and also Financial Peace University so we can walk with you, give you the financial literacy and the tool to apply it with that budget. We're rooting for you, man.

I like that you pulled an old phrase out. What's that? Hell or high water. I'm not even sure you understand it. I think there's water and fire involved. There is. That's all I know. And neither one are good choices. I like that. You gotta make something happen.

There's a time in your life and the baby steps for renting, but you don't want to do it forever because when you rent, you're still paying for a mortgage, just somebody else's. Plus rent means instability in your budget because it always goes up, never down.

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Hey, how many of you out there are tired, exhausted about the paycheck-to-paycheck style of living? You just want to get out of it. The hamster wheel is just wearing you out. If that's you, you've got to listen. This is an opportunity, a low, low effort, but high return. It's a free budgeting training this month. You're going to learn step-by-step how to make and stick to a budget.

Using EveryDollar, you can get all your biggest budgeting questions answered in the live Q&A. This is free, folks. Sign up for free at EveryDollar.com slash webinar. EveryDollar.com slash webinar. This is the way to kind of just kick the tires and take the pressure off and actually learn how to do the one thing that will change your financial life. So check it out. We'd love to see you there. Joe is up next in San Diego, California. Joe, how can we help?

What's going on? Thanks for taking my call. You bet. It might be a loaded question, but pretty much, is it appropriate for me to ask an employee about their personal finances, try and dig into it to understand what to pay them in the situation that I did buy this person's book of business in exchange for them having a job?

um, steady income. All right. Before we dive into that and I'll defer to George on this one, but I I'm curious, is there not a market value range of salary that you already aware of? And then, and then are you asking this question in the context of that? In other words, you know, the range of what, uh, the market says you should pay somebody with his experience or his or her experience and skill, or are you just sticking your thumb in the air?

So I have a general idea and it's a lot less than what they're getting paid right now. But I also know that they have a lot of personal debt from their business line that we purchased. I know the person has a friend, you know, now we're just work colleagues, you know, there's not really too much friendship. But the answer is I do know, but it's kind of a struggle to keep a good workplace and

and make sure that they are, in a sense, taken care of also. Because I'm weaning them off right now. I'm weaning them off being used to be able to live frivolously. When you said you bought the book of business, did you write them a check? How did that go down? No, so I actually acquired it for free. So it's actually, we had a document drafted that pretty much gave us the book of business in exchange for their employment guaranteed for six months. What do they get out of this? So...

So they get a job, essentially. They get a job. He's getting paid off the bottom line. He runs one of our branches. We have two branches. It was a big plus for us in terms of going from probably $300,000 to $400,000 for this year to probably a million-plus.

in revenue. So there's a big benefit on our end. And unfortunately, he ran his business into the ground culturally, financially. So that's where we came in compliance-wise. They didn't get the insurances they needed because of losses. So you swooped in and said, hey, I'll take over and I'll give you a job. And that was an agreed upon deal? Yes. Okay.

I'll tell you how we view this at Ramsey. And we never look at someone's personal finances to figure out how much we're going to pay them. The only reason we do a budget in the interview process is to make sure that what we pay them is enough for them to live. And so that gives them an out to say, Hey, listen, I'd love to take this job, but I can't afford to. I don't, we don't want people going to debt because they took on a job. So we don't do it to say, well, they need 10,000 to live. Let's pay them 10,000 a month. Uh,

I think that's a different situation. So I would not base it on how much debt he has. I would base it on the value that they are bringing to the organization and what the market rate is. Because what you don't want is for them to get underpaid to where they go, well, I can go elsewhere and make more, but I'm in this contract and stuck in this purgatory with handcuffs on. Because that's not going to create a great employment situation for them, which is only going to hurt you in the end. Yeah.

So give me a ballpark of what you think this role would get paid. What would you pay someone else to run a branch if you hired from the outside? $75,000 to $80,000, based hourly with some bonus based off performance. Great. What were they paying themselves before you bought their business? It's hard to determine. I went into their numbers. They were pretty much paying themselves out of the business, him and his fiancee, anywhere from $100,000.

$15,000 to $20,000 a month or more on big months. And you're telling me that was a poor choice based on how this business was run. He was overpaying himself. All right.

Overpaying themselves, taking on debt they didn't need. Spending out of the business, haven't paid taxes in three years. So he owes back taxes for that business for the last three years. Wow. Like he's mentioned, like some 20-something thousand. But you're telling me 80K is market rate to run a branch in your field?

Uh, yes, I'd say, yeah. Um, that'd be the higher side, you know, with his experience and his repertoire as being able to handle sales and logistics. Okay. But that's a, that's a big gap. So. Yeah. Is it going to be on him to say, I can't take this job because it sounds like he has to take it based on the agreed upon contract.

He doesn't have to. So he doesn't, we don't, we don't essentially, he's very, he's a valuable asset to the team. But it's just trying to figure out the balance between being a good guy and making sure he's taken care of. That's why I feel like I need to see something. And I know him, like I said, as a, as a friend from prior to business, I actually, long story short, I started helping him. I started,

Helping build his business. We had disagreements. I was like, hey, I need ownership in this thing. It was kind of like a young start. I'm relatively young. And we went down the road of no. So I left, started my own business in the same field. Now acquired his business line. Sure. I get that. Let me jump in here because I really appreciate your heart. You're a good dude. And I love the spirit by which you're entering into this decision. However...

You've already pointed out that he was paying himself too much based on the business. And I understand you already have an existing business. But as you talked to us today, you have a pretty good idea, the market value you told us. But you also have a pretty good idea about what's a healthy number and anything above that is you doing charitable work. True? Yeah.

Correct. Then what's that number? I'd say it's charitable work. What's the max number? Forget anything that he tells you in the days ahead as you dig into his finances or the way George told you to do it. Whether he has $500,000 in debt or nothing in debt, it doesn't reflect what you pay him. That's right. And so what I'm getting at is what's the max number that's not charitable? Max number that's not charitable, 85 to 90, like not much higher than that. That would be like the best of the best. Yeah, you can't justify a nickel beyond that. True or false?

That's true. Then that's the number. Okay. Yeah.

Yeah, the other reason I guess I was justifying it was partially the debt, but then also partially like, well, look, we wouldn't have this business line. But I was telling him, dude, there has to be a business – a balance. You can't just say, oh, well, you wouldn't have this business line if it wasn't for what I created. But it's like, well, you wouldn't have a business at all if we didn't step in. And now his employees are getting way better ratings, better performance. Everything's improved. Everything has improved from A to Z. Correct. So, Joe, that's why I'm jumping in here to say –

if you pay him any more than the number you just gave us, and he doesn't make any changes at all, and there's a good chance that he won't make any changes, correct? Yeah, there's a good chance. That's what I'm worried about. Guess what happens? You become resentful. Yeah. And then this whole thing just becomes a negative taste in your mouth, just a nasty taste. So the max number that you've already, that's it. Don't go beyond that. Now, you can incentivize him.

As the business grows. As the bottom line grows, so can his income. Yeah, but it is what it is, my friend. So don't go any more than that. And for that reason, George, I'm going to come back to what you already said. And I wouldn't be digging in too much to this guy's stuff.

Because then it's going to feel like you're trying to pull a fast one on him based on – and even if it's high or low, I want to treat him like I would any other person who is applying for this job. Give him that dignity and kind of remove all of the history and context and go, this is what I can offer you. And if he becomes resentful or entitled, that's a good sign that he's not the guy for this job.

Yep. And it's going to suck to have to go back to the drawing board and hire someone from the outside to run this thing. But that's the healthiest thing for the business. I'd rather do that, yeah. Exactly. In all honesty, business numbers, I'd rather hire someone else, train them. There you go. And because I like you, Joe, I'm going to send you the Entree Leadership Guide to Hiring that's going to help you make the most of this hire and everyone after that. So hang on the line. Christian will pick up. We'll make sure to get that guide over to you, my friend.

Love that. Got to be careful, George, in trying to be kind that we don't make bad business decisions on a personal decision, and it ends up affecting the personal. You've got to have some boundaries based on kindness, but also good common sense for your business. Great stuff there. Thanks, Joe, for the call. Thank you.

All right, Dave, you have some strong opinions. Possibly, yeah. I think so. Okay, because you really prefer credit unions over big banks. Well, credit unions, for one thing, are non-profit, which means that the members, the customers, own the credit union. So any profits that the credit union makes goes back into customer pricing.

So you get better interest rate on savings, cheaper checking, and so on, that kind of thing. But what's more important than that, though, is the fact that the customer is the owner changes the spirit on the credit union. So I find very few credit unions that aren't very customer-centric. Well, and I think we have found one that is incredible, and that's Fairwinds.

They are an incredible credit union that is really out with the heart to help the customer. They're the right kind of people with the right kind of values. And they've done a really, really good job with customer service. And the deals that they're offering, the Ramsey Tribe is incredible. Yeah, absolutely. And I love it. The things that we teach, they so line up with. And you're right, their customer service is unbelievable. Winston and I just signed up and we got an account. And I'm not kidding. It took less than five minutes.

It was so user friendly, like the step by step approach was unbelievable. And then the next day, my phone rings and it says Fairwinds on my phone. So I answered it and talked to someone there and they said, yeah, they give calls to every new customer. And so again, they just really care about your experience. And I

I so, so appreciate that. Plus, anything that you can do at a traditional branch, you can do with them at fairwinds.org or on their app. And you'll have free access to over 33,000 ATMs. Hey, you guys know how much I hate banks in general. And so for me to do this is a big deal. Talk to our friends at Fairwinds and check out the combined checking and savings bundle that they created just for the Ramsey tribe.

You guys are just incredible. Yeah, you guys, it's so easy to join Fairwinds no matter where you live. So go to fairwinds.org slash Ramsey. Fairwinds is federally insured by NCUA.

It's time for our Why Refi Ramsey Show question of the day. If you're buried in defaulted private student loans, you're not alone. You can reach out to Why Refi to see if they can build a custom plan to help dig you out. Visit whyrefi.com slash Ramsey today. That's Why Refi, Y-R-E-F-Y dot com slash Ramsey. It may not be available in all states. Today's question comes from Lindsey in Maine.

Last year, I bought plane tickets at a cost of $3,000 for me and my three children to go on a trip. Unfortunately, it had to be canceled, and the only thing we couldn't get a refund on was the airfare, which had to be used within a year. Fast forward one year, and I'm still working to pay off my debt. Do I go ahead and take a loss on these tickets or try to plan a cheap vacation somewhere, adding more debt to my budget? What a conundrum.

So the airfare didn't go to waste, but she has to use it within a year, but she's on her debt payoff journey still. So she's sort of like, hey, there's a sunk cost here. Do I take advantage of the flights because I still have $3,000 I can use for flights and do it cheap? Or I just don't like the way it was phrased at the end, adding more debt to my budget. My budgets are for cash flow planning, not planning to go into more debt. Yeah, I'm not sure why...

That has to be the scenario. I'm curious to know what you think here. I'm wondering if, okay, we've got the tickets. Can we go, you know, is this a thing where we pause the debt snowball and we save up for a cheap vacation? In other words, bologna sandwiches, we're staying at a discount hotel, a George Campbell special, or is it, sorry,

You're, you know, because this is the Dave. I hear Dave right now going, you're not going on vacation. Yeah. You're not doing anything. But if I knew I had $3,000 in credit, what would I personally do if I was in her shoes? That's why I think this is interesting. I'm going to try to give some grace here, some grace and mercy, which is something I rarely do. Because I'm the get out of debt guy at all costs guy.

Do it. But I'm also Mr. Frugal, and I go, there's a sunk cost here, and it hurts my soul to just lose $3,000. When I can create a memory, the stupid tax hath been paid. I see you in their kitchen, George.

coming up with a super saver vacation to use these tickets. Don't I see you doing that? I'm leaning that way. I see you doing that. I don't know where they could go while limiting how much they're spending. Now, because my thing is you got to eat anyways, whether at home. So can you go on vacation and go to the grocery store and have some bologna sandwiches for the week? Great. Can we do all the free activities in that area? Great. The only issue is going to be lodging. That's right. So that brings me to could we visit...

stay with family and make a trip around that to limit the costs. See, I knew you could do it, George. That gives me a headache, but you actually figured that out. If we go stay with family...

That's my final answer, because the true cost of vacation is going to be the travel is one of the highest costs. And then you got transportation and food and lodging. Yeah. And lodging can really eat up a big portion of the budget. So if you remove the lodging, we can eat cheap and have cheap transportation, have family member pick us up. So I don't know Lindsay's situation, but that's the only way I would feel good about doing that while on the debt free journey. Yeah. Yeah.

Yeah. I like that. Well done, sir. I tried to find some middle ground here, find a compromise. I think you did. I think you went beyond compromise. I think you got a, no, in exchange, you're staying with the family, you know? That is an exchange. You're staying with Uncle Larry and Aunt Mildred, but they got two extra bedrooms. They're empty nesters. Yeah. They got some parks and stuff around their house. And I think the kids can make it fun.

Yeah. They don't need to go to Disneyland and drop another two grand while they're on the debt-free journey. So I'm not advocating for that. But I think there is a middle ground here. Yeah. Let's go to Toronto, Ontario, where Bethany is waiting. Bethany, how can we help? Hi. How are you? Good. How are you doing? I'm good. So my question is, I paid off my...

Only debt I had, which was my car payment. And I have about $600 extra. And I've been putting my money paycheck to paycheck into different TFSA accounts. I have three TFSA accounts and I got two RSP accounts running right now. But I want to put my money into something that will...

give me more money back when I retire or when I go buy a house. And I don't know where to start to put my money into that. Do you have any savings? I have like $12,000. That's it. Okay. Is that considered your emergency fund? Is that enough for three to six months of expenses? So the three to six months, I have about $5,000. Okay.

Okay, what's this other $7,000 in investments? The TFSA and the RRSP? Yeah, it's just in my RRSP, those ones. Okay, I would focus on building an emergency fund because you haven't quite built the foundation to build wealth yet. Because what's going to happen is there could be one or two emergencies that knock this savings out, and now you're back going into debt to cover it.

And so I would add up what your total expenses are for one month on average, multiply that between three and six, depending on the stability of your situation, and then begin investing. And what you're saying is, if I'm getting this right, I'm trying to make sure our American listeners know the equivalence. The TFSA is essentially like the Roth IRA in America. You use after-tax dollars, it grows tax-free, but it is an investment account. It's not a savings account.

Yeah. Okay. And then the RSP is more like a traditional 401k or traditional IRA. Yeah. I can't take money out of my RSPO so I get taxed. So you're looking for a non-retirement account so that you can invest and have your money grow at a higher rate than a high yield savings account, which I don't know what the equivalent is in Canada. I imagine the rates aren't as great as the US. Do you know what the rates are for a savings account?

Well, right now I think it's, I'm at, I think about 5%. Oh, that's amazing. That's great. And you're saying you want to grow it beyond 5%. Yeah. How soon are these goals going to happen? You're talking about a house down payment? I would like to get a house down payment in within like 10 years. Oh. By the time I hit 40. Okay. So you're 30 years old right now. You're saying there's a long time horizon for this goal. Can I invest it rather than save it?

Yeah.

And so I like this plan of you putting this money to work, but I would first get the emergency fund in place and then begin investing in a non-retirement account. So this would be like a brokerage account. I assume it's going to be the same in Canada that you can open up one of these where it's just a taxable brokerage account. There aren't really any tax advantages and you can just stack money away there, invest it into the market. I would choose like a mutual fund or an index fund to do this.

instead of a single stock. I imagine you have similar things in your retirement accounts, and that's going to allow that money to grow, hopefully at a higher rate over the next 10 years. Okay.

I hope that helps you. I'm proud of you. Oh, thank you. But also, do I continue even putting money into my RRSP account? Because I heard someone say you shouldn't. You should just keep your money into a TFSA account. It would give you more interest rate onto it. Well, the TFSA, what's happening is you're using after-tax dollars. So you're not getting a tax advantage this year, but the tax advantage is that money won't be taxed again.

Okay. And so I'm a big fan of that because in retirement, it just causes less confusion. And if you have a million dollars sitting in that TFSA, that's like a million dollars of take-home pay that the government doesn't get to touch again. And so you're kind of betting that, hey, tax rates will likely go up over the long haul. And you're also – in the U.S., there's different stipulations like required minimum distributions don't apply to those tax-free accounts like they do with the traditional because the government wants a piece of the pie. Right.

And because you already gave it to them, they don't get it again. So a lot of advantages there. I would just stick to the TFSA if I were you for investing. And that's 15% is what I'd recommend. And then anything beyond that, put into that non-retirement account for the house down payment. Okay.

That'll give you some parameters to go. And that's pretty nerdy, Ken, but that's kind of our baby step 3B slash 4 is I'm saving for the down payment. I want to invest. You can invest anywhere from 0% to 15% in baby step 3B, but she's saying 10 years. I do not want her pausing investing for 10 years. I agree, and I think that number could change, the 10 years, right? I'm assuming she was on her own on that deal, so I don't know. That's true. Well, hopefully she can get that down payment a lot sooner than that. Who knows what.

Homes in Canada will cost 10 years from now. That's a scary thought. So true. You guys, one of the best gifts that you can leave your family after you're gone isn't stuff. It's peace.

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This is the Ramsey Show, where America hangs out to talk about their money, their work, and their relationships. 888-825-5225 is the phone number. I'm Ken Coleman. George Campbell joins me.

And we're going to go to Jake, who's joining us in Las Vegas. Jake, how can we help? Hey, how's it going, guys? Hey. Quick question for you here. So I'm planning on moving in with my longtime girlfriend by the end of the year, probably. Buy her dinner first.

Yeah, I've bought her plenty. So she's actually been in school for the past couple of years and will come out earning, she's graduate school, she's going to come out earning a pretty good chunk, maybe close to $130,000 to $150,000. And I'm just looking for some help on how to budget that because she's going to be the higher income earner, but she'll also have a lot more student loans. So just looking to see how you guys would recommend we balance that household budget. Well, that sounds like you guys are combining finances. Yeah.

That is the plan, yep, or at least in some way contribute to the household, the goals together. Can we play out a worst-case scenario because that's 99% of the calls we get on this show? Yeah, let's do it. But before we do that, George, I just want to – I was so excited. Well, you're going to get to do it. Okay. Super quick question. What's your income? We know hers or what it's going to be. What is yours? So I'm making pretty good money. I'm making about $90 right now. And she's going to be in the $130 to $150 range? Probably, yep. How much debt do you have?

I have none, and I have a pretty good savings investment accounts built up. We're both really young, so I'm in a very good place. She just has the student loans as well. Nice. All right, George, dash his dreams. I'm not here. I want to show you all the signs. I got worried when you were saying, hey, we're going to move in together. Are you guys going to buy a house?

No, we're going to rent an apartment together. Okay. And then what about the payoff? Because my concern, and we've seen this happen, is you help girlfriend pay off her loans, a breakup happens, and now you just have a sunk cost of helping this person pay off $50,000 worth of their debt with no financial relationship. Yeah.

Yes. I'm not planning on paying off her loans, but I'm wondering how much she would expect. I guess that would be a conversation for her, but how much she should contribute to the household versus living off of one income, having her use her income to pay off the debt primarily. Well, it's simple. It's simple. You guys are roommates. You guys are roommates. You're not married. So with roommates, you'd go, all right, we're going to split it down the middle. 50-50.

Okay. And, you know, she pays half the housing expenses and everything else she needs to be putting toward the debt. I don't know how gung-ho she is about getting rid of the debt, so she may be less excited about this plan of living like she's broke after finishing her program and making this amazing income and then still living like, man, I'm still eating ramen over here. How intense is she about getting out of debt? She is wanting to get rid of it ASAP. Okay. And do you know the total amount?

It's a couple hundred thousand. Woo! Hello. What was her program? What degree is this? It's a medical degree. Okay. Is this like a nurse practitioner type thing or is it on the administrative side? Physician assistant, very similar. Okay, PA. All right. So what's her long-term income possibility? So probably at most, probably getting up to around $200,000. Yeah. How long have you guys been dating? We've been dating about three years. And you've never lived together? No.

Well, she's been in school for the majority of that time, and we've actually been doing long distance for about two years of it. But anytime she comes home, we are staying together. So we sort of have a history of living together for a few months at a time and goes really well. Of course, we have those long term plans together. So we are. How old are you, Jake? Very young. Twenty, twenty five, twenty six years old. OK. Are you thinking about marrying this girl?

Yeah, that's on the agenda for both of us. Where is it on the agenda? Give me a date.

Five years down the road engagement, probably. Why five years? Hold on, another five years? Yeah. Probably something like that. Why? At least, maybe at least three at a minimum. What's up with the minimum? I'm calling in for financial advice, guys. Well, I'm just curious. America is also wondering. Jake with the Heisman. He stiff-armed us. Yeah. Hey, look, you're right. You did call in for financial advice, but guess what's involved in finances? What?

True. Good point. Yeah, I mean, we're just sort of feeling it out. We're not in any rush right now. I want to enjoy time together while we're young. And neither we know the vision we have. So we're not in a rush to get married. We just want to enjoy our time together. Okay.

I've done all I can do, Jake. Jake gave us the boundary. To me, Jake, it's not like a moral thing. I'm not here to make judgment calls about your life. I'm just telling you that financially, you're going to be so much better off by combining your financial lives, working toward a goal together, working toward a vision together. And right now, it feels like we're just kind of looking to play house and have a good time. And you can do all of that and be married.

So if you're committing to live with someone, committing to help someone with their debt payoff journey, whether it's support or financial, I would just go, hey, we're going to pay this thing off a whole lot faster if we work together. We're going to build wealth a whole lot faster if we work together. And if you know she's the one, I don't know the reason for a five-year delay.

Hey, hey, George, back off. He didn't call in for relationship advice. One man's take. No, more than fine. I didn't mean to get off. Jake, I'm just having fun with you. It's Friday. I like to have a good time. Here's the deal. I hope she's on the same page as you because with the plan that you've given us—

There's a good possibility. She starts making really good money as a PA and you guys aren't combined finances, so you don't get a say. And she starts to get a credit card here or car payment there. That's why I'm saying that's why we like the marriage play on this. If we know it's a foregone conclusion, it just makes a whole lot more sense. And if not, you're going to have to have some real boundaries financially in order that it doesn't hurt you relationally. Do you understand what I'm saying?

Yeah, that makes sense. So I would, because if I'm girlfriend, I'm going, hold on, I got hundreds of thousands of student loans. You want me to pay half of them? You can cover all the bills just fine on your own. I want to focus on my debt payoff. Can you take on the brunt of the bills? Boom, red flag, resentment. Yeah. That's kind of how I see this playing out, because that's how it happens in real life. And she makes more money than you, pal.

Or she's going to. Should she be paying more of the bills? Should it be based on income? Oh. So that's sort of what I'm getting at is because we are both on the same page financially. I'm a very financially conscious person. She knows my attention and dedication to just building a future for myself and ourselves there. So she wants this paid off. She wants to contribute towards the household. So I guess a big question of what I'm asking is, yeah,

With this future, we're both envisioning for ourselves together. Marriage aside, we'll table that for the time being. But how much do you think? Is it at this point 50-50 split? Or would those plans to marry down the road? Should it be maybe I do 60, she does 40, and we'll let her tackle more of that debt? No. That's going to be the plan. Oh, that's so goofy. Do you hear how goofy that sounds?

It's 50-50. It's what I said seven or eight minutes ago. I haven't changed my mind. Have you changed your mind? No, although I'm just picturing you saying, hey, you make 40% more than me. I think you should pay 40% more of the bills, too. I'd like a video of that. You could send it to me so I have something to watch when I get bored during the day. That's going to be fun. Yeah, that could go viral, Jake, if you film that scenario. Yeah. All right. Fair enough. Well, thank you guys for the help. Best of luck. Yeah.

He's in Vegas. Just go down to one of those little Elvis... Seriously. You know, there's a wedding chapel on every corner. It's kind of like a church in the South. You know, there's wedding chapels everywhere. God bless. Get her a ring, man. Yeah, we're going to put that off.

We're going to talk about our future together. He said, marriage aside. We're going to put that one. We're going to talk about our future. Just the one thing that actually legally means we're together. We'll put that aside. God bless, Jake. Hey, guys. I didn't call for relationship advice. Back off.

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Hey, what's up? Dr. John Deloney here. The new dates have dropped for the money and marriage getaway over Valentine's Day weekend in 2026. This is your chance to hit pause on everything in your life and reconnect with your spouse over a long weekend in Nashville, Tennessee. Me and my friend Rachel Cruz will be digging into topics like sex, money, communication, and more.

This weekend is happening on February 12th through the 14th, and early bird prices start at $749 per couple, but the prices will be going up soon. Get your tickets today at ramseysolutions.com slash events. Let's go to Zachary in Los Angeles, California. Zachary, how can we help?

Hey, thank you guys so much for taking my call. The issue that I'm having, it's actually more of a moral dilemma, and I'm looking for some guidance from you guys. Hello. We lost you. Zachary? We do not have a moral dilemma. We have a technology dilemma. I was so excited. I was too. I love those. Let's see if we can get him back. Maybe the guys can get on the line with him, see if his line can get... The pipes are clogged, apparently. Yeah.

on the phone. Is that right? I think. I don't know. He was sounding good until he wasn't. I appreciate that very much. While we're trying to get him, this is a good time to talk about... You and I were talking about during the break, you're getting ready to move. Got a new home. We just love to move. I like pain and suffering. Every few years, why not? Every thousand days, just up and move. A lot of people are thinking about buying or selling. George just started his process of selling and

you know, we always recommend don't do that on your own. It's such a massive, massive financial decision. We want to make sure that you understand what's going on in the market and the latest trends. Make sure that you understand them. Median home prices, for example, George, went up slightly last month to about $430,000. More homes are on the market, nearly $1 million. That's the highest since 2019. So there's no longer an inventory issue.

The average 15-year fixed rate rose to 5.9% last month. So the point is, if you're financially ready, don't worry about what's going on in the market. But we want to make sure that you know what's going on in the housing market trends and get some free tools to help you buy or sell. And we've created a wonderful website for you, ramsaysolutions.com. ramsaysolutions.com.

All right. Let's see. Look at that. You see what I did there? I helped people out with some good real estate information, and in the interim, we got Zachary back on the line. So smooth. Zachary with The Moral Dilemma. Are you there? Hey, yeah. Can you guys hear me? Oh, that's so good. All right. Lay it out. George and I have our fake robes on, our judge's robes and powdered wigs. What's going on?

I appreciate it. So about a year and a half ago, I got quote unquote recruited into the insurance industry, as I'm sure you can guess the whole life insurance industry. And I graduated from college in 2023 and just graduated from grad school about a couple of weeks ago. I'm a full-time college basketball player, as well as working part-time. I got married in August. And so

My moral dilemma is a little bit unique because this industry has done a lot for me financially, but the more that I've listened to you guys and the more that I've just grown to learn the financial industry as a whole, the more I am struggling to sell a product that I don't necessarily believe in. Did you ever believe in it? What caused the turn?

I got a cold DM on Instagram about a guy that played sports in college and does sales and stuff.

I was like, oh, that should work for my situation. And my managers allowed me to do it part time. And I really got to kill it when I was working full time. And I didn't have a great understanding of the product at all. I just knew it was sales and it became a lucrative. And so it was one of those things that was difficult to step away from and especially getting married. I'm not sure like. But what caused you to go? I have a different understanding of this product now. Why do you think it is a bad product?

I just listen. I mean, listening to you guys, if I'm being completely honest, like I understand, like,

I was pretty naive. Like when I started, I just knew it was sales. I knew it was insurance. You're getting pulled by all these people that it's helping people. You know, it's, it's, it's a product, it's cash value, it's building, it's an investment. So you're learning from people that don't know, and then you learn a different side and you do research. And so that's where it was really kind of more difficult for me to sell. And the, the kicker is I'm actually leaving in

In three months to go to Europe with my wife to go play professional basketball. Nice. So congrats. Thank you. So you can't do this anymore. Then it feels like this is your hour. I mean, why not just leave and not do whole life anymore? And that's, that's really like the, the quote unquote dilemma is like, is it something that I should,

Because the earnings potential through the summer is so high, and it's just so conflicted with do I provide for my wife and I versus what do we do? Yeah. So, Zachary, let me put the question to you, okay? Because you actually said this at the beginning of the call, and I paraphrase here if I can remember how you said it. But you said, is it a moral dilemma, or I have a moral dilemma because I'm selling a product that I do not believe in? So you tell me, is that immoral? Yes or no?

It sounds pretty immoral. It's not so much that it's immoral. It's not like you're selling an illegal product. You're not selling drugs. Yeah, yeah, yeah. I don't think it's immoral. That's why I'm putting it to you that way. Let me put it this way. Do you think that you can thrive, and I mean not just financially, thrive mentally and emotionally when you are selling a product that you don't think is a good product? Yes or no? No.

It's becoming more difficult, too. And I like I said, I want to preface it by saying I'm I'm super blessed with an incredible wife and incredible faith and incredible family. So it's like I am so blessed in my life. I never take that for granted financially, relationally. And so I just like the work, the work that I've been going, especially the last month since I've been done with school and basketball and trying to get back into it full time has been much more difficult this year than it was last year. Right. And why is it difficult?

Because of that little voice in your head that... It's eating away at your soul. So the answer to the question is not for George and I to answer. The answer is for you to answer. What's the answer? Say it. Yeah, just to be done. Be done. Be done. Here's what you're good at, Zachary. You're not good at selling whole life. You're good at serving people. Yeah. And so you can use that skill to go sell something else that you do believe in. That might be insurance. There's a lot of types of insurance that we do recommend that you can feel good about.

and there's types that we don't. And so I would go find something that you feel good about selling in the financial space, in insurance, or maybe there's something else out there for you entirely, and this was just a fun thing you did for a little while to make ends meet. When do you leave for overseas to play ball? Yeah, most likely the middle to end of August, and that's also kind of the other part of the question is, like, what does it...

Like what? I don't know if there's advice or what does it look like? Because making it doesn't really feel like to me, it makes a lot of sense to make a change, a career change. I agree. I agree. And so the next question is financial for me. Do you start getting paid already on the contract for the overseas team or is that not? No, I won't get paid until probably September. And so that's the thing is how much money do you need to stay afloat between now and getting paid in September?

I mean, need is – I don't need – I guess quote-unquote need any money in terms of like we have – we're pretty – we've set up pretty well. I mean, we have about – the thing for me is just –

Yeah, we don't need anything. You're saying is your wife working? You have income and savings that can support you guys if you quit insurance cold turkey today? Yeah, we do. Yeah, then go do some side projects. If you're just looking to bring in some cash, just go do something. You're in this really interesting season, man. What are you going to make as a professional basketball player?

Uh, not a lot in the first year. Um, it's usually two or three grand a month, but there's no expenses either. And so it's, it's know how your house, a car, food. I would walk away then from this whole life stuff that you don't feel good about and enjoy these next few months. That's all you got. It's going to be over like that. If you want some extra spending cash, go do something that's just super part-time and easy, you know? For sure. Yeah. Hey, question. And you may not feel comfortable telling me that's okay. Where'd you play ball?

Yeah, I put Point Loma, Nazarene, and San Diego, as well as Seattle Pacific and Seattle. Good for you, man. Well, man, that's exciting. You're going to have a season of life, a young married couple over in Europe playing basketball. That's not a bad gig, you know, and hopefully you stay healthy and can start cashing in on a big contract or so. And go for it, man. But do what's right. That's the thing. And you're determining what's right. I don't get to tell you what's right.

Yeah, that makes a lot of sense. Yeah, so good man. Appreciate the call. Yeah, I love the honesty there. That takes a lot of self-awareness and soul-searching to go, man, I'm making great money, and it's eating away at my soul. You got it, George. I love the way you said it because the bottom line is if you're selling something that you don't believe in,

it will eat away at you. There's just no question about it. And it's not worth the exchange. It's selling your soul at that point. That's right. Not just whole life. Yeah, really good stuff. All right, George, I'll explain to you what basketball is. And, you know. Alley-oop. That's a move. Okay, you got that one. Very nice. All right. Keep it up, buddy.

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Listen, guys, I've heard just about every excuse for why folks think they can't get ahead with money. So let's go ahead and settle this right now. You get the final say on what happens with your money. That's why you have to start telling your money where to go so you can stop wondering where it went. So if you're going to start winning with money, you have to get on a budget. The easiest way to get started and stick to it is with the EveryDollar Budget app.

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Hi. My question is if you guys would think that it would be feasible for me to be a stay-at-home mom. So I've kind of ran the numbers and I've made a budget for my husband. And it's kind of looked everything over and it's taken him a while to finally, like,

agree to it and be comfortable with it. But my thought was if I could get the Ramsey Network to quote unquote approve it, then maybe we could make it happen. Oh, wow. That feels like pressure, Ken. So so like he's already sort of OK with it, but you need our final stamp of approval and you're hoping that that gets him on board? Yes. Oh, boy. Oh, boy.

You know what? I got no problem getting in the middle of this one. What do you think, George? Yeah. All right. So you got to give us the details. So let's cut right to the most important part of it here. When you've done the budget, because we don't have time to go line by line. So when you do the budget, what does that show us? And we're looking for what surplus do you have after you've paid all the bills? And then tell us what baby step you guys are on again. Kind of give us a quick picture there.

It's tight, but it's very, very doable. So the reason why I'm still employed is so that I can get my pension. So I'm almost five years vested with this bait. And then after that, that's whenever we're looking for me to be able to stay home. So we have a two-year-old and an eight-month-old, both 20 months apart. And so line by line, he makes about $1,200 a week. And so it would be tight, but we could do it. How much tight? Like what would be left over?

Probably $200 to $300. Okay. And I can't remember if you told me, I apologize, what baby step are you on? So everything's paid off besides the house. We just have $50,000 left on the house. Great. And you have a fully funded emergency fund?

We do. We have about 20,000 in savings. Way to go. That's fantastic. Congrats. And when you say you have $200 to $300 extra, is that after all expenses are paid, health care, are you investing 15% of his income at that point, and there's still $300 left over? Yes. Okay. Okay.

So your only other financial goals would be saving for college and paying off the house and the baby steps? Yep. Yep. So we cash bought a vehicle in March. We traded my old Equinox in for a minivan. So I'm a minivan mom. And so we were able to pay cash for that, which is pretty awesome. Feeling good.

And then everything else is paid for. So we have no debt, no nothing. And then he has side job Saturdays and I have side job Saturdays. And so I'm a part-time photographer. And so he's a blue collar man. So he goes and welds and what does he make? Okay. This is great. I have a couple more questions and I'll be ready to rule. I think George is probably already ready over there. I seem. No, I'm hesitant. You're hesitant. Okay. I got a couple of questions. It may help judge George. Okay. All right.

How much does he make right now just in his trade job, his main job? Probably right around $70,000, I think. And what were you... A full month or a week after taxes. Okay, great. And what were you making? Let's assume you're already gone. So what has been your salary? $50,000. So we're taking a $50,000 hit. My question is, with you doing the...

What'd you call them? Saturdays? What'd you call it? Side job Saturday. Side job Saturday. I love that. Are the side jobs that both of you are going to continue to do, are they included in the budget number that you gave us? I, not his. Mine was, I do photography. And so I charge $300 a session and I just budget to do two sessions a month. That's very minimum for me. And so. What about his side hustle stuff? What will that generate?

It could be $1,000 a month easily. And that's not included in the numbers you gave us? No. So in all reality, it's reasonable to assume that from your budget alone, just going down to one income, you're going to have, let's call it $300 of surplus a month after everything's taken care of. And then we add his $1,000, so we're going to be in the black, let's say $1,300 a month. Mm-hmm. Okay. That to me...

I'm okay with it. I'm fully okay now. Because what I was going to suggest is how could he make an additional $50,000 a year professionally? And the fact that he's blue collar, but he's kind of in the trades, I think there's very reasonable expectation that he can do that.

And if you were to get close to replacing your 50 in the first 12 months, to me, that's a no-brainer. But I'll see what Judge George thinks. He's over here quietly tapping his pen. Tap, tap, tap. No, I like this plan, Laura. I'm not worried. I just want to make sure that you guys have enough margin to

create sinking funds to save for vacation, create a sinking fund to save up to upgrade the cars eventually, to have enough to throw a little bit at college savings, to have more on top of that to throw at the mortgage, to be able to give and spend the way you guys want and not just be right up to it every month.

Because when you said it's tight, I feel like that brings its own stress. But I also know that staying at home is such a big decision and it's such a family values decision that it sort of trumps the just math numbers. And that's where I go, if you guys both agree this is the right move, do it.

and then figure out a plan to achieve those further goals. And that might mean he busts his butt and gets some raises. It might mean that you have to continue this side hustle for the next three years until we get to a better place. But if you guys are willing to make those sacrifices necessary, you have a green light for me. Yeah. And you know you have a green light for me already. And I would also add that you will not regret this decision to come home. If you change your mind, you can always go back to work.

But you'll never get this time back with those little ones. And I'm, listen, I'm speaking as a guy who I'm watching my kids grow so fast, it's freaking me out. You know, I got a kid and just finished his freshman year in college. And I thought I was changing his diaper yesterday. It goes fast. And so I just think, and I'm going to also say this. And by the way, my mom was a working mom and my wife has worked

during many years of our kids' lives. So I don't want what I'm about to say to get misinterpreted because that happens in today's age. So I'm going to say this as clearly as I can. I am pro-women who want to work for financial reasons or professional reasons. Love it. But I also think that the greatest job in the world is a stay-at-home mom. And I applaud you. Give it a shot. So is your husband listening in right now or is this we're going to tell him this later?

I was going to tell them later. All right. Fun. When is this happening, you said? Is it a little ways out? So I would be vested for retirement at the end of July and so then probably August. Okay. Just a few months away. Yeah. Congratulations. But we wanted to stay that vested so I could get the pension when I retire with the state, but then also I put in extra retirement. So I put in about 15% of my income once I started here. And so I have roughly about $30,000 in retirement now.

just with the state. Awesome. Nice. Way to go. I think that's a very wise move. And I'll tell you, Laura, my wife decided to stay at home after a nine-year career at Ramsey. She was thriving, crushing it, and it was the right decision for her as hard as it was. And so I think, like Ken said, you're not going to regret this. And it is definitely a big move for your family. It is. And I love what

I love what I do. So I work in recruitment for a college, and I love what I do to recruit these students for technical education. It's just my babies are calling me home. Come on, Mama. I love it. I think that's fantastic. George, really quick, because we've got about a minute and a half with her. I'd love for you to give her some advice on what to do with that pension and maximize that. Oh, absolutely. So you said you're fully vested. When will you have access to it? When I retire. Okay, so we're talking 60? Yeah.

Yeah. What will it end up being per month? Right around $1,500 to $1,900, I think. Great. So that will kind of bolster your retirement. And as long as he's investing that 15%, you guys are still young, right? Yeah. So he just turned 31 this week, and I'm 29. And we have him putting $500 a month into a Roth IRA already. Okay. But you're not quite at 15% yet?

So you'll need to increase that to 15% because it's 15% of household income, which then might change your budget. So I'd go back to that budget and see what it would be like to take 15% out of each paycheck before it hits versus his current $500.

I still think you're going to make it happen. And I think the power of you guys making this move will change the direction of your family in the best way. And the money will just show up because you guys are willing to work for what's important to you. Yeah, Laura, so, so excited for you. And you're going to be great at home.

It's going to be great. Tell the husband. It's going to all be okay. It's natural for him to be worried about losing an income, but it'll replace itself. Glad we got to make that decision. I think that was the right thing. Yeah. For two random guys to do. Two random guys, yeah. To rule on it.

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 people you can trust to have your back from the first call...

All right, folks, thanks so much for being a part of our audience. We do this for you, and we need your help. You know, the show is continuing to grow new audiences. And so wherever you're partaking of the show, if it's on YouTube, we'd love for you to subscribe, like, and share. And if you're listening via podcast, give us a follow. And if you're listening via podcast, give us a follow.

And share as well. Subscribe because that helps us grow. You know how the algorithms work. I don't, but that's what they tell me. So we would appreciate that. We don't want to hurt Ken's head. We do not. It's easy to do, George. Say things like algorithm and I just start to get verklempt. Keep Ken out of it. Start crying. It scares me. Aaron is up in Columbus, Ohio. Aaron, how can we help?

Hi, Ken. Hi, George. Thank you so much for taking my call. You bet. Long-time listener and follower of Baby Steps. Thank you. Wife and I made it to Baby Steps 7 about five years ago. Hey-o. That's no big, that's no small thing there. That's huge. Yeah. Thank you. We've got a problem. I wanted to run something by you, get some advice, and see what you think. All right.

So one of the things we're doing well that got us there is investing in our company 401k plans. And I work for a small business, very small family owned company at the LLC and have been in there for one day, about 14 years, have amassed about 315,000 at its height in March of this year. We know what happened to the market in April. So it went down about two 50 and around that time, the company wants to switch providers and,

So we get a blackout notice. Everything seems kosher. However, during that switch, I found out that we were fully divested out of the market for seven days, May 7th to May 14th. And if you've been watching the market, that was a rally period.

So losses were realized. I lost about 237 shares valued at $18,000 out of that retirement account. And I've got about 30 more years projected to my retirement date.

So, the question, I guess, is have you ever heard of that? I guess it's standard, I'm told, for an old 401k provider to liquidate to cash and then spend some days to move out of the market and then rebuy with a new company. Yeah.

Man, that really stinks. And, you know, the changes like this happen all the time, but the crazy fluctuations in the market is just really bad timing to miss out as the market makes a comeback and you're sitting on the sidelines unable to do anything about it. Sure. And so I don't know that there's anything you can do to get that money back. I mean, essentially it was out of your control and you're going to just have to build that back up.

But you can ask HR for a detailed transfer report, you know, and work with the record keeper to go, hey, what exactly happened? I want to make sure that my investments are still invested where they were. It's in the same funds. I have the same amount of shares. But you're telling me that essentially they had to cash out this transfer temporarily for that week. And when they cashed it back in to buy the same amount of shares, you bought less shares because of the price or what? Exactly. The price went up about 6%. Yeah.

So it's not a loss in a traditional sense. It's more of a missed gain. Correct. And that, unfortunately, is just part of the risk of any kind of 401k provider transition. And so you can talk to your employer. I doubt they're going to do anything, especially as a mom-and-pop kind of small company. They're not a giant corporation where they're going to go, we're going to cover any missed gains that happen because that's on us for changing providers. You guys had nothing to do with that decision. But I don't want you to spend too much time reeling over this

Because you guys are doing so well that it's such a small part of your world at this point.

Sure. Yeah, we had, I appreciate that. We did talk to the employer. In fact, this happened in 2017 as well, but it was only 15 shares and about $800. Much smaller scale. Yeah. I warned the employer and asked the new advisor, hey, I've got scars from last time and the stakes are higher. Can this be avoided? Yeah.

And it wasn't avoided. And when I followed up, the response was, sorry, that can happen. That's unfortunately what I thought the answer would be. I doubt they're going to be like, well, let's just write you a check for $18,000, Aaron, for your missed gains. We're so sorry. I wish it worked like that. It's just one of those snafus and the timing could not have been worse. But it's a good reminder that

to not pull your money out of the market because the stats are pretty wild, Ken. If you missed the best 10 days of the market because you were spooked, you thought, hey, it's going to go crashing. Well, you're going to really miss out on gains on the other side when the comeback does inevitably happen.

But, man, it's pretty rare that this kind of stuff happens. It's not every day that employers are just switching 401K providers, especially going a whole week with that money not sitting in any investment account. But it's just part of the reality of an employer retirement plan. You don't have all the control. That's right. Yeah, it stinks, but you got to move on. So, you know, you're okay. This is not a devastating play for you.

And it does stink, though. So sorry about that. Yeah, I will grieve with you on that one. Yeah, absolutely. That one stings. Ruby is up next in Washington, D.C. Ruby, how can we help? Hi, I was wondering if I should sell my home. Okay, tell us more. Why are you wondering about selling your home?

So I am over the 25%. I'm currently at 42%. I have a debt of $34,919. Total monthly income is $6,360. Mortgage is $2,660. And including utilities, it would be $2,990. Okay.

Okay, we can remove utilities from that. I'll clarify the parameter. It might help your numbers. I'm not sure yet. So the 25% parameter is, again, just a parameter. So if it's 27%, it's not like, go sell your house today. The goal is just to have enough money left over to fund your other goals, like investing 15% of your household income, putting away some money for college, paying off the home early, going on vacation, upgrading the cars, yada, yada, yada.

So the after-tax 25%, that is before any other deductions like your health care premiums, your 401k contributions. So are you factoring that in right now? Only the health insurance, which is about $220 a month. Okay. So if you subtract the $220 from that, that will help your 25%. And are you doing any investing right now, or do you have this debt to pay off? No. No investing. I have the debt to pay off. Okay. And what kind of debt was that? Did I miss it?

This is consumer debt. Okay. Is that combined or is that one debt? No, that's all combined. Okay. That was the $34,000 number you gave us? Yes. Okay.

All right. So if we take out the health insurance, you're likely maybe slightly under 40, still not a great position. So what I would tell you is this, selling your home is a very expensive transaction. And so I would not encourage you to do that unless there was no hope in sight that you were going to get your income up and your expenses down. So what are you doing for work? Is this a sole income for the household? Is it just you? Yeah.

No, this is me and my husband. Okay. And what does the upward mobility look like in your careers? Because if we get your income up, that changes these numbers drastically. Yeah, I would say in about just this year, I should be getting about a 7% raise. My husband, on the other hand, is probably going to lose his work permit soon, but we have high hopes that

So what does that mean? Is he going to go without income for two years? Then you definitely can't keep this house. What happens if he loses his income today and it's just on you?

That mortgage becomes 70% of your take-home pay, right? Yeah. The only thing I can do, because he brings in $2,400 a month, is I can rent out rooms that I have. I don't have any kids yet. That doesn't feel sustainable. No, this isn't good.

And I wouldn't trust, listen, I don't care who's in the White House. I don't trust the government to move on time about anything. So the two years could stretch into who knows what, throw you guys into a real tough situation. I absolutely would sell the house and rent cheap. You guys are in flux because of his work permit.

Correct. I would really think about this long and hard, and if it's a surefire thing he's going to lose his income, there's just no way we can keep living like this. So even if your rent is the same, there's still a lot less risk and less expenses that go along with being a renter versus a homeowner, so you might need to delay that dream a little while longer until we get some stable income, like $10,000 a month to afford a $2,500 payment. That's the math. Go call every social media app.

Hey, what are you still doing here? You know the rest of the show is happening on the Ramsey Network app, right? So you've got to jump over there to continue watching. You can download it for free. Just go to your app store, type in Ramsey Network. It's completely free, and I'll drop a link in the show notes to make it easy for you. So if you're watching on the app, you're in luck. But if you're watching anywhere else, this show is over for you. So jump onto the app and let the fun continue. All right, go on now. Don't make it weird.

Okay, I got nowhere to go, so you need to go. Okay, bye-bye now. All right, this is getting weird over there, guys. What do we do?