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Chapter 1: What are the five misconceptions about the Ramsey Plan?
Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studios. It's the Ramsey Show, where we help people. Build wealth, do work that they love, and create actual amazing relationships. Open phones here at 888-825-5225. Jade Walshaw, Ramsey Personality, is my co-host today. Open phones at 888-825-5225.
Jade just finished leading a Ramsey Personality Coordinator FPU class.
That's right.
And that's the second time you've done that. That's right. I mean, as a Ramsey personality, you've done it many times before you joined us here. Went through it several times before you joined us here. Yes.
I think it's a good idea occasionally to stop and say, okay, if you're going to go through a nine week class on how to handle money, the class that more people have gone through than any other financial class, right? Over 10 million people have been through it. No one's even a close second. So it is, it is the one, it's the goat. It's number one, right? And so there we go. And, um,
But why do so many people go through it? What happens while you're in there? And you just led this class, so give me some...
insights as a coordinator you watch the light bulb come on over the top of people's heads i do i watch people get introduced to concepts that they haven't thought about before or it hasn't been explained to them why it's important for for example everybody knows the word insurance oh yeah i'm supposed to have health insurance i got car insurance but most people are so confused about insurance they don't understand how much coverage they need they're underinsured they don't realize that or they're overinsured they're overinsured insurance
yeah and so and a lot of folks when they first get connected with Ramsey they're like oh yeah I heard about the baby steps I'm on baby step two I need all my money insurance can wait so I can pay off my debt and that is one of the biggest things that we find is people are willing to sacrifice sometimes in the wrong areas in order to pay off their debt but it is so important that you get covered when it comes to your insurance it's not waiting until a particular baby step it's as soon as you find out about it you need to get it
If you don't have car insurance, you need to get car insurance.
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Chapter 2: How can high-income earners still find themselves broke?
You'll get some of these insights. Check out RamseySolutions.com slash FPU. We can get you into a class, and we can get you leading a class. By the way, you can go through for free if you're the leader. That's pretty cool, too. This is The Ramsey Show. Jade Warshall, Ramsey Personality, is my co-host today. Brittany is with us in Kansas City. Hi, Brittany. Welcome to the Ramsey Show.
Hi, Dave.
Hey, what's up?
How are you?
Good. How are you doing?
I'm good. I'm nervous to be here.
It's okay. How can we help?
I had a quick question. So my husband and I have had issues with buying used cars. We're not car people. And most recently, we wanted a reliable SUV, and we had it for six months, and the engine locked up, and we spent $8,000 on it. And so we're really looking for advice on... what we should do next.
It's very tempting, I feel like, to buy a new car because we need something reliable and we don't want to have to worry about buying a used car and issues happening to it. So I was wondering your advice around that.
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Chapter 3: What should you consider when selling a house to move closer to work?
But we're both 27, so I don't want to do anything stupid. Okay. We bought this house for $387,000 in February of 2022. Since then, our property has decreased in value, not increased. How? To $335,000.
Who said?
The market.
No.
Realtors, the comps, all that. Yeah, it's crazy.
Did you massively overpay and get in some weird bidding war when you bought it?
I did not get in a bidding war. We got it from a new construction. That's what they were asking. We fell into the, like, we'll offer you, like, so much down for closing things. So, I mean, I think it was $380 after they paid closing costs. But our home has lost a lot of money over the past year, literally a year.
Kathleen, something's wrong. Because Austin, Texas has not lost real estate value.
Okay, so we're in the suburb of Austin in Kyle, Texas.
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Chapter 4: How do you balance spending on hobbies while building wealth?
Cause you've done a really good job.
You know, I haven't really given it a significant amount of thought in terms of prepping for when I want to retire. It's really just been head down and saving as much as I can. I would have liked to have saved more, but, uh, you know, it's, uh, focusing on the future. I really haven't given it much thought. I just know that I should probably buy a house, those that store the cars,
But then that comes with costs and it's like, how should I balance that between trying to retire early if that's an option?
Well, it's all about your ratios and how you're spending your money. So you said you make an income of about a half a million dollars. Is that right? Yeah. So when you go to look for real estate, you want to make sure that what you're looking for is not cutting as a percentage too far into your, you know, take home pay, which you've got a lot to work with, but you're also in a very expensive area.
And so when the time comes to purchase real estate, the way that we would do it, obviously, in your situation, obviously you want to save up a large down payment, but whatever you choose, you don't want it to be more than 25% of your take-home pay so that you're leaving more of that income to do the things that you want to do in your case, build more wealth, right?
So a good way of thinking about this is that there are three things you can do with money, and you always need to be doing all three. You need to be generous, you need to be saving investing, and you need to be enjoying it. Okay? So we've covered saving and investing. Buying a house is an investment. Investing for wealth building is there. Lifestyle would be vintage cars, enjoying, right?
Um, so you need to, you need generosity in your mix and you could decide that. But when I work with, and I've worked with, uh, like famous people or even not famous people that make a bazillion dollars. Okay. Like I sat with a guy not long ago, made 15 million last year. So how do you decide what to do with that? Um, all I want to do is put a percentage of my income towards each thing.
And the total is $100, okay? So what percentage of my income after taxes is going to go to generosity? What percentage of my income after taxes is going to go into investments? And what percentage of my income is going to go to lifestyle? And Sharon and I do that now, Brian. So, like, I got a really nice check in the other day from the publisher on Total Money Makeover. It's a big old check.
And I've already know where that's going. A certain percentage, number one, 50% is gone before I start because, you know, government's going to take 40%. And I'm going to give a tenth because I'm an evangelical Christian. My baseline generosity is a tithe in my case. And so that's 50 percent. OK, 40 for taxes and 10 for that. That leaves me the other 50 percent.
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