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Chapter 1: When is the right time to buy a house?
Live from the headquarters of Ramsey Solutions, broadcasting from the pods, moving in storage studio, this is the Ramsey Show. It's where we help you win in your life, specifically your money, your work, and your relationships. I'm Ken Coleman, joined by my colleague, George Campbell. We're here for you this hour, 888-825-7000. 5-2-2-5, 888-825-5225.
We've been called the root beer float of the Ramsey show. A lot of duets with the Ramsey personalities and Dave. Every day brings a different duet, as I like to say. I like that. So hope you like the root beer floats.
Well, the explanation is two ingredients. This is from a fan review. They said two ingredients that are great on their own, but when brought together are magic.
yeah i i you know i i didn't want to go so far as to that big of a compliment of ourselves but whatever it's from a fan i don't agree whatever you think the beverage we are today but we are here together and uh always enjoy being with george we have a lot of fun and so let me set the tone here of course we're gonna take your money questions george is ready to go he's got his bomber jacket on i got my pen he brushed his teeth just moments ago back in the bathroom i ran into him he's freshly brushed and flossed and george can answer your money questions
And I'll weigh in, but I'm here to answer any work questions. And when you talk about money, George, you've got to think about work. Your income is your greatest wealth-building tool. How can you make more money? How can you enjoy work? If you're feeling stuck but I'm in the baby steps, can I move? Can I pivot? The answer is yes. I'll take any work-related questions.
Maybe you're dealing with a toxic boss or coworker, and you just, hey, you know what? I just need to be encouraged. I need to stay the course. We'll take some of those questions. And so we're ready to go. We've told you what to expect, and let's do it. Terry is up first in Tampa, Florida. Terry, how can we help? Well, let me hit the button. That helps to get Terry on the line.
Well, I'm trying to hit line two, but I've done something wrong.
I trust that Ken knows how to hit a button, so I think we have some technical difficulties. It's all good, just a technical difficulty.
There you are, Terry. I'm sorry. You're welcome here on the Ramsey Show. What's going on?
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Chapter 2: How can you determine if your side hustle is ready for full-time?
I was calling because I was wondering if it is a good time to buy a house as a woman in her early 20s.
Now, what does a woman have to do with this, or a woman in her 20s for that matter?
That's true. So the real question is, is it a good time to buy a house? And that time has nothing to do with necessarily the time in which we live, but what, George?
Your financial situation. Boom. So talk to us about that. What makes you think you are ready or are not ready?
Well, I think I'm ready because I finished paying off my $30,000 in student loans. Awesome. And I have a bit of money saved for my future, future family, all of that. When I say good time, I don't mean due to the market or anything like that. Just as we all know, your 20s can kind of be a little bit of a roller coaster and we don't know what's to come in a few years.
So financially, I believe I could buy a house. I just don't know if it's a good time for me.
Okay. So you have no debt now. Do you have an emergency fund of three to six months of expenses? Yes. And then beyond that, do you have a down payment saved?
Yes.
How much do you have saved for the down payment?
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Chapter 3: What should college students realistically expect to earn?
So then we go, okay, with a $45,000 down payment, and we want to keep the mortgage payment at around $2,500, how much house can we buy? And let your budget dictate your home price versus what you feel and what you want. And that helps you step into this thing with a lot of peace and wisdom. And then you can start shopping.
That sounds awesome. Good plan.
Terry, you are awesome, and this is exciting. So, again, George, you feel good about that, don't you?
I feel really good because it has nothing to do with her being a woman or her being in her 20s. There's men in their 60s who aren't ready to buy a house. There's women in their 20s who are absolutely ready. I love it.
All right, next, let's go to Trey in Sacramento. Trey, how can we help? I'm doing good. Thanks for taking my call. You bet. What's up? We've got about two minutes here, so get to the point, and we'll try to help you out as quickly as possible.
Yeah, no problem. So my side hustle has actually taken off quicker than I thought, and I'm trying to figure out when the appropriate time would be to get away from my standard job and move full-time into the entrepreneurial life. Right.
What is the side business?
Digital marketing.
Nice. And what do you do for a full-time job, and how much do you make?
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Chapter 4: Do Baby Steps Millionaires really need life insurance?
I like your timeline.
With his caliber, I'm like, he could leave today and go do it. I think he's going to be fine, but there's going to be a lack of cushion there. If he waits a few more months, nothing wrong with that. He's going to have an astronomical career ahead of him as an entrepreneur. Can we talk about Terry and Trey Supercallers? Is this going to be a weird show of unicorns?
I don't know, but I am impressed. They need to be behind this desk. TNT. Crushing it. They're tearing it up. I love it. Don't go anywhere. He's George Camel. I'm Ken Coleman, and this is The Ramsey Show. Welcome back to The Ramsey Show, where we help you win with your money, your work, and your relationships. I'm Ken Coleman, joined by George Camel. And we are here for you this hour.
The phone number to jump in is toll-free. It is 888-825-5225. That's 888-825-5225. And callers are standing by. We'll get to them. But first, George, you've got an article in your hands. And I've talked a lot about this on The Ken Coleman Show because we're helping people win at work. And college grads have got an overinflated view of what they could make and should make.
Is that a fair way of saying that? That's a very fair way. And you get some more data on your hands.
Yeah, this is pretty wild. As hiring demands increases from CNBC.com, the average starting salary for the class of 2022 is projected to be more than $50,000. Okay, checks out. However, current college students expect to earn twice that, $103,880 in their first job. According to one report.
Yeah. That's a problem. It is a problem. It's not realistic. The market's not there. The question is, and I've not seen any of these articles that offer an opinion as to why. I think I have an opinion, but what say you?
I interviewed a bunch of high schoolers, and when I talked to them, they all were like, well, yeah, I'm going to make six figures when I graduate. I was like, what makes you think that? Right. Right. There's no reality. It's just kind of this wet finger in the air. And I think I deserve. And the way things are going with the economy, you need to make $100,000.
So I'm just going to go make $100,000. Yeah.
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Chapter 5: Is it worth staying in a dead-end job for benefits?
George, you are going to have unmet expectations. Ooh. And so that starts you off right out of the gate with a certain amount of resentment. Yeah, and cynicism. And frustration and everything that comes with that. And so this is interesting. So the number is they're expected to start at, you said it was 55? Well, they're expected to start at just over 50.
Oh, just over 50,000. But their expectations are that they're going to make 103 plus. And it says 10 years into the careers, students anticipate making more than $200,000. Yeah. Well, so they're way overestimating their starting salaries. One report says by 88%. And so they need to understand what degree am I after? What are the jobs on the other side of that degree?
And what do those jobs pay in my area with my experience?
All right. So now I want the steps to take. Yeah, I agree. And so we want to know, okay, what does it look like? They've got to know the industry. And then more importantly, young people, listen, go hang out with women and men who are winning in your industry. And then say, hey, if I'm going to make or if I want to make $200,000 in 10 years, what would need to be true?
Like, let's just get some real coffee and some real knowledge so that you have an idea of what you need to expect. Now, I want to flip this for a second. In my hands here, I've got an article. I like that. I bring my own sound effects. And this is an op-ed on Fox News. But listen to this. The world is changing as it relates to college degree and professional success. Now, George, you know this.
I talk about this all the time ad nauseum next to your desk. And it makes me nauseous. It does. I talk about it too much. I'm very passionate about it. But the leveling of the playing field is here, and it's good for people who don't have a degree. Now, there are people that are listening and watching us right now.
They feel stuck because they don't want to go get another degree because either they want to pivot and they feel like they need that qualification or they don't want to stay in the same field that they're in with the degree they have. And they think, oh, I need a degree. Maybe not. But here's how it's changing. The headline here is employers are wising up.
Between 2007 and 2019, George, the share of job postings requiring a four-year degree rose more than 60%.
Wow.
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Chapter 6: How can living off debt impact your financial future?
Great call. So that the degree and the credit score have become somewhat of the same thing. It's a measuring tool, but does it actually matter? We know it doesn't. You bought a house without a credit score. That's right. And we teach this all the time. All right, so real quick, though, here's what's interesting.
In 1990, this is the same time that we begin to see a real difference in prime age workers who are earning between $60,000 and $80,000 a year. So 38% earning between $60,000 and $80,000 a year had a bachelor's degree. Today, the proportion is 52%. So it's about degree, degree, degree, but listen to this.
Four in 10 recent college grads work in jobs that have not traditionally required a college degree. And in that case, the college graduates in non-college degree requirement jobs are earning more than $10,000 less. In other words, the way they write that's confusing. Sure. If you have a college degree, you're making over $10,000 less than than your compadres who have no degree.
So all that to say, two questions that I teach for our new audience members. If you've never heard me say this before, there's two questions you can ask. Is a degree the only way to get the job I want, or is it the best way? Now, you've got to dig, but the research is readily available, George. It's not a mystery. No. And the answer is no to either one. Here's the great news.
There's more and more jobs coming online. You have state governments. I didn't mention this. Eleven states now have removed college degree requirements for you to get a job in their executive branch. Eleven governors said, we're changing it. So I just think this is a trend that is not stopping.
It's a great shift. I'm very happy about this shift. And the truth is, anecdotally, as we take calls on the show, the folks that have degrees, they call in and they go, I'm making $40,000 and I'm $100,000 in debt. The folks that don't have degrees, they call in and they go, well, I'm 19 and I make $80,000 as a welder and I have no debt. That's right. And I go, who would you rather be? Yeah.
And guess who's not desperate for the raise and not struggling and anxious in their job? The guy who has no debt, who's making 80 grand with no college degree. So I'm just tired of this system that's pushed all of these kids through to focus on a degree without thinking about what's on the other side.
Well, let's not forget that we pushed them into this. They were told it was the right way to do it. And then they come out of school and the debt payments are killing them. They don't feel like they're ever going to climb out of the hole of the student loan. And then a politician comes along. And they promise that we're going to wipe away $20,000 worth of your loan.
And they hold on tight for years. And then you find out that some judges wearing black robes said, nope, can't do it. And they're left holding the bag. And that stinks. And so look out at the future. Look at the now and go, wait a second. Do I need a degree? And if we look at the technology field alone, George, just the technology field,
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Chapter 7: What steps can you take to transition your side hustle into a full-time career?
They are desperate for people who can come in and work. And you and I were at a conference recently where Malcolm Gladwell, on the stage at our Entree Leadership Summit, said that he was talking to a well-known professor at an Ivy League school, and he said, what would you tell your kids about their future, his young kids? He said, I'd tell them to get into trades. That's powerful.
This is an Ivy leaguer, you know, an elitist. And if you will, for people like to make fun of the point is, is he's even saying the value is not there. Yeah. And so all that to say, this is, we have this conversation because George, so many people make bad financial decisions under the guise of, well, I had to do it.
Well, we've let the degree dictate what job happens versus letting the job dictate whether or not we even need a degree.
There it is.
We've got to make that change. And if you want to learn more about this, we explore it in our documentary called Borrowed Future. It's completely free on YouTube. There's also a podcast series I hosted around the same topic. And it will open your eyes. Watch it with your kids and start the conversation now.
Also, we have a great resource at our website, RamseySolutions.com, called Debt-Free Degree. It's a great book, easy read. You can go to college without the debt we want you to. All right. More of your calls. People are lining up. Don't move. Quick break. Right back with more of The Ramsey Show. Welcome back to The Ramsey Show. I'm Ken Coleman. I'm joined by my colleague, George Campbell.
We're here for you this hour, taking your questions about money, about work-related issues that have some tie to money, and relationship issues around all of that. George and I are here for you. 888-825-5225. Let's stay right here in our backyard, Nashville, Tennessee. Jessica is there. Jessica, how can we help?
Hi, guys. So excited to be talking to you. So I'm toying with my next career steps and I'm considering possibly going back to school and I'm not sure where in my budget that saving would go or come from. Okay.
I just need some help. What are you doing now and what do you want to be doing?
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Chapter 8: What advice do experts give about financial planning for young professionals?
So I'm not absolutely certain. I'm just considering it. And before I do anything, I just want to make sure that I have
the money to do it because i don't want to take out student loans i've never been in debt and i refuse to be in debt all right so before we go that step though i want to make sure that accounting is the the path so before we even talk about the money i love that you're calling us okay i love that but the step before we get the money saved up is do i really want to go into accounting
You know, do I want to be a financial analyst? Do I want to be a CPA? And I really want you to practice what I call the proximity principle. In fact, I'm going to give you my book. It was the number one bestseller, and it's called The Proximity Principle. And it basically says this.
In order to do what Jessica wants to do, she's got to be around people that are doing it and in places where it is happening. And this is if we decide to do it, but you can begin to use the proximity principle to get around people that are in that field. This is coffees, this is lunches, breakfasts. Hey, I want to hang out with you and I want to learn more about what you do.
The ins, the outs, the good, the bad, the ugly. What was the right path for you? And we want to determine, do I need a degree? After we determine, is this something I actually want to do? And so if you figure out, is this something I really want to do? Because I've talked to people and I've essentially done a term paper.
And my heart has said, yes, this is absolutely what I want to do after talking to people, observing them, shadowing them, whatever that looks like. And then we go, okay, do I need a degree for that to go that path? You might need a certification. You might need the degree. But if you do all of that and you go, I absolutely know that I know that I know I want to go that direction.
And now we know we need the degree. Then we say, all right, now I'm going to cash flow it. Okay. Are you there?
Do you feel like that's definitely the path?
No, it makes sense, and I am there. I have a couple friends who are accountants, and I've been talking to them and slowly researching it, but I definitely need to amp it up.
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