What Baby Step Am I Actually On? (Hour 2)
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What baby step am I actually on?
Live from the headquarters of Ramsey Solutions, broadcasting from the pods moving in a storage studio, it's the Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. We help people. build wealth, do work they love, and create actual amazing relationships. Christina Ellis, number one best-selling author, Ramsey Personality, is my co-host today. We invite you to join us. The phone number is 888-825-5225. Jacqueline in Phoenix is going to start off this hour. Hey, Jacqueline, what's up?
Hi, Dave. Thanks for taking my call. Sure. So I'm curious if I'm on Baby step two or baby step six, my husband and I had saved for a house and we had a down payment. And while looking for a mortgage, my grandmother offered to let me borrow from my trust fund. And the expectation was that I would pay it back because she doesn't want me to have my trust fund until after she passes.
How do I decide to become a stay-at-home mom?
And so I've been tackling the debt like it's baby step two. And my husband thinks maybe we should just chill out a little and tackle it like baby step six.
You said you had a down payment for the house previously. Is that correct? What was that down payment?
40%.
You had 40% down payment and then you borrowed from grandma?
Yes. Okay.
How much did you borrow from her?
$230,000.
Was that the rest of the house? Yes.
Okay. So you owe your trust fund for your home?
What financial considerations come with being a stay-at-home parent?
Yes.
Um, it's a bad baby step six. Okay. Okay. So, um, how much is in this trust fund?
Um, I don't know exactly, but definitely at least half a million.
Still after you took 200 out? Yes. Okay. So the trust fund was left from who to you? my grandma is leaving it to me is leaving it so she's already oh she opened she put the money in there while she's alive for you her granddaughter seven hundred fifty thousand dollars yes and then she agreed to loan the money from the trust fund to you what happens if you don't pay it um legally legally oh um i was told that i would just
get the balance of what's in the trust fund. So I wouldn't owe the trust fund any money. I would just get whatever's left.
So you did not legally do a lien on the house or the trust fund that is yours could actually foreclose on you.
How can I determine if I should return to work?
You didn't file a mortgage at the courthouse.
No.
Were there any paperwork signed?
Uh, yeah.
There was paperwork signed? Yes. On the loan?
It's more like just a document between my grandmother and me and a lawyer.
I'm sorry, say that again?
It's just a document between me and my grandmother.
And the document states that you're to repay this at a certain rate?
Yeah, she's paying a certain dollar amount every month until it's paid back or until she passes.
Is there interest on that?
No, it's an interest-free loan.
Okay.
What factors should I consider when evaluating job offers?
I'm curious, what is grandma's reasoning for not giving you the money versus lending it? Yeah, which is what she should have done.
Okay.
She just doesn't want me to have access to it until after she passes for some reason.
But she gave you access to it.
Yes, she did.
She's talking out of both sides of her mouth.
I guess she doesn't want my cousins and siblings to also have access to theirs.
Ah, she didn't want to set a precedent.
Yes.
that the others go, well, you did that for Jacqueline.
Oh, yeah.
Now that makes a little more sense. I was getting ready to get after Grandma here for a second. Well, it's baby step six for sure to answer your original question.
How do I balance family responsibilities with financial goals?
It's not two. It's a home mortgage. It's just a weird home mortgage. Agreed?
Yes.
Okay. There's no question about what this is for, what the money went to, why you have $200,000 in debt. It's all about this house. And if you were to sell the house, you would pay off the mortgage. If you were to refinance the house, you'd pay off the mortgage, which would be repaying the trust fund that someday will be yours anyway. Yes. Hmm. Okay, I'm going to get tacky. Are you okay with that?
Me?
What strategies can I use to increase my household income?
How old's your grandmother?
I was going to ask the same thing. Like early 70s, 72, 73 maybe.
Early 70s? Yeah. Okay. How's her health?
She's great. Okay.
So this is going to go a while.
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Chapters
8 chapters
1
What baby step am I actually on?
0:27–1:36
2
How do I decide to become a stay-at-home mom?
1:36–2:10
3
What financial considerations come with being a stay-at-home parent?
2:10–3:26
4
How can I determine if I should return to work?
3:26–4:18
5
What factors should I consider when evaluating job offers?
4:18–5:06
6
How do I balance family responsibilities with financial goals?
5:06–5:40
7
What strategies can I use to increase my household income?
5:40–6:17
8
How can I effectively budget as a stay-at-home parent?
6:17–39:31