We Have Over $2,500,000 Of Debt

[Music] brought to you by chm a biblically based alternative to health insurance learn more at chministries.org budget I have a question that um my wife and I bought a house worth around uh 2 uh 5 million um and uh we have another house which is worth around 1.3 million um and uh it has um 500k remaining um we have granted out uh it's around $4,000 per month so um our salary is around $900,000 um uh and uh yeah so we we were just kind of concerned uh um whether to kind of keep the rental property uh or sell it off um the rental is coming like pretty nicely like it's around um 4,500 which is kind of like covering all the mortgages and uh any other insurance and stuff like that so I was just wondering what your thought is on that yeah what is the mortgage on your current home uh it's around 2 million okay so you've got two and a half million you have any other debt outside of these two mortgages um just a car loan maybe uh 40K okay well you're calling us cuz your plan isn't working as you wanted it to there's some stress here and I would feel it if I was over 2 and A5 million in debt regardless of my income and how great things were right now in the back of my mind I I would be knowing this is a house of cards it could all come crashing down any minute yep and so you want to reduce risk in your life you're using language like well it's just a 40K car loan that's kind of what gets us here right you guys have an just undeniably insane income and yet what happens is you just go well we can acquire more and handle more payments and it leads us to this place where we have to decide do we want to keep going this down this road or do we want a more peaceful path so if I was in your shoes I'm going to try to reduce that risk so you have an amazing income how much extra margin do you have at the end of each month uh so we have around cash coming in around 25k um after all the four 401K savings and everything um we have around 1 million um in stock um and around 401K is around another million okay and the stock is non-retirement right it's vest fully vested uh yes that's correct so you could sell a whole bunch of that and knock out a lot of this debt you could knock out the car loan instantly and knock out the rental loan instantly and make about you know what a quarter progress on your own mortgage that's that's absolutely correct um my wife and I like so my wife kind of feels that the rental is self-paying so why should we worry about it let's just like the renters pay for for our mortgage pretty much and I'm trying to convince kind of like lowering the risk so I don't know um do you remember um I I don't know if you remember it was a while ago um there was this thing called covid and people quit working and then the local government said they don't have to pay rent and you can't evict them yeah remember that yep yep I do so I would I would I would assume the mortgage on your rental property is um not very safe because you don't you don't ever know and especially in California with the um squatting laws the res I mean I mean it y y'all are y'all have good tenants and God bless you CU those tenants can go south in a hurry and it might be 30 days 60 days 90 days 6 months two years you got get tied up in court but the bank doesn't care they want to get paid every month and the other risk is having all this money tied up in a single stock and a single company so I like the idea of offloading it for other reasons other than just getting debt free my mom worked at this company called Enron that used to do that gave everybody a lot of stock and I had friends who went to bed millionaires who woke up one morning with zero dollars because all their retirement was in stock in that company so yeah man if if you're talking to me and George our families our houses we'd sell that stock and start paying off everything we own man I'd much rather have two tangible assets two homes I can go see than a company saying no no no I promise we're worth it I'd much rather that man okay and especially you're too rich to be holding a depreciating a Al loan on a depreciating asset like a vehicle man okay sounds good so I have some extra like $55,000 um per month that I can contribute towards my mortgage do you recommend me putting that into the mortgage too yeah once the car is paid off then your next step you know if if you're filtering this through our Ramsey Baby Steps you should be completely Consumer Debt free with a fully funded emergency fund then begin investing 15% then any money beyond that can go to kids college and paying off the mortgage early okay and with your income I think sit down with your wife show her okay here's where we're at here's where we could be and if we go down this path we sell the stock we become debt free we free up that rental mortgage payment we free up a car payment we have all this extra money we could tackle our own mortgage and probably be done with that with your income in under five years yeah that's pretty amazing and how old are you two um we are 39 and 40 think about that you're in your mid-40s and you will have I'm not even saying sell the rental property you could keep it if you're going to knock it out and reduce some of the stress and increase the cash flow you'd be sitting with a about a $4 million net worth of paid for property in your mid-40s and a million dollar in your retirement fund yeah so you're worth five million bucks free and clear and here's the thing you have then that you don't have right now absolute freedom peace and guess what your buddies are going to think this advice is stupid they're going to be like you should buy nine more properties and leverage all the debt and do HELOC on the first one that's what's going on out there in the culture but they don't live your life they don't pay your bills they don't know what happens inside your home what's happening inside your body how you're feeling about it and that's where John and I go we're solving for Freedom all day long and you're in a amazing position where you have a million dollars sitting there in stock you have about a million doll income this problem is pretty easy to solve but the hard part is the choice and getting your wife aligned on this I think the new um the new wealth moving forward in the 21st century George is can you fall asleep on your pillow at night I think the new the new status of wealth like Dave used to say it's not the it's not the BMW I think the new status of wealth is nobody owns me and my family me and my family have freedom we've got peace and man I don't care how little or how big your salary is solve for that man you change everything in your home well said thanks for the call n good conversation chm isn't health insurance it's a health cost sharing Ministry check it out for yourself at chministries.org budget