I'm 62, $79,000 In Debt, And Have No Retirement

Brought to you by CHL, a budget-friendly, faith-based alternative to health insurance. chministries.org slash budget. I'm 62 years old and about ready to claim social security, but I have about $79,000 in debt and I got a letter from the consolidating to consolidate it by stopping your credit cards. And so that was the first question I've kind of listened over and looked at the show. It doesn't, you know, like that's a bad idea from what I hear you guys say, or is it a bad idea? Or, and I own three houses. Okay. Tell us about one of those houses. I'm going to go short answer. Likely. Yes. Short answer. Yes. Debt consolidation. It is not the answer to this situation. It rarely, I would never suggest it as the answer. The reason is what it's doing is something you could do, which is not pay your debts, pool the money. And then when they're ready to settle, now you can make a settlement. That's all they're doing. And they're just doing with fees attached. So you don't need help doing that. Tell us about the three houses because your, your solution is likely there. Well, I, the thing is I have renters that I've rented for forever and to sell one of the houses, I'd have to be putting a family out. That's true. And they really aren't in that position. And I, so far I haven't been able to do it. And I have problems there just because they have five kids. Are your prices competitive or are you giving them some sort of a deal that they wouldn't be able to get elsewhere? I'm probably very, I'm very low on, on, on that house that I would sell. Okay. Let's go to the other two. We'll set, let's set that one aside. We appreciate your heart. What about the other two houses? Give us the numbers. Um, one house rents for 1350. Um, it would sell for 170,000. How much would you make on that? Oh, I don't know anything on the houses. Okay. So it's all, it's all profit. That's house number two. Let's go to house number three. Um, house number three is a, it's basically a rental apartment, but it's a home. Um, but it's not very big. How much is it worth? If you sold it today, how much would you pocket? It's on my property, on my house, my own house. Okay. So I, I couldn't sell that part of it. You know what I'm saying? It's just a spare house. Okay. So, and you just happen to figure out a way. Just for the heck of it. What is the house that the family of five or the family of five kids, how much is that house worth? Um, down the street, it worked. Um, one of the house went for one seven. Okay. So this is, this is a no brainer to me. Can, can I ask a question before? Cause I know what you're going to do. I just am curious for a guy who's got two cash houses. Why do you have $79,000 in debt? If you missed health plan, open enrollment, don't panic. Christian healthcare ministries offers a budget-friendly alternative to health insurance, and you can join at any time. With CHM, there are no network restrictions and members say they often save hundreds of dollars a month compared to traditional insurance. So make a change that fits your budget, your values, and your timing. Check out chministries.org slash budget to learn more. Why do you have $79,000 in debt? I spent too much. But you paid off these other houses, right? Well, I paid off the other houses a while ago. Um, basically I paid cash. I turned in my 401k on my, my retirement when it dropped so much in 2008, I got upset that they took all that money. I lost a lot. And so I took the rest of it, paid the fees and bought the house. Oh gosh. So you have nothing in a 401k? Oh, I have nothing now. Understood. So your income, your income will be, uh, then, then go back and tell me again, what's the rent from house number one with the family of five? What, what's your rent on that? What do you take? 1,100. And, and what goes away in, in, in fees and upkeep? What, what do you actually pocket as profit from that house? Um, there's not much fees. I haven't been much fees and upkeep over the last couple of years. Well, I mean, certainly you take some, certainly you take money out in case the AC goes out or in case it needs a repair. Uh, I'm a plumber. Okay. So I kind of fix things. So for round numbers, for round numbers, I'll use the 1,100, but I want to encourage you to know what the numbers are less upkeep, because that's going to give you a clearer picture of how well this is doing. Um, tell me, tell me the rent on number three, the one that's on your property. Uh, a thousand. A thousand. So, so far we've got 2,100 and what's it take? Are you going to be drawing? You said you're going to draw social security here soon. What will that be? Yes. Um, 2,000. 2,000. Do you think you can hold on until later so you can get a higher amount? Um, no, I, I've already signed up for it and I don't know some health problems. I'm not sure. I want to wait. Are you currently employed? I work for myself. I own a plumbing business. Okay, great. What do you pay yourself out of the plumbing business? Um, I, I, I basically don't know. I pay the, I pay for the plumbing parts and the plumbing bills, and then I pay my taxes. Are you busy? Are you busy? Um, I work as, I work, I work as much as I want every day. Okay. I don't push it as hard as I used to. Cause your health. Eight to 10 hours a day. Well, you got no, you got no retirement. You got no retirement. So you need to sell at least one of these houses and clear off the debt. And then Jade walk you through, you've got to start reinvesting in now. Yeah. So, I mean, here's the thing. We need real numbers. I have a feeling, obviously you don't have a budget. What I'm gathering is you're bringing in somewhere around 4,000 to 4,100 a month plus whatever plumbing you do. We don't know what that amount is. Um, the equation we need is how much does it cost for you to run your lifestyle minus the debt? Cause we're going to pay the debt off. So we need to find out how much does it take to keep the lights on, keep the water going, keep food on the table, keep the vehicles running. Um, if it's 4,100, you're okay. And you can make this work. Uh, what I would suggest is just what Ken said. We're going to sell house number two and we're going to take the 79 of the a hundred thousand and we're going to pay off the debt. And then you're going to take 90,000. And I would say keep three to six months of expenses out, keep that in a high yield savings account. And then the rest, you're going to plop it in some nice mutual funds. And if you, if you can, after this call, uh, go to Ramsey solutions.com, uh, slash smart Vestor, I believe is what it is. And I, I want you to get with a smart Vestor pro because investing some of this money is going to be helpful for you. It's not going to be the break free point for you. I think at this point, um, I think at this point for you, keeping these paid for, um, real estate is going to help you live. Like you can't afford to sell these just yet. So keeping the rent on them is probably going to be a big, a good move for you. And if you get to the point where you can no longer be a landlord, you're selling those and you're popping those into a 401k as I'm sorry, into a Roth IRA as well. Really? So you don't think you should sell one to clear the 79? If he sells it, he doesn't have any income. I told him to, no, no, no, no. I told him to sell number two. Okay, good. I'm talking about the other two, the one that's on his property. He can't sell that one anyway. I agree. But I would tell you the one with the family of seven with five kids, appreciate your heart, but they need to at least be paying market rent. That's true. And then at the same time, if you need to unload that to take care of yourself, you can give them plenty of advance notice to where you're not kicking them out. That's true. That's true. You can't just be the, you know, whatever you've fashioned yourself to be this hero here. Um, it doesn't make you a bad guy. There's a way to go about it in a way that does not, you know, make life for them really uncomfortable and stressful, but that's something to be thinking about. And I agree. You need to sit with a smart investor pro tomorrow and begin to plot out your future. Christian Healthcare Ministries can save your family hundreds of dollars on healthcare every month. Learn more at chministries.org slash budget.