Latest news with #DaveRamsey
Fast Company
a day ago
- Business
- Fast Company
The real reason a staggering 40% of U.S. homeowners are mortgage-free
Want more housing market stories from Lance Lambert's ResiClub in your inbox? Subscribe to the ResiClub newsletter. Here's a stat that would likely make financial adviser and radio personality Dave Ramsey—who has long advocated for Americans to pay off their mortgages early as a key pillar of his debt-free philosophy—at least somewhat pleased: A staggering 39.8% of U.S. owner-occupied housing units in 2023 were mortgage-free, marking a new high for this data series. That's up from 39.3% in 2022 and 32.8% in 2010. Among the 85.7 million U.S. homeowner occupied households, 34.1 million are mortgage-free. The other 51.6 million have an outstanding mortgage. So why did I say it'd only make Dave Ramsey 'somewhat pleased'? Well, the reason is that a higher percentage of Americans are mortgage-free isn't necessarily because so many are paying off their mortgages faster. Instead, it reflects a powerful underlying demographic shift: the aging composition of the American population. As Americans live longer, the U.S. fertility rate declines, and the massive baby boomer generation ages into their senior years, the U.S. population has skewed older. Since older homeowners are more likely to have paid off their mortgages, the aging composition of the American population means a larger share of homeowners are achieving mortgage-free status each year. The other thing is that when older Americans sell their house and buy another home, they're more likely to rollover their equity and purchase that next home in all-cash. Given that most demographic forecasts expect the composition of the American population to continue shifting upward in age, the share of mortgage-free households could also continue rising in the years to come. The wild card? If reverse mortgages get more popular and more older Americans take on mortgage debt again to tap into their equity.
Yahoo
a day ago
- Business
- Yahoo
Dave Ramsey gets frank with Seattle woman $100K underwater on Florida home — what he says to do about her ‘sunk costs'
When Sarah from Seattle recently called into The Ramsey Show, Dave Ramsey described her situation as 'a ticking time bomb." She owns a condo in Seattle with a $2,300 monthly mortgage plus homeowners association (HOA) fees, and purchased a second property in Florida last year at the top of her budget. Don't miss Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how I'm 49 years old and have nothing saved for retirement — what should I do? Don't panic. Here are 6 of the easiest ways you can catch up (and fast) You don't have to be a millionaire to gain access to this $1B private real estate fund. In fact, you can get started with as little as $10 — here's how Now, the Florida mortgage costs her $4,000 a month, rental income of $2,700 doesn't cover it and the property remains in negative equity. Why she's underwater Originally from Florida, Sarah knew she eventually wanted to return to be near her aging parents. She says she "freaked out because of the housing situation.' With prices going up, she worried that if she waited too long she'd get priced out of the market. So, she went ahead and bought the second property. Shop Top Mortgage Rates Personalized rates in minutes A quicker path to financial freedom Your Path to Homeownership Unable to rent it out for more than a year, Sarah finally has tenants, but their rent falls $1,300 short of her monthly mortgage payment. She's spent approximately $23,000 in closing costs and $50,000 more trying to sustain the property. Despite having $50,000 in savings and a strong take-home pay of $8,600 a month, she simply can't afford to live this way anymore. Ramsey and cohost Jade Warshaw strongly recommended that Sarah sell the property. 'You have a problem here that is not going to get better … If you have to write a $10,000 check to get rid of your mistake, do it,' Ramsey asserted. The pair recommended immediate action, first by quickly listing the home. Ramsey warned she'd pay some "stupid tax" for her mistake, but she needed to take a short-term loss to stop the financial crisis. "You're going to get some of your money back, but you're not going to get all your money back," he said. Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says — and that 'anyone' can do it The sunk-cost fallacy and its dangers Sarah's reluctance to sell stems from the sunk-cost fallacy: the belief of having invested too much to walk away. Ramsey warned against this mindset. "There may not be a way to get back the money that's lost. You're doing well if you can break even … Mistakes cost you,' he said. Ramsey and Warshaw advised Sarah to focus on cash flow, not past expenses, cautioning against letting emotional attachment or fear keep her trapped. If she keeps the home, they warned that the situation could get worse through things like insurance issues, vacancy cycles or emergency repairs. "We're trying to stop the bleeding, not reverse the fact that we had a car wreck." Sellers in Florida markets like Miami are increasingly delisting homes rather than cutting prices, suggesting buyers are becoming scarce. Meanwhile, Florida home prices dipped 2.2% year-over-year to a median of around $412,400 as of May 2025, according to Redfin. These conditions give all the more reason for Sarah to get out of the market sooner than later. Plus, carrying the property risks continued price drops, increasing home insurance and HOA costs and the chance of foreclosure. Florida had 2,780 foreclosure starts in May 2025, among the highest in the U.S. Homeowners there face rising insurance premiums, with the average cost increasing 45% from 2017 to 2022, alongside higher HOA fees and property taxes — all putting sellers at risk even in rising markets. Nationwide, it's not much better. In May across the U.S., housing prices were up just 0.6% to $440,910, while the number of homes sold was down 4.5% year over year. Affordability continues to suffer due to high mortgage rates and regional oversupply. What to read next Robert Kiyosaki warns of a 'Greater Depression' coming to the US — with millions of Americans going poor. But he says these 2 'easy-money' assets will bring in 'great wealth'. How to get in now Accredited investors can now buy into this $22 trillion asset class once reserved for elites – and become the landlord of Walmart, Whole Foods or Kroger without lifting a finger. Here's how Rich, young Americans are ditching the stormy stock market — here are the alternative assets they're banking on instead Here are 5 'must have' items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you? Stay in the know. Join 200,000+ readers and get the best of Moneywise sent straight to your inbox every week for free. This article provides information only and should not be construed as advice. It is provided without warranty of any kind. Sign in to access your portfolio
Yahoo
2 days ago
- Business
- Yahoo
'Really, really scary': Dave Ramsey urges caller not to join grandma's scheme to deceive IRS about $1 million debt
Sarah and her husband rent a place in Los Angeles and are expecting their first child. But she called into The Ramsey Show because of a tricky situation involving her mother-in-law, homeownership and the IRS — one that caught host Dave Ramsey off guard. Why? Because this caller's situation includes $1 million in debt and potentially deceiving the IRS. 'Sarah, there's just so much going on here that you're not talking about or you don't know,' Ramsey said in a clip posted July 12. 'And it's really, really scary. There's a line of crazy running through this conversation.' Don't miss Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how I'm 49 years old and have nothing saved for retirement — what should I do? Don't panic. Here are 6 of the easiest ways you can catch up (and fast) You don't have to be a millionaire to gain access to this $1B private real estate fund. In fact, you can get started with as little as $10 — here's how Here's what was revealed during the exchange. A questionable situation Sarah's mother-in-law currently lives with the couple in their rental home. However, Sarah says her grandmother-in-law has offered to buy her mother-in-law a house in Sarah and her husband's names so her mother-in-law 'is not docked by her unpaid debts from the IRS' — and the three would continue to live together in the new house. 'She has a lot of unpaid debts and so grandma is trying to take care of her by providing a home,' Sarah said. Her mother-in-law, 55, is going through a divorce and lost her job in September after a corporate restructuring. Right now she's making DoorDash deliveries to bring in some extra cash. She's also apparently $1 million in debt. When Ramsey asks why her mother-in-law is almost $1 million in debt, Sarah responded: 'I don't ask questions.' Sarah says she adores her mother-in-law, but wants to know if this setup would be a wise decision and, if so, what they need to 'have on paper.' Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says — and that 'anyone' can do it Why this is unethical Ramsey answered clearly: 'I would not do this.' He said, by doing so, 'you are tying yourself to people you don't ask questions about, permanently, and you are taking away her reasons for getting back on her own feet. This is not good. It is not healthy.' He said Sarah's mother-in-law needs to recover from the grief that comes from ending a marriage and experience 'what's known as a life — not hiding at her son's house from reality.' Secondly, 'the whole reason to do this is to deceive,' he said. 'Your grandmother-in-law is teaming up with her daughter and using you guys to deceive the people that she owes,' Ramsey said. 'This is deception and I'm not going to participate in that. It's a lack of integrity. It's unethical.' Ramsey guessed the debt belongs to the mother-in-law's ex-husband — perhaps unpaid IRS debt from a failed business venture. It's possible the mother-in-law had nothing to do with it, in which case she could potentially get rid of the debt using innocent spouse relief. Innocent spouse relief can 'relieve you from paying additional taxes if your spouse understated taxes due on your joint tax return and you didn't know about the errors,' according to the IRS. 'I got a feeling she didn't buy purses to get to a million dollars [in debt],' Ramsey said. If the mother-in-law qualifies for relief and grandma wants to give her daughter some money to clean up any debt that's left over, 'I got a feeling it's not going to be that much,' Ramsey said. He also believes this is a better option than buying a house under deceitful circumstances. 'That would be the ethical thing,' he said. 'Try to settle it.' What to read next Robert Kiyosaki warns of a 'Greater Depression' coming to the US — with millions of Americans going poor. But he says these 2 'easy-money' assets will bring in 'great wealth'. How to get in now Accredited investors can now buy into this $22 trillion asset class once reserved for elites – and become the landlord of Walmart, Whole Foods or Kroger without lifting a finger. Here's how Rich, young Americans are ditching the stormy stock market — here are the alternative assets they're banking on instead Here are 5 'must have' items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you? Stay in the know. Join 200,000+ readers and get the best of Moneywise sent straight to your inbox every week for free. This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
Yahoo
2 days ago
- Business
- Yahoo
We sold our home and now my wife wants to build an emergency fund instead of paying off debt — which is right?
Imagine a situation where a couple, whose house was paid off, decided to downsize and — after paying for a new, smaller house — has about $50,000 left over. Deborah's husband, Pete, wants to pay off their $50,000 credit card debt, but Deborah wants to put the money in a high-interest savings account (HISA). Both are working, have benefits and have 401(k)s with employer matching. However, because they put their extra money into paying down their first house, they don't have other savings. Other than their credit card debt, they don't have other high-interest debt, don't have kids and don't anticipate making any major purchases in the next few years. Don't miss Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how I'm 49 years old and have nothing saved for retirement — what should I do? Don't panic. Here are 6 of the easiest ways you can catch up (and fast) You don't have to be a millionaire to gain access to this $1B private real estate fund. In fact, you can get started with as little as $10 — here's how The pros and cons of each approach Many financial planners would advise paying off the debt. 'If you have credit card debt that is increasing and you're paying high interest, you definitely want to pay that off first,' Stuart Boxenbaum, president of Statewide Financial Group, told CBS News. Personal finance expert Dave Ramsey would agree — for the most part. He recommends what he calls the 7 Baby Steps, which starts by saving $1,000 in a 'starter' emergency fund and then paying off non-housing debt. From there, he recommends building a more substantial emergency fund (saving three to six months of expenses) and then investing 15% of your income for retirement. In the case of Deborah and Pete, the advantage of paying off their credit card debt could mean saving thousands of dollars in interest. Consider that the average credit card interest rate in the U.S. is 24.33%, according to LendingTree. On a debt of $50,000, interest starts adding up fast if you're only making minimum payments. The downside? They'd temporarily reduce liquidity. If they put the money in an interest-bearing account, they'd have full access to that cash if they need it. However, the rate on a high-interest savings account is currently around 4%, so even doing some simple math shows that the annual percentage yield on a HISA won't outpace credit card interest. Rod Griffin, senior director of public education and advocacy at Experian, told CNET that 'paying off debt and saving money doesn't have to be all or nothing,' and that consumers 'can and should do both.' That may mean building an emergency fund and paying down debt (or following Ramsey's approach with a 'starter' emergency fund, paying off high-interest debt and then building a larger emergency fund). A HISA can make that emergency fund work for you. 'For example, instead of having your emergency fund sitting idle and earning next to nothing, a high-yield savings account can help you earn a real return on your money while still keeping it readily available for unexpected expenses,' Kristen Beckstead, vice-president and financial planner at First Horizon Advisors, told CBS News. Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says — and that 'anyone' can do it Couples need to work together on their finances Deborah and Pete may decide to pay off the full $50,000 balance to stop the high-interest bleeding. Or they could reach a middle ground. Since they don't have an emergency fund, they may want to put a portion of that money aside — enough to cover three to six months of expenses — and then pay down as much of the debt as possible with the remaining money. More importantly, they may want to examine their financial plan and how they're managing their finances as a couple. It can help to do this with a financial planner, who can provide them with various options and be an impartial third-party to help them navigate what can sometimes be difficult conversations. 'Money is the number one issue married couples fight about, and it's the second-leading cause of divorce, behind infidelity,' says finance expert Rachel Cruze in a blog for Ramsey Solutions. After all, people come into a marriage with different money mindsets — the attitudes and beliefs we each hold about money and how that influences the way we manage our finances. But, once you're married, you need to manage financial matters as a team. To do this, Cruze recommends keeping a joint bank account, since 'separating the money and splitting the bills is a bad idea that only leads to more money and relationship problems down the road.' She says couples should also discuss lifestyle choices together, recognize differences in personality and keep purchases out in the open. Working together and communicating isn't easy, especially when each partner has different money mindsets, but it can help couples like Deborah and Pete find a solution that works for both partners. What to read next Robert Kiyosaki warns of a 'Greater Depression' coming to the US — with millions of Americans going poor. But he says these 2 'easy-money' assets will bring in 'great wealth'. How to get in now Accredited investors can now buy into this $22 trillion asset class once reserved for elites – and become the landlord of Walmart, Whole Foods or Kroger without lifting a finger. Here's how Rich, young Americans are ditching the stormy stock market — here are the alternative assets they're banking on instead Here are 5 'must have' items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you? Stay in the know. Join 200,000+ readers and get the best of Moneywise sent straight to your inbox every week for free. This article provides information only and should not be construed as advice. It is provided without warranty of any kind. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
3 days ago
- Business
- Yahoo
Dave Ramsey Caller Was Overpaid $48,000 By Her Employer. Now They Want It Back—'This Conversation Was Worse Than A Tooth Extraction'
A recent episode of 'The Ramsey Show' sparked frustration and sympathy after a caller revealed she was accidentally overpaid $48,000 by her employer—and now, nearly a year later, the company wants the full amount returned. Rachel from Nashville said she and her husband had taken Dave Ramsey's course last fall and were making major progress paying down debt. But in October, her large corporate employer made a huge payroll error, mistakenly paying her $48,000 in gross income she wasn't owed. Don't Miss: 7,000+ investors have joined Timeplast's mission to eliminate microplastics—now it's your turn to $100k+ in investable assets? – no cost, no obligation. The conversation that followed was somewhat confusing for both the hosts and the caller, as they tried to sort through the tangled details. One YouTube viewer summed up the chaotic conversation with a comment that captured the mood: 'This conversation was worse than a tooth extraction.' Tax Confusion And Delays Made It Worse 'I told them before it hit my bank account,' she explained. 'Unfortunately, it was too far gone at that point.' She said the net amount she received was $28,000 after taxes. Only about $3,300 of that was her actual paycheck. And even though she flagged the mistake immediately, it took the company 10 months to send her a repayment letter. Trending: Accredited Investors: Grab Pre-IPO Shares of the AI Company Powering Hasbro, Sephora & MGM— Because the issue crossed into a new tax year, the employer is now asking her to repay the full gross amount, including $23,000 in taxes that were already sent to the IRS. 'It was taxed in my 2024 tax return,' she said, adding that the tax hit came out of pocket. To make things more confusing, the employer is offering to deduct 15% of her future paychecks until the debt is repaid. Ramsey broke it down directly: 'You don't pay more than what you actually owe.' He explained that she should only repay what she physically received – about $24,000, after accounting for her real paycheck – and the rest should come back from the IRS once her taxes are corrected. 'You paid $23,000 more in taxes than you should have,' Ramsey said. 'You should get all of that back.'The IRS Will Likely Have To Return The Tax Overpayment Ramsey told her to have the company file an amended W-2 and to make sure her tax preparer files an amended return, so she can recover the $23,000 she never should have paid. 'If your CPA doesn't know how to do that, get a new CPA,' he said. 'This is not rocket science.' Co-host Ken Coleman criticized the company for taking so long to fix its mistake: 'A big company that has all the resources in the world to fix this, and they didn't fix it quickly. Hate that for her, but it is fixable.' Ramsey said that in his own business, if they accidentally overpay someone a few thousand dollars, they often just let it go. 'You know what we do? Eat it. Just keep the money. We're so stupid. We did this. We're going to pay the stupid tax and we're going to fix it. ' Read Next: Many are using retirement income calculators to check if they're on pace —Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? APPLE (AAPL): Free Stock Analysis Report TESLA (TSLA): Free Stock Analysis Report This article Dave Ramsey Caller Was Overpaid $48,000 By Her Employer. Now They Want It Back—'This Conversation Was Worse Than A Tooth Extraction' originally appeared on © 2025 Benzinga does not provide investment advice. All rights reserved. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
