Is it too late for retirement?

thanks for joining us America Ruth is

with us in Cincinnati Ruth welcome to

the Dave Ramsey show thank you

how are you better than I deserve how

are you I'm good and you think for

answer my call sure I was wondering on

61,000 260 and we're wondering if it's

too late for us to retire mm before 70

because we don't have enough money in

retirement so I hear you have six or

seven hundred thousand to retire and we

don't have that kind of money we have

that and a little bit of spoiling pay

saving how much is in your 401 K um I

think there's only around like 76,000

how much does AFS we have with our house

- we have a core it has too many years

to be paid off I think we owe 10

thousands and we have um about 2004 debt

and we have a couple other debt so we

paid off in June what are they

one is a Care Credit it's a um pureed

I'm bill that we paid off in June and

it's um I think there's a thousand left

and we have um I think they did oh we

get where your hellos anything yeah you

guys are 61 yes and what are you owe on

your house um around 137 okay

that's good news okay all right well I

mean obviously the answer can't be no

because you're going to retire at some

level the question is what you're going

to be able to keep and what's going to

happen do you have another car

you guys both work I don't he does watch

out what does he make about 130 oh

that's good news okay and and how much

longer does he plan to work he says 20

drops over Jamie's afraid doesn't let me

retire well he's right he doesn't and he

makes way too much money for you all to

be this broke so what you guys need to

do is you need to get on a really beans

and rice rice and beans scorched earth

budget and get this stupid car and these

credit cards all paid off as fast as

possible build you an emergency fund and

then lay into that 401k good and heavy

at 15% of your income and I'm gonna

reach over and try to get that house

paid off too so but you really are not

going to go on vacation at all ever


until after you retire oh my you're way

behind and you need to get your house

paid off get these debts cleaned up and

throw another hundred or two hundred in

the good news is you make 130 I was

scared to death you were going to tell

me he makes thirty two thousand a year

well he hasn't always made that much um

just the past five years even in the six

but you've got nothing to show for it

right except the stinking car payment

and no money sorry I don't know where

you've been spending it but it's over

you know you're eating out all the time

or you're traveling I don't know what

you're doing but you guys have got to

get on a written budget for your sake I

don't care I mean you can do whatever

you want eh but you call me so if I'm in

your shoes I'm going yeah I got about 10

years of this seven years of this 130

thousand dollar income to pay off 137

thousand dollar mortgage to get some

money stuck in my 401 K my IRAs and get

these other little miscellaneous debts

cleaned up and have a little bit of cash

for an emergency and you can do a lot of

that you could you could literally have

a half a million dollars and have the

house paid off and have no debt but

you're going to do nothing else that's

all you're going to do but the good news

is then you got the rest of your life to

retire and actually enjoy your

retirement but if you keep spinning like

you've been spending and you stay

disorganized like you have been you're

going to retire on dog food and that's

what he's afraid of well

let's get afraid enough to do something

about it well he said he wanted to pay

off the house but in order to compare

off the house that would take money from

well here's the order here's the order

okay first thing I want you to is pay

off all these little debts the car and

the credit cards and these other things

list them smallest to largest that's the

first thing what you do then the second

thing I want you to do is build an

emergency fund a rainy day fund of three

to six months of expenses let me help

you with that in your case that's

$15,000 minimum in an emergency fund

now you're debt-free but the house and

you have fifteen thousand then you move

to baby step four we call it you start

putting fifteen percent of your income

that's $20,000 a year for you guys I

want you to start saving $20,000 a year

now what you throw the rest of it at the

house until the house is paid off once

the house is paid off I want you to

throw everything you can get your hands

on into retirement so that you can

retire I think if you do that I just did

the calculations in my head but I might

be wrong but if you work seven eight if

he works seven eight years nine years

more making this kind of money you'll

have a half a million dollars a paid-for

house and no debt but you're not going

on vacations you're not going on

vacation that's not good news you're not

eating now unless you're working there I

know is one of you when was the last

time you won years there was last time

you know what um I don't know probably

actually I were part-time like 20 years

ago okay all right I mean if you're if

you're able I don't mind you going and

doing something too because you throw

another thirty fifty thousand bucks in

this equation a year offer you all

sudden we got some serious money to

clean this thing up with and we can turn

it around this is doable but you guys

are going to get very very serious today

and you're not buying nothing

nothing nothing nothing so that you can

retire with dignity but I'll help you

with this hold on I've got to send you a

copy of our book the Total Money

Makeover you and him sit and go through

that book and it'll show you exactly

what I'm talking about I'll give that to

use my gift

there you go turn your life around let

me know how you're doing - if you need

some help along the way you call me I'll

help you