Brought to you by CHM, a biblically-based alternative to health insurance. Learn more at chministries.org slash budget. So this is probably a really stupid question, but I'm a tightwad, so I've got to ask it anyways. Okay.
So I'm in baby step seven, my wife and I, and we're 27. And really the problem with my question is I feel like I just have too much of my net worth wrapped up in my house. But I just recently bought a Mercedes-Benz class maybe a day or two ago. And just emotionally to me, it feels like I spent way too much money on something that goes down in value.
And it just eats me up thinking about what I could put that money in that would go up in value. And so my question is, should I take this stupid car back? Well, let's talk about what you spent on it. So after taxes and fees and all that junk, it was about $35,000.
All right. And what's your household income? The last two years, I've averaged about $250,000. Well, there's some ratios for you.
That puts it in perspective. How much do you have tied up in everything with wheels and motors in your house right now? It's only about $45,000, counting the Mercedes. Yeah.
Okay. You're driving an older car for the other car. Dave would have said you should have bought a nicer car. You're not doing anything.
Both of my cars outside of the Mercedes are probably worth $10,000 total. I understand ratio-wise it sounds okay. But emotionally, it just doesn't feel right to write a check for something that goes down in value when I could put that in something like some mutual funds, retirement, whatever. All right, let me ask you a quick question, Landon, and you seem like a very even-keeled, level-headed person, so this may be difficult for you to answer.
But have you ever acted out of emotion before and realized that your emotion was wrong? Sure. All right. So your emotion is wrong on this Mercedes.
Your emotion is wrong. I mean intellectually I get that I do get that Wait a second Wait wait wait wait You started off and said it was all emotional and I just destroyed the emotional argument on your behalf by the way And now you want to go intellectual Well what I mean is like basically all in all in are worth about and about of that is in the house Okay. And so it just feels like cash-wise, I feel like $35,000 is rich out of the cash that I have available is what I mean. It's not.
Landon, there are people who have a negative net worth who bought more expensive cars than you today. And so just know that in the grand scheme of life, it's going to be okay. And here's the deal. when you're young, naturally, more of your house is going to make up your net worth.
It might be 50, 60, 70, 80% when you're young, but over time, compound growth with your investments will catch up, and so by the time you retire, your house will probably be a third of your net worth. And you're right, that car will be in an impound somewhere 30 years from now, and that's okay. Stuff is stuff. So you wouldn't say, go buy $10,000 on Toyota Camry or something?
You're in your live-like-no-one-else era. You said you have a paid-for house, right? You're in Baby 7-7? Yeah.
Then what's the point of money? You're scared to death over nothing. There's three things you can do with money, Landon. You can give it, save it, spend it.
And if you just save it, you're going to drive yourself crazy. If you just spend it, you're going to end up broke. And if you just give it, you'll be a great philanthropist, but unable to retire. And so it's wise to do all three.
And what you're experiencing is something I experienced as well, which is needing to flex this muscle of spending after you've been so aggressive toward a financial goal of paying off the house or investing. And so this is something I struggled with. When I wrote, when I stroke a check for my wife's last car we bought her, it hurt my soul. I've never spent that much money on anything outside of a house.
I remember that. I can't remember. I was talking to him about it. But over time, you'll look back 10 years from now and go, remember when I was stressed out about buying a $35,000 car?
I'm sure Dave Ramsey had the same experience. Now Dave's cars are worth more than my house. And so it's okay to have nice stuff as long as you understand that it a toy that goes down in value It doesn make or break you Money just magnifies who you are And it sounds like you are right on track What year what year is that mercedes and how many miles 2018 it about 85 000 yeah it totally fine i drive a used mercedes as well if you take good care of it it last forever it a little bit more expensive to keep up yes but you've got it i mean listen you've been shooting all over yourself and you need to stop keyword should just for those listening who weren't sure what ken just said i know exactly what i said and we all tend to should should but i'm using it very purposely my therapist tells me this it's called double entendre stop shooting on yourself i should have done this and I should have done that. That's the idea.
And so you can sit there and play that game and talk yourself into another $5,000 car. Sounds like you've got two $5,000 cars or somewhere in that range. So you can do whatever you want to do. You can take the car back and that allows you to sleep better, but I think you're not addressing what's really going on.
And what's going on, George, this is more your lane than mine. Although I understand it. I just think there's a deep, rooted shame in this. I'm not allowed to have something this nice.
I don't think it's fear. I think it's shame. I think he's got shame over this. And I think you've got to confront that.
Did you grow up with money, Landon? Yeah, maybe my parents had some money for sure. So what was the – we say behavior is a language. How did the way they handled money influence you?
Well, I'll tell you what. Honestly, what I think it is is honestly that I've just been so aggressive since I was 18 because – I mean just doing this since I was 18 and doing this about marriage that it almost feels like I need to stay aggressive. You know what I mean? And so we just fought and clawed so hard to pay our house off and the whole deal.
Yeah. What does your spouse think about this? Oh, she legitimately – we went up to the dealership, and she said, buy whatever you want. I'm tired and went home.
Good for her. That's a good woman right there. That's a good woman. By the way, let me just ask you this How long have you been familiar with Dave And his teachings and what we do here Since I was probably 12 Alright I want you to finish a sentence for me okay You ready Sure sure Live like no one else so that later you can Live like no one else All right then Now swap that with drive Drive like no one else Drive the crappy car.
So later you can drive like no one else. You worked really hard. You worked really hard to get to a point where you can buy a $35,000 Benz. And by the way, your wife has worked really hard, too, and she deserves to go on date night with you in a car that you don't have to pedal like Fred Flintstone.
Hey, there he is. Did you hear that laugh? That's the first time on this entire call I felt like we got the real you who wasn't so uptight. Well, what's funny about that is that's not far off from what I'm driving outside of the VINs.
I know. I know I don't look at this guy. Do I come across really dumb? Because when you tell me you've got two cars worth $10,000, those are Fred Flintstone cars.
I didn't have to do a lot of deduction, my man. And so she deserves better. She deserves better. If you want to drive a turd on wheels, then that's up to you.
But she doesn't deserve that. Can we agree it's Valentine's Day, for heaven's sakes? I agree. All right, then.
Relax. You worked really hard. It is impossible for me, George, to conceive of a scenario where Landon does something dumb with money. Yeah, I mean, you are spot on in our parameters.
Here it is. If all the things with wheels, motors, and your life adds up to more than half of your annual income, you're off track. That's simply too much. You are not even close to that.
And again, like ratios, Dave buying a nice car is like me buying a biscuit. And so you have to understand the ratios look different. When you have a very high income, your net worth is going to continually grow. You're 27.
You've got another 30, 40 years of working for you and investing to build wealth. And so in the meantime, you have to do something called enjoying life. And I'm scared because you're kind of like me. I'm wired to go.
But if we didn't eat this month, we could invest that in a good gross stock mutual fund. It can make 12% over that. You can't live your life like that. You got to let go.
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