This is the Ramsey Call of the Day, part of the Ramsey Network.

Today's question comes from Julie in the Baby Steps Millionaires Group.

I'm saving 20% down to buy a house in 2023, but this mortgage rates keep me worried. Are we really going to

buy at six to seven percent rate next year? People's incomes are not growing as much.

What are your thoughts? It will take longer to save money for a down payment.

Yeah, and it is hard.

I mean, if you're seeing increases of interest rates and, you know, the price of housing has kind of, I feel like... It's definitely cooled off.

Deadied, yes.

It hasn't been increasing at the same rate.

No, no.

But the interest rate is having people worried.

And so, Julie, I mean, just looking at the math, we always talk about a down payment of 10 to 20%. So even if you wanted to get into the housing market faster, you could just do save up 10%. 20 is obviously a wonderful goal, but the 10% would work. But just making sure that your mortgage payment is no more than 25% of your take-home pay.

That's the big part of this equation. And again, a lot of people fight us on that because it's very

conservative. But here's the deal. Like if half of your income is going to a mortgage payment,

you're not going to have a lot of money to go and enjoy and to invest and to save your kids'

college and to put extra on the house to pay it down.

I mean, it just limits your ability.

So we don't want your house, your mortgage payment to eat up so much of your income.

So that's that's the conservative approach that we take.

But honestly, it works, works.

And we just took a call earlier from a guy who could be looking at foreclosure because they got in a house a little too soon.

The payment's a little too much.

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