Brought you by Y-ReFi. Refinance your defaulted private student loans today at Y-refi.com slash Ramsey.

All right. Today's question comes from Travis in Vermont. He says I'm 23 in saving for a home down payment, which should only take 12 to 18 months.

However, I've heard that you recommend not having a mortgage of more

than 25% of your take-home pay. Even if I were to save enough for a 20% down payment,

I wouldn't be able to get a mortgage anywhere near that. I earn 70,000 per year, which is above

average for coming straight out of college. There are no starter

homes in this area for less than 150,000. Do you think young people will ever have a chance at

purchasing a house if we stick to your 25% guideline? All right. Oh, that's a good question. Yeah.

Let's talk about it from a couple of angles. Number one, I love that you want to buy a house.

I think that's great.

I think the dream of real estate is the American dream, right?

To own something that's yours outright.

It's great.

What you first said was you could save for a down payment in 12 to 18 months, which lets me know whatever you had in

your mind, you thought, this number will get me in the door. But the door that it's going to get

you in is a dangerous door for you. The reason that we say 25% of your take home pays, because we

want you to be able to live. Like, we want you to be able to breathe out here because...

That's right. You don't want to be house poor. Yeah, at some point, you have to think about it like this. At some

point of the 100% pie of income that you have, at some point you're going to want to invest

15%. So there's that. At some point, you're going to's say it's more than 25% let's say

it's at 40% well suddenly you don't have much to live off of right you've

really cut that wedge really really small for you and we find people all the time

...