My Kid Won't Pay Me Back

Summary

Podcast Summary: The Ramsey Show Highlights – "My Kid Won't Pay Me Back" (August 8, 2026)

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Episode Overview

In this episode, co-hosts Rachel Cruze and Dave Ramsey tackle a listener question about a challenging family financial situation: parents who co-signed student loans for their teenage daughter only to find themselves responsible for the debt after she refused to make payments. The episode delves into the emotional, relational, and financial consequences of co-signing for children, with practical advice and honest reflection from both hosts.

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Key Discussion Points & Insights

1. Listener’s Dilemma: Broken Promises and Broken Relationships

• Situation Recap (00:02–00:42):
  • Parents co-signed $135,000 in student loans for their 17-year-old daughter, who promised to pay them back.
  • Parents have already paid $60,000, with $75,000 remaining. Daughter is now refusing to pay.
  • The episode highlights resultant tension and estrangement within the family.

2. Emotional Impact & The “Wedge”

• Rachel suggests the wedge could exist not just between parent and child, but possibly between spouses too, as such decisions can also cause marital tension (00:46–00:58).

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3. The Parent PLUS Loan “Relationship Killer” (00:53–01:47)

• Dave Ramsey: “It’s the number one reason I hate parent PLUS loans: because of the relationship killer. It’s not even the financial aspect.”
• Rachel acknowledges the emotional cost, agreeing that the loan isn't just a financial mistake, but one that damages priceless relationships.
• Rachel Cruze: "I love my daughter too much for this to cause a wedge."

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4. The “Stupid Tax” and Moving Forward (01:47–01:47)

• Dave frames the remaining $75,000 as a "stupid tax"—the cost of a decision made in ignorance.
• His advice is pragmatic: pay off the debt even if it means adjusting retirement plans, prioritizing long-term family relationships over recouping the money.
  • “It might mean you retire in 10.5 or 11 years instead of 10… But that’s what I would personally do as a parent if I was in the situation." (01:47)

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5. Questioning the Daughter’s Situation (01:47–02:19)

• Dave wonders about the daughter's circumstances: Is she struggling financially, or simply choosing not to pay? Without this info, it's hard to fully judge her actions.
• Rachel Cruze: "When a 17 year old promises you something, I'm going to take that with a big old grain of salt." (02:19)

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6. Teenage Promises vs. Adult Responsibility (02:19–02:49)

• Dave notes many young people expect to pay loans off "eventually" over decades, without grasping the long-term consequences.
• Rachel points out most teenagers don't comprehend the scale of large loans, especially with compounding interest.
  • “What teenager understands the actual amount of one 35 grand plus interest?” (02:33)

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7. Parental Responsibility vs. Expecting Adult Behavior from Teens (02:49–03:16)

• Dave takes a hard stance that signing a big loan with a teenager is a "parenting issue" more than a child's failure, as the parents placed an unrealistic expectation on their 17-year-old.

  • Dave Ramsey (Hot Take): “This is the parent's fault… you were depending on a 17 year old to make good on thousands of dollars of promises. I find that to be a parenting issue, more so than it is the 17 year old's issue..." (02:49)

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8. The Cost of Pursuing Repayment: Is It Worth the Relationship? (03:16–03:39)

• Rachel distinguishes two options:
  • Go after the daughter for payment, risking total estrangement.
  • Let go, pay the remainder, and preserve the relationship.
  • Rachel Cruze: “She’s never showing up for Thanksgiving ever again… is that worth $75,000 more dollars to you?” (03:22)
• For Rachel, the relationship with her future children means more than the money.

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9. Final Advice and Takeaways (03:39–03:49)

• Rachel and Dave agree: "You gotta preserve the relationship.” (03:39)
• Accept the consequences (“suck it up, buttercup”) and use this as a tough lesson—both for the listener and as a warning for other parents considering similar decisions.
  • Rachel Cruze: “You guys will be okay. You will live to tell the tale.” (03:41)

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Notable Quotes & Memorable Moments

• Rachel Cruze (on promises from teens):
  “When a 17 year old promises you something, I'm going to take that with a big old grain of salt.” (02:19)
• Dave Ramsey (on loan co-signing):
  "This is the parents' fault… you were depending on a 17 year old to make good on thousands of dollars of promises. I find that to be a parenting issue.” (02:49)
• Rachel Cruze (relationship vs. repayment):
  “She’s never showing up for Thanksgiving ever again… is that worth $75,000 more dollars to you?” (03:22)
• Dave Ramsey (on preserving relationships):
  “You gotta preserve the relationship.” (03:39)
• Rachel Cruze (life lesson):
  “You guys will be okay. You will live to tell the tale.” (03:41)

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Timestamps for Key Segments

• 00:02–00:42: Listener's question introduction
• 00:53–01:47: Parent PLUS loan as a "relationship killer" & the “stupid tax”
• 01:47–02:19: Speculations about the daughter's situation
• 02:19–02:49: Teenage promises and loan realities
• 02:49–03:16: Dave’s “parenting mistake” verdict
• 03:16–03:39: Interpersonal cost vs. financial cost debate
• 03:39–03:49: Resolution and closing advice

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Final Reflection

Rachel and Dave remind listeners that while financial losses are painful, lost family relationships are often costlier. Their advice is to learn from this mistake and avoid co-signing for children’s loans, emphasizing the value of preserving family bonds over recouping financial investments.

Transcript

[Rachel Cruze]

Brought to you by the EveryDollar app. Start budgeting for free today. When my husband and I co signed our daughter student loans. This is a strong start. She promised us she would make the payments. The loan is due now and she refuses to pay anything on it. We have worked hard our whole lives and are debt free.

[Dave Ramsey]

Are you?

[Rachel Cruze]

That's my extra commentary I'm throwing.

[Dave Ramsey]

I like it.

[Rachel Cruze]

We recently started saving for retirement which will be in 10 years. We, we've already paid 60 grand on her loans and the balance is 75 grand. We know that we should never have signed for her, but they would not allow her to sign because she had no payment history. She's 17. Of course. What can my husband and I do? We've always had a wonderful relationship, but this has caused a huge wedge between us.

[Dave Ramsey]

Why is the. I wonder why the wedges between the.

[Rachel Cruze]

Well, they expected her to pay. They cosigned going, fine, we'll, we'll sign it so that you can go to school but you're going to pay. Maybe that was a conversation.

[Dave Ramsey]

Oh, she's saying the wedge between them and the daughter, not the husband and wife.

[Rachel Cruze]

Maybe all of them at this point. Maybe because someone probably was like, we probably shouldn't do this. And one spouse like, no, it's her future. It's an investment tell. It usually sounds. Oh, this is brutal. And it's the number one reason I hate parent plus loans is because of the relationship killer. It's not even the financial aspect. It is, I love my daughter too much for this to cause a wedge. So. So the truth is I'm going to pay the stupid tax and pay the extra 15 grand. Oh, the balance is 75. They paid 60 on it already. Chances of her paying slim to none at this point. And if she does, she's going to resent you forever. So this is sort of a $75,000 remaining stupid tax. It might mean you retire in 10.5 or 11 years instead of 10. And that's, that's a hard pill to swallow. But that's, that's what I would personally do as a parent if I was in the situation.

[Dave Ramsey]

I'd love to know, and it's not in here. I would love to know how successful the daughter is at this point. Was she able to get out of college and land a great job? Is she just choosing not to or is she really on a struggle bus? There's so many ways this could land

[Rachel Cruze]

but we don't know her situation. Is she able to make the payments? That's one thing or is she trying to like buy a house and she's doing great, but she's like, this is not a priority. This is mom and dad's problem. Yes, but they started it with saying she promised us. When a 17 year old promises you something, I'm going to take that with a big old grain of salt.

[Dave Ramsey]

But here's the thing. That again, and that's such a good point because most people are like, I'll pay off my student loans eventually in 30 to 40 years. And that may have been her thought. Like, yes, I said I would pay them back. I just didn't say I was going to pay them back in the next two to three years.

[Rachel Cruze]

Yep.

[Dave Ramsey]

Can I?

[Rachel Cruze]

You know, and what teenager understands the actual amount of one 35 grand plus interest? You, especially in a parent plus loan where the interest is even higher. So by the time she graduates and is actually paying, this balance has ballooned and she's going, whoa, whoa, I didn't sign up for this.

[Dave Ramsey]

And that's why I'm going to take a hard stance. And this is a hot take. But this is the parents fault. Even though she's not doing something. You had to deal with a 17 year old about thousands and thousands of dollars. And you were depending on a 17 year old to make good on $1,000. You know, thousands of dollars of promises. I, I find that to be a parenting issue, more so than it is the 17 year old's issue who is now probably in her 20s.

[Rachel Cruze]

But it's up to them. Here's the two paths. They can pursue her and go, no, you said you would.

[Dave Ramsey]

It's only going to hurt.

[Rachel Cruze]

She's never showing up for Thanksgiving ever again. You won't have a relationship with your grandkids. Is that worth it? Is that worth 75,000 more dollars to you? That's really what's on the line here. And for me in my house, I just, I can't. My daughter's three. I cannot imagine losing that relationship over a mistake that I made.

[Dave Ramsey]

Yeah, you gotta preserve the relationship.

[Rachel Cruze]

This is a suck it up buttercup situation. Unfortunately, Diana. But you guys will be okay. You will live to tell the tale.

[Dave Ramsey]

I hope so.

[Rachel Cruze]

Hopefully it's a warning sign for any other parent who's in that situation.

[Dave Ramsey]

Ought to be.

[Rachel Cruze]

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