I Ran Up $37,000 In Credit Card Debt And Ashamed

Summary

Podcast Summary: The Ramsey Show Highlights

Episode: I Ran Up $37,000 In Credit Card Debt And Ashamed
Release Date: December 15, 2024
Host/Author: Ramsey Network

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Introduction

In this heartfelt episode of The Ramsey Show Highlights, a distressed caller shares her journey of financial turmoil and emotional struggle. The host, alongside experts from the Ramsey Network, provides compassionate advice to help her navigate out of significant credit card debt following a personal tragedy.

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Caller’s Personal Story and Financial Struggles

Caller Background: The episode features a 63-year-old nurse who has been a long-time listener of The Ramsey Show since the early 2000s. Five years prior, she faced the sudden passing of her husband, Bill, at the age of 59. This loss severely impacted her financial stability and emotional well-being.

Financial Setback:

• Debt Accumulation: In her grief, she donated a substantial amount of money, depleted her emergency fund, and incurred $37,000 in credit card debt.
  • "I donated a lot of money and I spent our emergency fund money, and I charged up $37,000 worth of credit card debt." [00:06-00:19]

Current Financial Status:

• Retirement Savings: She possesses $1.1 million in her retirement account and is confident about her financial security upon retirement, supported by two pensions.
  • "I have $1.1 million in my retirement account. I'll be secure when I retire because I'll have two pensions." [01:30-01:39]
• Mortgage: Still has a remaining mortgage balance of $97,000, which will be paid off in four years upon her full retirement.

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Financial Dilemma and Seeking Advice

The caller is at a crossroads, debating whether to:

1. Use Future Income: Continue following the Ramsey baby steps by using her ongoing working income to pay off the credit card debt.
2. Tap into Retirement Funds: Withdraw funds from her $1.1 million retirement account to eliminate the debt immediately.

She poses the critical question: "Should I plan to just, you know, go back to baby steps and pay off my credit card with my working income now as fast as I can, or should I just take some money from my retirement and get that off my plate?" [01:41-02:15]

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Expert Advice and Recommendations

Host’s Initial Response:

• Avoiding Future Debt: Emphasizes the importance of using future working income to pay off the debt to prevent falling back into debt.
  • "Using future income. You will never go into debt again when you have to make those extra payments on those credit cards." [02:27-02:53]
• Behavioral Change: Suggests that paying off the debt with working income instills better financial habits and discipline.
  • "I want to see your habits change forever. And that's where paying off this debt with future income... is what's going to cause you to make better decisions in the future." [02:54-03:14]

Emotional Support and Encouragement:

• Acknowledging Grief: The host and co-host engage in a compassionate conversation, acknowledging her loss and emotional state.
  • "Can I tell you, you're allowed to be mad at stinking Bill." [04:28-04:42]
• Motivational Dialogue: Through guided breathing and emotional prompts, they help her process her feelings and regain confidence.
  • "You're a millionaire because of the life you and Bill created. You're going to get this debt paid off. You're not as scared of hard work." [05:02-05:30]

Final Advice:

• Commitment to Peace: Encourages her to commit to personal peace and self-worth, reinforcing that her actions are a gift to herself.
  • "At least commit for the rest of today to give yourself that peace, because you're worth that, too." [06:02-06:08]
• Long-Term Financial Health: Reiterates that paying off the debt using her future income aligns with maintaining financial health and honoring her and her late husband's legacy.
  • "Paying off these credit cards with your future income, this is not a punishment to Ann because she's made bad decisions. This is a gift to herself." [07:12-07:20]

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Notable Quotes with Timestamps

• Caller’s Admission:
  "I ran up $37,000 worth of credit card debt." [00:19]

• Host’s Emphasis on Future Income:
  "Using future income... you will never go into debt again." [02:27-02:53]

• Emotional Reassurance:
  "You're a millionaire because of the life you and Bill created." [05:02-05:30]

• Encouragement to Self-Worth:
  "Commit for the rest of today to give yourself that peace, because you're worth that, too." [06:02-06:08]

• Final Affirmation:
  "You're creating a new picture of what's next... They're cheering you on for this next chapter of your life, and you're entering into it with freedom, no debt." [08:59-09:20]

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Conclusion

This episode poignantly underscores the interplay between financial health and emotional well-being. Through compassionate dialogue and expert advice, the Ramsey Network not only addresses the caller's immediate financial dilemma but also supports her emotional healing journey. Listeners are reminded of the importance of disciplined financial strategies, especially in the face of life's unexpected challenges.

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Additional Resources

• EveryDollar App: The podcast briefly mentions the EveryDollar app as a tool for budgeting.

  • "Start budgeting for free today." [00:02]

• Follow-Up: Listeners are encouraged to create a free EveryDollar budget to manage their finances effectively.

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Note: This summary encapsulates the key discussions and emotional exchanges from the episode, providing a comprehensive overview for those who haven't listened to the full podcast.

Transcript

[A]

Brought to you by the EveryDollar app. Start budgeting for free today.

[B]

So I've listened to your show for a very long time, and I actually started following Ramsey in the 19, the early 2000s, and, you know, succeeded in having some decent financial security. And then, yeah, about five years ago, my husband suddenly passed away. And, yeah, 59. So, you know, it was just a bummer because we were planning, you know, we had educated our kids. We were making good headway on finances at home. We were planning a future. So I went into, like, a state of just craziness. I don't know what you call it, but very angry. Yeah, very angry. And I actually donated a lot of money and I spent our emergency fund money, and I charged up $37,000 worth of credit card debt.

[C]

Wow.

[B]

And so I'm back to replay replenishing my emergency money, and I'm getting rid of my credit cards, consolidating back to the baby steps. But my question is, I have. I feel like my situation so awkward because I have $1.1 million in my retirement account.

[A]

Okay.

[B]

I have. I'll have you know I'll be secure when I retire because I'll have two pensions and.

[A]

And how old are you?

[B]

I'm 63. So this is my question. I have two more years of working full time, and I plan on. I'd like to go part time. I'm a nurse, and I'd like to go part time at 65. Should I plan to just, you know, go back to baby steps and pay off my credit car with my working income now as fast as I can, or should I just take some money from my retirement and get that off my plate? Like, I don't know which is the best.

[A]

What's your total debt right now?

[B]

37,000.

[A]

Do you have a mortgage?

[B]

Yes.

[A]

What's left on that?

[B]

I'm sorry. I have 97.

[A]

Okay.

[B]

So when I fully retire, I'll have that paid. That'll be paid in four years.

[A]

Okay. So should you use your working income in the future to pay this off or take some out of retirement? It's not a lot. You're taking that 1.1 million and taking 37. I mean, the ratio here is small, but here's what I love about you. Using future income. You will never go into debt again when you have to make those extra payments on those credit cards. And I would.

[B]

That's what I'm.

[A]

I would encourage you to cut them up after. So from a math standpoint, you could take retirement money and pay this off today and. And be done with it. But I want to see your habits change forever. And that's where paying off this debt with future income, you'll feel that more. And I think adding friction back into your life is what's going to cause you to make better decisions in the future. That's one man's taste.

[B]

Yeah. That's my gut feeling. But I'm like, am I being stupid financially, though? Because I do have the money, but I do want to make it uncomfortable for myself.

[A]

I think discomfort is undervalued in today's world.

[B]

Yeah.

[A]

I think we've been comfortable for too long. What do you think, John?

[B]

Yeah. Yeah.

[C]

And we. Do me a favor.

[B]

Yes.

[C]

This is kind of a weird request.

[B]

Okay.

[C]

Are you holding anything in either of your hands?

[B]

No, but I'm kind of nervous. I'm shaking my legs. Am I making a lot of noise?

[C]

No. No, you're not doing anything wrong. I want you to take your hands.

[B]

Yeah.

[C]

And I want you to squeeze them as hard as you can together.

[B]

Okay.

[C]

Squeeze them really tight. 3.

[B]

Yeah.

[C]

2. And then let them go. Open them up gently. Okay.

[B]

Mm.

[C]

And your shoulders are pretty high right now because you're nervous. I want you to pull them all the way down. Consciously pull them down. Okay.

[B]

Yep. Okay. Done. What? Can you see me or something?

[C]

No, I can hear you. Now. Listen to me. Listen.

[B]

Okay.

[C]

What was your husband's name?

[B]

Bill.

[C]

He just up and. He up and passed away, didn't he?

[B]

Yeah.

[C]

And you miss him? Like bloody hell.

[B]

Great guy. Oh. He was my soulmate.

[C]

Okay. Can I tell you, you're allowed to be mad at stinking Bill. And when you get to the gates, he's going to get an earful from Aunt. That's fine. Okay. And can I tell you something?

[B]

Yeah.

[C]

He gonna be waiting there for you, hollering at you to hurry up and quit taking so long. Can I tell you something else?

[B]

What?

[C]

When he passed away, the world got real gray and you bought some stuff. Who gives a crap? Will you quit beating yourself up over that?

[B]

I know I am.

[C]

Today. Today we're done. If he was sitting right next to you, he'd say, ann, quit. Oh, my gosh. Quit talking about it. Wouldn't he?

[B]

Yeah.

[C]

Yes.

[B]

Yep. It was mostly for, like, my grandkids, my kids.

[C]

I know. You know what you tried to do with your pain? You tried to be in service to other people. Good. I could think of a lot of worse vices that you could have gotten into after losing an arm and a leg and part of your Heart.

[B]

Yeah.

[C]

Okay. So quit beating yourself up. You're a millionaire because of the life you and Bill created. You're going to get this debt paid off. You're not as scared of hard work. You're not scared of putting a couple of small hurdles in front of you. You're an amazing 62 year old woman.

[B]

Oh, my God. This is such a nice phone call. It's not what I expected.

[C]

I know, but listen. Every day you wade in to the craziness of hurting people and you bring them a little peace, don't you?

[B]

Mm.

[C]

Okay. At least commit for the rest of today to give yourself that peace, because you're worth that, too.

[B]

Thank you.

[C]

You promise?

[B]

I really appreciate that.

[A]

Yeah.

[B]

Cause financially, I have felt a lot of shame.

[C]

I know. No, dude, you know what happens if my wife up and passed away? You know what happened? You would see the supernova from Boston. I can tell you right now, I would not make a string of good choices back to back to back to back.

[B]

Yeah.

[C]

Okay.

[B]

He was such a good guy. Yeah. You do feel like you lost your better half.

[C]

What was your. What's the funniest? What's the hardest he ever made you laugh?

[B]

Oh, my God. He was always making me laugh. He used to dance around the house, you know, just.

[C]

Whoa. And this is a family show. What are you doing?

[B]

Yeah, he would dance around the house. Oh, I have all these funny videos of him. Yeah, he would. He's just. He was just a great guy. Yeah.

[C]

All right, well, that joy and that light is still sitting inside your chest, and I want you to quit covering it up with shame because you spent some money and gave some money away after he passed away. Okay, we're done with that now.

[B]

Yep.

[A]

So paying off these credit cards with your future income, this is not a punishment to Ann because she's made bad decisions. This is a gift to herself.

[B]

Yeah, I feel good with that. I feel really good with that because I. My husband and I worked so hard to save up that money. And it would be like, just very defeating if, you know, just make me feel bad that I took that money. I mean, I read Dave Ramsey's first book in 2002, and I remember I was just a new nurse putting $10 a week into my retirement account, thinking, this can't possibly.

[A]

This isn't doing anything. Much money now you got 1.1 million at 63, and you go, oh, I guess it does something.

[B]

It does. And I never stopped contributing. I never segued. When the markets crashed, I just didn't even look at it. And one day I turned around and I had 800,000 in my account. I couldn't believe it. But of course, it's been 39 years.

[C]

So that's right for just this moment. And I'm glad. I'm glad that our paths cross today. My life is going to be a little bit brighter because I got to talk to you.

[B]

Thank you so much.

[A]

And selfishly, as a guy from the South Shore, I just miss a good Boston accent and I know really did something for me.

[C]

If you were in a Harvard bar having a lager right now, it would make me feel a lot better.

[A]

But I'm going to eat some clam chowder tonight in your honor.

[B]

Yeah, get some clam chowder for sure.

[A]

Oh, that warmed my heart.

[B]

Oh, great. Oh, I feel so much better. I'm. You know, even though I have to struggle and pay for this, I feel much better with that decision. Thank you.

[C]

Dude, you're doing everything right. You're on the right path, man.

[A]

You're creating a new picture of what's next. As my friend Dr. John would say, it's not the one you had in your mind, not the one you and Bill created. But everyone listening is proud of you. They're cheering you on for this next chapter of your life, and you're entering into it with freedom, no debt. With the beautiful memory of this man who made you the woman you are. Thanks for the call, Anne. Create your free every dollar budget today. The simplest way to budget for your life.