I'm Broke And Don't Know What To Do

Summary

The Ramsey Show Highlights: "I'm Broke And Don't Know What To Do"

Release Date: April 26, 2025
Host: Ramsey Network
Guests: Dave Ramsey, Jade Warshaw

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Introduction

In the episode titled "I'm Broke And Don't Know What To Do," Sarah, a 56-year-old grandmother, reaches out to The Ramsey Show for financial guidance. Facing monumental challenges while raising four special needs grandchildren, Sarah shares her journey from financial stability to her current state of hardship. Hosts Dave Ramsey and Jade Warshaw offer compassionate advice and actionable steps to help Sarah regain control of her finances.

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Sarah's Background and Financial Downfall

Sarah begins by explaining her situation:
[00:15] Sarah: "I'm 56 years old and I have four grandchildren that I am now raising."

She recounts her life before taking on the responsibility of her grandchildren:
[00:20] Sarah: "I was in a perfectly good situation before I got the kids. I had, you know, money in the bank. I was working for an airline and I was doing really well."

However, circumstances forced her to make significant sacrifices:
[00:37] Sarah: "Needless to say, I came back. And I had to spend everything I had."

Sarah faced personal loss and had to single-handedly support her grandchildren after her husband's passing:
[00:47] Sarah: "My husband passed away. So it was like it was only me, you know?"

Over the past five years, her financial situation deteriorated drastically:
[01:02] Sarah: "And now it's been five years and I am like broke. I don't know what to do."

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Employment Challenges and Current Income

Previously employed as a travel agent, Sarah lost her job due to the demanding needs of her grandchildren:
[03:34] Sarah: "Yes, that is the reason why I lost my job."

Her income plummeted from $6,500 to $4,300 monthly:
[02:57] Sarah: "I went from having around 4,300 in income down. I mean, from 6,500 having income down to 4,300."

Currently, Sarah relies on pet sitting to make ends meet, unable to commit to a regular 9-to-5 job:
[02:20] Sarah: "I am in Georgia now... and this is where I lost it. This is where I'm losing everything because I don't have enough."

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Detailed Breakdown of Debts and Expenses

Sarah provides a comprehensive overview of her financial obligations:

1. Mortgage:

   • Monthly Payment: $1,748
   • Interest Rate: 6.25%
   • Current Home Value: $235,000
   • Amount Owed: $217,000
   • [04:06] Sarah: "Most of the money now since I had to get a mortgage, it goes to the mortgage."

2. Credit Card Debt:

   • Total Debt: Approximately $6,100
   • Monthly Payment: $385
   • [05:38] Sarah: "All of them together is around 6100. I pay 385amonth."

3. Furniture Bills (Rent-to-Own):

   • Total Cost: $5,229
   • Monthly Payment: $847
   • [06:01] Jade: "I was confused about that... Another year on it."
   • [06:56] Sarah: "Yes... it's 5,229 total."

4. Payday Loans:

   • Total Debt: $2,400
   • Monthly Payment: $1,320
   • [07:06] Sarah: "My stupid butt got some payday loans I'm gonna work on getting."

Sarah emphasizes that while Medicaid covers some medical expenses, the mortgage remains a significant financial burden:
[04:21] Sarah: "Most of the money now since I had to get a mortgage, it goes to the mortgage."

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Expert Advice and Actionable Steps

Jade Warshaw and Dave Ramsey respond with empathy and strategic advice to help Sarah navigate her financial turmoil.

1. Prioritize High-Interest Debts:

   • Jade underscores the urgency of addressing payday loans to prevent further financial strain:
     [07:22] Jade: "Those payday loans, those will suck the life out of you. So I want those at the very, very top of the list."

2. Exit the Rent-to-Own Agreement:

   • Jade suggests finding alternative solutions to eliminate the burdensome furniture payments:
     [07:22] Jade: "I want those at the very, very top of the list... How much furniture does that include?"

3. Seek Community and Emotional Support:

   • Emphasizing the importance of a support network, Jade encourages Sarah to connect with a local church or community group:
     [07:34] Jade: "I want you to get plugged into a church or into some community because you can't do this alone."

4. Financial Coaching:

   • Dave offers to connect Sarah with a financial coach for personalized assistance:
     [08:08] Dave: "Set her up, Christian, with one of our financial coaches... There's a plan."

5. Transparency and Asking for Help:

   • Both hosts stress the importance of Sarah sharing her story to garner support and resources:
     [08:16] Jade: "And you've got to let people hear what's going on... So getting people around you is paramount to making this work."

6. Encouragement and Reassurance:

   • Dave provides motivational support, reinforcing that Sarah is not alone and that a path forward exists:
     [09:10] Dave: "Sarah, Help is on the way. Keep your chin up. There's a plan."

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Conclusion and Next Steps

The episode concludes with a clear roadmap for Sarah to begin rebuilding her financial stability:

• Connect with a Financial Coach: Personalized guidance to create a sustainable financial plan.
• Engage with Community Support: Building a network through local churches or community groups for emotional and practical assistance.
• Address High-Interest Debts First: Tackle payday loans and rent-to-own agreements to reduce financial pressure.
• Explore Alternative Income Streams: Consider additional or alternative sources of income that accommodate the needs of her special needs grandchildren.

Sarah is reassured that with structured support and strategic financial planning, she can overcome her current challenges and work toward a more secure future for herself and her grandchildren.

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Notable Quotes

• "I gave up everything to travel."
  Sarah [00:47]

• "Your chin up. There's a plan."
  Dave Ramsey [09:10]

• "You stepped up. You did what you did. No one's judging you, including us."
  Dave Ramsey [08:08]

• "You can't do this alone."
  Jade Warshaw [07:34]

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This episode of The Ramsey Show Highlights serves as a beacon of hope for individuals facing similar financial hardships, emphasizing the importance of prioritization, community support, and professional guidance in overcoming debt and rebuilding financial health.

Transcript

[Sarah]

Brought to you by chm, a biblically based alternative to health insurance. Learn [e-mail] budget I'm 56 years old and first of all, thank you for taking my call.

[Dave]

You bet.

[Sarah]

I'm 56 years old and I have four grandchildren that I am now raising.

[Dave]

Oh, my.

[Sarah]

I was in a perfectly good situation before I got the kids. I had, you know, money in the bank. I was working for an airline and I was doing really well. And I got the call, either come and get the kids or to go into state.

[Dave]

Oh, my goodness.

[Jade]

Oh, no.

[Sarah]

Needless to say, I came back.

[Dave]

Oh.

[Sarah]

And I had to spend everything I had.

[Dave]

Yeah.

[Sarah]

And I took the kids, got a place as quick as I could to. Because I, I was. I gave up everything to travel. My husband passed away. My husband, I mean, my mom passed away. So it was like it was only me, you know?

[Dave]

Yeah.

[Sarah]

So here I'm gonna live my life. And so I had to come back and I had to try to get a home. I had to try to get the furniture. I had to try to get, you know, and I was getting all this to keep them out of the system. And now it's been five years and I am like broke. I don't know what to do.

[Jade]

Oh, Sarah.

[Dave]

Well. Well, first of all, you are such an amazing grandma. I'm telling you, you stepped up and we're going to help you. We're going to help you. So give us the scenario. Where are you at? Where are you financially? Or did you, did you accrue any debt?

[Sarah]

A lot.

[Dave]

Walk us through that.

[Sarah]

I went from having 63,000 in the bank and was going to put more, you know, as I was traveling. But all that's gone because I had to get a lawyer, I had to get the house, I had to get furniture. I had, you know, and it was just, I. I spend it all.

[Dave]

Okay, I get it. It's okay. We want to get you out of this. What are, what's your debt from that?

[Jade]

Real quick, Sarah, tell me, where did you used to live, where did you travel from and where do you live now?

[Sarah]

I live in Georgia now. And when they called me, I was in Paris.

[Jade]

Paris.

[Sarah]

So I had France. Paris, France. Yeah. But I was traveling. Yeah. I didn't live anywhere.

[Dave]

She didn't have a home.

[Jade]

Got you. Okay. I was confused about that. So now you're in Atlanta. How, how old are these kids?

[Sarah]

These kids? The youngest is six. Then there's eight year old identical twin boys and then a 12 year old little girl.

[Jade]

Okay. Okay.

[Dave]

She's got a ways to go now. Do you have full custody of them now? And all that's settled, so.

[Sarah]

No, all that settled and.

[Dave]

Okay. All right.

[Sarah]

And now it's all on me. So I'm mama, you know, basically.

[Jade]

What are you doing for work? You're not doing the travel agent thing anymore?

[Sarah]

No, I can't. I was working with a local company, and then they let me go. So I went from having around 4,300 in income down. I mean, from 6,500 having income down to 4,300. And this is where I lost it. This is where I'm. I'm like losing everything because I don't have enough.

[Dave]

So what. What are you doing now?

[Sarah]

Sitting. I'm doing pet sitting. I go to people's houses and pet sit. The reason I don't do a regular 9 to 5 type job is kids are special needs.

[Jade]

Okay.

[Sarah]

Yes.

[Dave]

Is that why you lost your job before?

[Sarah]

That is. Yes, that is the reason why I lost my job.

[Jade]

Okay, so you're in Georgia. Is there anybody. Is it. It's just you and these kids? There's no other family? You mentioned your mom passed.

[Sarah]

Yeah, no other family. It's just me.

[Jade]

And how many of the kids have special needs?

[Sarah]

All four.

[Jade]

Okay.

[Sarah]

They're. They were born on drugs.

[Dave]

And so a lot of medical stuff still going on.

[Sarah]

A lot. A lot of medical and a lot of emotional, behavioral.

[Jade]

Okay.

[Dave]

And so where's. Where's. Where's most of your money going? Is it for therapy and. And the medical stuff? I'm guessing that's extremely expensive.

[Sarah]

Yes, that. Well, they do get Medicaid. Thank goodness for that. You know, that does help.

[Dave]

Okay.

[Sarah]

But most of the money now since I had to get a mortgage, it goes to the mortgage, and I had to get, you know, the mortgage right now is off the chain. So what is it.

[Jade]

What is the mortgage?

[Sarah]

I do is I do a 6.25% now, and my mortgage is $1748 a month. That's most of it right there.

[Dave]

And is it a house?

[Sarah]

Just the mortgage? Yes, it is a house.

[Jade]

Okay.

[Dave]

Whereabouts?

[Sarah]

Actually, I'm in, like, southwest area Georgia.

[Dave]

Yeah. And the reason I. I'm asking because I know that area very well. I lived down there for a long time. So just curious. So you're. You're south of the airport?

[Sarah]

I am, yes. I am, like, near Albany.

[Dave]

Okay, gotcha. All right. All right, let's walk through the debts really quick because we don't have a ton of time left, and we're going to get you some help here. But let's give Jade a quick snapshot of your total debt. We know the house well. Let's just quickly get that. How much is, how much is the house worth today? Do you have any idea versus what you owe?

[Sarah]

It's worth 235,000 and I owe 217,000.

[Dave]

Okay, so you don't have much there. Okay. And now go through the rest of your debts. Smallest to largest.

[Sarah]

Credit card debt. I got several of those. All of them together is around 6100. I pay 385amonth.

[Dave]

Okay.

[Sarah]

Furniture bills. I pay 8 7-847amonth.

[Jade]

Is that, is that a one time purchase? The furniture bill, you just put it on a loan or is it something that's like a rent to own deal?

[Sarah]

It's, it's sort of like a rent to own deal.

[Jade]

Okay, how do we get out of that? Because what are you paying a month?

[Dave]

8:47.

[Sarah]

Okay, 8:47amonth.

[Jade]

Now how is there a way to get out of that? Because that's going to be a revolve like you're going to be in that forever if we don't, if we don't get out of it now. And that's a lot of money.

[Sarah]

Yeah, it's, it's another year on it.

[Dave]

Okay, get out of it.

[Sarah]

Seven a month. I don't know how.

[Jade]

Okay, that's your homework. One of the things that I want you to do getting off of this call is to find out how I can get off of this. Because this for a whole nother year is a lot of money. I'd rather you just go over to Walmart and make it happen for, for $847 for in one month and to continue paying this.

[Sarah]

Right.

[Jade]

How much furniture does that include?

[Sarah]

All the beds, the couches, the kitchen table. Includes everything in the house. I had to get something so this is how I did it.

[Jade]

And then after the year you'll own it?

[Sarah]

Yes.

[Jade]

Okay.

[Sarah]

It's 5,229 total. Okay.

[Jade]

Okay. Keep going down the debt. What else do you have?

[Sarah]

I have basically that's all the debts is the furniture bill and the credit cards. And then my stupid butt got some payday loans I'm gonna work on getting.

[Jade]

What do you own the payday loans?

[Sarah]

2400 total.

[Jade]

Okay.

[Sarah]

1320Amonth.

[Jade]

Okay. So yeah, you're right. Those payday loans, those will suck the life out of you. So I want those at the very, very top of the list. Do whatever you can to get those things out. I. I really, really want. And I know that this doesn't happen overnight, but if you find the right folks, it can. I really want you to get plugged in. In a church or into some community because you can't do this alone, you abs. I mean, you are running on fumes already. So you got to get somewhere and you've got to tell your story.

[Dave]

That's right.

[Jade]

And you've got to let people hear what's going on, people who care. I want you to get to a local church. I want you to get plugged into a life group, and I want you saying what's going on because anybody else that hears that is going to go, if you came into my life group today, I'd be like, what can I do? Instantly. Do you see what I'm saying? So getting people around you is paramount to making this work. Okay?

[Sarah]

Right.

[Dave]

And by the way, because we're running out of time, I want. I want to set her up, Christian, with one of our financial coaches. Please. Let's get it. Let's. Let's gift her session so that there's just a little bit more time and they can help you with a plan because we just cannot cover all of this in the small time we have with you. Secondly, Christian, you've done this before. Also. Let's figure out what churches we know in the area where she lives specifically. We will also make some connections to this church for you or churches. And I cannot say what Jade said is absolutely the number one thing you got to do right now. Now, the coach will help you. Our coach, financial coach, will help you and come up with a game plan. But you gotta go tell your story because people's hearts will break with yours and you will get help. You've gotta be okay to say, I need help. No shame in your game, Sarah. You stepped up. You did what you did. No one's judging you, including us.

[Jade]

Everybody just wants to help us some help. Yeah.

[Dave]

Yeah. So hang on line. Christian's amazing. He'll take good care of you. Sarah, Help is on the way. Keep your chin up. There's a plan. This is the Ramsey Show.

[Jade]

CHM isn't health insurance.

[Sarah]

It's a health cost sharing ministry. Check it out for [e-mail] budget.