My Parents Lied About My Student Loans Being Paid Off (Am I Still Responsible)

Summary

The Ramsey Show Highlights

Episode: My Parents Lied About My Student Loans Being Paid Off (Am I Still Responsible)
Air Date: August 17, 2025
Hosts: Dave Ramsey & George Kamel
Caller: James

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Episode Overview

In this compelling episode, Dave Ramsey and George Kamel field a call from James, who recently learned his parents had taken out a $13,000 Parent PLUS loan on his behalf without his knowledge. Years later, his parents have come asking James to assume responsibility for the loan—which now, with interest, totals $17,000. The hosts navigate the core questions: Is James responsible, legally or morally? The discussion turns into a masterclass on boundaries, family financial transparency, and taking control of your own financial house—sprinkled with Dave and George’s signature direct, sometimes humorous tone.

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Key Discussion Points & Insights

1. Caller Backstory: Discovery of a Secret Loan

• James (00:37): Paid off the $15,000 in student loans he knew about. Recently learned his parents took an additional $13,000 Parent PLUS loan without telling him. They are now asking him to take over its payments.
• Key Details: The loan is entirely in the parents’ name. For nearly a decade, they made only minimum payments, and interest during COVID paused or compounded. The balance is now $17,000.

2. Legal vs. Moral Responsibility

• Legal Perspective (02:37):
  • George Kamel (02:37): “...it’s not [your debt] because it’s in their name, not yours. So legally it’s their responsibility.”
  • Dave Ramsey (02:50): “Oh, there’s no question about the legal part.”
• Moral/Ethical Perspective (02:53 – 04:36):
  • James (02:58): Asks if he’s ethically obliged to help, expressing concern for his relationship with his parents.
  • Dave Ramsey (04:36): Emphasizes that the parents’ request is not morally right and that James has a right to be upset, but admits it’s a small amount of money for James’s current financial situation.

3. James’s Financial Reality & Advice for Action

• James and his wife’s income: $305,000/year with only a car loan and a $30,000 emergency fund. (03:06 – 03:15)

• George Kamel (03:26): Expresses surprise: “Why is a couple making $305,000 having trouble paying for a car in cash, let alone paying off the loan?”

• Dave Ramsey’s Direct Assessment and Steps (04:36 – 07:09):

  • Suggests James pay off the Parent PLUS loan just to “get rid of it,” despite believing he isn’t morally obligated.
  • Calls for a reset: pay off the car, rebuild the emergency fund, and set hard boundaries with parents if they spring surprise debts again.

  Memorable Quote:

  • Dave Ramsey (06:22): “If you come at me again with another one of these, I'm going to give you a big fat nope. And you can chew on my big fat nope because I'm not going to do it. Nope. This is wrong.”

4. The Bigger Issue: Financial Communication & Parent PLUS Loans

• Ramsey & Kamel (07:26 – 07:57):
  • Critique Parent PLUS loans as “a cancer on relationships.”
  • Explain the mechanics: parents take them at high interest because the student can’t qualify, often setting up painful family dynamics years later.
  • George Kamel (07:31): “We get this call once a month... where the parents didn’t even tell the kid.”

5. Broader Financial Lessons

• Dave Ramsey (08:05): Rebukes the attitude of “kicking the can down the road,” using a humorous echoing “we’ll worry about it tomorrow” chorus to highlight the generational denial about student debt.
• Emphasizes the importance of honesty with your kids about money, keeping commitments, and not burdening future generations out of your own embarrassment or avoidance.

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Notable Quotes & Memorable Moments

• On Legal Responsibility:
  • George Kamel (02:37): “Legally it’s their responsibility.”
• On Moral Clarity and Setting Boundaries:
  • Dave Ramsey (06:22): “If you come at me again with another one of these, I'm going to give you a big fat nope. And you can chew on my big fat nope because I'm not going to do it. Nope.”
• On Parent PLUS Dangers:
  • George Kamel (07:26): “These Parent PLUS loans, Dave, it's a cancer on relationships—they're horrible.”
• On Avoidance Culture:
  • Dave Ramsey (08:05–08:31, with echo): “Student loan is the ultimate emotionally kicking the can down the road... All these lies you people tell yourself and your kids over and over and over.”

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Important Segments with Timestamps

| Timestamp | Segment | |---------------|----------------------------------------------------------| | 00:37 | James introduces his student loan dilemma | | 02:35 | Discussion of legal vs. moral responsibility | | 03:06 | James’s financial situation revealed | | 04:36 | Dave’s direct advice and boundaries on future requests | | 06:22 | Dave’s “big fat nope” quote on family boundaries | | 07:26 | Critique of Parent PLUS loans and family fallout | | 08:05 | “Worry about it tomorrow” segment—generational avoidance |

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Conclusion: Takeaways & Tone

The hosts make it clear: legally, James isn’t responsible—but taking care of this debt might be worth the peace and the relationship, given his financial leverage. More importantly, this episode is a real-time lesson in honesty, boundaries, and the dangers of letting money secrets fester in families. With their classic mix of tough love and humor, Dave and George urge listeners to “get control of their money, set healthy boundaries, and never borrow trouble (or dollars) from tomorrow.”

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For more on handling tough family financial conversations, listen to the full episode or check out resources at Ramsey Solutions.

Transcript

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[Dave Ramsey]

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[James]

I've been out of college for many years. I've paid off about $15,000, which was the entire loan that I was aware of. And recently my parents just informed me that they had taken out a loan to assist me going to College for about $13,000 and they are now ask for me to be responsible of it.

[Dave Ramsey]

So it's a parent plus loan. Correct in their name. Okay. When they took it out, was there any discussion back in the day when you were in college?

[James]

No, I literally, I didn't know it existed. You know, I thought it's because they were very honest with me, you know, about college. You know, I got FAFSA assistance, I got a lot of grants. I only went to a four year school for about two years. I went to a county college the first two years. So I really thought that that was sort of it. I didn't really realize that they had taken out.

[Dave Ramsey]

So they took out a loan and didn't tell you anything about it at all and yet they want you to be responsible for it?

[James]

Yeah, you know, they're asking for responsibility or at least help or assistance with it.

[Dave Ramsey]

Yeah.

[George]

How many years ago was.

[James]

I graduated about nine years ago.

[George]

So for a decade they've been making just minimum payments on it.

[James]

Well, there's so on top of the 13,000, there's $4,000 accrued in interest. So it's totaling out to around 17.

[Dave Ramsey]

So they took out a loan and they didn't pay on it for a decade.

[James]

Well, there was a good portion of time with COVID forgiveness I believe that had.

[Dave Ramsey]

Sure.

[George]

But the balance has grown.

[Dave Ramsey]

They did not pay on it for a decade.

[James]

Yeah, yeah, no, absolutely.

[George]

And now they don't like this payment in their life. They're probably having their own financial problems. They're going, well, it's really his debt, so we should go after him for it. Except it's not because it's in their name, not yours. So legally is their responsibility.

[Dave Ramsey]

Oh, there's no question about the legal part.

[George]

You're talking. Is this a moral. Ethically, what should I do as the Son.

[James]

Yeah, I think that's definitely more what I'm coming from. My wife and I.

[Dave Ramsey]

What do you guys make a year?

[James]

We make roughly about 305 a year.

[Dave Ramsey]

Okay. And you have a lot. Do you have money stacked up somewhere?

[James]

No, we don't. I mean, we have an emergency fund. We have 30,000. Emergency fund. The only debts we have are a car, payments that we're going to have paid off next April.

[George]

Can I ask a stupid question, James? Why is a couple making $305,000 having trouble paying for a car in cash, let alone paying off the loan?

[James]

We. We could have paid it in cash, but we didn't want to dip into our emergency fund.

[George]

Where's the $300,000 going? Because in my head, you can clean this debt up and savor the relationship with your parents, or you can let it, you know, crush the relationship, because people are petty.

[James]

Yeah, that's sort of where that's. So that's what I'm getting to.

[Dave Ramsey]

Okay. What George is saying is you suck at handling 300 5000. We can't figure out what you're doing with it.

[George]

Yeah, this is a sidebar, but it's connected to the first problem because you could clean this up in two months and pay them and say, hey, listen, this really isn't mine legally to pay, but I love you guys. I appreciate what you've done for me. This didn't go down how he thought it would. Here's your money. Pay it off. Even better yet, apply it directly to the loan.

[James]

We have received, you know, recent promotions within the last year with our family.

[Dave Ramsey]

Okay? So here's what. Here's what I want.

[James]

Here's what I want the entire time.

[Dave Ramsey]

Here's what I would do, okay? I would commit to getting control of my money so that my home does not look like your father's home. You want to work this hard and make this kind of money, and you want to have something to show for it that includes paying off your car immediately. And I probably, given the disparity in income, the fact that you guys make this much money, I'm probably going to reach over there and just pay that other loan off. But I do think it is completely fair for you to not do that as well, if you choose not to. Because it's not fair that you come up to someone a decade later, tell them something that they didn't even know existed, that they did not agree to, and ask them to pay something from a decade earlier. That's ridiculous. If I had done that, I would have too much honor and pride to tell my kid they had to pay it. I would have gone and delivered pizzas to pay it rather than ask you to pay it. This is not morally right, what your parents are asking you to do. It's maddening and it's frustrating. The only good news is it's a tiny amount of money. Sure, that's the only good news in the story. If it was 130,000, I'm probably just telling them, sorry, guys, you signed up for this crap. You didn't tell anybody. If you had promised them when you were 19 years old and going to school, yeah, Mom, y' all take out this loan. When I get out, I'll pay it back. It's in their name. You're not legally responsible, but you handshaked. You'd be morally responsible. I'd be telling you to write a check and shut up your whining. But they didn't tell you a stinking thing about it, and that is morally wrong. They should not have done that. You have a right to be angry about that and so does your wife because she's getting drug into this, too. And then on top of that, you guys make so stinking much money. Now, maybe the recent raises, but I really want you all to get control of your money so that it's not an issue either way. So if I'm you, I'm paying this loan off. And one, just write a check today just to get rid of it. And if you want to have a little sit down with your dad and go, dad, this is not cool. And if you come at me again with another one of these, I'm going to give you a big fat nope. And you can chew on my big fat nope because I'm not going to do it. Nope. This is wrong. You shouldn't have surprised me. You shouldn't have done this afterwards. It's wrong. But I'm going to pay it because I can and I'm going to get rid of it. I'm with you, George, on that because it's just such a stinking small amount of money.

[George]

They make that much in a month, so it's not a big part of their life.

[Dave Ramsey]

And then I'm going to pay off the car, and then I'm going to rebuild my emergency fund and no more borrowing money, okay? Period. Period. Get away from this. None of this discussion has brought you a blessing. Nothing in this was like, oh, this was so wonderful. No, none of this is wonderful.

[George]

These Parent plus loans, Dave, it's a cancer on Relationships, they're horrible.

[Dave Ramsey]

Absolutely horrible. That's just. And we see this. We get this call once a month, maybe. Yep. Or the parents didn't even tell the kid.

[George]

And what's happening is the kid can't qualify, which is pretty wild, because student loan lenders, they'll just give anybody loans. So they go, hey, parent, you're going to take it on at a higher interest rate than a normal loan for the pleasure of your kid going to college? And then they struggle to pay it off a decade later. This is the story we hear time and time again.

[Dave Ramsey]

They haven't paid anything on it in a decade. There's no struggle.

[George]

They haven't done anything that is on it. It's by the wayside. We'll let him worry about that. A decade later.

[Dave Ramsey]

Sat on it. And then they looked up, oh, somebody needs to pay this. Goodness. Yeah. So, moms and dads, this is the problem when everyone goes. Student loans don't have a. Oh, student loan is the ultimate emotionally kicking the can down the road. I don't have to worry about it.

[Caller Echo/Chorus]

I'll worry about tomorrow. We're about tomorrow. We're about tomorrow.

[Dave Ramsey]

They'll. They'll get out. They'll get a degree, they'll get a big job. They'll be making a lot of money.

[Caller Echo/Chorus]

We'll worry about tomorrow. We'll worry about tomorrow. We'll worry about tomorrow.

[Dave Ramsey]

It doesn't matter. All education's worth it.

[Caller Echo/Chorus]

We'll worry about it tomorrow.

[Dave Ramsey]

All these lies you people tell yourself and your kids over and over and over. So they go get a degree that's absolutely freaking worthless, and then they've got debt around it. And worse than that, some of you didn't even bother to tell anybody. Ugh. It's unbelievable. Create your free every dollar budget today. The simplest way to budget for your life.