"You Have To Stop This!"

Summary

Summary of "You Have To Stop This!" Episode from The Ramsey Show Highlights

Release Date: June 8, 2025
Host: Ramsey Network
Episode Title: "You Have To Stop This!"

In this episode of The Ramsey Show Highlights, a distressed caller reaches out to seek advice on managing substantial debt, prompting a comprehensive discussion on debt reduction strategies and financial discipline. Host Dave Ramsey, alongside his co-host, offers practical solutions aimed at helping the caller regain financial stability.

1. Caller's Financial Situation

The episode begins with a caller expressing her concern over mounting debts. She outlines a total debt of $215,000, excluding their mortgage. The breakdown is as follows:

• Student Loans: $115,000
• Credit Card Debt: $50,000
• Home Equity Loan: $48,500

At [00:24], the caller explains:

"Basically, we're roughly $215,000 in debt. That's excluding our mortgage."

2. Source of Debt and Income

The caller reveals that the debt accumulation began after purchasing a new home a few years prior. They resorted to credit cards and a consolidation loan to manage expenses. Despite the household income of $8,000 per month, their spending habits outpaced their earnings.

At [01:09], she admits:

"We bought a new house a few years ago, and obviously we started using credit cards uncontrollably and we did a consolidation loan to pay off credit cards."

3. Asset Evaluation

Dave Ramsey inquires about their assets to assess their financial standing. The caller provides the following details:

• Home Value: $375,000
• Mortgage: $213,000
• Home Equity Loan: $48,500

At [01:55], she states:

"About 375 right now."

4. Debt Details and Age Factor

Further discussion reveals that the couple is 48 years old. The significant student loan debt accumulated over 20 years, largely due to minimal payments since college.

At [02:18], Ramsey probes:

"How you get $115,000 of student loans at 48? You never paid on them since college."

5. Income and Lifestyle Changes

The caller explains a recent increase in income over the past five to seven years, which led to lifestyle inflation and excessive spending, exacerbating their debt situation.

At [02:33], she confesses:

"We were just barely making it. And then obviously when the income changed."

6. Dave Ramsey’s Financial Advice

Dave Ramsey offers a multifaceted plan to address the debt crisis:

a. Budgeting and Expense Reduction

• Immediate Action: Cut up all credit cards to stop further debt accumulation.
• Budgeting Tool: Utilize the EveryDollar budgeting app to create and adhere to a strict budget.

At [03:56], Ramsey emphasizes:

"Get out all the credit cards and cut them up tonight. And you and your husband sit down and open the EveryDollar budgeting app and fill out a budget that you're going to stick to next month."

b. Accelerated Debt Repayment

• Debt Snowball Method: Focus on paying off debts from smallest to largest to build momentum.
• Aggressive Payments: Allocate increasing amounts monthly towards debt, aiming to pay $4,000 per month to eliminate debts within three years.

At [06:16], Ramsey asserts:

"You start paying $50,000 off a year. That's 48,000, or that's $4,000 a month. If you do that, you're debt free in three years, not counting your house."

c. Lifestyle Adjustments

• Spending Cuts: Eliminate non-essential expenses such as dining out, vacations, and unnecessary purchases.

At [04:14], he advises:

"You're not going out to eat anytime soon. Like, it's going to be three years before you see a restaurant. Unless you're working there."

d. Commitment to Change

• Mindset Shift: Both spouses must commit to the budget and support each other in abiding by the new financial plan.

At [06:20], Ramsey encourages:

"You can do this. I've seen people do it... You guys have got to make the decisions to say, that's it. I've had it."

7. Additional Recommendations

• Educational Resources: Ramsey recommends the book Total Money Makeover and the EveryDollar Premium app to guide them through the debt-free journey.

At [07:35], he suggests:

"I'm going to give you the book, the Total Money Makeover, and we're going to give you every dollar premium to help you do this."

• Investment Pausing: Temporarily halt all investments, even those with employer matching, to prioritize debt repayment.

At [08:10], the co-host states:

"Stop investing. Pause it."

8. Conclusion and Motivational Insights

Dave Ramsey concludes by reinforcing the necessity of drastic measures to overcome long-standing financial habits. He underscores the importance of perseverance and mutual support in achieving financial freedom.

At [08:11], Ramsey motivates:

"You got to free up every dollar you can free up and get this done as fast as you can."

Key Takeaways

• Immediate Debt Control: Stop using credit cards and cut unnecessary expenses.
• Structured Budgeting: Implement a strict budget using tools like EveryDollar.
• Focused Debt Repayment: Prioritize and systematically eliminate debts.
• Lifestyle Discipline: Make significant lifestyle changes to support financial goals.
• Commitment and Support: Both partners must be committed to the financial plan and support each other throughout the process.

This episode serves as a poignant reminder of the consequences of unchecked spending and the transformative power of disciplined financial planning. Dave Ramsey's guidance provides a clear roadmap for individuals seeking to escape the burden of debt and build a secure financial future.

Transcript

[Announcer]

Brought to you by chm, a biblically based alternative to health insurance. Learn [e-mail] budget hello, I'm calling today.

[Caller]

Because my husband and I are severely in debt and we are trying to find determine whether or not selling our home would be the best course of action.

[Co-host]

All right, tell us about it.

[Caller]

Okay, so, well, Basically, we're roughly $215,000 in debt. That's excluding our mortgage.

[Co-host]

What kind of. What kind of debt is it?

[Caller]

So 115,000 of it is student loan. Roughly 50,000 is credit card debt, and then another 48. 5 is a home equity loan. Okay, I know, it's horrible. It's horrible.

[Dave Ramsey]

What's your household income?

[Caller]

About 8,000amonth.

[Dave Ramsey]

Okay, now, how much was car payments again?

[Caller]

We don't have car payments.

[Dave Ramsey]

You don't have car debts. You have a home equity loan. So what'd you run all this debt up on? What's it all from?

[Caller]

Well, full transparency, obviously, that's why I'm calling is that we bought a new house a few years ago, and obviously we started using credit cards uncontrollably and we did a consolidation loan to pay off credit cards.

[Dave Ramsey]

Ah, that's the home equity loan, but.

[Caller]

It didn't cover all of. The home equity loan is to pay off the original debt we had on credit cards, but it didn't cover all of it.

[Dave Ramsey]

And you didn't stop spending.

[Caller]

You're absolutely right. Yes. It was a huge mistake on our part.

[Dave Ramsey]

Okay, so what's your home worth?

[Caller]

The home loan is the mortgage. It's 213,000 for the home that we're currently in.

[Dave Ramsey]

Okay. And the home equity loan again was what?

[Caller]

48. 5.

[Co-host]

Okay.

[Dave Ramsey]

And what's the house worth?

[Caller]

About 375 right now.

[Dave Ramsey]

Okay. All right, well, you can work your way out of those two things. How much is the credit card debt again?

[Caller]

50. Right. At 50.

[Co-host]

Okay.

And you have 115 in student loans?

[Caller]

That is correct.

[Dave Ramsey]

Okay. How old are you guys?

[Caller]

48.

[Dave Ramsey]

How you get $115,000 of student loans at 48? You never paid on them since college.

[Caller]

Honestly, very minimal.

[Co-host]

So they've just been hanging around for 20 years.

[Caller]

Sorry. Yes. The amount of money we're making now just recently changed, probably in the last five to seven years. Prior to that, the income was very low. And so at the time, I mean, it was. We were just barely making it. And then obviously when the income changed.

[Dave Ramsey]

Okay, when did the income change again?

[Caller]

I would say probably in the last five years or so.

[Dave Ramsey]

Okay. But you immediately adjusted your lifestyle up and are spending all of it.

[Caller]

Correct. And now we're seeing that we're just. It's. It's out of control. And, you know, obviously we're thinking about retirement, what we're going to do in the next 15, 20 years. And I don't know. It's depressing, to be honest.

[Dave Ramsey]

Yeah, I can imagine.

[Co-host]

All right.

[Dave Ramsey]

Okay. The first thing I would do is the two of you, both of you sit down. What are your cars worth?

[Co-host]

Nothing.

[Caller]

They're both 2014. Why? I don't want to say nothing, but they're both 2014 model. I'm gonna say maybe three. Three grand. Three or four grand. I mean, I'm driving a Ford Focus. He's driving a Dodge Charger.

[Dave Ramsey]

Yeah.

[Co-host]

Yeah. Okay. All right.

[Dave Ramsey]

All right. So the. The answer to the equation is the problem here is not the credit card debt or the student loan that's been hanging around. The problem is you guys have never in your married life learned how to live on less than you make, and it's caused all of these other things. So the first step is to learn to live on less than you make. Get out all the credit cards and cut them up tonight. And you and your husband sit down and open the EveryDollar budgeting app and fill out a budget that you're going to stick to next month. Then we're going to work extra above the 8,000 and earn some more money. We're going to look around, see what we can sell. We're not going out to eat anytime soon. Like, it's going to be three years before you see a restaurant. Unless you're working there. You're not going on vacation. You are broke people. Broke people don't go out to eat, and broke people don't go on vacations. You've got to change this cycle. You don't need any clothes. You've got a bunch. You don't need any toys. You got toys coming out your ears. Motorcycles, sea doos, boats, lawnmowers around Any of that?

[Caller]

No.

[Dave Ramsey]

Okay. All right, then you. Well, you've been spending your money on experiences. You've been spending your money on experiences. Those aren't assets. They're problems. But okay, all right, so anyway, so we're gonna live on nothing on this budget, and we're gonna start putting 2000, then 3000, then 4000, then $5000 a month towards these debts. We're gonna list them smallest to largest, and that'll be the credit cards, and we're going to attack them in that order. You're never going to use a credit card again in your entire freaking life. If you do, you're going to retire and eat dog food. You have to turn this around. You have to stop this. You've got a 20 year habit pattern that's going to be very difficult to break. And that's why I'm being so in your face.

[Caller]

I need that. We need it. I mean that we absolutely need it.

[Dave Ramsey]

You can do this. I've seen people do it. But the challenge is it's not like we've been married 20 months and we were stupid. We've been married 20, 25 years doing stupid. So we got to break those. Those patterns. And you're not stupid, but you've been doing some stupid stuff. I'm not stupid, but I've done some stupid stuff. Okay? So we're all in the human race together now. You guys have got to make the decisions to say, that's it. I've had it. We're not living like this anymore. And flip the switch and change right now and start aggressively attacking this debt. Smallest to largest, living on a written budget that both of you are in agreement to. And you start making a game, an emotional game, out of how much debt we can pay, how little we can buy, and how much debt we can pay and how much debt we can pay. And here's the. Here's the equation. Okay? You start paying $50,000 off a year. That's 48,000, or that's $4,000 a month. If you do that, you're debt free in three years, not counting your house.

[Caller]

Mm. Should we stop?

[Dave Ramsey]

You drove right past that.

[Caller]

No, I heard you. You said we could do within three to four years, we could have everything paid off if we start throwing $4,000 at it.

[Dave Ramsey]

And that means you're living on nothing. Beans and rice, no life. Your friends think you joined a cult. Okay, that's what it's going to take. All right, you hang on. I'm going to give you the book, the Total Money Makeover, and we're going to give you every dollar premium to help you do this. And if you'll get in that dadgum app that we have built that is so freaking powerful, it's unbelievable. It will take you by the hand and walk you guys through it. But the two of you both have to commit to no more buying of anything.

[Co-host]

And yes, Amber, to answer your other question, Stop investing. Pause it.

[Dave Ramsey]

Yes, Stop investing. For sure.

[Co-host]

Pause it. Even though we got a match. You're crazy. You don't have any money.

[Dave Ramsey]

You don't have any money. You got to free up every dollar you can free up and get this done as fast as you can. Wow. Really scary. But you got to get after it. That's how it works.

[Co-host]

Dave. This is, this call, I think is more Americans than we want to believe.

[Dave Ramsey]

Oh, it's out.

[Co-host]

They don't know what to do.

[Dave Ramsey]

30 years sitting in this chair. Yeah. Every day. This is the Ramsey Show.

[Announcer]

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