Dave Ramsey is a savvy finance expert. He’s also a straightshooter who isn’t afraid to call out his followers when they make bad money choices — especially when they are intelligent people who should know better.
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Consider these situations where Ramsey’s podcast callers should be thriving, but debt is holding them back.
More Than $1 Million in Debt
“Dave Ramsey Show” caller Ryan confessed to having roughly $181,000 in debt, including credit cards, personal loans, student loans, and a car loan, as well as a mortgage on a $767,000 house.
Prior to being out of work for 18 months with a workers’ compensation claim, Ryan was making as much as $220,000 per year. Even so, he’s failed to pay down more than a few thousand in debt. Ryan wanted to consolidate his debt, but his credit score wouldn’t allow it. He asked Ramsey for a solution.
“You’ve given your life away and the way you get it back is you’re gonna have to give up some stuff,” Ramsey said. “Sell your car, sell your stupid house. Get you another one later, when you get your act together.”
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The caller argued that his credit wasn’t good enough to buy another home. Ramsey suggested the caller put $140,000 per year toward debt to get out of his current situation.
“But you don’t want any pain, you don’t want to sacrifice,” he said.
Ramsey takes paying down debt seriously and doesn’t take excuses from callers.
Student Loan Debt and Young Egos
James, another caller on “The Dave Ramsey Show,” confessed to having more than $750,000 in debt, including student loans and a $350,000 mortgage, which is held by a family member.
The caller is in law school, poised to take the bar exam, while his fiancé has two years left of medical school and another two years of residency. When she completes her residency, the couple should have a combined annual income of roughly $550,000.
But even with this massive income potential, right now they are essentially broke college students. And Ramsey suggested they start living as such.
“You can’t have a house right now. You have no income,” Ramsey said, after James confessed to two big financial mistakes.
First, James has been living off his student loan money. And he and his fiancé have been living in the house with a deferred mortgage provided by a family member.
“I have not collected any interest nor have I made any payments on the property,” James said.
“Whoever your relative is has helped you step into a bear trap, and bear traps take your leg off,” Ramsey said, reiterating that James should sell the house.
“Get you a one-bedroom apartment, dude, and eat beans and rice and go to work as a lawyer making $150,000 and start cleaning up the remaining debt,” he said. “[But] you’re not going to do that, because you still think this is a good idea, but you called the wrong show because we love you enough to tell you the truth.”
Ramsey went on to say that doctors and lawyers often don’t use common sense when it comes to financial decisions.
“[M]edical doctors are about as notorious as people in the music business or the acting world for being stupid with money,” Ramsey said. “Only they add a level of arrogance to it, because they’re so freaking smart.”
Refusing to listen to James’ excuses, he concluded, “When you’re 30 years old, you guys are going to be very wealthy if you’ll… follow through on what we’re saying.”
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This article originally appeared on GOBankingRates.com: 2 Times Dave Ramsey Has Called Out People’s Terrible Money Decisions
