A caller from Chicago named Shonda recently phoned in to “The Ramsey Show” and shocked the hosts when she revealed just how deep she was in debt. The single mother said she owed about $185,000 on credit cards alone, which included both personal and business expenses.
Business Failed, Debt Kept Growing
Shonda explained that she had started a credit repair business after losing her brother in 2020 and struggling to return to traditional work. But the business never took off. “It’s still slow,” she said. When asked how much it currently earns, she replied, “$600 a month.”
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When he heard how much debt she had, Dave Ramsey was sharp: “$185,000 in credit card debt. What the crap did you buy, Shonda?”
She admitted that during the business launch, she used credit cards to cover everyday bills and also tried to invest in side ventures like house flipping. “I was losing money trying to do different investments,” she said.
She now works in security, making $40,000 a year. Her highest annual income to date has been $60,000. On top of the credit card debt, she owes $25,000 on a car and $36,000 in student loans.
“You make $40,000. You don’t need a $25,000 car. There’s no planet that works on,” Ramsey said, urging her to get rid of the car.
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Ramsey Urges A Mindset Shift
Ramsey told her not to file for bankruptcy just yet. Instead, he advised her to stop paying on the credit cards for now and let them go bad, since many creditors will eventually settle for pennies on the dollar. “You could go through and settle these credit cards over the next five years and, you know, end up getting completely out of debt for $25,000 or $30,000,” he said.
He also encouraged her to stop focusing on quick wins and start building a steady career using her criminal justice degree. “If instead you had taken that same amount of energy and poured it into your career, you’d probably be making $100K right now,” Ramsey said.
He stressed the importance of long-term growth over short-term gains. “Where you are today is not your destiny,” he told her. “Be the tortoise, don’t be the hare.”
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“You told me two or three different things that are internet, TikTok get-rich-quick schemes. Even your credit repair thing was a get-rich-quick scheme,” he added, noting that those approaches rarely work.
To drive the point home, Ramsey opened up about his own financial collapse decades ago. “I remember being scared to death 35 years ago when Sharon and I lost everything,” he said. He shared that the experience forced him to examine the mistakes and flawed beliefs that caused the downfall. “We looked at that and said, ‘Okay, why did I fall for building a house of cards? What was driving that inside of me?'” He described how it took both financial and spiritual healing to recover and start over with a stronger foundation.
“If you’re going to go through this kind of hell, learn the lessons from the hell,” Ramsey said.
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