As someone who has gone through a debt relief company I can truly say it’s not worth it. Using National Debt Relief is the biggest regret on my debt free journey. Dave is 1000% correct in what he is saying here.
Why? I know someone who did it. Ended up paying 80% of the balance (as of the start of the program) between settlement amounts and lawyer fees over 5 years and didn't have to pay interest during those 5 years either. Given his limited employment he had NO CHANCE of paying it off otherwise. Debt relief works provided you get disciplined the moment you sign on.
Fk that....that stuff is good. I know somebody who did it and ended up with some thousand dollar payment at the end of 2 years. Now, his credit score is back up higher than before....credit gets cleared after a couple years anyway.
I was once a Director of a nonprofit and got paid 23k a year for full time work. Now indirect 4 nonprofits and make 218k a year. Just depends. But she's not doing great with this situation.
I went with one of these companies when I was younger. It’s worked for me cause I did not care about credit anymore and checked out. It held me back for 10 years cause I was stuck at a job I didn’t like, and it was extremely difficult to find an apartment. Looking back if I had found someone like Dave 30 years ago I would not have done this.
There is no shortcut, pay back the money you borrowed and don’t do it again. I was lucky to do bad financial moves at 19 which prevented to do it in my 30s and 40s
Invest judiciously, keep a stop loss figure. Shuffle between debt and equity wherever the ratio goes too off your target. As for the target, I recommend a Ratio like this Debt % should be equal to your age in years. If you are 20, debt is 20%, reset in equity. If the market falls or rises drastically, your debt % will change, which you should rebalance to 20% and bring back equity to 80%. Thus you would have bought low or booked profit depending on if it was a crash or a bull run.
Effective personal finance management is more important than the amount of money saved, regardless of whether income is earned through job or investment. Individuals can seek counsel from a certified financial advisor to optimize financial outcomes, who can provide specialized advice and methods to decrease expenses and maximize income.
I completely agree; I am 60 years old, recently retired, and have approximately over 2million dollars in external retirement funds. I am debt free and have very little money in retirement funds compared to the total value of my portfolio over the past three years. To be honest, the Fin-advisor can only be neglected, not rejected. Just do your due diligence to identify a fiduciary one.
Finding financial advisors like ‘’Aileen Gertrude Tippy’’ , who can assist you shape your portfolio would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.
Thank you for the information. I conducted my own research and your advisor appears to be highly skilled and knowledgeable. I've sent her an email and arranged a phone call. Her expertise is impressive, and I'm eagerly anticipating our conversation.
i completely agree with Dave Ramsey's advice : increasing income and creating a budget is a sustainable way to get out of debt, rather than relying on debt relief companies that could harm your credit score.
Worked for me- debt company negotiated with my creditors and lowered my rates substantially.They paid every single month. My credit score soared from in low 400’s to well over 800 today. They’re not all evil and NO, not like bankruptcy. I still paid EVERY credit card balance that was due. Now these same companies continually send me credit card apps lol
Thank you Dave for talking about this! I have a similar situation of getting letters of debt forgiveness relief in the mail and it I figured it wouldn't be worth it. But this was a great topic to cover! Great way to break it down and explain the process! Never worth signing up for a program like that.
I never thought debt relief was the answer to solving debt problems. Thank you, Dave Ramsey! You gave me another reason not to go that route. I nearly maxed out one of my two credit cards and now I'm paying it off on my own, slowly and surely. One day at a time!
When we were flat broke years ago, we refused to use one of those companies. We were able to borrow the money to pay off our debt, and did not go back into debt. Was it the best way? No, but we were disciplined enough to not go back into debt. Many people aren't, which is why the Dave Ramsey way is better. There was no Dave Ramsey way when we were broke.
@@BrianW211 Yes,but for a much shorter period of time,specially if borrowed at a lower interest rate. That's how I went from $102K in debt five years ago to 12 creditors at 25-30% interest to $75K 3 years ago to 6 creditors and currently at $27K @ 7% to just one creditor...You have to be disciplined and smart enough to know the deadlines as when the favorable rates expire.
@siva47931 I said there was no "Dave Ramsey way" back when we were broke. Dave Ramsey was broke back in the '80s. That's when we were broke. There was no Ramsey plan back then.
@BrianW211 Technically, yes. But it was an easier payoff just to one payee, and we paid it off earlier than we would have. We paid off all of our debts and caught up on our rent. We paid off the loan company early, and we were done. No more debt and stress.
I personally did this. I almost signed up for a debt relief company and then realized I could do it myself so I left them. Unless im missing something… yes my credit score was in the 500s during the process but I paid i settled it all and every time I paid off a debt my credit shot back up. I just paid my last one off and about 2 weeks later my credit score was 700… so where’s the downside? It shows settled for less than but so far no one seems to know or they don’t care. I’m buying a house and they saw my credit and said great ! 700 is awesome blah blah
I couldn't help noticing that Dave is criticising a debt relief company, but this video is sponsored by Yrefy which is .... hold on, a debt relief company.
I think it's a moral distinction for him. He is clouded by his hate for student loans. But there are also people who have so much student loan debt they have no other choice. And bankruptcy doesn't help.
I mean yrefy does offer actual loans but it’s still kinda the same deal. I work in collections and these companies are a pain and there is no guarantee it’ll workout either. The creditor has to agree to the settlement plus the fees and taxes don’t make it that much cheaper
I mean, he's also talking about how it will ruin her credit score, when normally he says credit scores are worthless and just show how much of a slave to debt you are... His advice can be a little two-faced if you haven't noticed!
I think there is a difference between the type of "debt relief company" the caller was considering and a refinancing consolidating debt relief company like Yrefy as Dave was kinda getting at at the end of the video.
Very true and that’s exactly what happened to me and my wife when one of these companies stopped paying we ended up getting a very bad credit, she’s very mad at me for a bad decision like that and I wish I knew this before.🙏🏾
Too bad you weren't working together with your wife to pay off this debt. The way you say she went behind your back, yiu just threw her under the bus in front of strangers on the internet. It shows what kind of "husband" you are. She was probably so overwhelmed and stressed that she just wanted some help, some breathing room. You can say the debt relief company sucks. You can say your wife sucks. You know who really sucks...YOU!!!
It's funny how so many people call the Dave Ramsey show but they already know the answer on what they should do I understand some of those are complicated but for the most part people know right from wrong😮😅
I am pretty well educated and work a lot.. make decent money. It comes down to discipline and sticktoitivness. I have learned to enjoy podcasts and my meals. I don’t spent much on anything besides my kids.
The fact she's so far in debt, then comes up with a 4 year scam to destroy her credit indicates they both need to sit down and have a heart to heart about their finances, BEFORE he gets married. Otherwise after he marries her she starts taking out payday loans @55%.
Having a bad credit score is different than having no credit score. You need to have either a good credit score or no credit score (with manual underwriting) in order to qualify for a mortgage.
To say he doesn't care about credit scores is to say people don't care if their house is infested with cockroaches. It matters and he cares. He wants the problem gone as quickly as possible.
Rubbish. They NEVER say that. To say he doesn't care about credit scores is to say people don't care if their house is infested with cockroaches. It matters and he cares. He wants the problem gone as quickly as possible.
Avoid these companies. They exist for the same purpose payday lenders exist. Taking advantage of people who are desperate and have a history of poor financial decision making. There is no easy way out of debt.
That’s the thing though people have it twisted. “21k isn’t that bad why get a second job”🤦🏻♂️🤦🏻♂️ let me kick this can down the road like our government😂😂
If he's working a class 1 Railroad, there's no way he can work anywhere else, being on a 2 hour call if he's with CSX or NS etc. $160K/yr as a qualified engineer. And he's never home.
My mom did this without thinking and lost another $8000.00 by sending them several hundred a month she could have paid off the smaller credit card bills herself. So now she is out $8000 plus more with the credit card debt that’s been accumulating interest all along because no payments ever went to pay down her debt. They just took her payments and did nothing for her.
How do they just take $8,000 and NOT pay down the debt?? This makes no sense.. I assume they get paid to do this job, but l can't imagine them taking $8,000 to do it!
1:35... That is EXACTLY what Freedom Debt Relief just recommended I do. I pretty much said to her everything Dave just said. "Uh, uh...ummm...well....."
I have heard that if you can get a loan at 2% and pay off debts that are at 30%, that might be helpful. The problem was that the people doing it were retired. Not sure how they expect to pay back any debts at their age.
If you get too far behind on credit card debt they will just sell your debt to collection for pennies on the dollar. Then you can settle with the debt collectors for 10-15 percent of what you owe. You don't have to do anything. The debt collectors will call you with offers and then you haggle with them to get the deal you want. Yeah it dents your credit score but you can build that back up fairly quickly by being responsible. You don't need a relief company.
I’d rather them pay the minimums on each card, credit score would still be down from utilization being high,but much better than showing late payments or collections for the next 7 years and losing relationships with card companies in itself.
@@Jumperman12mac lol im pointing out that Dave crap son credit and swears you dont nee it for anything but for some reason is worried about their credit in this situation? its like an accidental slipup he didnt realize...the fact is MANY people rely on credit even while climbing out of debt, MANY people have no debt and use credit for their advantage to make money in perks...MANY in not most viewers in debt will NEVER be millionaires lol they just dont want to be in debt anymore...BUT the issue is Dave cant tell people he knows cant handle money credit is ok it complicates his system...Dave preaches one thing but thinks a little different realistically...rich people dont need credit poor people do...It cna be used as a good tool but its not an option across the board since most cant be trusted to use it and proved that already...
BAD credit causes problems other than being able to borrow money. NO credit may cause a few minor inconveniences that are easily solvable by those of us who understand and follow Dave's plan. When you learn the difference, you'll understand Dave's teaching on this subject. It's worth your time, truly.
Hearing these stories makes me feel really blessed to be working where I work. Last year I owed 31k in credit card debt. I went tax exempt the first 3 month of the year averaged 92 hours a week, had it paid off by April. This year I’m doing the same to pay off my wife’s jeep we owe 15k. Should be done by February.
@@sunnysmilesalways8061first 3 months of the year I changed my w4 to exempt so I had no federal taxes taken out, then rest of the year I claim single 0 deductions. That allowed me to get that money up front to pay my debt off instead of the government getting it. While I’m working a lot of hours that would cause extra taxes taken out. Still will get back around $300 federal return this year. You just gotta know where your income and tax liability will be at end of year so you reach the break even point without owing. I’ve worked at the same place 8 years so I got a pretty good idea how to do it without owing.
Having credit (or debt) is bad, and Dave is consistent about that. Defaulting or going bankrupt instead of paying your debt is worse, because you lose the ability to make the full range of decisions yourself. Dave is consistent there as well.
If you’re getting killed by interest you can try doing a balance transfer to a card with 0% interest. Find a card that’s interest free for the first year and transfer balance from high interest card over.? Curious what Dave thinks about this. Never did it myself but was close. Had 12k in debt between 5 cards. Paid off 4 and closed the accounts down entirely. Only 2k left and one card to go! 💪 can’t wait to be free thanks Dave for your guidance
That only works if (1) You can get approved for another card. and (2) You can get approved for a high enough limit to cover your existing card debt. If you are having trouble making your credit card payments, then you will fail at either (1) or (2). Additionally, and unlike several years ago, balance transfer fees are typically around 3%, so it's not as free as you think it is.
I have done this many, many times.. and even when they started charging a transfer fee with the balance transfer to the 0% card, l STILL saved money. It's a smart move to make to get out of higher interest cards..
Dont do it. I was taken to court thanks to a company called “freedom debt relief”. They “took over” my payments, while charging me a monthly fee. My creditor did not settle, so they took me to court for the full amount. Long story short: after paying these crooks for nearly two years, I ended up having to pay my creditor the full amount. So, full amount PLUS the fee for “settling my debt” to these P.O.S company. Talk about stupid tax. DO NOT GIVE THESE CROOKS A DIME.
the beans and rice thing, just be aware that you still need essential fats and b12. you don't want to be a deteriorated vegan. adding some omega 3 eggs would be a really good idea.
@@amireallythatgrumpy6508 i feel like within the metaphor there is a point where dave actually does want you to literally place a large bag of beans and a large sack of rice in your cart as a cheap source of sustenance. beans and rice together contain all the essential amino acids so they can keep you alive for a while, but you need b12, healthy fats and other essential nutrients so it's best to keep some meat and eggs in your diet even if you are trying to keep costs down.
I stopped paying student loan payments one time for about 7 months back in 2008. Completely unaware of what that would do to my credit. It. Destroyed. It. Let me tell you 😂. I dont recommend that. Also as soon as he said "daycare" i knew her income would be low no matter the position. They dont pay shit.
Why does Dave care about whats going to happen with the credit score \ report if the whole point \ goal is go not use credit at all ? What does it matter if you have a bankruptcy or a "fico of 300" if they are instructed to not use any credit whatsoever in the future?
I paid up all my mortgages in 2yrs while working with a Financial Adviser. I’m 50 and my husband 54 we are both retired with over $3 million in net worth and no debts. We got to realize that the secret to financial freedom is making better investments.
If anything, the situation will worsen. Affordable housing will soon become unaffordable. Therefore, I advise taking action now, as today's prices will seem low compared to the future. Until the Fed takes more stringent measures, I anticipate widespread hysteria due to rampant inflation. You can't remove the band-aid halfway.
Home prices will come down eventually, but for now; get your money (as much as you can) out of the housing market and get into the financial markets or gold. The new mortgage rates are crazy, add to that the recession and the fact that mortgage guidelines are getting more difficult. Home prices will need to fall by a minimum of 40% (more like 50%) before the market normalizes. If you are in cross roads or need sincere advise on the best moves to take now its best you seek an independent advisor who knows about the financial markets.
I really don't like making such recommendations, because everybody's situation is unique. But there are many freelance advisors you could check out. I have been working with ''Melissa Terri Swayne’’ for about four years now, and she's really, really good. If she meets your discretion, then you could go ahead with her. I endorse her.
This is a common misunderstanding of Dave's teaching. Dave doesn't want people to (and I quote) "Worship at the alter of the great FICO." Meaning, you shouldn't spend your time in debt just to "build your credit." But, that's not saying the same thing as, "You shouldn't pay your bills which will trash your credit score." There are very real consequences to having a BAD credit score caused by not paying your bills as agreed. High insurance rates is one. Up to 10 years of debt collectors hassling you is another. Missing employment opportunities for some jobs that check your credit is a thrid. There are others. Dave doesn't want people to have BAD credit scores; rather, he wants you to have NO credit score. When you understand the difference, you'll understand what Dave teaches.
I love Dave but isn’t it hilarious how we’re talking about don’t refinance but he’s advertising for a refinance option on student loans😂 I know it’s somewhat different but funny coming from Dave
They’re not married. It’s not his problem. If he had any spine, he’d tell her to pay it off herself before they get married. That should buy him more time to figure out of she’s really marriage material.
I've been following Ramsey advice for years. When I started a new job a year and a half ago, I talked modestly about my approach to money, and inspired one of my younger coworkers to start working on her debts. It has been one step forward, two steps back for the last year and a half. She proudly came to me a month ago to tell me she's finally got her head in the right place and her ducks in a row to make 2025 the year she starts committing herself to getting her debt paid off--and then explains that she signed up for one of these "debt consolidation" programs. When I asked her questions about repayment, and interest, I could tell she didn't understand the details. I don't use credit myself, and I hadn't even thought about how those companies actually make their own profit by going into default with other peoples' credit lines. I am so horrified for my coworker, and this video hurts to watch. Not sure if I should continue beating her over the head with my attempts to be a gentle cheerleader for her financial freedom, or just let her reap what she has sown. This sucks.
Something tells me this guy didn’t call to hear about eating rice & beans or working longer hours to get of debt. I’m guessing he called to see how he could get out of debt quick and easy without any effort.
One thing not mentioned: She is gainfully employed, the credit card companies will not settle her debt, they will sue her and start garnishment proceedings. The debt relief company will not resolve her problem, just compound it. If she wants to go the bankrupt path, the court will make her pay monthly for a period of time, and may even make her pay it all back. Bad credit is the goal of the Baby Step plan. If you get to cash only and never borrow again, you will have "bad credit". Yourscore will fall to the bottom eventually.
If you don’t pay your bills you will have derogatory marks on your credit report. Having no credit score just means you don’t have any loans currently. Very different situations. He would never recommend someone intentionally destroy their credit. Having no credit score does not destroy your credit. It just means no score. Having a record of non payment of bills will ruin your credit/reputation.
@@warwagon: She's in no position to purchase a home. And by the time she is (with or without the caller), her credit score will either recover or become undeterminable. Stop simping for Dave.
To address those who ask why dave cares about her credit score, he knows not everyone is gonna wanna go through manual underwriting to get a mortgage or pay for a house in cash. If your gonna kill your credit do it for a good reason, like being hundreds of thousands dollars in debt that takes years to pay off. Not an amount thats gone with a year of hardwork.
This makes no sense if you don't have the cash flow. Credit is a privilege, and if you do not have the cash flow, then you can not utilize credit properly. And it's nothing like filing for chapter 13, not even close! As soon as the debts are settled, your score starts going up. You can simply get a secured credit card while you're in the program to start rebuilding good debt and maintaining your secured debt, which also stabilizes your credit. Just go out there and get 5 jobs and eat beans and rice. Like you're not going to have an emergency within that time. Just pay your debt is stupid as well if you're at 30% interest and you can only make minimum payments. It's the complete opposite of what he teaches that cash is king, and you need to save money for emergencies. So if you can't save and you rob peter to pay paul, all you are doing is swapping out one large payment for another large payment with a loan. Then what happens is that you build the debt right back up when you reuse the cards and double up making theings even worse. And no, you can not negotiate the same type of terms on your own. Because the credit card compaines are going to say ok you owe $10k, great we want $6, all of it up front no payment plan. How does that help you? Shame on Dave for this bad information as he promotes a debt consolidation company for your student loans. Make it make sense.
Don’t marry her. Pretty simple. Someone with credit card debt that high and she’s a single mom? Millions of other people to build a life together with. She wants saving, and if you do that, the both of you will need saving.
Absolutely NOT. To say he doesn't care about credit scores is to say people don't care if their house is infested with cockroaches. It matters and he cares. He wants the problem gone as quickly as possible.
Dave's largest objection here is that it damages your credit. I think the biggest objection is that its IMMORAL. Why does he care so much about it destroying your credit when he advocates for you to essentially get rid of your credit score. If you aren't borrowing money then you don't have to worry about your credit score being destroyed lol
$21,000 of credit card debt is not that much. I've heard worse on this show. Buckle down, figuratively eat beans and rice AND rice and beans, pay extra on the cards and just get them paid off quickly.
To say he doesn't care about credit scores is to say people don't care if their house is infested with cockroaches. It matters and he cares. He wants the problem gone as quickly as possible.
Dave: the credit score is stupid, dont use credit cards and have a zero credit score. Also Dave: Dont use a debt relief program!! It will destroy your credit score!!
My mother convinced me to do debt relief in my early 20's. More of the garbage advice she gave me. I'm glad she's gone and I'm around people who know more about life.
@@lauralaura12345 This is happening right now in my family. There are many of these things going on in today's world. There are way more than just a few bad stories. In fact, they are not stories. They are truth.
Bad credit and no credit (not using credit) are different things. There are some situations such as mortgages they do support with guidelines. Bad credit can sink a mortgage application while manual underwriting is a solution to no credit.
*sigh* yet another one that cannot handle nuance. To say he doesn't care about credit scores is to say people don't care if their house is infested with cockroaches. It matters and he cares. He wants the problem gone as quickly as possible.
As someone who has gone through a debt relief company I can truly say it’s not worth it. Using National Debt Relief is the biggest regret on my debt free journey. Dave is 1000% correct in what he is saying here.
Yep. Better to just stop paying. If you truly want to be debt free, why do you need a credit score?
Same I used them and got fees like crazy
Why? I know someone who did it. Ended up paying 80% of the balance (as of the start of the program) between settlement amounts and lawyer fees over 5 years and didn't have to pay interest during those 5 years either. Given his limited employment he had NO CHANCE of paying it off otherwise. Debt relief works provided you get disciplined the moment you sign on.
@@CurieBohrbecause if you have bad credit you cannot buy a house or rent a place if you need to move.
Fk that....that stuff is good. I know somebody who did it and ended up with some thousand dollar payment at the end of 2 years. Now, his credit score is back up higher than before....credit gets cleared after a couple years anyway.
Man, job titles mean nothing. “She’s the Director…for $55k.”
No kidding. The Director for "multiple". Horrific.
I was once a Director of a nonprofit and got paid 23k a year for full time work. Now indirect 4 nonprofits and make 218k a year. Just depends. But she's not doing great with this situation.
Yeah she’s very underpaid
And you know when they talk to people, it's with a "tone" of success being a "director" LOLOL
@@reese85 based on how she handles her finances, I dont think she is underpaid.
Me and my wife did that. It worked out fine. Time goes by fast. Credit is easy to build and easy to destroy.
I went with one of these companies when I was younger. It’s worked for me cause I did not care about credit anymore and checked out. It held me back for 10 years cause I was stuck at a job I didn’t like, and it was extremely difficult to find an apartment. Looking back if I had found someone like Dave 30 years ago I would not have done this.
Exactly same for me
No credit > bad credit. Bad credit means you cant rent an apartment or buy a home. No credit means you just have to provide more documentation
Or just get a secured credit card to build a little credit. Good credit > no credit
Good Credit > No Credit > Bad Credit
That is terrible advice
There is no shortcut, pay back the money you borrowed and don’t do it again.
I was lucky to do bad financial moves at 19 which prevented to do it in my 30s and 40s
So true💯 there’s no quick fix.
Invest judiciously, keep a stop loss figure. Shuffle between debt and equity wherever the ratio goes too off your target. As for the target, I recommend a Ratio like this Debt % should be equal to your age in years. If you are 20, debt is 20%, reset in equity. If the market falls or rises drastically, your debt % will change, which you should rebalance to 20% and bring back equity to 80%. Thus you would have bought low or booked profit depending on if it was a crash or a bull run.
Effective personal finance management is more important than the amount of money saved, regardless of whether income is earned through job or investment. Individuals can seek counsel from a certified financial advisor to optimize financial outcomes, who can provide specialized advice and methods to decrease expenses and maximize income.
I completely agree; I am 60 years old, recently retired, and have approximately over 2million dollars in external retirement funds. I am debt free and have very little money in retirement funds compared to the total value of my portfolio over the past three years. To be honest, the Fin-advisor can only be neglected, not rejected. Just do your due diligence to identify a fiduciary one.
This is exactly how i wish to get my finances coordinated ahead of retirement. Can you recommend the financial advisor you used to get ahead?
Finding financial advisors like ‘’Aileen Gertrude Tippy’’ , who can assist you shape your portfolio would be a very creative option. There will be difficult times ahead, and prudent personal money management will be essential to navigating them.
Thank you for the information. I conducted my own research and your advisor appears to be highly skilled and knowledgeable. I've sent her an email and arranged a phone call. Her expertise is impressive, and I'm eagerly anticipating our conversation.
i completely agree with Dave Ramsey's advice : increasing income and creating a budget is a sustainable way to get out of debt, rather than relying on debt relief companies that could harm your credit score.
@CashKeys401 according to Ramsey, you need credit
Worked for me- debt company negotiated with my creditors and lowered my rates substantially.They paid every single month. My credit score soared from in low 400’s to well over 800 today. They’re not all evil and NO, not like bankruptcy. I still paid EVERY credit card balance that was due. Now these same companies continually send me credit card apps lol
Thank you Dave for talking about this! I have a similar situation of getting letters of debt forgiveness relief in the mail and it I figured it wouldn't be worth it. But this was a great topic to cover! Great way to break it down and explain the process! Never worth signing up for a program like that.
I never thought debt relief was the answer to solving debt problems. Thank you, Dave Ramsey! You gave me another reason not to go that route. I nearly maxed out one of my two credit cards and now I'm paying it off on my own, slowly and surely. One day at a time!
When we were flat broke years ago, we refused to use one of those companies. We were able to borrow the money to pay off our debt, and did not go back into debt. Was it the best way? No, but we were disciplined enough to not go back into debt. Many people aren't, which is why the Dave Ramsey way is better. There was no Dave Ramsey way when we were broke.
"We were able to borrow money to pay off our debt." If you borrowed money to pay off debt, your debt would be the same.
@@BrianW211 Yes,but for a much shorter period of time,specially if borrowed at a lower interest rate. That's how I went from $102K in debt five years ago to 12 creditors at 25-30% interest to $75K 3 years ago to 6 creditors and currently at $27K @ 7% to just one creditor...You have to be disciplined and smart enough to know the deadlines as when the favorable rates expire.
Dave is 60. You were broke over 60 years ago?
@siva47931 I said there was no "Dave Ramsey way" back when we were broke. Dave Ramsey was broke back in the '80s. That's when we were broke. There was no Ramsey plan back then.
@BrianW211 Technically, yes. But it was an easier payoff just to one payee, and we paid it off earlier than we would have. We paid off all of our debts and caught up on our rent. We paid off the loan company early, and we were done. No more debt and stress.
I personally did this. I almost signed up for a debt relief company and then realized I could do it myself so I left them. Unless im missing something… yes my credit score was in the 500s during the process but I paid i settled it all and every time I paid off a debt my credit shot back up. I just paid my last one off and about 2 weeks later my credit score was 700… so where’s the downside? It shows settled for less than but so far no one seems to know or they don’t care. I’m buying a house and they saw my credit and said great ! 700 is awesome blah blah
Can you please share more? Did you pay tax on the amount you paid? Was the tax high?
I couldn't help noticing that Dave is criticising a debt relief company, but this video is sponsored by Yrefy which is .... hold on, a debt relief company.
Obviously... Dave sold out.
I think it's a moral distinction for him. He is clouded by his hate for student loans. But there are also people who have so much student loan debt they have no other choice. And bankruptcy doesn't help.
I mean yrefy does offer actual loans but it’s still kinda the same deal. I work in collections and these companies are a pain and there is no guarantee it’ll workout either. The creditor has to agree to the settlement plus the fees and taxes don’t make it that much cheaper
I mean, he's also talking about how it will ruin her credit score, when normally he says credit scores are worthless and just show how much of a slave to debt you are... His advice can be a little two-faced if you haven't noticed!
I think there is a difference between the type of "debt relief company" the caller was considering and a refinancing consolidating debt relief company like Yrefy as Dave was kinda getting at at the end of the video.
Very true and that’s exactly what happened to me and my wife when one of these companies stopped paying we ended up getting a very bad credit, she’s very mad at me for a bad decision like that and I wish I knew this before.🙏🏾
DONT DO IT. They are ripoff artists. My wife went to one behind my back and now we can’t get them to return a phone call or email.
Too bad you weren't working together with your wife to pay off this debt. The way you say she went behind your back, yiu just threw her under the bus in front of strangers on the internet. It shows what kind of "husband" you are. She was probably so overwhelmed and stressed that she just wanted some help, some breathing room. You can say the debt relief company sucks. You can say your wife sucks. You know who really sucks...YOU!!!
It's funny how so many people call the Dave Ramsey show but they already know the answer on what they should do I understand some of those are complicated but for the most part people know right from wrong😮😅
Hurting your credit score is not the worst thing in the world😮
I am pretty well educated and work a lot.. make decent money. It comes down to discipline and sticktoitivness. I have learned to enjoy podcasts and my meals. I don’t spent much on anything besides my kids.
The fact she's so far in debt, then comes up with a 4 year scam to destroy her credit indicates they both need to sit down and have a heart to heart about their finances, BEFORE he gets married.
Otherwise after he marries her she starts taking out payday loans @55%.
Why is Dave worrying about their credit getting ruined? I thought he didn't care about credit scores?
Having a bad credit score is different than having no credit score.
You need to have either a good credit score or no credit score (with manual underwriting) in order to qualify for a mortgage.
@@bradleymaravalli2851 But if you're not looking to buy a house, then good, bad, or no credit is irrelevant.
@@bradleymaravalli2851 In addition to this, he believes that because you borrowed the money, you should pay it back. Just from a moral standpoint
To say he doesn't care about credit scores is to say people don't care if their house is infested with cockroaches.
It matters and he cares. He wants the problem gone as quickly as possible.
He’s talking about someone’s FICO. Not Credit
Where do people get the idea they can buy things and not have to pay for them?
Jennifer Garner
it's not thinking, it's feeling and impulsivity
@alinatamashevich3354 Dave Ramsey, he filed bankruptcy
@@siva47931 No he didn't. That's just a business origin story he made up that gullible people like you believe.
People run into hardships in life unfortunately
The worse part is northing to show for the debt.
They always say that your credit score doesn't matter and then say repeatedly in this call that it will damage your credit to go that route haha
Rubbish. They NEVER say that. To say he doesn't care about credit scores is to say people don't care if their house is infested with cockroaches.
It matters and he cares. He wants the problem gone as quickly as possible.
Avoid these companies. They exist for the same purpose payday lenders exist.
Taking advantage of people who are desperate and have a history of poor financial decision making.
There is no easy way out of debt.
I work for a debt help charity and we are nothing like pay day lenders. We help people, so let's not generalise.
@helengoddard3477
You're there to help yourself or you wouldn't be in business.
In other words, taking advantage people who are desperate.
I had to sell feet pics online to a bunch of thirsty guys to pay off my debt and don’t regret it one bit
@@helengoddard3477Surely the charity is not a ‘debt relief company’ which is what is being discussed.
Have you ever dealt with one of these? Because I have, and you're wrong.
Thank you for the sound advice.
21k isn't that bad. You can pay that off by making sacrifices and getting a 2nd job.
In one year at that
That’s the thing though people have it twisted. “21k isn’t that bad why get a second job”🤦🏻♂️🤦🏻♂️ let me kick this can down the road like our government😂😂
No becayse The jobs suck
If he's working a class 1 Railroad, there's no way he can work anywhere else, being on a 2 hour call if he's with CSX or NS etc. $160K/yr as a qualified engineer. And he's never home.
Plus he is under hours of service restrictions.
My mom did this without thinking and lost another $8000.00 by sending them several hundred a month she could have paid off the smaller credit card bills herself. So now she is out $8000 plus more with the credit card debt that’s been accumulating interest all along because no payments ever went to pay down her debt. They just took her payments and did nothing for her.
Why didn't she ask her husband or another man for advice?
@ he is deceased.
How do they just take $8,000 and NOT pay down the debt?? This makes no sense.. I assume they get paid to do this job, but l can't imagine them taking $8,000 to do it!
1:35... That is EXACTLY what Freedom Debt Relief just recommended I do. I pretty much said to her everything Dave just said. "Uh, uh...ummm...well....."
Don’t save her ! Single mom. Makes no money and has 20k in debt. You help her pay this off, she will leave you brother
I'm curious if the baby daddy is still in her life. She made a kid with someone. What's her relationship with that guy?
@ that part ! I’m sure he’s around and they switch off , and he probably pays her in child support
I have heard that if you can get a loan at 2% and pay off debts that are at 30%, that might be helpful. The problem was that the people doing it were retired. Not sure how they expect to pay back any debts at their age.
More likely than not the girlfriend just can't live within her means. Until she can do that, getting rid of the debt is just going to fight a symptom.
I'd love to know if it works the same for these tax relief companies.
The best thing you can do. Is keep her as a girlfriend!
YASSSS. absolutely do not marry her
Except they are living together, so he is finished
No. Best thing he can do is leave.
Best thing he could do is find a wife, and it ain't her!
Hit it and quit it when he gets tired of her. Pump and dump. Then move on to the next.
If you get too far behind on credit card debt they will just sell your debt to collection for pennies on the dollar. Then you can settle with the debt collectors for 10-15 percent of what you owe. You don't have to do anything. The debt collectors will call you with offers and then you haggle with them to get the deal you want. Yeah it dents your credit score but you can build that back up fairly quickly by being responsible. You don't need a relief company.
I’d rather them pay the minimums on each card, credit score would still be down from utilization being high,but much better than showing late payments or collections for the next 7 years and losing relationships with card companies in itself.
1:55 - I thought Dave said you don't need a FICO score, so why does he care about destroying your credit here?
You missed the point
Listen again and listen carefully
The girlfriend is a big girl now and should call in herself. She also needs to control her impulses. It's what a mature, responsible person does.
all I heard was it hurts your credit stay away, LMAO
I mean this channel is not about credit anyways so you'll be fine.
@@Jumperman12mac lol im pointing out that Dave crap son credit and swears you dont nee it for anything but for some reason is worried about their credit in this situation? its like an accidental slipup he didnt realize...the fact is MANY people rely on credit even while climbing out of debt, MANY people have no debt and use credit for their advantage to make money in perks...MANY in not most viewers in debt will NEVER be millionaires lol they just dont want to be in debt anymore...BUT the issue is Dave cant tell people he knows cant handle money credit is ok it complicates his system...Dave preaches one thing but thinks a little different realistically...rich people dont need credit poor people do...It cna be used as a good tool but its not an option across the board since most cant be trusted to use it and proved that already...
So using credit, paying interest and making others rich is smart?
Signed up yesterday was nervous/excited but then got a feeling i had made a mistake. Canceled this morning!
Since Dave doesn't believe in credit, why would it matter if your credit is destroyed?
Perhaps because there are still debts owed
BAD credit causes problems other than being able to borrow money. NO credit may cause a few minor inconveniences that are easily solvable by those of us who understand and follow Dave's plan.
When you learn the difference, you'll understand Dave's teaching on this subject. It's worth your time, truly.
Please don't do it, my credit was worse after dealing with them. One of the credit card companies told me I should have called them.
Bankruptcy is a much better deal and why should Dave care about bad credit when he says you don't need credit anyway?
Hearing these stories makes me feel really blessed to be working where I work. Last year I owed 31k in credit card debt. I went tax exempt the first 3 month of the year averaged 92 hours a week, had it paid off by April. This year I’m doing the same to pay off my wife’s jeep we owe 15k. Should be done by February.
Can you explain more about this tax exemption?
@@sunnysmilesalways8061first 3 months of the year I changed my w4 to exempt so I had no federal taxes taken out, then rest of the year I claim single 0 deductions. That allowed me to get that money up front to pay my debt off instead of the government getting it. While I’m working a lot of hours that would cause extra taxes taken out. Still will get back around $300 federal return this year. You just gotta know where your income and tax liability will be at end of year so you reach the break even point without owing. I’ve worked at the same place 8 years so I got a pretty good idea how to do it without owing.
How do you go tax exempt?
I don't think I could ever work with Dave Ramsey because the minute you have your own thoughts he will probably yell at you😮😅😊😂
O Dave I thought we dont need credit
Having credit (or debt) is bad, and Dave is consistent about that. Defaulting or going bankrupt instead of paying your debt is worse, because you lose the ability to make the full range of decisions yourself. Dave is consistent there as well.
If you’re getting killed by interest you can try doing a balance transfer to a card with 0% interest. Find a card that’s interest free for the first year and transfer balance from high interest card over.? Curious what Dave thinks about this. Never did it myself but was close. Had 12k in debt between 5 cards. Paid off 4 and closed the accounts down entirely. Only 2k left and one card to go! 💪 can’t wait to be free thanks Dave for your guidance
That only works if (1) You can get approved for another card. and (2) You can get approved for a high enough limit to cover your existing card debt. If you are having trouble making your credit card payments, then you will fail at either (1) or (2). Additionally, and unlike several years ago, balance transfer fees are typically around 3%, so it's not as free as you think it is.
I have done this many, many times.. and even when they started charging a transfer fee with the balance transfer to the 0% card, l STILL saved money. It's a smart move to make to get out of higher interest cards..
Dont do it. I was taken to court thanks to a company called “freedom debt relief”. They “took over” my payments, while charging me a monthly fee. My creditor did not settle, so they took me to court for the full amount. Long story short: after paying these crooks for nearly two years, I ended up having to pay my creditor the full amount. So, full amount PLUS the fee for “settling my debt” to these P.O.S company. Talk about stupid tax. DO NOT GIVE THESE CROOKS A DIME.
the beans and rice thing, just be aware that you still need essential fats and b12. you don't want to be a deteriorated vegan. adding some omega 3 eggs would be a really good idea.
It's a metaphor.
@@amireallythatgrumpy6508 i feel like within the metaphor there is a point where dave actually does want you to literally place a large bag of beans and a large sack of rice in your cart as a cheap source of sustenance. beans and rice together contain all the essential amino acids so they can keep you alive for a while, but you need b12, healthy fats and other essential nutrients so it's best to keep some meat and eggs in your diet even if you are trying to keep costs down.
@@yanwain9454 He has laughed at people that took it literally.
@@amireallythatgrumpy6508 i hope they at least treated themselves to some salt and some hot sauce or something to give it some flavor.
If she's got a child and you marry her and she has her debt.... When the student loan debt is paid off she will leave you. Seems to always happen!😮😮😮
This is like paying someone after they guarantee that you will lose 30 pounds in 30 days without dieting, exercise, drugs/supplements, nor surgery
I stopped paying student loan payments one time for about 7 months back in 2008. Completely unaware of what that would do to my credit.
It. Destroyed. It. Let me tell you 😂. I dont recommend that.
Also as soon as he said "daycare" i knew her income would be low no matter the position. They dont pay shit.
Bro, run away from that woman. She's a single mother with credit card debt.
Why does Dave care about whats going to happen with the credit score \ report if the whole point \ goal is go not use credit at all ? What does it matter if you have a bankruptcy or a "fico of 300" if they are instructed to not use any credit whatsoever in the future?
I paid up all my mortgages in 2yrs while working with a Financial Adviser. I’m 50 and my husband 54 we are both retired with over $3 million in net worth and no debts. We got to realize that the secret to financial freedom is making better investments.
If anything, the situation will worsen. Affordable housing will soon become unaffordable. Therefore, I advise taking action now, as today's prices will seem low compared to the future. Until the Fed takes more stringent measures, I anticipate widespread hysteria due to rampant inflation. You can't remove the band-aid halfway.
Home prices will come down eventually, but for now; get your money (as much as you can) out of the housing market and get into the financial markets or gold. The new mortgage rates are crazy, add to that the recession and the fact that mortgage guidelines are getting more difficult. Home prices will need to fall by a minimum of 40% (more like 50%) before the market normalizes. If you are in cross roads or need sincere advise on the best moves to take now its best you seek an independent advisor who knows about the financial markets.
I will be happy getting assistance and glad to get the help of one, but just how can one spot a reputable one?
I really don't like making such recommendations, because everybody's situation is unique. But there are many freelance advisors you could check out. I have been working with ''Melissa Terri Swayne’’ for about four years now, and she's really, really good. If she meets your discretion, then you could go ahead with her. I endorse her.
I just checked her out on google and I have sent her an email. I hope she gets back to me soon.
Dave cares about credit? lol he goes back and forth 😂
This is a common misunderstanding of Dave's teaching.
Dave doesn't want people to (and I quote) "Worship at the alter of the great FICO." Meaning, you shouldn't spend your time in debt just to "build your credit." But, that's not saying the same thing as, "You shouldn't pay your bills which will trash your credit score."
There are very real consequences to having a BAD credit score caused by not paying your bills as agreed. High insurance rates is one. Up to 10 years of debt collectors hassling you is another. Missing employment opportunities for some jobs that check your credit is a thrid. There are others.
Dave doesn't want people to have BAD credit scores; rather, he wants you to have NO credit score. When you understand the difference, you'll understand what Dave teaches.
I wish we know the locations where people are calling. 55k is a very low salary.
It says on the screen where they're calling from
Ruin your credit to save $5000?
Even if I were married to them I'm not worried about someone's student loanor credit card debt. I had no parts in that😂😂 good luck😊
The better advice is find a different girlfriend 😂
I love Dave but isn’t it hilarious how we’re talking about don’t refinance but he’s advertising for a refinance option on student loans😂 I know it’s somewhat different but funny coming from Dave
Curious. Considering that Tamsey advocate for living with zero debt and 0 credit score, why and what does it matter if the credit score goes to crap?
No credit is better then Bad credit.
You might still need it for mortgage for example. They'd prefer if you pay cash but most people aren't able to.
All Dave talks about is saving money and buy with cash. So why would he care about credit score?
Dave has never cared about a credit score in more than 31 years so I'm not sure where you got that from
They’re not married. It’s not his problem. If he had any spine, he’d tell her to pay it off herself before they get married. That should buy him more time to figure out of she’s really marriage material.
Work harder and don’t eat
There again, why live beyond your means?? Like Dave says, if you can't pay cash, you don't need it.
I've been following Ramsey advice for years. When I started a new job a year and a half ago, I talked modestly about my approach to money, and inspired one of my younger coworkers to start working on her debts. It has been one step forward, two steps back for the last year and a half. She proudly came to me a month ago to tell me she's finally got her head in the right place and her ducks in a row to make 2025 the year she starts committing herself to getting her debt paid off--and then explains that she signed up for one of these "debt consolidation" programs. When I asked her questions about repayment, and interest, I could tell she didn't understand the details. I don't use credit myself, and I hadn't even thought about how those companies actually make their own profit by going into default with other peoples' credit lines. I am so horrified for my coworker, and this video hurts to watch. Not sure if I should continue beating her over the head with my attempts to be a gentle cheerleader for her financial freedom, or just let her reap what she has sown. This sucks.
What if im already signed in to one of those companies? What can i do now?
Something tells me this guy didn’t call to hear about eating rice & beans or working longer hours to get of debt. I’m guessing he called to see how he could get out of debt quick and easy without any effort.
She makes enough to pay that. Why are people so dang lazy?
One thing not mentioned: She is gainfully employed, the credit card companies will not settle her debt, they will sue her and start garnishment proceedings. The debt relief company will not resolve her problem, just compound it. If she wants to go the bankrupt path, the court will make her pay monthly for a period of time, and may even make her pay it all back.
Bad credit is the goal of the Baby Step plan. If you get to cash only and never borrow again, you will have "bad credit". Yourscore will fall to the bottom eventually.
As he advertises for yrefy…
Feel like they will still do it regardless.
Why pay some entity to do the same thing that you can do for yourself! PAY YOUR OWN BILLS FOLKS!
Why is Dave suddenly concerned about destroying credit? I don't understand.
Because having wrecked horrendous credit is worse than no credit. If you have wrecked credit .... You probably can't even do the manual underwriting.
If you don’t pay your bills you will have derogatory marks on your credit report. Having no credit score just means you don’t have any loans currently. Very different situations. He would never recommend someone intentionally destroy their credit. Having no credit score does not destroy your credit. It just means no score. Having a record of non payment of bills will ruin your credit/reputation.
@@warwagon: She's in no position to purchase a home. And by the time she is (with or without the caller), her credit score will either recover or become undeterminable. Stop simping for Dave.
Good advice dave Ramsey, be smart, stay apart.
Ironic that the sponsor of this video was for a company that refinances defaulted student loans
Call them directly
To address those who ask why dave cares about her credit score, he knows not everyone is gonna wanna go through manual underwriting to get a mortgage or pay for a house in cash. If your gonna kill your credit do it for a good reason, like being hundreds of thousands dollars in debt that takes years to pay off. Not an amount thats gone with a year of hardwork.
He cares because although debt is bad, default or bankruptcy is worse. He's been there.
This makes no sense if you don't have the cash flow. Credit is a privilege, and if you do not have the cash flow, then you can not utilize credit properly. And it's nothing like filing for chapter 13, not even close! As soon as the debts are settled, your score starts going up. You can simply get a secured credit card while you're in the program to start rebuilding good debt and maintaining your secured debt, which also stabilizes your credit. Just go out there and get 5 jobs and eat beans and rice. Like you're not going to have an emergency within that time. Just pay your debt is stupid as well if you're at 30% interest and you can only make minimum payments. It's the complete opposite of what he teaches that cash is king, and you need to save money for emergencies. So if you can't save and you rob peter to pay paul, all you are doing is swapping out one large payment for another large payment with a loan. Then what happens is that you build the debt right back up when you reuse the cards and double up making theings even worse. And no, you can not negotiate the same type of terms on your own. Because the credit card compaines are going to say ok you owe $10k, great we want $6, all of it up front no payment plan. How does that help you? Shame on Dave for this bad information as he promotes a debt consolidation company for your student loans. Make it make sense.
The instant I heard Tom Selleck, I knew it was National Debt Relief
Have you ever signed up for one of those programs? I didn't think so.
Don’t marry her. Pretty simple. Someone with credit card debt that high and she’s a single mom? Millions of other people to build a life together with. She wants saving, and if you do that, the both of you will need saving.
Why do they care if you ruin your credit? Isn’t the Ramsy always saying credit scores dont matter? Seems a bit odd.
Absolutely NOT. To say he doesn't care about credit scores is to say people don't care if their house is infested with cockroaches.
It matters and he cares. He wants the problem gone as quickly as possible.
AVP 👽
Same ?/... days away////yeah i get Samuel" some/ but still headed in the right direction/
Dave's largest objection here is that it damages your credit. I think the biggest objection is that its IMMORAL. Why does he care so much about it destroying your credit when he advocates for you to essentially get rid of your credit score. If you aren't borrowing money then you don't have to worry about your credit score being destroyed lol
Because you can't rent an apartment if you have to move. No credit > bad credit
Sure, working multiple jobs is so easy, according for them. They are clueless.
Why is he dating a woman who's 21k in credit card debt?
Some people call it "love".
And with a kid 😂
Beans and Rice 😂
$21,000 of credit card debt is not that much. I've heard worse on this show. Buckle down, figuratively eat beans and rice AND rice and beans, pay extra on the cards and just get them paid off quickly.
you finally said something that wasn't marxist and anti-American. Are you sure this isn't the fault of the...patriarchy, capitalism, etc?
I thought your credit score doesn’t matter
To say he doesn't care about credit scores is to say people don't care if their house is infested with cockroaches.
It matters and he cares. He wants the problem gone as quickly as possible.
Dave: the credit score is stupid, dont use credit cards and have a zero credit score.
Also Dave: Dont use a debt relief program!! It will destroy your credit score!!
Yeah that makes no sense
I know someone who did this. He was getting credit card offers in the mail in no time. It's a pretty good deal unless you want to risk DIYing it.
My mother convinced me to do debt relief in my early 20's. More of the garbage advice she gave me. I'm glad she's gone and I'm around people who know more about life.
Don't marry someone with credit card debt especially someone looking for a easy way out like this.
And a single mom. Wow this sounds like train wreck
They need to stop "playing house" and get married today so HE can pay off her debt. 😅
@@djpuplex New year BUT NOT new you!! Same old schtick. Your mom rejecting you really did a number on you. But she was right to reject you.
@JustinCase780 No he needs to bail. She also a single mom.
Give me a damn break?
I forgot Dave is perfect never messed up guess what that's life sorry
She is a teacher with a lot of debt, she is probably waiting to get married and stop working. Be careful dude!
You are so spot on.
Stop with the generalization, omg !!😂. The few bad stories make it bad for everyone and you get stereotypes.
@@lauralaura12345 This is happening right now in my family. There are many of these things going on in today's world. There are way more than just a few bad stories. In fact, they are not stories. They are truth.
Nope, she is looking for her ATM. Single mom, in debt, lower paying job. That kitty ain't worth it!!
Hit it and quit it when he gets tired of her. Pump and dump. Then move on to the next.
Just stay away from Debt Relief companies Relief companies.
I thought Dave does not care about credit score. ?
Bad credit and no credit (not using credit) are different things. There are some situations such as mortgages they do support with guidelines. Bad credit can sink a mortgage application while manual underwriting is a solution to no credit.
*sigh* yet another one that cannot handle nuance.
To say he doesn't care about credit scores is to say people don't care if their house is infested with cockroaches.
It matters and he cares. He wants the problem gone as quickly as possible.