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The Ramsey Show

What Does “House Poor” Mean and Why Is It Bad? (Hour 1)

05 Jun 2023

Transcription

Transcript generated automatically by AI and may contain errors.

Chapter 1: What does it mean to be 'house poor' and why is it bad?

28.01 - 55.497 Dave Ramsey

Live from the headquarters of Ramsey Solutions, broadcasting from the Pods Moving and Storage Studios, it's the Ramsey Show, where we help people build wealth, do work that they love. and create actual and amazing relationships. George Campbell, Ramsey Personality, co-host of the very, very popular Smart Money Happy Hour here on the Ramsey Network. It's a podcast with me and Rachel.

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55.897 - 72.192 Dave Ramsey

He is my co-host today. We're taking your calls at 888-825-5225. That's 888-825-5225. Joyce is going to start off this hour with us in Chicago. Hi, Joyce. Welcome to the Ramsey Show.

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72.88 - 74.982

Thank you. Hi, Dave and George.

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75.142 - 76.003 Dave Ramsey

Hey, what's up?

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76.844 - 80.027

I'm so excited to be on your show and a little nervous too.

80.348 - 82.59 Dave Ramsey

Oh, that's okay. We've never lost a patient. How can we help?

83.992 - 98.787

Hey, I just wanted some clarification about the advice that you give debt and collections seems to contradict what you say about other debt. And I'm just curious as to why that is different.

99.61 - 109.059 Dave Ramsey

Okay, I think I know where you are, but let me make sure. You mean suggesting people settle it versus like if you have a student loan, I suggest you pay it?

109.939 - 110.62

Absolutely.

Chapter 2: How can I clarify debt advice about collections?

425.475 - 426.777

I figured that out.

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427.278 - 430.281 Dave Ramsey

But that doesn't mean you shouldn't pay your bill, even if they're jerks.

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432.624 - 445.5 Dave Ramsey

If you've got the money. But if it's going to take you 152 years to pay your bill versus settle it, and they'll settle it, and you've got a little bit of money and you're willing to give them that little bit of money, I'll help you beat the crap out of them because they're jerks.

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446.78 - 455.918 George Campbell

I love it. And the lenders, they already lost their money. They've sold it to the collectors. The collectors are trying to collect to make profit. They bought it for cents on the dollar. So it's a different scenario.

456.019 - 467.46 Dave Ramsey

That's a valid point. That's a really good point to bring up. But it's still morally her bugaboo. She's a moral person. I agree with her. Yeah. If you signed up for that credit card debt, you ought to pay it. Pay it. Right?

467.841 - 473.99 George Campbell

But I don't have the money. A lot of the times it's medical debt, which I have more empathy for because no one goes to the hospital going, I'd love to take on $50,000 worth of debt.

474.05 - 492.398 Dave Ramsey

Yeah, but a credit card, you're right about the credit card. The medical sells for 10 or 15 cents on the dollar usually. Medical debt, I mean, credit card debt, you can buy it for a nickel on the dollar if it's 36 months old. Wow. And so, you know, in other words, $5 will buy $100 worth. $50 will buy $1,000 worth of credit card debt.

492.759 - 505.559 Dave Ramsey

And these guys buy these accounts in mass for a nickel on the dollar and then go try to collect the whole thing, which, again, that doesn't relieve you of the fact you morally owe the debt. But when you're negotiating with them, that's handy to know.

Chapter 3: What are the consequences of being house poor?

2142.162 - 2143.003 Dave Ramsey

Good for you, man.

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2143.043 - 2143.603 George Campbell

This is great.

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2143.643 - 2160.179 Dave Ramsey

And you have no debt, but she does? Correct. I just finished Baby Step 2. Way to go. Very good. Very good. Yeah, I'm cash flowing the wedding and then piling up cash as high as I can pile it up. And when we come home from the honeymoon, we'll combine our finances and really get after hers real fast and hard.

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2160.199 - 2163.462 George Campbell

And then we can look at that career change. You've got a lot going on right now. Yeah.

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2164.644 - 2195.497 Dave Ramsey

Yeah. Do you need to do that before the wedding? The career switch? Yeah. I don't need to, no. Good. Let's wait until spring. Okay. This is a time of great joy, and changing jobs is not always a great joy. Right. She, as we've talked about it, she has peace about it. I have peace about it. So I think we'll move forward eventually. Yeah, I want you to move forward. I was just questioning when.

2196.098 - 2208.153 Dave Ramsey

Sometimes when we try to do six of the good things at once, one of them ends up messing up the other ones. Does that make sense? Yes, sir. That's what I'm thinking. But you do whatever you want. I'm okay. Hey, cash flow your wedding, man. You're doing it. I'm proud of you. Very cool.

2208.694 - 2213.68 George Campbell

Man, there's hope, George. There's hope. I thought you had to spend $100,000 on a wedding. Turns out people are just dumb.

2214.301 - 2217.065 Dave Ramsey

Yeah, the 12,000 people aren't dumb. The 100,000 people aren't dumb.

2217.085 - 2217.966 George Campbell

Yeah, way to go.

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