The Ramsey Show

Take Ownership Of Where Your Life Is Headed

February 20, 2026

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  • Discouragement regarding purchasing NYC property should be based on the perceived risk of local government actions (like community land trusts) actually being implemented, rather than just political rhetoric. 
  • For individuals in a toxic living situation with low income, prioritizing immediate expense reduction and securing stable, full-time employment in a new location (even pausing education) is crucial for gaining emotional freedom and confidence. 
  • When asking for a raise due to an increased scope of work in a sales role, focus the conversation on factual discrepancies, such as the expected base salary for the new title, rather than emotional feelings of inconvenience or comparison to others' base pay. 
  • Financial decisions made while tired or grieving are often poor, emphasizing the need for a detailed plan like EveryDollar to maintain accountability. 
  • Money will only behave when forced to; it flows away from those who don't make it behave and toward those who do. 
  • When evaluating a repair on an older vehicle, do not spend money on a repair if the cost plus the current broken value of the car exceeds the finished value after the repair, instead use the combined funds to purchase a better replacement vehicle. 
  • When using money for a relational exercise, such as practicing family financial decisions, the primary goal is learning and practicing collaboration, not maximizing investment returns. 
  • Avoid taking on debt, such as a mortgage, for family investment experiments, as the risk of loss should be manageable. 
  • Renovating an old home can be a financial black hole, so cash-flowing renovations using income or asset sales (like selling unused acreage) is strongly advised over taking out a large loan. 

Segments

NYC Property Purchase Risk
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(00:00:42)
  • Key Takeaway: The risk of purchasing NYC property hinges on the actual implementation capability of local government plans to convert private housing to community ownership.
  • Summary: A caller expressed concern about discouraging her daughter from buying property in NYC due to the current administration’s stated goals regarding community land trusts. Dave Ramsey advised pausing to see if these policies are actually enacted, noting that real estate generally works itself out unless property is actively stolen from private owners. If the socialist policies gain traction, walking away from the investment would be the recommended action.
Single Mom Income Crisis
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(00:10:33)
  • Key Takeaway: A single mother earning $1,200/month must immediately pause college classes and relocate to a lower-cost area like Arkansas to achieve financial stability and build confidence.
  • Summary: Nancy, a single mother making $1,200/month from two part-time jobs, needs to escape a toxic environment. Ken Coleman advised pausing her college classes, as the grants are irrelevant if she remains financially stuck. The immediate goal is to move to a lower-cost area, like Arkansas, where expenses could drop to $1,500-$2,000, and secure a full-time job to build margin and confidence.
Debt Payoff Strategy High Income
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(00:23:19)
  • Key Takeaway: Couples with high income ($210K) and significant debt ($109K) must commit to a scorched-earth lifestyle change to eliminate debt within two years, or sell high-value assets like a paid-off truck.
  • Summary: John and his wife have $40K in consumer debt and a $69K vehicle loan, but $17K in savings. Dave Ramsey stated that living on $100K/year could clear all debt (excluding the house) in one year, emphasizing that the spending habits must change permanently. They can try a 90-day hardcore budget to test their commitment before deciding whether to sell the $52K truck.
Handling Lease Break Debt
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(00:33:08)
  • Key Takeaway: Landlords are not obligated to negotiate lease breaks, and if a former tenant has substantial savings, they should prioritize paying the debt rather than engaging in prolonged disputes.
  • Summary: Cliff owes nearly $6,000 for breaking a lease after moving for a new job, but he and his wife have significant savings ($12K emergency fund plus over $40K more). The hosts implied that since they have the means, they should settle the debt quickly rather than letting it linger, especially since they are currently not working due to school.
Advice for Aging Parent’s Finances
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(00:44:33)
  • Key Takeaway: A high-earning father ($100K/year) with minimal savings must immediately adopt a detailed budget to control high expenses, as his prior desperate real estate deal indicates poor financial behavior.
  • Summary: Josh’s 62-year-old father has only $3,000 saved despite a six-figure income, having depleted funds on high medical deductibles and a failed real estate venture. The father needs to stop living like he is in Congress, create a detailed budget, and start stacking cash to build a nest egg over the next decade. If he refuses coaching, Josh may need to set a boundary, as the problem is behavioral, not a lack of knowledge or ability.
Debt Reduction for Single Parent
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(00:54:02)
  • Key Takeaway: A single mother earning $160K/year who is stuck on Baby Step 1 due to high expenses and debt ($90K student, $9K credit card) must stop using emotional spending as a coping mechanism and implement a strict budget immediately.
  • Summary: Elizabeth, a single mother of two (one 21-year-old still dependent), feels paralyzed by debt despite a high income. Taking a hardship withdrawal from retirement to buy multi-family property is strongly advised against as it would cause further destabilization. She must use the EveryDollar app to gain accountability, cut expenses like the $600 car lease, and attack the debt aggressively, aiming to be debt-free within 18 months.
Emotional Spending vs. Emergencies
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(00:59:53)
  • Key Takeaway: Distinguish between genuine emergencies and emotional spending impulses, especially when feeling tired or grieving.
  • Summary: Some perceived emergencies are merely emotional reactions that do not require immediate spending. When emotionally compromised, individuals are prone to making poor financial decisions. A detailed budget, like the one provided by the EveryDollar app, serves as an accountability tool to prevent this.
Debt Payoff Timeline
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(01:01:06)
  • Key Takeaway: With a $14,000 monthly income, substantial debt payoff progress should result in becoming debt-free within 18 months.
  • Summary: A high income necessitates aggressive debt repayment, aiming for completion in under 18 months. Listeners must avoid impulse purchases or risky ventures like buying multifamily properties based on social media trends. Financial behavior must be forced to ‘behave’ through strict budgeting.
401k Withdrawal Strategy
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(01:05:42)
  • Key Takeaway: To maintain purchasing power in retirement, withdraw less than the projected average annual return minus the rate of inflation.
  • Summary: If the market averages 12% and inflation averages 4%, withdrawing 8% or less ensures the nest egg’s purchasing power remains constant or grows. Drawing out more than the earnings rate erodes the principal’s real value over time. Savers often struggle to give themselves permission to spend the money they accumulated.
Mortgage Overpayment Strategy
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(01:13:27)
  • Key Takeaway: Prioritize aggressive mortgage payoff over building large, separate savings accounts for predictable future expenses like car replacement.
  • Summary: Once debt-free and retirement is funded, direct all surplus income toward the mortgage principal. Only pause aggressive mortgage payments when a known, necessary expense (like a car replacement) arises. Avoid accumulating large cash reserves for predictable maintenance items.
Employer Stock Purchase Plans
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(01:16:36)
  • Key Takeaway: Avoid employer stock purchase plans unless a significant discount (greater than the stock’s typical 52-week volatility) is offered, favoring diversified mutual funds instead.
  • Summary: A 15% discount on company stock is often insufficient to offset the risk of investing in a single stock, which is riskier than diversified mutual funds. Single stocks expose one’s entire investment to the fate of one company. Diversification lowers risk, aligning with a ’tortoise’ investment strategy.
Repair vs. Replacement Math
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(01:22:16)
  • Key Takeaway: If the cost of a repair plus the current broken value of a car exceeds the finished value after repair, sell the car as-is and use the combined funds toward a better replacement.
  • Summary: For a $3,000 car needing a $1,500 repair, selling it for $1,500 and adding the repair money toward a new $3,000 vehicle is mathematically superior. When buying a cheap replacement, prioritize reliable models like a Camry or Accord over less dependable ones like the Ford Escape.
Income Crisis and Tough Love
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(01:26:45)
  • Key Takeaway: When a family faces financial strain due to income issues and supporting an adult child with substance abuse, all income streams must be immediately maximized, and the adult child must be cut off from financial support.
  • Summary: The self-employed plumber husband must immediately seek employment with a plumbing company if his business is not generating sufficient income. Financial support for the 24-year-old struggling with substance abuse must cease so he faces necessary consequences to turn his life around. The laid-off project manager must aggressively seek new employment utilizing her transferable skills, not just waiting for a similar Big Pharma role.
Adjustable Rate Mortgage Warning
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(01:37:34)
  • Key Takeaway: Adjustable Rate Mortgages (ARMs) are inherently risky because they start below market rate and are designed to max out at higher rates, setting up borrowers for failure if unexpected life events occur.
  • Summary: A mortgage payment exceeding 25% of take-home pay indicates the borrower cannot truly afford the house, regardless of projected future income increases. Rationalizing an ARM based on projected prosperity ignores the reality that unforeseen negative events can occur. Build a ‘brick house’ (fixed-rate mortgage) that withstands storms rather than a ‘straw house’ based on favorable, temporary conditions.
Investment Club Purpose
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(01:58:10)
  • Key Takeaway: The primary goal of a family investment club funded by gifts should be relational training through healthy disagreement, not maximizing investment returns.
  • Summary: Placing the entire $40,000 into passive mutual funds defeats the purpose of learning to work together, as it requires no active discussion or friction. While single stocks are generally discouraged for personal investing, they might serve as a necessary vehicle for creating the required debate and decision-making practice for the group.
Investment Exercise Purpose
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(02:00:25)
  • Key Takeaway: The purpose of a $40,000 investment exercise among family members is relational practice, not wealth accumulation.
  • Summary: If $40,000 is placed into a mutual fund and forgotten, it defeats the purpose of the exercise, which is learning how to work together. Playing with single stocks is suggested as a relational exercise, even though it is not recommended as a primary investment strategy. The goal is practicing decision-making for future, larger assets like inherited real estate.
Relational Learning Over Investment
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(02:01:31)
  • Key Takeaway: The value of the family investment exercise lies in research and observing siblings’ risk tolerance and financial aptitude.
  • Summary: The exercise is explicitly defined as a relational exercise, not purely an investment strategy. Participants should observe who is more focused on numbers and who has a greater tolerance for risk. This observation provides valuable learning for future collaboration on much larger family matters.
Family Business Dynamics
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(02:03:21)
  • Key Takeaway: Family members in business roles often default decision-making authority to the recognized expert, even when sharing ownership.
  • Summary: Dave Ramsey notes that his children argue over the operation of the business despite Daniel being president, illustrating ongoing discussion. For family real estate, relatives often defer to the member who manages it, like Winston managing the family’s real estate. This demonstrates how family dynamics naturally influence decision-making authority.
Inherited Home Renovation Plan
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(02:04:10)
  • Key Takeaway: Renovations costing $250k-$300k on an inherited 160-year-old home should be cash-flowed, not financed with a large loan.
  • Summary: The caller inherited a home needing significant updates and has a household income of $115,000 taxable. Land valuation in Robertson County is approximately $33,000 to $35,000 per acre. Selling a small corner tract of the potential 15 acres could fund a significant portion of the necessary renovations.