“I would be a multi-bazillionaire in real estate. ” Dave Ramsey told a caller during the episode of The Ramsey Show.
He was responding to a young man asking whether to take on $200,000 in student debt so his fiancée could pursue a nursing degree.
Ramsey used the opportunity to open up about his own collapse, not from bad investing, but from a single banker who called in his loans and pulled everything out from under him.
“I was making money in real estate,” he said. “I had never lost money on a deal. I wasn’t a dime late or a day late on a single note. But the bank I was working with got sold, and the new banker looked at our file and said, ‘Let’s limit this relationship.’ They pulled an obscure paragraph out of the paperwork and called my notes.”
That triggered a spiral, Ramsey says took two and a half years to fully unravel.
“And that started two and a half years of me losing everything I owned with our water getting cut off, our electricity getting cut off, and our marriage almost ending with a brand new baby, a toddler, and a marriage hanging on by a thread.”
He says he wasn’t reckless, just overleveraged, and it cost him everything.
“I didn’t do dumb stuff. The only dumb thing is I signed up for a big old pile of debt thinking it was always going to work out. And the borrower is slave to the lender 100 percent of the time.”
From Collapse to Redemption
Ramsey’s financial failure in 1988 is well documented. As reported by Benzinga, he filed for bankruptcy the same day the sheriff was set to seize his daughter’s crib.
At just 26, he had built a real estate portfolio through aggressive borrowing. When the bank sold his notes and the new owners called in the loans, Ramsey had 90 days to pay millions he didn’t have. His house of cards collapsed.
“I was broke and broken,” he said in a previous interview. “With a newborn at home, a furious wife, and my confidence shattered, I had to rebuild from nothing.”
After the crash, Ramsey leaned heavily on his faith. “I had met God on the way up, but I absolutely got to know Him on the way down,” he’s said.
He began studying personal finance, reading everything he could and seeking mentors. He returned to real estate, but this time with a vow: no debt. That single rule became the foundation of his financial empire.
Building Ramsey Solutions
In 1992, Ramsey launched The Money Game, a local radio show that would eventually become The Ramsey Show.
What began with a few calls a week turned into one of the most popular financial talk shows in the world. Millions tune in for Ramsey’s tough-love advice and “Debt-Free Screams.”
He also built Ramsey Solutions, a company focused on financial education and media. Programs like Financial Peace University have helped millions of families learn how to budget, save, and live without debt.
Today, Ramsey is reportedly worth $200 million and owns over $600 million in real estate, all paid in cash.
The Caller Who Triggered the Lesson
Ramsey warned that the timing was wrong. “How you’re going about it and the timing of when you’re going about it is very unwise,” he said.
“And selfish and strange and immature. And you’re going to screw this up. Please don’t do it.”
The caller, who said he and his fiancée were considering taking on $200,000 in student loan debt for a nursing program, was seeking advice on whether it was a smart long-term move.
Ramsey pushed back hard, saying the couple was about to start their marriage off under immense financial strain, before even knowing how life with a newborn would affect their plans.
“I would wait until you guys have the baby,” Ramsey said, suggesting that the fiancée might end up wanting to stay home. “You’re in a good spot financially. Maybe then we pursue it.”
But, he warned, doing it now would set the stage for potential disaster.
His concern wasn’t the degree; it was the risk of stacking up debt based on assumptions that life would go exactly to plan.
“Best-laid plans of mice and men go sideways when you think all of your positive assumptions are how things are going to turn out — and they just don’t turn out that way.”
Ramsey noted he was once in the same position.
“I was good at it, too. And I’m smart. The only dumb thing is I signed up for a big old pile of debt thinking it was always going to work out..”
The Bigger Message
The story resonated with many listeners not because Ramsey failed, but because he rebuilt.
His advice often cuts deep because it’s rooted in personal loss, and because he’s still carrying the lessons decades later.
Ramsey’s message hasn’t changed: avoid debt, communicate with your partner, and don’t assume everything will go according to plan.
And if you’re already in a mess?
“You can get out of it,” he says. “You just have to face the person in the mirror, take control and go.”
IMAGE CREDIT: ”Dave Ramsey” by Gage Skidmore, via Flickr. Licensed under CC BY-SA 2.0. Image adjusted for layout.