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Dave Ramsey is DEAD Wrong On Debt Consolidation – And How I Became Wealthy

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Dave Ramsey has pronounced over the years that debt consolidation is a bad idea, and YES in some cases he’s bloody well right.

But he goes further by delving into name calling even – albeit his name calling is toward an entire industry – but we’ll get into that further down this post.

Today I pronounce Mr. Ramsey DEAD wrong.

For example one of his blog posts he describes debt consolidation as being “dangerous” because “it only treats the symptom” of bad financial management.

To keep the medical metaphor going then: If I have a nasty headache because of an underlying disease I will still take action to rid myself of the symptom as I work towards curing the disease.

In other words, if my underlying problem with personal debt is my overspending, under earning, impulse buying, and lifestyle choices I still need to consolidate all debts into one and get a lower interest rate on the term.

What I decide to do after that is critical – I can make it a whole lot worse or a whole lot better.

Of course it’s dangerous to consolidate all your liabilities and then continue spending on your credit cards and buying rounds for everyone in your local pub.

But that is where our freedom of choice comes in. If you want to live on the edge and keep on overspending with your credit cards you will be yet ANOTHER one of those unlucky individuals who suffers through a humiliating debt settlement, and ultimately personal bankruptcy.


Dave Ramsey’s “Truth About Debt Consolidation” Post

Dave’s post entitled The Truth About Debt Consolidation goes on to claim that debt consolidation “is nothing more than a con” because it dupes debtors into thinking they have a fresh start and a second chance to get their financial affairs in order when they’ve actually just moved their debt from on creditor to another.

In my opinion – not always.

It truly is a second chance if you take action to change your lifestyle, spending habits, and earnings.

At the end of his short post he writes, “….you get out of debt by changing your habits”.

Noooooo shit Sherlock.

This doesn’t mean there is something wrong with the financial service – some people choose to continue their irresponsible spending.

What he doesn’t mention in any of his content is THE most powerful way to cure your debt problems forever.

There is an approach that your humble narrator used that not only got rid of my debt forever, but made me an independently wealthy person.

I call it the “The Debt Reversal Plan” which I will describe below and elsewhere on

Dave Ramsey’s Post “Don’t Do Debt Consolidation”

Here we go again Dave. Wrong.

Mr. Ramsey writes that most people are misunderstanding debt consolidation all together and that they’re confusing it with debt settlement or debt relief programs. I don’t believe people are doing that.

I believe “people” are much smarter than we collectively give them credit for.

Most people “get it”, and they just need a little help steering themselves in a new direction.

Dave Ramsey does help people – I’ll never claim he doesn’t, but I disagree with him on debt consolidation and debt settlement.

I believe people DO understand the difference between these services and I don’t believe it’s a nasty or shady industry altogether.

In describing debt settlement providers he writes. “Horrible, horrible, dirty, filthy industry that has about a 98% dissatisfaction rate“.

Of course there ARE shady operators out there asking for upfront fees and don’t provide true debt relief.

Some don’t manage to even negotiate with all your creditors and their fees are outrageous, but I see abuse in almost ALL business models. I see questionable dentists, doctors, and lawyers too.

There are some reputable debt settlement companies that don’t charge up front fees and have A+ ratings with the Better Business Bureau (BBB). NDR comes to mind.

What I Would Tell Dave Ramsey About My Debt Consolidation and Settlement

If Dave was sitting in a room with me this is what I would tell him.

Well Dave….I think you’re wrong. All of the financial institutions provided me with a fair service when I was struggling with debt.

When I was spending money like Peggy Bundy in a flea market I had to consolidate to get out from under the high interest rates I was paying. I used a credit union to get a debt consolidation loan and it worked beautifully – it was my own bad choice to keep using credit cards and rack up double the debt I had in the first place.

When I was drowning in debt from the above choices I used a debt settlement company to negotiate on my behalf with all my creditors.

Their service relieved my stress immeasurably.

When I continued to spend money like Johnny Depp in a marina it was my own choice and it’s what led to my personal bankruptcy.

It wasn’t the fault of service providers – it was my own.

I believe consolidating and settlement services are 100% valid and helpful as long as you do your due diligence and find a legitimate and reputable company to work with.

The professionals I had working with me were friendly, understanding, and I believe they actually cared about my money troubles.

I’ve never forgotten them for their kindness.


The Most Powerful Way To Get Out Of Debt

I want to let Mr. Ramsey know how I actually got myself out of debt and became wealthy.

I never imagined being wealthy. Never planned on it. Never had a goal to be wealthy. It just happened and here is how.

I call it the Debt Reversal Plan.

When I declared personal bankruptcy it forced me take a full inventory of my life. An autopsy of my personal finances – so to speak.

I blamed my impulsive spending on my passion hobby.

I made my living as an Aircraft Mechanic but my true passion in life was making music. I spent money on equipment, traveling, recording, hiring other musicians, pressing CDs, etc. This drained me financially, emotionally, and physically.

Like the saying goes, “Be Careful What You Wish For”.

I had some success with radio airplay and made some pretty cool music, but it destroyed me financially.

So I decided I would never let it happen again. I decided I was going to flip the whole debt nightmare on it’s head.

The Debt Reversal Plan

My knew goal was to completely reverse what I did before.

I was going to find a passion hobby that MADE money instead of SPENDING money.

With every waking moment I thought about finding a hobby that would MAKE money and cost next to nothing – and I found it.

I discovered blogging.

I like writing and I love making money so I started creating niche product websites.

That’s a whole other subject I won’t go into here, but the point is I switched from a costly hobby to a lucrative hobby.

Over the next few years my new hobby was earning more and more. Within three years I had quit my job with the airlines. Within 5 years my wife quit her job too. Within 10 years our mortgage was gone, our vehicles, RVs, and toys were all paid for.

Zero Debt.

And now we just save money every month. We spend once and awhile when we have to – like stuff for the swimming pool or a new generator for the RV.

But we buy these expensive items with cash and our credit card balances are all at zero each month.

All of this because of the Financial Switcharoo.

If you look at most wealthy people you will notice that they had a passion for their work first. Wealth was just a “bi-product”.

If you are struggling with deep debt I urge you to try this method and don’t be afraid to use legitimate financial products such as debt consolidation and/or debt settlement.

Dave’s a great guy – I just disagree with him some things.



  1. RayinPenn RayinPenn

    Dave isn’t wrong it just that Dave has outlined the most likely road to successful debt elimination given human nature. Let’s see an example

    Debt snowball: pay off you smallest debt first. Well any MBA/Accountant will probably tell you to pay off the loan with highest interest rate. You can’t deny the math. Well I can tell you paying off the smaller debt first will yield that first taste of successful debt reduction. It will stimulate you to move on to the next debt and more successes.. simple human nature..

    Debt free and LBYM isn’t always about the numbers….
    Great read.

    • Thanks for coming by and reading. I was speaking purely from a mathematics point of view assuming the borrower(s) have changed their spending and earning habits. If you can get a lower rate and pool all your debt into a consolidation loan why not.

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