We adhere to strict standards of editorial integrity to help you make decisions with confidence. Some or all links contained within this article are paid links.
When Jelani from New York called into The Ramsey Show about his financial problems, he didn’t sugarcoat his situation.
"I owe over $100,000. I’m kind of lost right now,” he told finance personality Dave Ramsey in a clip posted May 28. “I don’t know if I should file [for] bankruptcy. I just need some advice."
Don’t miss
- I’m 49 years old and have nothing saved for retirement — what should I do? Don’t panic. Here are 6 of the easiest ways you can catch up (and fast)
- Robert Kiyosaki warns of a ‘Greater Depression’ coming to the US — with millions of Americans going poor. But he says these 2 ‘easy-money’ assets will bring in ‘great wealth’. How to get in now
- Gain potential quarterly income through this $1B private real estate fund — even if you’re not a millionaire. Here’s how to get started with as little as $10
Jelani owed around $80,000 in credit card debt, $8,500 in student loans and $11,500 on a car loan. His debt has accumulated rapidly since Thanksgiving, when he only owed $30,000.
Jelani is a truck driver earning between $110,000 and $140,000 per year. The source of his rising debt? Gambling via an online dice game.
A way out
Ramsey and co-host Jade Warshaw warned Jelani about the mental and financial toll of gambling and the psychological traps it creates.
Jelani admitted he quit gambling cold turkey and hadn’t yet sought help through therapy or Gamblers Anonymous, prompting Ramsey to urge him to get support from someone who understands the sobriety process.
As for a financial recovery plan, Ramsey laid out a no-frills approach:
- Create a “scorched-earth, no life” recovery budget where all spending halts except for necessities and tackling debt. “Eat peanut butter and jelly. Eat beans and rice. That’s it,” Ramsey advised
- List debts from smallest to largest and use the snowball method to pay them down aggressively
- Pick up extra shifts at work and aim to increase income as much as possible
Jelani’s story is far from unique. Nearly 1-in-4 adults are drowning in “unmanageable” debt, according to a survey from Experian conducted in March.
But there’s a silver lining. With proper planning and execution, 45% of those who once felt overwhelmed have wiped their debt clean.
If you find yourself in a similar situation, you could consider paying down your debt by leveraging your home equity through a Home Equity Line of Credit (HELOC).
A HELOC is a secured line of credit that leverages your home as collateral. Depending on the value of your home and the remaining balance on your mortgage, you may be able to borrow funds at a lower interest rate from a lender as a form of revolving credit.
Rather than juggling multiple bills with varying due dates and interest rates, you can consolidate them into one easy-to-manage payment. The results? Less stress, generally reduced fees, and the potential for significant savings over time.
LendingTree’s marketplace connects you with top lenders offering competitive HELOC rates. Instead of going through the hassle of shopping for loans at individual banks or credit unions, LendingTree lets you compare multiple offers in one place. This helps you find the best HELOC for your situation.
Terms and conditions apply. NMLS#1136.
Read more: Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it
The rise of online gambling
Online gambling has grown in America.
According to the National Council on Problem Gambling, an estimated 2.5 million adults in the U.S. meet the criteria for a severe gambling problem every year. Around 85% of adults have gambled at least once in their lives, while 60% have gambled within the past year.
Sports betting also went up nationwide in 2024, with revenue jumping 25.4% to a record-breaking $13.71 billion. This rise may be thanks to easier access to sports betting as more states have legalized the practice.
Back to basics
If you’re unsure how to take control of your finances or are facing financial anxiety, an advisor can help you get back on track.
Financial advisors can help you chart a course to being debt free, then help grow your wealth when you’re on the other side. After all, a good advisor can be a lifelong financial partner.
If you’re trying to figure out where to start, you can find vetted FINRA/SEC registered advisors near you for free with Advisor.com. Their network of experts only includes fiduciaries, which means they are required by law to act in your best interest.
All you have to do is answer a few questions about your financial situation, and Advisor.com will pair you with an expert.
From there, you can set up a free introductory call with no obligation to hire to test the waters, and see if they’re a good fit for you.
Once you feel more confident about your money, the next step is to build good habits that can help you achieve financial freedom.
Knowing where your money is going at all times can help you trim unnecessary expenses. Money management platforms like YNAB can help you simplify spending decisions and clarify your financial priorities.
Assigning every dollar a job — whether it’s paying down debt or saving for retirement — can help you take control of your finances. YNAB can help you create a personalized debt paydown plan and calculate how much you could be saving in interest if you top up your monthly payments with a little extra.
You can also sign up for a free coaching session to learn more about managing your finances from experts. Plus, you don’t have to enter your credit card information when you sign up for YNAB’s free trial.
Once you’ve paid down your debt, consider saving and investing in order to build wealth. Even if you start from scratch, a little goes a long way toward developing a hefty nest egg.
For instance, investing just $30 each week for 20 years could add up to just over $80,000, assuming it compounds at 10% annually.
The S&P 500 index has averaged 13.46% returns annually over the last 15 years. So, consistently investing in low-cost index ETFs could be your ticket to long-term growth.
You can turn everyday purchases into an investment opportunity with Acorns.
Here’s how it works: Once you link your debit and credit cards, Acorns will round up each transaction to the nearest dollar and invest the difference into a smart investment portfolio of diversified low-cost ETFs. The result? A $4.25 coffee becomes a $0.75 investment in your future.
What’s more, you can get a $20 bonus investment when you sign up with Acorns with a recurring deposit.
What to read next
- JPMorgan sees gold soaring to $6,000/ounce — use this 1 simple IRA trick to lock in those potential shiny gains (before it’s too late)
- This is how American car dealers use the ‘4-square method’ to make big profits off you — and how you can ensure you pay a fair price for all your vehicle costs
- Here are 5 ‘must have’ items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you?
- How much cash do you plan to keep on hand after you retire? Here are 3 of the biggest reasons you’ll need a substantial stash of savings in retirement
Like what you read? Join 200,000+ readers and get the best of Moneywise straight to your inbox every week. Subscribe for free.
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.
