The Ramsey Show

“My Financial Advisor Told Us To Take Out A HELOC For A Tax Write-Off”

November 21, 2025

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  • Do not take out a HELOC for a tax write-off if the resulting debt causes you significant emotional distress, as peace of mind outweighs minor tax advantages when you have the cash to pay for a project. 
  • Children who disobey clear warnings (like not playing baseball near a window) must face financial consequences, such as paying for the damage they cause, to learn the lesson. 
  • When facing overwhelming debt, a drastic lifestyle change, including cutting non-necessity expenses like private school tuition, is required to create the necessary cash flow to attack the debt snowball. 
  • When receiving a large, sudden influx of cash like \$6 million from a business sale, the immediate advice is to do nothing, breathe, and secure a great CPA before making any major decisions. 
  • For a side hustle to become a full-time business, the owner should have six to twelve months of their current salary saved in a separate business account before quitting their stable job. 
  • When pursuing higher education like law school, aggressively paying off existing student loan debt while simultaneously seeking full scholarships based on high LSAT scores at lesser-known schools is a viable path to avoid massive debt. 
  • Long-term marital success, especially financially, hinges on constant, honest communication where both partners are willing to say 'no' when necessary. 
  • Do not liquidate invested retirement accounts like a Beneficiary IRA to pay off relatively small consumer debts (like orthodontics or car loans) when cash flow adjustments can solve the problem faster. 
  • When facing debt, the recommended path is to increase sacrifice and cash flow aggressively (e.g., selling an asset like an overvalued car) rather than taking the 'easy button' of paying taxes on investments. 

Segments

Retirement Celebration Planning
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(00:00:38)
  • Key Takeaway: Husbands must plan a special celebration for wives retiring after 40 years of work.
  • Summary: Dan called in just as his wife was finishing 40 years of work. Ken Coleman stressed the importance of stepping up to plan a monumental celebration for her retirement. Even if the couple does not drink alcohol, sparkling grape juice can be used to mark the occasion.
HELOC vs. Cash Flow Addition
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(00:02:31)
  • Key Takeaway: Do not take on debt like a HELOC for a home addition if cash flow is available, as peace of mind outweighs minor tax benefits.
  • Summary: Dan’s financial advisor suggested a HELOC for a $100k-$120k addition, citing tax write-offs and interest rate advantages. The couple has $2 million in retirement assets and felt uneasy about incurring debt right as they retire. The hosts strongly advised against the HELOC, emphasizing that Dan’s plan to cash flow the project aligns with his value system of living debt-free.
Children Paying for Broken Items
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(00:10:14)
  • Key Takeaway: Disobedient children must pay for damages, especially when clear warnings were ignored, to learn respect for property.
  • Summary: Julia asked how much her 10-year-old son should pay for breaking a $400 window while throwing a baseball against explicit instructions. The hosts ruled that since the boy disobeyed a direct warning, he should pay the full $400 for the window. For the shattered glass table, where the circumstances were less clear disobedience, a partial payment was suggested, but the dangerous broken table must be removed immediately.
Navigating Family Debt Snowball
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(00:21:46)
  • Key Takeaway: A family of seven running a $2,000 monthly deficit requires immediate, drastic lifestyle changes, including re-evaluating non-essential spending like private school.
  • Summary: Valentina’s family grew from two to seven in five years, leading to $280,000 in non-mortgage debt and a monthly deficit. Their combined after-tax income is $162,000 annually, but expenses are outpacing income. The hosts recommended an immediate, hard conversation about changing their lifestyle for the next two to three years to stop the debt accumulation.
Ministry Degree vs. Local School
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(00:32:34)
  • Key Takeaway: Pursue a specific calling like ministry with an affordable, cash-flowable degree rather than settling for a cheaper, irrelevant degree due to parental pressure.
  • Summary: Antoine, 18, feels called to ministry but his parents want him to attend a cheaper local school that does not teach ministry subjects. The ministry school costs only $2,000 per semester, which can be cash-flowed through side work, meaning no debt is necessary. He should honor his parents’ caution but follow his calling, as resenting them later is worse than disappointing them now.
529 Plan for Career Upskilling
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(00:40:07)
  • Key Takeaway: A 529 plan should be solely for the daughter’s education, as career upskilling in tech or academia often requires cheaper, faster courses or bootcamps, not a full degree.
  • Summary: Trent and his wife, both 35, plan to use a 529 for their daughter or for one of them to return to school if their careers become unstable. The hosts advised against this dual purpose, noting that upskilling in tech does not require a degree, and they should cash flow any necessary retraining. The 529 is an investment meant to sit for at least five years, making it unsuitable for immediate career pivots.
Retirement Savings for Late Starters
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(00:44:07)
  • Key Takeaway: A 62-year-old with no retirement savings must prioritize aggressive debt payoff, including selling a high-payment vehicle, before considering homeownership.
  • Summary: Antoinette, 62, has $8,000 in debt (including a car loan) and no retirement savings, making immediate homeownership impossible. She must immediately get a firm grasp of all her numbers, including the $995 minivan payment, and is strongly encouraged to sell the minivan for a $2,000 ‘beater’ car to free up cash flow. This cash flow must then be directed toward debt payoff (Baby Step 2) before saving for retirement (Baby Step 4).
Holiday Sales and Store Promotion (Unknown)
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  • Key Takeaway: None
  • Summary: None
Managing $6 Million Windfall (Unknown)
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  • Key Takeaway: None
  • Summary: None
Passion vs. Income Conversation (Unknown)
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  • Key Takeaway: None
  • Summary: None
Side Hustle to Full-Time Transition (Unknown)
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  • Key Takeaway: None
  • Summary: None
Retirement Savings and Nursing Home Fears (Unknown)
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  • Key Takeaway: None
  • Summary: None
Paying Off Student Loans and Law School (Unknown)
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  • Key Takeaway: None
  • Summary: None
Business Debt Aggression Strategy (Unknown)
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  • Key Takeaway: None
  • Summary: None
Baby Steps Millionaire Success Story (Unknown)
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  • Key Takeaway: None
  • Summary: None
Advice for Newlyweds
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(01:53:56)
  • Key Takeaway: Sustained financial health requires constant communication about needs, wants, and limitations.
  • Summary: Maintaining open communication is crucial for long-term success, especially regarding finances. Partners must constantly update each other on their financial status, needs, and desires. Being willing to honestly say ’no’ to certain requests ensures both parties remain on the same page.
Kia Car Anecdote
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(01:54:54)
  • Key Takeaway: Audience feedback on car reliability can be mixed, contrasting with established brand reputations like Toyota and Honda.
  • Summary: A brief, lighthearted poll revealed mixed audience reviews regarding Kia vehicles. The hosts noted that Hondas and Toyotas have long-standing positive reputations in the US market. This segment highlights the subjective nature of consumer preference versus established reliability data.
Insurance Research Importance
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(01:56:08)
  • Key Takeaway: Vetted Ramsey Trusted Pros should be used for researching and securing insurance coverage for major assets.
  • Summary: Just as extensive research is done for major purchases like homes or cars, due diligence is necessary for insurance coverage. Ramsey Trusted providers are coached and vetted to offer service aligned with Ramsey Solutions’ standards. Listeners are directed to ramseysolutions.com/slash insurance to find necessary coverage.
Scripture and Wisdom Quote
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(01:56:54)
  • Key Takeaway: True wisdom involves recognizing the limits of one’s own knowledge, contrasting with youthful arrogance.
  • Summary: The scripture of the day warns against boasting in wisdom, strength, or riches (Jeremiah (9:23). A quote from Thomas Soule emphasizes that people often realize how little they know only decades after believing they know everything as teenagers. This realization keeps individuals humble and open to a larger world view.
Parenting Teenagers Reality
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(01:57:18)
  • Key Takeaway: Teenagers often view their parents as incompetent, a phase that eventually leads parents to realize their own limitations.
  • Summary: Parents of teenagers frequently experience feeling like an ‘idiot’ because their children perceive them as lacking basic knowledge. This dynamic is a normal part of development where children transition from viewing parents as the center of the universe. Eventually, this experience keeps parents humble and opens them to realizing the world is bigger than they thought.
IRA Withdrawal vs. Debt Payoff
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(01:58:36)
  • Key Takeaway: Using a $70,000 invested IRA to pay off $19,000 in debt is discouraged in favor of aggressive cash flow and sacrifice.
  • Summary: The caller, earning $180,000 annually, wanted to withdraw from a Beneficiary IRA to clear $7,000 in orthodontics debt and pay off a car loan. The hosts strongly advised against touching the invested IRA, emphasizing that it is working for future growth. Instead, they recommended lowering the lifestyle and finding ways to generate extra income to eliminate the $19,000 debt within a year.
Aggressive Debt Attack Strategy
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(02:04:38)
  • Key Takeaway: Selling a highly valued asset (a car worth mid-$20k with a $12k loan) to buy a cheaper replacement frees up monthly cash flow to attack remaining debt.
  • Summary: Ken suggested an extreme but effective move: selling the caller’s car worth $22,000 while owing $12,000, netting $8,000 to $10,000 cash. This action would eliminate the car debt and free up nearly $400 in monthly payment. This freed cash flow should then be immediately directed toward the remaining $7,000 orthodontic bill, accelerating debt freedom without touching retirement funds.