Question: Chris wants to know how Dave's bankruptcy changed his behavior and helped him to succeed.

Dave Ramsey's advice: The truth is that I crashed and didn't turn it around. I spent some time being ashamed and blaming everyone else. I got back out and was working because I had a family to support. Over time, I started looking at what caused me to file bankruptcy, which was me. It went from being humiliating to being humbling. That just means you had a course correction.

I was impulsive and lived without a plan and was arrogant and didn't listen to my wife. Now I don't do anything financial without a plan. We don't make any big money decisions without us discussing it first and being in agreement. I don't sign deals without her knowing what's going on. I always live on a budget and know where the money is going. I never borrow money or co-sign, ever. I'm always diversified in my investments. Those are God's ways of handling money. I save for emergencies and give to my church and other ministries.

Now, I'm not so guilty or ashamed or humiliated. Do your own course corrections and you'll walk your way through it.

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Question: Rodney and his wife had a bankruptcy discharged a year and a half ago. He opened up a credit card because he was told he needed to re-establish his credit rating. He's now three months behind and owes $400. Should he settle with the credit card company, or just offer them the monthly payment? Dave has a lesson for Rodney, but also a harsh reality.

Dave Ramsey's advice: Let me rehash what you just said, with different words. You went into debt and couldn't pay your bills because debt messed you over, then filed bankruptcy and went into debt again. Now you're screwed up again. That is kind of a dumb plan and whoever told you to do this is wrong.

You have to think for yourself. You need to stop and think and know that the debt you borrowed made you bankrupt. Don't borrow money and don't buy anything unless you can pay cash for it. I don't give a crap what your credit rating is! Your credit rating isn't an indication that you have money; it's an indication that you have debt! Worry about this as fast as you can. learn your lesson from this and never go back.

Just $400 shouldn%u219t end your life. Get on a written budget that looks like beans and rice and get some money saved to pay this bill. Have a garage sale and pay this bill this weekend. Then close the account and never do this stupid thing again. This was a stupid behavior, and you don't need to do it again

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Question: Julie thinks she is bankrupt. She and her husband are self-employed and live frugally. Their business grosses $150,000 a year, live off $50,000 and they have been borrowing money to make payments on their $170,000 in credit card debt. Why does Dave not like bankruptcy? For one big reason, according to Dave.

Dave Ramsey's advice: When you make $50,000 a year, why didn't you look up and realize that what you're doing is getting out of control? If your business owns equipment, you likely won't be able to keep your business. In your state, you can keep your house and that's about it. But your business wasn't making much money anyway. Bankruptcy is bad because it rips your guts out. I went through it 20 years ago, but sometimes good people file bankruptcy. I don't like it because it damages your life, and if there is any way to avoid it, then avoid it.

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