A recent episode of “The Ramsey Show” featured a heartbreaking call from a 68-year-old Texas woman named Cathy, who revealed she lost her entire retirement savings to an online investment scam. In total, she lost $487,000 and also convinced her brother to invest. He lost an additional $110,000, including $50,000 that Cathy had borrowed from him.
“I retired from my company. I took out all my 401(k) and pension,” Cathy explained. “And last month [the online investment group] ghosted us and froze our accounts, and we lost it all.”
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Her brother now wants the $50,000 she borrowed repaid, but Cathy, who is now living on $2,000 a month in Social Security, says she simply can’t afford it. She also has around $33,000 in debt, including a loan from American Express. Her house is paid off and estimated to be worth around $400,000, but she’s struggling to make ends meet.
“You lost your retirement money. You’re not going to get that back,” co-host George Kamel told her. “Bankruptcy would clear the American Express debt, but I don’t think it’s worth filing over this.”
Cathy said she has applied for jobs but hasn’t had success. She previously worked in sales for 36 years before retiring in May. “I’m easily replaceable,” she said of her old employer.
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She also looked into a reverse mortgage but was told her home wasn’t in good enough condition to qualify. Kamel quickly dismissed that option. “They will just screw you with all the fees. You’re going to lose all the equity in your home. It’s a terrible, horrible financial product and they prey on desperate people like our friend Cathy.”
The hosts were straightforward: getting back to work is non-negotiable. “One of the best things you can do is get to work,” co-host Ken Coleman said. “You’re going to have to take some opportunities that you wouldn’t normally think about now. That’s maybe Starbucks, Walmart, Target. We need income.”
He encouraged Cathy to be open about her story, even if it’s uncomfortable. “I completely understand what I’m asking you to do, which is to share your story. It is going to be difficult because you’re ashamed, and I understand that. But you aren’t the only person who has been duped before.”