Texas retiree lost her $487K nest egg to an investment scam — Ramsey Show co-hosts tell her it's time to face reality
When Cathy called into The Ramsey Show, she was already six months into a nightmare. The 68-year-old from Texas admitted she had gotten involved with an “online investment group” and wound up losing everything. (1)
She retired from her job of 36 years and cashed out her entire 401(k) and pension — handing over $487,000. In addition, she borrowed $50,000 from her brother, who also invested $110,000 of his own money.
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"Last month they ghosted us and froze our accounts, and we lost it all," Cathy said in a clip posted Oct.16.
Now, she’s jobless with nothing but the $2,000 she gets in Social Security each month, which barely covers her expenses. She does have a paid-off home worth about $400,000, but also $33,000 in debt and an angry brother who wants his money back.
Where does someone like Cathy go from here?
The harsh reality check
Co-hosts George Kamel and Ken Coleman didn’t sugarcoat Cathy’s situation. On her brother’s demand for repayment, Kamel suggested he’s on his own.
“The promises are over,” he said. “You both got screwed in this and you just simply don’t have the money to pay him back.”
As for tackling her debt, the co-hosts advised Cathy to focus on generating income rather than take a drastic measure like declaring bankruptcy or tapping into her home’s equity. Cathy says she’s applied for sales jobs, her old field of work, but the co-hosts suggested she expand her search to areas she wouldn’t normally have considered, including retail and food service.
Liquidating the home should be a last-resort option, according to Kamel. If Cathy finds herself unable to work in a few years, she can sell the property, downsize and invest the difference to create a small nest egg for herself.
Read more: 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
Warning signs of investment fraud
Cathy’s story isn't isolated, as investment scams have exploded. In 2024, consumers lost $5.7 billion to investment scams — 24% more than in 2023 — according to the Federal Trade Commission (FTC).
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