59-Year-Old Sold Her $518k House To Pay Off Debt —But Dave Ramsey Warns She's Now Facing A 'Major Problem' Heading Into Retirement Without A Home

Most people dream of entering retirement debt-free and set for the golden years. Mary, a 59-year-old from Florida, thought she was making all the right moves. She sold her $518,000 home, wiped out nearly all her debt, and called the "Dave Ramsey Show" feeling optimistic. But what seemed like a financial win quickly turned into a reality check.

"I just recently sold my home and paid off almost all of my debt," Mary told Ramsey. "But I'm 59 and I do not have any money in retirement."

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Her plan? Use the remaining $290,000 from the sale to either buy another home or beef up her investments. She hoped Ramsey would greenlight putting most of it into an investment account and maybe taking on a small mortgage.

That's when he hit her with the truth bomb.

"If you do not have a paid-for house when you're through working, you're going to have a major problem," Ramsey warned. "It destabilizes your whole situation."

Mary's instincts were understandable. According to the Nationwide Retirement Institute's Advisor Authority 2024 study, about 26% of retirees still carry a mortgage—a number that's steadily rising. And the Federal Reserve's most recent Survey of Consumer Finances found that retirees aged 65 to 74 carry an average debt of $134,950, including mortgages, credit cards, and car loans. Experts widely agree that entering retirement without a paid-off home can stretch limited retirement income dangerously thin.

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Ramsey's advice? Skip the mortgage entirely.

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He proposed Mary buy a modest $200,000 home outright, pay off her car lease, and use the remaining funds to kick-start her retirement investments. "I would live in that $200,000 house for three to five years while I got my nest egg roaring," he said.

Ramsey also stressed a broader point that many retirees—and even financial advisors—emphasize: housing stability is just as important as retirement savings. Without a paid-off home, even a solid nest egg can quickly drain under the weight of monthly mortgage payments.

And while Mary's $70,000-a-year income from her small business bookkeeping isn't bad, Ramsey noted she had to prove to herself she could save aggressively going forward. "You've not saved a dime in 59 years on the planet," he pointed out bluntly. "So you got some proving to do to yourself—not to me, but to yourself—that you can do this."

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His long-term plan? Get her to $500,000 in retirement savings over the next decade or so. Only then, he said, should she even consider moving up to a more expensive home—paid in full, of course.

The irony of Mary's situation wasn't lost on listeners. What looked like a smart, debt-free move—selling the home—actually put her at risk of financial instability in retirement.

As Ramsey put it, retiring with "zero money or close to zero money and a nice paid-for house is not a plan." And selling your house without a retirement plan? Well, that's just trading one problem for another.

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