Personal finance guru Dave Ramsey has given advice about bitcoin to a man who made over $100,000 by investing just $1,500 in the cryptocurrency. Ramsey repeatedly expressed his doubt that bitcoin can be cashed out, calling the cryptocurrency “funny money.” He recommends selling bitcoin immediately.
Dave Ramsey Suspicious of Bitcoin
Famous radio show host and best-selling author Dave Ramsey gave advice about bitcoin on his Dave Ramsey show aired on Wednesday. Daniel from Salt Lake City, Utah, called into the show to get Ramsey’s advice as his income was about to drop when he goes back to school. Daniel mentioned that he invested about $1,500 in bitcoin in 2014 and has made about $120,000 off of it so far.
The self-proclaimed personal money management expert, Ramsey calls himself “America’s trusted voice on money.” He is the author of seven best-selling books: Financial Peace, More Than Enough, The Total Money Makeover, EntreLeadership, Dave Ramsey’s Complete Guide to Money, The Legacy Journey, and Smart Money Smart Kids. Altogether, they have sold more than 11 million copies.
Daniel explained that since the bitcoin investment was small, he “just bought it” and “just left it,” noting that he “never did anything with it.” He asked Ramsey for his view on the investment.
“Are you saying you can cash it out today for 100 grand?” Ramsey quickly asked the bitcoin investor. “For sure,” he replied.
Ramsey proceeded to educate the man. “There’s a process in finance called sunk cost analysis. If you don’t cash it out today, in the morning, you would have invested $100,000 into bitcoin. That should scare your brains out,” he exclaimed. “It’s not $1,500, it’s $100,000, every day you leave it there, you are reinvesting into this again.” The famous radio show host then advised:
By nightfall, dude, cash it.
He added that bitcoin is “going over 50% of your freaking net worth. It’s on the roulette table, on one roll of the dice,” reiterating:
If you really can cash it out and you might find out that this is funny money but I hope you can … I hope that you can cash it out when you go to do it tonight.
“I’m suspect when I hear $1,500 turns into $100,000. I’m really suspect,” he continued. “I hope you don’t find other things when you go try to cash it out. But those numbers are bizarre.”
Ramsey further cautioned the man that “If you are able to cash it out, the other danger is that you actually pulled off this crap once and it’s gonna tempt you to do it again.”
In conclusion, he said that ultimately, “You do whatever you want to do but I am not a fan of ultra high-risk investments, and at a minimum that’s what we would call bitcoin.”
What do you think of Dave Ramsey’s advice about bitcoin? Let us know in the comments section below.
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