A recent call to “The Ramsey Show” opened with a tax question but quickly revealed a much larger financial and emotional crisis. The caller, a woman with a household income of just $38,000, shared that she and her husband had lost over $300,000 through day trading.
Dave Ramsey‘s immediate reaction cut to the heart of the issue: “Where did you have $300K that you could lose?”
The answer? An inherited IRA that had been liquidated and lost in a flurry of trades.
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According to the caller, the trading took place over a six-week period during which her husband, later diagnosed with bipolar disorder, experienced a manic episode. She had just given birth and was recovering from a complicated pregnancy when her husband began trading full time from home.
“He was doing it and doing well… until he wasn’t,” she said.
“There’s no such thing,” Ramsey responded. He cited research showing that 78% of day traders lose money, noting that it’s “statistically… all of them.” Comparing the couple’s experience to gambling, he said, “That’s like saying I’m at the roulette table and I hit, so I’m doing well.”
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The call was originally about capital loss deductions. After their losses, the couple had $316,000 in capital losses on the books. Their accountant told them they could deduct $3,000 per year against ordinary income. At that rate, the caller joked, “It would take 115 years.”
The accountant also suggested opening a taxable brokerage account to generate gains that could be offset by those losses.
Ramsey acknowledged the technical validity of the idea. However, he warned that trying to create new investment income to take advantage of past losses could expose the caller’s husband to more risk — something he clearly believed was unsafe, given the history.
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While the accountant may have given sound tax advice, Ramsey stressed the importance of considering the full context.
