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Dave Says: Sell stock to get out of debt?

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Dear Dave,

I have about $5,000 in an individual stock and $6,000 in debt. Should I sell the stock and pay off the debt?

- Leann


Dear Leann,

Let’s look at it this way. Pretend you only had $1,000 in debt, and you had a credit card with a $5,000 open line of credit. Would you go borrow $5,000 on it to buy that stock? Of course not. It’s the same kind of thing in reverse.

If I woke up in your shoes tomorrow morning, I’d have only $1,000 in debt before the coffee started brewing. Sell the stock, and pay off the $5,000. Then, I’d formulate a plan, get on a budget and fix that thing in my life called overspending so that I could knock out the remaining debt in no time and start building wealth!

- Dave

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About The Author

Dave
Ramsey

Dave Ramsey is America's trusted voice on money and business. He has authored five New York Times best-selling books: Financial Peace, More Than Enough, The Total Money Makeover, and EntreLeadership. His newest book, written with his daughter Rachel Cruze, is titled Smart Money, Smart Kids. The Dave Ramsey Show is heard by more than 8 million listeners each week on more than 500 radio stations.