Financial guru and advisor Dave Ramsey has been giving his advice to people struggling with debt for years. His tough love approach can come across as rude, arrogant, or entertaining, but whatever your reaction, his biblical principles work if you apply them right. Having counseled thousands of people through his popular radio program, Ramsey found himself particularly astonished over one couple’s $1mm+ debt and his reaction is priceless, pun intended.
The couple had a good income of $230,000 but their advanced degrees and consumer spending had skyrocketed their debt to over $1MM at 29 years old.
Here’s the rundown of the situation: $335,000 is in student loans (they both have advanced degrees), $136,000 in credit card debt, $44,000 in personal loans, $35,000 in car loans, and a $210,000 mortgage.
Ramsey’s remedy? Extreme times, extreme measures:
“You’ve been making $210,000, spending $310,000, [and] I’m getting ready to put you on [a budget] of $30,000,” he said. “You’re not going to see the inside of a restaurant unless it’s your extra job. … This is how humbling this is going to be.”
“You’re scared and you should be,” he said. “Your lifestyle is considerably above your extremely good income and has been for a long period of time. And so you’ve gotten used to spending like you’re in Congress.”
Ramsey’s common sense approach to finances and excellence in broadcasting earned him a spot in the National Radio Hall of Fame in 2015.
Take a listen here: