“You Make Too Much Money To Be This Broke!”

Summary

Podcast Summary: The Ramsey Show Highlights

Episode: “You Make Too Much Money To Be This Broke!”
Release Date: December 31, 2024
Host/Author: Ramsey Network
Description: The Ramsey Show Highlights offers a quick, daily dose of life and money advice in under ten minutes, featuring experts like Dave Ramsey, Ken Coleman, Rachel Cruze, Dr. John Delony, George Kamel, and Jade Warshaw. This episode delves into financial responsibility and the pitfalls of living paycheck to paycheck, even with a substantial income.

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Caller’s Dilemma: Balancing Family Obligations and Financial Stability

Timestamp: [00:06] – [03:39]

The episode begins with a caller reaching out to seek advice regarding his financial predicament intertwined with family responsibilities. The caller shares that his father has been disabled with multiple heart attacks, and his mother is battling stage three cervical cancer. Amidst these challenges, he contemplates taking his wife and kids on a trip to Disneyland, reminiscent of his childhood experiences, but fears accruing $1,000 in debt to make it happen.

Caller’s Situation Highlights:

• Family Health Issues: Father with disabilities and multiple heart attacks; mother fighting cancer.
• Financial Strain: Annual income between $80,000 to $120,000 but lacks sufficient savings.
• Desire for Family Time: Wants to recreate cherished childhood memories by taking his family to Disneyland.
• Financial Conflict: Debates whether it's honorable to incur $1,000 debt for the trip.

Dave Ramsey’s Candid Response: Emphasizing Financial Discipline

Timestamp: [01:02] – [05:59]

Dave Ramsey addresses the caller’s concerns with straightforward honesty, emphasizing that earning $120,000 a year yet lacking $1,000 indicates a severe mismanagement of finances. He challenges the caller’s reasoning for borrowing, pointing out that with $2,000 in savings, dipping into just $1,000 should be feasible without borrowing.

Key Points from Dave Ramsey:

• Financial Inconsistency: “You make $120,000 a year. You don't have $1,000.” ([01:30])
• Misplaced Justification: Encourages the caller to recognize that borrowing isn’t necessary if funds are available.
• Wake-Up Call: Labels the situation as a signal to fundamentally change financial habits. “You make too much money to be this freaking broke.” ([02:38])
• Budgeting Advice: Stresses the importance of cutting unnecessary expenses, selling luxury items like expensive cars, and adhering strictly to a budget.
• Children’s Happiness: Simplifies children’s needs to shelter, food, and basic necessities, dismissing excessive spending on non-essentials. “They have shelter and food and dry clothing that fits. That’s it.” ([04:21])

Co-Host’s Perspective: Emotional Exhaustion and Overextension

Timestamp: [03:39] – [05:59]

The co-host steps in to offer a compassionate yet realistic view of the caller’s emotional and financial state. He suggests that the caller is emotionally exhausted and overextended, trying to balance personal happiness with familial obligations without proper financial planning.

Co-Host’s Insights:

• Emotional Exhaustion: “Sounds like you're exhausted.” ([03:39])
• Overextension: Highlights that the caller is stretched too thin, both financially and emotionally.
• Perceived vs. Actual Disappointment: Explains that the caller’s fear of disappointing his family is more about internal stress than actual external expectations.
• Rationalizing Purchases: Critiques the caller’s use of his children as a justification for unnecessary expenses, urging him to recognize the true motivations behind his spending. “You didn't do this for the baby.” ([06:00])

Key Takeaways: Reassessing Financial Priorities and Responsibility

1. Income vs. Savings Discrepancy: Earning a substantial income does not equate to financial stability. Proper budgeting and saving are essential, regardless of how much one earns.

2. Avoiding Unnecessary Debt: Even with pressing family needs, incurring debt for non-essential expenses such as luxury trips is discouraged. Utilize existing savings wisely.

3. Emotional Impact on Financial Decisions: Emotional exhaustion and overextension can lead to poor financial choices. It’s crucial to separate emotions from financial planning.

4. True Motivations: Rationalizing purchases by attributing them to others’ happiness (e.g., children) often masks the real desire for unneeded luxuries. Recognize and address these motivations to make sound financial decisions.

5. Call to Action: The episode serves as a wake-up call for listeners to reevaluate their financial habits, prioritize essential spending, and commit to disciplined budgeting to achieve financial freedom.

Notable Quotes:

• Dave Ramsey: “You make too much money to be this freaking broke.” ([02:38])

• Dave Ramsey: “She has the money. And that's okay. But that's different than, I'm broke and I did this for my child.” ([06:00])

• Co-Host: “He’s got to be okay with what he perceives as disappointment when in all reality, it's just not there.” ([05:16])

Conclusion: Emphasizing Responsibility Over Entitlement

In this episode of The Ramsey Show Highlights, Dave Ramsey and his co-host provide a no-nonsense perspective on financial responsibility, especially when one paradoxically earns a high income but remains financially unstable. They urge listeners to confront their financial mismanagement, prioritize essential spending over emotional desires, and adopt disciplined budgeting to ensure long-term financial health. The conversation underscores the importance of aligning one’s financial actions with their income, emphasizing that true financial freedom comes from responsible money management rather than increased earnings alone.

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Resources Mentioned:

• EveryDollar App: A budgeting tool recommended by Dave Ramsey for managing personal finances effectively.

Final Thought: Listeners are encouraged to take control of their financial destiny by creating a budget, eliminating unnecessary debt, and making mindful spending decisions to live a financially secure and fulfilling life.

Transcript

[Dave Ramsey]

Brought to you by the EveryDollar app. Start budgeting for free today.

[Caller]

So I had a quick question. Might be a little complex, but my dad's been disabled my whole life, and he's had multiple heart attacks. My mom's been fighting with stage three cervical cancer. You know, I want to know if it's honorable to go a thousand dollars into debt to be able to take my wife and kids down, to go visit them and take them to Disneyland and what my parents used to do with us when we were kids so they can, you know, I don't know when the next time.

[Dave Ramsey]

We're all gonna take your kids to Disneyland. Your parents, all of us. Oh. Your parents health will allow a Disneyland.

[Caller]

Trip in a wheelchair. Yeah.

[Dave Ramsey]

Disney Lander. Disney World in Orlando.

[Caller]

Disney World in Orlando.

[Dave Ramsey]

Where. Where's mom and dad?

[Caller]

He just got cleared to fly from California to Florida to visit my grandmother and my sister. She just had a baby, too.

[Dave Ramsey]

Okay.

[Caller]

I'm just trying to.

[Dave Ramsey]

Yeah. So what's your household income, sir?

[Caller]

I bring in anywhere from 80 to 120.

[Dave Ramsey]

Why can you not find a thousand dollars?

[Caller]

Dug myself a little hole before I had kids and bought more expensive cars than I should have. And the price now.

[Dave Ramsey]

So you don't have $1,000. You make $120,000 a year. You don't have $1,000.

[Caller]

I have 2,000 in savings and then.

[Dave Ramsey]

Take $1,000 and go to Florida. Okay, why did you call me and ask me to borrow money when you have $2,000 in your savings account?

[Caller]

I wasn't calling to borrow. I was calling just for some insight.

[Dave Ramsey]

No, you were saying, is it honorable to borrow money because my parents are sick and dying so I can spend some time with them before they leave this earth, and I have to borrow money to do it, but you don't have to borrow money to do it.

[Caller]

Yeah, I was just trying to figure out if I should keep the thousand dollars or two thousand for.

[Dave Ramsey]

Let me rephrase. Frame this for you, okay? If you borrow a thousand dollars, you're not borrowing it for your sick parents. You're borrowing it to put it in savings. Because same thing. If you take $1,000 out of savings and you borrow $1,000 for this trip and put it back in savings, it's the same thing. So you're really not borrowing for the parents trip. You've worked this whole drama thing up in your head. You're really borrowing so you don't have to deplete your little savings account. See the difference?

[Caller]

Yeah.

[Dave Ramsey]

Now what? This Is if I'm you is my wake up call. It's time to do some different stuff. Alex. Agreed. You make too much money to be this freaking broke. You work too hard to be this freaking broke, dude. Yeah, what's, what's the depression from? You sound like you're walking around a mud hole.

[Caller]

Just trying to figure out the way. I mean I, you know, I've read the books, I've read your books and.

[Dave Ramsey]

You have the energy of a hound dog in the sun. What's the deal, man? I mean, are you depressed?

[Caller]

You know, I think it's just hard watching your family suffer your whole life and then you try and you're trying to prevent that from happening in your house and with your kids and trying to make everybody happy and trying to. And be happy yourself too and make all the right choices.

[Co-host]

Sounds like you're exhausted. Yeah, I think you're emotionally exhausted.

[Dave Ramsey]

So here's the thing. You make $120,000 a year. The plan you've been working is not working. Can we agree with that? You work too hard, you make too much money to be as broke as you are. So take $1,000 out of the account is the answer to your question. And go visit your mom and dad. Take them, everybody to Disneyland, that's fine. But when you get home, man, time to sell some cars. It's time to cut up the credit cards. It's time to put everybody on a budget. And I don't care if the 14 year old's happy. By definition 14 year olds are not happy anyway. And so I don't really care.

[Co-host]

That's true.

[Dave Ramsey]

That's the deal. So I don't know if you got a 14 year old. I just made that up. But you said you're taking kids to Disney. Maybe it's the 8 year old that's not happy. The definition of happy when you're eight is you have shelter and food and dry clothing that fits. That's it. After that, everything else is a spoiled freakin American. So you know it's okay to have some nice things. It's not okay to have some nice things when you can't afford them. And you can't afford them. You guys have got to change your ways, man. This is your wake up call. When you make $120,000 a year and you have to call some guy on the radio that you've never even met to ask permission in your mind or to ask insight in your mind to use $1,000 of your $2,000 savings account. That's Signaling, that's flares going off. Time for a change. Time to do something different.

[Co-host]

Dude, he's going to have to get comfortable disappointing some people. Or really, to be honest with you, he's got to be okay with what he perceives as disappointment when in all reality, it's just not there. That's what I hear. I hear a guy that's just overextended and. And he's just lost all reason because he's trying to emotionally feel good about himself, make sure everybody else feels good about him. And he gets to this point where he calls and says, is it okay to take $1,000 out on a credit card just to pay for this trip? Because I feel like I got to make my mom and dad happy because they made me happy. I heard that throughout the entire description. And I feel bad for him. I really do.

[Dave Ramsey]

But it's not even. It's not even on the. It's not even an issue.

[Co-host]

It really isn't.

[Dave Ramsey]

So that's not.

[Co-host]

It's all in his head.

[Dave Ramsey]

So, guys, one of the things you have to do in this regard and is all of us, Dave included, me included, rationalize our purchase. And one of the rationalization methodologies that we use is that we are doing this for someone else. And when you. When you unpack it, most of the time, that's just not true. Example, okay, Little family has a brand new little baby. We spend $26,000 redoing the nursery. Promise you, little baby has no freaking idea. You did not do this for the baby. It does not change the baby's environment. It does not change their developmental skills. It does not increase their intelligence. All absolute hogwash. You did this for yourself. You did this so your friends could walk in and go, oh, it's so cute. And they're not talking about the baby. They're talking about the nursery. And so babies don't give a crap. All they want is a dry diaper and some food. That's all they. And a good hug. That's what a baby needs. That's it, man. It's simple. They don't need $26,000 worth of nursery equipment. Now, if you have $26,000 extra laying around and you want to spruce up your home, do something nice. Do it. I can promise you Sharon Ramsey's doing that right now for Christmas for no apparent reason, but that she has the money. And that's okay. But that's different than, I'm broke and I. I did this for my child. No, you didn't. Your child is three months old. They don't have a freaking clue. Hello, Christmas present purchasers. Who are you really buying for? Think about it. I don't mind you, but I'm not the Grinch. But quit using the little children as my rationalization. Create your free every dollar budget today. The simplest way to budget for your life.