Dave Ramsey says in order to get out of debt, you have to be prepare to do this painful thing

A caller to the Dave Ramsey Show wanted to know how to repay the debt he owes. He makes $150K a year, owes $20,000 on a car, and was wondering if he should sell his hunting gear to get out of debt ASAP. 

While Ramsey believes in sacrificing to get out of debt, and said that the caller would definitely need to sell his stuff if it was going to take him years to pay off the loan, his advice to the caller was different. He actually believes there is a better way for the man to become debt-free ASAP. While it will require some painful sacrifice, it will allow him to keep his possessions and still achieve his goal. 

Ramsey said this is the best way for the caller to become debt-free

Ramsey outlined the caller’s options for him and was very clear on the best course of action. “We can either sacrifice the hunting gear, we can sacrifice the car, or we can sacrifice the next three months of your life. I’m going with C. The next three months of your life.” Ramsey said. 

Ramsey’s advice was that the caller should work overtime as much as he can, avoid spending money on anything at all that is non-essential, and use every spare dollar to pay off the car over the next three months. He believes that with his $150,000 income, the caller can do that easily within that time frame and then he will not have to worry about being in debt anymore. 

While three months of not spending on anything fun may be very difficult — especially since the caller is engaged to be married and has his fiance to think about — it will also pay off big time because the caller will get to keep the hunting stuff he enjoys, he will be able to continue driving the vehicle which is worth around $32K, and he will no longer have any creditors. 

The right way to pay off debt is going to depend on your income and spending

Ramsey’s advice for this caller was based on the fact that the caller makes a good income of $150,000. Earning a lot of money makes debt payoff easier because there is more money to spare after covering the essentials. Someone who makes $30K, for example, will have to put a lot more of their monthly paychecks towards things that can’t be cut, like food and utility payments and rent. In that situation, it would be more important to find alternatives like selling expensive equipment because there’s only so much income to go around. 

The important thing is to look at the specifics of your financial situation, identify how much you need to pay each month to hit your debt-free goal, and explore all the options available to reach that target ASAP. This could mean increasing income, selling items, or cutting spending — or doing a combination of all three. 

The bottom line is that there is always going to be some sacrifice involved if you want to make sure you are living a debt-free life. The important thing is to find out which sacrifices will be the most effective so you can say goodbye to your creditors for good and start using your income to build wealth instead of pay interest.