Dave Ramsey Says Buy the Boat if You Can Burn $100,000 Without Flinching

A caller on the Ramsey Everyday Millionaires podcast asked whether he should buy a 38-foot trawler that cost more than what he earns in a year. The verdict was a green light. The host’s reasoning: “the reason that the decision makes sense is the other rule that you used is, if I burn that much money in the middle of the floor, would my life change? And the answer is no.”

That single sentence flips the usual rule of thumb most people use for big-ticket purchases. A $100,000 boat against a $90,000 salary looks reckless on income alone. Against net worth, it can be a rounding error. The stakes for you: getting this distinction wrong in either direction. Buy the boat on income logic when your net worth easily absorbs it and you’ve taxed yourself for no reason. Buy it without the net-worth cushion and you’ve torched your retirement timeline for a depreciating asset.

The income ratio is the wrong yardstick

The advice is right, but only because of one specific test. The host conceded the math directly: “if we were doing it off your income, you know, we’d be going, okay, $100,000 if you burn that.” Then he gave the caller the go-ahead anyway: “I would buy that boat. Yeah, that’s what I would do if you want a boat.”

The mechanic at work is the burn test. Picture stacking the purchase price in cash and setting it on fire. If your financial life genuinely does not change, the purchase is affordable regardless of how it compares to your paycheck. A similar version of this rule shows up across the show. In one episode, a host told a caller weighing a $3,000 purchase, “You could burn three grand on the table and you’d be like, all right, that stinks, but I’m gonna be just fine.”

Run the math on a realistic case. Say the caller earns $90,000 a year and has a net worth of $3 million, with a paid-off house, taxable investments, and a fully funded retirement. A $100,000 boat is roughly 3% of his net worth. If those assets compound at a typical long-run rate, the lost growth on $100,000 over a decade is real but absorbed inside ordinary portfolio volatility. The boat does not delay retirement, threaten the emergency fund, or force any other financial decision.

Now run the same purchase against income. $100,000 against $90,000 is more than a full year of gross earnings. On a financed basis at current marine loan rates, the monthly payment plus insurance, slip fees, fuel, and maintenance would eat a punishing share of take-home pay. Same boat. Same price. Completely different verdict.

What your net worth actually looks like

The factor that decides this is liquid net worth outside your primary home and retirement accounts. The host was clear that boats are depreciating assets: “trawlers go down in value too, just like cars” and “100% of boats go down in value.” The purchase only works because it’s a small percentage of net worth.

Two scenarios make the split obvious. A buyer with $3 million in net worth spending $100,000 is parking about 3% of his balance sheet in a hobby that will lose value. Annoying, but survivable. A buyer with $250,000 in net worth spending the same $100,000 is committing 40% of everything he owns to an asset that depreciates and carries ongoing costs the host acknowledged would be “probably pretty substantial” for docking, insurance, fuel, and maintenance.

The macro backdrop matters too. The national personal savings rate sits at 4% in the first quarter of 2026, down from 6.2% in early 2024. Households are saving less of what they earn, which means most Americans considering this purchase are not the caller. They’re closer to the second scenario.

What to do before you sign

1. Calculate your liquid net worth outside your home and retirement accounts. If the boat is more than 5% to 10% of that number, you are using the income yardstick whether you admit it or not.
2. Build a 12-month operating budget for the boat. Slip fees, insurance, winterization, fuel, and a maintenance reserve at roughly 10% of purchase price per year. Confirm those costs pass the burn test on their own.
3. Pay cash. Financing a depreciating asset that exceeds your annual income reintroduces every risk the net-worth math was supposed to eliminate.
4. Run the opportunity cost. $100,000 invested at long-run market returns is real money your future self will miss. Decide whether the boating years are worth it. That’s a values call, not a math call.

If burning the purchase price would not change your life, the income ratio is noise. If it would, the income ratio is the only number that matters.