'We have $200 or $300 to last us until next Friday': This mom broke down in tears over her family's financial struggles — despite making ‘good money’ as a nurse. What else can she do?

It’s not inflation that’s hurting you

Several times throughout the video, Mackenzie expresses that she doesn’t understand how she’s struggling to barely make ends meet.

“I make good money, [my husband] makes good money, we don’t live above our means,” she says.

But Ramsey argues that the reason many people are broke is because they are living above their means, but fail to see it. So they often blame inflation instead.

“When you actually consider the way we all live, it’s outrageous,” Ramsey says. “Our lifestyles are outrageous.”

Though Mackenzie says she’s only paying for the mortgage, food and gas, Ramsey would argue that there are always items to cut out, or ways to live more frugally. There are still savy ways to reduce those expenses at the checkout.

Budgeting is also a great way to stay on track in these expensive times. The envelope method in particular — known as “cash stuffing” on TikTok — is a classic Ramsey method that helps with this.

Here's how it works: at the beginning of a set period of time (say a month or a single pay cycle), you take out a set amount of cash and divide it into envelopes for each category of spending, whether that be groceries, gas or mortgage. When the envelope's empty, you've run out of money for that budget item until your next cycle.

Discover How a Simple Decision Today Could Lead to an Extra $1.3 Million in Retirement

Learn how you can set yourself up for a more prosperous future by exploring why so many people who work with financial advisors retire with more wealth.

Discover the full story and see how you could be on the path to an extra $1.3 million in retirement.

Read More

Create an emergency fund

At the end of every pay period, Mackenzie and her husband only have $200 or $300 left over. With four kids and a small ranch home, that doesn’t leave much to cover everything else, nevermind an emergency.

Though Mackenzie doesn’t share how much she has in savings, it sounds like she’s in a situation that a staggering 70% of her fellow Americans face: living without $400 to cover an emergency expense.

This is why one of Ramsey’s top tips for setting yourself up for financial success is to create an emergency fund. He advises you to start with the goal of saving $1,000. Though he recommends you eventually save enough to finance three to six months’ worth of expenses, the $1,000 goal is a good place to start.

The road to $1,000 may be long, but it requires that you are committed to putting away a certain amount of money each month toward this goal. That may mean that you include “emergency fund” as one of your envelopes for the envelope method or you need to create a budget so that you can ensure that some money goes toward the emergency fund each month.

Pay off your debt

Mackenzie mentions that she attends school full-time while working full-time as a nurse. Though she doesn’t mention any kind of debt in her video, it’s likely that she carries student loans, much like 20% of Americans who completed an undergraduate degree do, according to 2023 estimates from the Education Data Initiative.

Ramsey’s no fan of student loans or any debt. He started giving out personal finance advice because he himself fell into a trap of debt. He only got out of it by using the snowball method.

The snowball approach would see you first pay off your smallest debt (or account with the lowest balance) and make only minimum payments on all of your other outstanding debts. Once you’ve paid the smallest debt off, you move on to the next smallest debt, until you’ve paid off all your debts.

If you're still struggling to make do, Ramsey says you need to increase your income. These days, there are lots of side hustles that take little effort but still can make you quite a bit of cash, such as online tutoring or real estate investing.

Though it’s not easy to live in today’s economic climate, Ramsey has some frank advice: “There is no special sauce. You’ve got to live on less than you make, you have to invest steadily over a long period of time.”