This Nashville couple is struggling with credit card debt on a $162K income — Dave Ramsey says it would be ‘easy’ to erase it in a year

“We’re following your baby steps. We’ve been following it all year, but it doesn’t seem like we’re getting anywhere,” Liz, 30, told The Ramsey Show recently. “I don’t know what to do anymore. (1)”

The couple has no student loan debt. They only have $1,000 left to pay on his car (she’s already paid hers off), so the remaining $61,000 in debt is all credit card debt.

But Ramsey said it’s an “easy” fix and they could erase their debt in a year. Could you do the same?

Sharing a financial future

Almost a quarter (23%) of married couples in America don’t have any joint accounts, according to 2023 data from the U.S. Census Bureau. This share is up from 15% in 1996.

The agency points to a possible reason for this. Couples are marrying later than they did in 1996, so their individual finances may be more established. Or, they may decide to open joint accounts later, like when they have children.

But this can pose other challenges. It’s sometimes hard for couples to see their finances as “shared” even when they’re married. And it’s understandable that one person doesn’t want to take on another person’s debt — or be held accountable for it. If one person is a saver and the other is a spender, it could breed resentment and lead to a breakdown of trust.

A study commissioned by National Debt Relief found that three in five Americans have actually considered putting off marriage to avoid inheriting their partner’s debt, and more than half (54%) believe having a partner who is in debt is a major reason to consider divorce (2).

While a joint account can help — after all, it improves transparency — it can still cause friction if the couple isn’t on the same page about spending habits and priorities.

Some financial experts like Kevin O’Leary even advise signing prenuptial agreements and keeping finances separate, which Ramsey doesn’t recommend.

“Your system of getting out of debt is not going to work until both of you decide you’re going to get out of debt. He has not decided that,” Ramsey told Liz. “You have a marriage issue.”

Even if Liz’s husband holds most of that debt, it impacts both of them, especially if he’s racking up credit card interest — they’ll be in debt longer, which prevents them from pursuing other financial goals.

In this case, it appears that Liz’s husband is on board, since she said he cut up his credit cards. But that gesture doesn’t seem to be enough for Liz, who still feels hopeless.

Getting on the same page

While Liz’s husband made a grand gesture, they need a plan of attack, which starts with a budget and debt reduction plan — and a willingness for both partners to stick with it.

“You make $162,000. You only need $62,000 to pay all this off,” Ramsey told Liz. If they live on $100,000 a year, then they’re “debt-free in one year — voila. It’s fairly easy. It’s $5,000 a month.”

The 50-20-30 rule is a common budgeting method (there are a few variations on it), where you spend 50% of your after-tax income on needs (such as mortgage/rent and essential living expenses, including car payments and minimum debt payments); 20% on debt reduction and savings; and 30% on discretionary spending.

In Liz’s case, they also pay for day care. The average cost of child care in Nashville is $2,685 per month, so that’s not insignificant (3). It could also be more challenging for couples with student loan debt and car payments, which may require a longer-term “get out of debt” strategy.

In Liz’s case, they could reduce their discretionary spending and put more toward debt.