I Make $750,000 And We're Drowning in Debt

Summary of I Make $750,000 And We're Drowning in Debt

by Ramsey Network

10m•February 3, 2026
Listen to Episode

Overview of I Make $750,000 And We're Drowning in Debt

This Ramsey Network episode walks a single‑income surgical family through a real‑life debt plan. The husband is a plastic surgeon making about $750,000/year (≈ $34,000 take‑home/month). They have three small children (one due in ~3–4 weeks), $600,000 in student loans ($500k his, $100k hers), a mortgage, and two car leases. They have $122,000 in a high‑yield savings account (over six months of expenses) and are following Dave Ramsey’s Baby Steps. The host (Dave Ramsey) and Jay give direct, numbers‑driven advice focused on aggressive debt elimination and protecting the family with insurance.

Key points and context

  • Debts: ~$600,000 in student loans (husband $500k, wife $100k), plus mortgage and two car leases (F‑150 and Expedition).
  • Income: Gross about $750k/year; average take‑home ≈ $34k/month.
  • Savings: $122k in high‑yield savings (covers >6 months of expenses).
  • Monthly lease payments: ~$600 and ~$800.
  • Family: Single‑income household with three young children; one baby due soon.
  • Insurance: The husband states he has life insurance and disability (important for single‑income security).

Advice and recommendations given

Immediate steps

  • Don’t pause a debt plan for the baby — their savings already covers the near‑term needs.
  • Check lease termination costs and get out of both car leases ASAP.
  • Use part of the $122k savings to buy inexpensive, paid‑in‑cash replacement cars (budget roughly $10–11k each suggested), but do not drop emergency fund below six months.

Debt paydown strategy (aggressive)

  • Use a chunk of savings to pay off the wife’s $100k student loan immediately.
  • Live much more frugally for a fixed period (example: live on $200k–$250k of the ~$750k income for ~1 year) and apply the remainder of income to aggressively pay down the $500k student loan.
  • Alternative realistic monthly payoff: if they can contribute ~$15k/month to the $500k balance, it will take ~33 months (~3+ years). The host points out the goal is speed — “rip the band‑aid off” — to reach security faster.

Protection and contingency

  • Confirm life and disability insurance are adequate for a single‑income family (they currently have both).
  • If a sudden emergency occurs while aggressively paying debt, stop debt payments and use cash flow — with their income level, one missed month of debt payments can handle many emergencies.

Action items (practical checklist)

  1. Determine early‑termination costs for both car leases and execute exit strategy.
  2. Buy two used/cash cars (budget ~$10–11k each) without reducing emergency fund below six months.
  3. Immediately pay off the wife’s $100k student loan from savings.
  4. Recalculate monthly budget and determine realistic monthly amount available to throw at the $500k loan (target scenarios: $15k+/month or a one‑year all‑in plan).
  5. Verify life insurance and disability coverages are sufficient for the family’s needs.
  6. Consider ways to increase surgeon income (additional shifts, cosmetic practice growth) to accelerate payoff.
  7. Revisit mortgage strategy only after student loans and consumer debt are cleared.

Timeline and numbers (estimates)

  • Maintain ≥6 months emergency fund (~$122k currently).
  • Use part of savings to clear $100k loan and buy two cash cars (est. $20–22k total), leaving some cash for emergencies and immediate cash flow.
  • If paying $15k/month toward $500k: payoff ≈ 33 months.
  • If living on $200–$250k/year and using remaining income, the host suggests the $500k could potentially be cleared in about 1 year (requires very aggressive budgeting and applying most income to debt).

Notable quotes and mindset

  • “You’ve got gobs of money.” — Emphasizes capacity to solve the problem quickly given high income.
  • “Security is best gotten quickly, not little by little.” — Encourages accelerated, sacrificial payoff rather than slow payoff.
  • “Ripping off the Band‑Aid is the way to get that.” — Advises aggressive, short‑term sacrifice for long‑term freedom.

Risks, tradeoffs, and considerations

  • Aggressive payoff reduces liquidity and could feel uncomfortable; keep at least six months of emergency savings.
  • Being single‑income with young children increases reliance on life/disability insurance — verify adequacy.
  • Early lease termination may have significant fees; calculate total cost before deciding to exit early.
  • Tax implications and net income variability can affect the monthly payoff plan — run precise post‑tax numbers.
  • Opportunity cost: paying down loans vs. other investments — Ramsey’s plan prioritizes debt freedom and financial security.

Final takeaway

With high income and an adequate emergency fund, this family can aggressively eliminate student loan debt quickly by: exiting expensive leases, paying off the smaller $100k loan now, living on a dramatically reduced budget for a defined period, and throwing large monthly payments at the $500k balance. The host stresses speed and protection (insurance) as the path to lasting security and peace of mind.

(Advertisement note in episode: whyrefi.com/ramsey for refinancing help with defaulted private student loans.)