Jackson, a heavy-duty mechanic from Canada, called in to "The Ramsey Show" in April and exposed a troubling gap between income and savings. He earns about CA$200,000 a year ($147,000) with no debt, yet admitted, "I get my paychecks, pay my bills and rarely check my balance," adding that it stays between CA$15,000 and CA$25,000.
Personal finance adviser Dave Ramsey warned that unchecked "lifestyle creep" can consume any salary and urged Jackson to give "every dollar an assignment." Meanwhile, an H&R Block Canada survey released in April reported that 85% of Canadians live paycheck-to-paycheck.
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Paycheck-To-Paycheck High Earners
"It's not moving forward because I'm kind of just living," Jackson said. Ramsey praised Jackson's healthy disgust and warned that income without clear goals "evaporates into nothing useful."
Jackson's struggle reflects a broader trend. While financial strain is widespread in Canada, similar pressures are evident across the border. U.S. data offers a sobering reminder that Canadians aren't alone—both countries are grappling with the same financial stressors.
A 2024 study by PYMNTS Intelligence found that 36% of Americans earning more than $200,000 live paycheck to paycheck. Many cite family costs or loose habits, and Bankrate's latest Emergency Savings Report shows 60% of adults feel uneasy about their emergency funds.
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A separate 2024 pay raise survey by Bankrate reported that 61% of workers received a salary bump in the past year, showing that anxiety persists even as paychecks grow.
That tension, Ramsey said, is why a written plan matters: "A budget is people telling their money what to do instead of wondering where it went." Ramsey said high income just magnifies behavior — good or bad. Without boundaries, spending quietly expands to match pay, leaving wealth on pause.
Ramsey's Budget Blueprint
Despite Ramsey's push for purpose-driven budgets, many households remain uneasy. The Federal Reserve's "Economic Well-Being of U.S. Households in 2024" report, released in May said that 63% of adults can cover a $400 emergency with cash, leaving 37% exposed.
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Meanwhile, the FINRA Investor Education Foundation recently reported that only 46% hold at least three months of rainy-day funds, seven points below the 2021 level.
Long-term saving tells a mixed story. This year's Fidelity Investments' Q1 retirement analysis found a combined 401(k) savings rate of 14.3% of pay — a record high. Yet Vanguard's latest report shows a median defined-contribution balance of $38,176, while the average is $148,153— a wide gap.
For Jackson, Ramsey's prescription was simple: automate investing once the budget is in place, cap lifestyle upgrades and review progress.
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